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Stock Code:9973
(A joint stock company incorporated in the People's Republic of China with limited liability)
Joint Sponsors, Sponsor-Overall Coordinators, Overall Coordinators,
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Overall Coordinator, Joint Global Coordinator, Joint Bookrunner and Joint Lead Manager
Joint Bookrunners and Joint Lead Managers
GLOBAL OFFERINGGLOBAL OFFERING


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IMPORTANT : If you are in any doubt about any of the contents of this prospectus, you should obtain professional independent advice.
Chery Automobile Co., Ltd.
ʮ̡
(A joint stock company incorporated in the People’ s Republic of China with limited liability)
Global Offering
Number of Offer Shares under the
Global Offering
: 297,397,000 H Shares (subject to the
Over-allotment Option)
Number of Hong Kong Offer Shares : 29,739,700 H Shares (subject to
reallocation)
Number of International Offer Shares : 267,657,300 H Shares (subject to
reallocation and the Over-allotment
Option)
Maximum Offer Price : HK$30.75 per H Share, plus brokerage
of 1.0%, SFC transaction levy of
0.0027%, AFRC transaction levy of
0.00015% and Hong Kong Stock
Exchange trading fee of 0.00565%
(payable in full on application in Hong
Kong dollars and subject to refund)
Nominal value : RMB1.00 per H Share
Stock code : 9973
Joint Sponsors, Sponsor-Overall Coordinators, Overall Coordinators,
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
CICC HTSC GFSHK
Overall Coordinator, Joint Global Coordinator,
Joint Bookrunner and Joint Lead Manager
CITIC Securities
Joint Bookrunners and Joint Lead Managers
BOCI CMBI ABCI FUTU
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility
for the contents of this prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for an y 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 section headed “Documents Delivered to the Registrar of Companies a nd Available
on Display” in Appendix VII to this prospectus, has been registered by the Registrar of Companies in Hong Kong as required by Section 342C of the Compani es
(Winding Up and Miscellaneous Provisions) Ordinance (Chapter 32 of the Laws of Hong Kong). The Securities and Futures Commission of Hong Kong and the
Registrar of Companies in Hong Kong take no responsibility as to the contents of this prospectus or any other documents referred to above.
The Offer Price is expected to be fixed by agreement between the Overall Coordinators (on behalf of the Underwriters) and us on the Price Determination Date. The
Price Determination Date is expected to be on or around Tuesday, September 23, 2025 (Hong Kong time) and, in any event, not later than 12:00 noon on Tuesd ay,
September 23, 2025 (Hong Kong time). The Offer Price will not be more than HK$30.75 per Offer Share and is currently expected to be not less than HK$27.75
per Offer Share, unless otherwise announced. If, for any reason, the Offer Price is not agreed by 12:00 noon on Tuesday, September 23, 2025 (Hong Kong ti me)
between the Overall Coordinators (on behalf of the Underwriters) and us, the Global Offering will not proceed and will lapse. Applicants for Hong Kong Offer Shares
are required to pay, on application (subject to application channels), the maximum Offer Price of HK$30.75 for each Hong Kong Offer Share together wit h a brokerage
fee of 1.0%, a SFC transaction levy of 0.0027%, a Stock Exchange trading fee of 0.00565% and an AFRC transaction levy of 0.00015%, subject to refund if th e Offer
Price as finally determined is less than HK$30.75.
Prior to making an investment decision, prospective investors should carefully consider all of the information set out in this prospectus, in partic ular, the
risk factors set out in “Risk Factors” . The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination
by the Overall Coordinators (on behalf of the Hong Kong Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. Such grounds are s et out in
“Underwriting — Underwriting Arrangements — Hong Kong Public Offering — Hong Kong Underwriting Agreement — Grounds for Termination” in this prospec tus.
It is important that you refer to that section for further details.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities laws in the United States, and may not be
offered, sold, pledged or transferred within or to the United States, or for the account or benefit of US persons (as defined in Regulation S), except in
transactions exempt from, or not subject to, the registration requirements of the U.S. Securities Act. The Offer Shares are being offered and sold to n on-U.S.
persons outside the United States in offshore transactions in accordance with Regulation S.
ATTENTION
We have adopted a fully electronic application process for the Hong Kong Public Offering. We will not provide printed copies of this prospectus to the
public in relation to the Hong Kong Public Offering.
This prospectus is available at the website of the Stock Exchange at www.hkexnews.hk and our website at www.chery-auto.com . If you require a printed
copy of this prospectus, you may download and print from the websites above.
IMPORTANT
September 17, 2025


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IMPORTANT NOTICE TO INVESTORS
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong Public
Offering. We will not provide printed copies of this prospectus to the public in relation to the
Hong Kong Public Offering.
This prospectus is available at the website of the Stock Exchange at www.hkexnews.hk
under “HKEXnews > New Listings > New Listing Information” section, and our website at
www.chery-auto.com . If you require a printed copy of this prospectus, you may download and
print from the website addresses above.
To apply for the Hong Kong Offer Shares, you may:
(i) apply online through the White Form eIPO service at www.eipo.com.hk ;o r
(ii) apply electronically through the HKSCC EIPO channel and cause HKSCC
Nominees to apply on your behalf by instructing your broker or custodian who is a
HKSCC Participant to give electronic application instructions via HKSCC’s FINI
system to apply for the Hong Kong Offer Shares on your behalf.
We will not provide any physical channels to accept any application for the Hong Kong
Offer Shares by the public. The contents of the electronic version of this prospectus are
identical to the printed document as registered with the Registrar of Companies in Hong Kong
pursuant to Section 342C of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance.
If you are an intermediary , broker or agent , please remind your customers, clients or
principals, as applicable, that this prospectus is available online at the website addresses above.
Please refer to “How to Apply for Hong Kong Offer Shares” in this prospectus for further
details on the procedures through which you can apply for the Hong Kong Offer Shares
electronically.
Y our application through the White Form eIPO service or the HKSCC EIPO channel
must be for a minimum of 100 Hong Kong Offer Shares and in one of the numbers set out in
the table below.
If you are applying through the White Form eIPO service, you may refer to the table
below for the amount payable for the number of Shares you have selected. Y ou must pay the
respective amount payable on application in full upon application for Hong Kong Offer Shares.
IMPORTANT


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If you are applying through the HKSCC EIPO channel, you are required to pre-fund your
application based on the amount specified by your broker or custodian , as determined based
on the applicable laws and regulations in Hong Kong.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
100 3,106.00 3,000 93,180.34 50,000 1,553,005.69 700,000 21,742,079.63
200 6,212.03 4,000 124,240.45 60,000 1,863,606.83 800,000 24,848,091.00
300 9,318.03 5,000 155,300.57 70,000 2,174,207.97 900,000 27,954,102.38
400 12,424.04 6,000 186,360.68 80,000 2,484,809.10 1,000,000 31,060,113.76
500 15,530.06 7,000 217,420.79 90,000 2,795,410.23 2,000,000 62,120,227.50
600 18,636.07 8,000 248,480.91 100,000 3,106,011.38 3,000,000 93,180,341.26
700 21,742.08 9,000 279,541.03 200,000 6,212,022.76 4,000,000 124,240,455.00
800 24,848.09 10,000 310,601.13 300,000 9,318,034.13 5,000,000 155,300,568.76
900 27,954.10 20,000 621,202.28 400,000 12,424,045.50 10,000,000 310,601,137.50
1,000 31,060.12 30,000 931,803.41 500,000 15,530,056.88 14,869,800
(1) 461,857,679.44
2,000 62,120.22 40,000 1,242,404.56 600,000 18,636,068.26
Notes:
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
No application for any other number of Hong Kong Offer Shares will be considered and
any such application is liable to be rejected.
IMPORTANT


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If there is any change to the expected timetable of the Hong Kong Public Offering, we will
issue an announcement to be published on the website of the Hong Kong Stock Exchange at
www.hkexnews.hk and our website at www.chery-auto.com .
Hong Kong Public Offering commences ............................. .9:00 a.m. on
Wednesday, September 17, 2025
Latest time to complete applications under
the White Form eIPO service through the
designated website at www.eipo.com.hk (2) ......................... 1 1:30 a.m. on
Monday, September 22, 2025
Application lists open (3) ......................................... 1 1:45 a.m. on
Monday, September 22, 2025
Latest time (a) to complete payment of White Form
eIPO applications by effecting internet banking
transfer(s) or PPS payment transfer(s) and (b) give
electronic application instructions to HKSCC
(4) ................... .12:00 noon on
Monday, September 22, 2025
If you are instructing your broker or custodian who is a HKSCC Participant will submit
electronic application instructions on your behalf through HKSCC’s FINI system in
accordance with your instruction, you are advised to contact your broker or custodian for the
earliest and latest time for giving such instructions, as this may vary by broker or custodian.
Application lists close
(3) ........................................ .12:00 noon on
Monday, September 22, 2025
Expected Price Determination Date (5) ..................... a to r before 12:00 noon on
Tuesday, September 23, 2025
Announcement of the final Offer Price; the level of
applications of the Hong Kong Public Offering;
the level of indications of interest in the International
Offering; and the basis of allocation of the Hong Kong
Offer Shares to be published on the website of the
Hong Kong Stock Exchange at www.hkexnews.hk and
our website at www.chery-auto.com (6) ................... a to r before 11:00 p.m. on
Wednesday, September 24, 2025
EXPECTED TIMETABLE
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The results of allocations in the Hong Kong Public
Offering (with successful applicants’ identification
document numbers, where appropriate) to be made
available through a variety of channels as described
in the section headed “How to Apply for the
Hong Kong Offer Shares — Publication of
Results”, including:
on the website of the Stock Exchange at www.hkexnews.hk
and our website at www.chery-auto.com (6) respectively . . . .at or before 11:00 p.m. on
Wednesday, September 24, 2025
on the designated results of allocation website at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) with a
“search by ID” function ................................. .from 11:00 p.m. on
Wednesday, September 24, 2025 to
12:00 midnight on
Tuesday, September 30, 2025
from the allocation results telephone enquiry line by
at +852 2862 8555 between 9:00 a.m. and 6:00 p.m. .............. .from Thursday,
September 25, 2025
to Tuesday, September 30, 2025
(excluding Saturday, Sunday
and public holiday in Hong Kong)
Despatch of H Share certificates in respect of wholly
or partially successful applications, or deposit of
H Share certificate into CCASS, on or before
(7) ....... W ednesday, September 24, 2025
Despatch of White Form e-Refund payment (8)
instructions and refund cheques in respect of
wholly or partially successful applications on or before . . .Thursday, September 25, 2025
Dealings in our H Shares on the Hong Kong Stock
Exchange expected to commence at ....................... .9:00 a.m. on Thursday,
September 25, 2025
EXPECTED TIMETABLE
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Notes:
(1) All dates and times refer to Hong Kong local time and dates unless otherwise stated.
(2) Y ou will not be permitted to submit your application through the designated website at www.eipo.com.hk after
11:30 a.m. on the last day for making applications. If you have already submitted your application and obtained
an application reference number from the designated website before 11:30 a.m., you will be permitted to
continue the application process (by completing payment of application monies) until 12:00 noon on the last
day for making applications, when the application lists close.
(3) If there is a “black” rainstorm warning, a tropical cyclone warning signal number 8 or above and/or Extreme
Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Monday, September 22,
2025 the application lists will not open on that day. See the section headed “How to Apply for the Hong Kong
Offer Shares — Severe Weather Arrangements” for further details.
(4) If you instruct your broker or custodian who is an HKSCC Participant to give electronic application
instructions via FINI to apply for the Hong Kong Offer Shares on your behalf, you should contact your broker
or custodian for the latest time for giving such instructions which may be different from the latest time as
stated above.
(5) The Price Determination Date is expected to be on or before Tuesday, September 23, 2025 (Hong Kong time)
and, in any event, not later than 12:00 noon on Tuesday, September 23, 2025 (Hong Kong time). If, for any
reason, the Offer Price is not agreed by 12:00 noon on Tuesday, September 23, 2025 (Hong Kong time), the
Global Offering will not proceed and will lapse.
(6) None of the websites or any of the information contained on the websites forms part of this prospectus.
(7) The H Share certificates will only become valid evidence of title at 8:00 a.m. on the Listing Date, which is
expected to be on or around Thursday, September 25, 2025 provided that the Global Offering has become
unconditional in all respects. Investors who trade our H Shares on the basis of publicly available allocation
details before the receipt of H Share certificates or before the H Share certificates become valid evidence of
title do so entirely at their own risk.
(8) Applicants being individuals who are eligible for personal collection may not authorize any other person to
collect on their behalf. If you are a corporate applicant which is eligible for personal collection, your
authorized representative must bear a letter of authorization from your corporation stamped with your
corporation’s chop. Both individuals and authorized representatives must produce evidence of identity
acceptable to our H Share Registrar at the time of collection.
Any uncollected H Share certificates and/or refund checks will be dispatched by ordinary post, at the
applicants’ risk, to the addresses specified in the relevant applications.
White Form e-Refund payment instructions/refund cheques will be issued for the applicants who have applied
through White Form eIPO service in respect of wholly or partially unsuccessful applications and in respect
of wholly or partially successful applications pursuant to the Hong Kong Public Offering if the final Offer
Price is less than the maximum Offer Price of HK$30.75 payable per Offer Share on application. Part of the
applicant’s Hong Kong identity card number or passport number, or, if the application is made by joint
applicants, part of the Hong Kong identity card number or passport number of the first-named applicant,
provided by the applicant(s) may be printed on the refund cheque, if any. Such data would also be transferred
to a third party for refund purposes. Banks may require verification of an applicant’s Hong Kong identity card
number or passport number before encashment of the refund cheques. Inaccurate completion of an applicant’s
Hong Kong identity card number or passport number may invalidate or delay encashment of the refund
cheques.
Applicants who have applied through White Form eIPO service and paid their applications monies through
single bank accounts may have refund monies (if any) dispatched to the bank account in the form of White
Form e-Refund payment instructions. Applicants who have applied through White Form eIPO service and
paid their application monies through multiple bank accounts may have refund monies (if any) despatched to
the address as specified in their application instructions in the form of refund cheque(s) in favor of the
applicant (or, in the case of joint applications, the first-named applicant) by ordinary post at their own risk.
EXPECTED TIMETABLE
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For applicants who have applied for Hong Kong Offer Shares through the HKSCC EIPO channel, H Share
certificate(s) will be issued in the name of HKSCC Nominees, deposited into CCASS and credited to their
designated HKSCC Participant’s stock account.
For applicants who have applied through HKSCC EIPO channel, their broker or custodian will arrange refund
to their designated bank account subject to the arrangement between them and their broker or custodian.
Further information is set out in the sections headed “How to Apply for Hong Kong Offer Shares —
Despatch/Collection of H Share Certificates and Refund of Application Monies”.
The above expected timetable is a summary only. Y ou should read carefully the
sections headed “Underwriting”, “Structure of the Global Offering” and “How to Apply
for the Hong Kong Offer Shares” for details relating to the structure of the Global
Offering and the conditions and procedures for application for the Hong Kong Offer
Shares.
EXPECTED TIMETABLE
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IMPORTANT NOTICE TO PROSPECTIVE INVESTORS
This prospectus is issued by us solely in connection with the Hong Kong Public
Offering and the Hong Kong Offer Shares and does not constitute an offer to sell or
a solicitation of an offer to buy any security other than the Hong Kong Offer Shares
offered by this prospectus pursuant to the Hong Kong Public Offering. This prospectus
may not be used for the purpose of, and does not constitute, an offer or a solicitation
of an offer to subscribe for or buy, any security in any other jurisdiction or in any other
circumstances. No action has been taken to permit a public offering of the Offer Shares
or the distribution of this prospectus in any jurisdiction other than Hong Kong. The
distribution of this prospectus and the offering and sale of the Offer Shares 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
authorization by the relevant securities regulatory authorities or an exemption
therefrom.
Y ou should rely only on the information contained in this prospectus to make your
investment decision. The Hong Kong Public Offering is made solely on the basis of the
information contained and the representations made in this prospectus. We have not
authorized anyone to provide you with information that is different from what is
contained in this prospectus. Any information or representation not contained nor
made in this prospectus must not be relied on by you as having been authorized by us,
the Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers and the
Capital Market Intermediaries, any of the Underwriters, any of our or their respective
directors, officers, employees, agents or representatives of any of them or any other
parties involved in the Global Offering.
Page
EXPECTED TIMETABLE ............................................ i
CONTENTS ....................................................... v
SUMMARY ....................................................... 1
DEFINITIONS ..................................................... 2 6
GLOSSARY OF TECHNICAL TERMS ................................. 4 1
FORW ARD-LOOKING STATEMENTS ................................. 4 4
RISK FACTORS ................................................... 4 6
W AIVERS FROM STRICT COMPLIANCE WITH LISTING RULES ......... 8 6
INFORMATION ABOUT THIS PROSPECTUS AND THE
GLOBAL OFFERING ............................................. 9 7
CONTENTS
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DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN
THE GLOBAL OFFERING ......................................... 1 0 1
CORPORATE INFORMATION ....................................... 1 1 3
INDUSTRY OVERVIEW ............................................. 1 1 5
REGULATORY OVERVIEW ......................................... 1 3 9
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE ............. 1 9 2
BUSINESS ........................................................ 2 1 7
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER ......... 3 1 5
CONTINUING CONNECTED TRANSACTIONS .......................... 3 2 2
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT .............. 3 3 2
SUBSTANTIAL SHAREHOLDERS ..................................... 3 6 1
SHARE CAPITAL .................................................. 3 6 4
FINANCIAL INFORMATION ......................................... 3 6 7
CORNERSTONE INVESTORS ........................................ 4 2 8
FUTURE PLANS AND USE OF PROCEEDS ............................. 4 4 1
UNDERWRITING .................................................. 4 4 5
STRUCTURE OF THE GLOBAL OFFERING .............. .............. 4 5 7
HOW TO APPLY FOR HONG KONG OFFER SHARES ................... 4 6 7
APPENDIX I — ACCOUNTANTS’ REPORT ........................ I - 1
APPENDIX II — UNAUDITED PRO FORMA FINANCIAL
INFORMATION ................................ II-1
APPENDIX III — TAXATION AND FOREIGN EXCHANGE ............. III-1
APPENDIX IV — SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS ..................... I V - 1
APPENDIX V — SUMMARY OF ARTICLES OF ASSOCIATION ........ V - 1
APPENDIX VI — STATUTORY AND GENERAL INFORMATION ........ VI-1
APPENDIX VII — DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY ....... VII-1
CONTENTS
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This summary aims to give you an overview of the information contained in this
prospectus. As it is a summary, it does not contain all the information that may be
important to you and is qualified in its entirety by, and should be read in conjunction
with, the full text of this prospectus. You should read the whole document before you
decide to invest in the Offer Shares. There are risks associated with any investment. Some
of the particular risks in investing in the Offer Shares are set forth in the section headed
“Risk Factors” in this prospectus. You should read that section carefully before you
decide to invest in the Offer Shares.
OVERVIEW
Who We Are
We are a passenger vehicle company headquartered in Wuhu, China. We design, develop,
manufacture and sell a diverse and expanding portfolio of passenger vehicles, including
internal combustion engine (ICE) vehicles and new energy vehicles (NEVs), to cater to the
distinct and evolving needs and preferences of customers in both the domestic and overseas
markets. Since our founding in 1997, with a commitment to leading industrial innovation and
engaging in the global market, we offer high quality passenger vehicles to users worldwide. We
are the second largest Chinese domestic brand passenger vehicle company, and the 11th largest
passenger vehicle company globally, in terms of global sales volume of passenger vehicles in
2024, according to Frost & Sullivan.
The following chart highlights our business achievements:
2,295,000+
2024 Global Sales Volume (1)
No. 2
Chinese Domestic Brand Passenger
Vehicle Company (2)
No. 1 Exporter for
22 consecutive years since 2003
Among Chinese Domestic Brand
Passenger Vehicle Companies
(4)
11th Largest
Passenger Vehicle Company Globally (5)
Sales to
100+
Countries and Regions (3)
13,000,000+
Cumulative Global Sales Volume (3)
No. 1 Among Global Top 20 Passenger Vehicle Companies
49.4%: 2024 YoY Growth (6)
Only Global Top 20 Passenger Vehicle Company
With 25.0%+ YoY Growth for each NEV Sales, ICE vehicle Sales,
Domestic Sales and Overseas Sales
(6)
RMB269,897 million &
65.4% YoY Growth
(7)
2024 Revenue
RMB14,334 million &
37.2% YoY growth
(7)
2024 Net Profit
265%+
NEV Sales
YoY Growth (6)
29%+
ICE Vehicle Sales
YoY Growth
(6)
55%+
Domestic Sales
YoY Growth
(6)
35%+
Overseas Sales
YoY Growth
(6)
Size Global Coverage Leadership
Rapid Development Financial Performance
SUMMARY
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Notes:
(1) For the year ended December 31, 2024.
(2) In terms of sales volume in 2024 (excluding sales volumes of brands acquired from overseas by Chinese
companies for the purpose of comparison of sales volume of Chinese domestic brands only), according to Frost
& Sullivan (hereinafter the same).
(3) As of the Latest Practicable Date.
(4) In terms of export volume of Chinese domestic brands from 2003 to 2024 (excluding export volume of brands
acquired from overseas by Chinese companies for the purpose of comparison of export volume of Chinese
domestic brands only), according to the same source (hereinafter the same).
(5) In terms of sales volume of the global top 20 passenger vehicle companies in 2024, according to the same
source.
(6) In terms of sales volume from 2023 to 2024.
(7) From 2023 to 2024.
Our Business and Sales Performance
According to Frost & Sullivan, we are the only passenger vehicle company among the
global top 20 to achieve a sales volume increase over 25.0% for both NEVs and ICE vehicles
and in both China and overseas markets in 2024, compared to 2023. Our sales volume of
passenger vehicles increased by 49.4% in 2024, compared to 2023, the largest growth among
the top global 20 passenger vehicle companies, according to the same source. We continually
roll out models that enjoy popularity in the market. There were eight models, each achieving
an average monthly sales of over 10,000 units in 2024. We have to date achieved success in
China and overseas markets.
 Domestic Market . Both of our business scale and sales revenue grew rapidly with
increasing market share, fueled by industry-leading technologies, a diversified
product portfolio, strong brand equity and an extensive sales and distribution
network. In 2024, our sales volume of passenger vehicles in China increased by
56.0%, while the sales volume of NEVs increased by 277.3%, compared to 2023. In
2024, we ranked first among the top 10 Chinese passenger vehicle companies in
terms of sales volume growth of both ICE vehicles and NEVs in China, according
to the same source. With products featuring high performance and safety, and
technological innovation capabilities driven by cutting-edge intelligentization, we
believe we can continue to drive sales growth going forward.
 Overseas Market . We exported our first vehicle in 2001. Through the 24 years
thereafter, we sold over 13 million passenger vehicles globally to more than 100
countries and regions as of the Latest Practicable Date. Leveraging first-mover
advantage, we achieved success in overseas markets with a diverse brand portfolio,
multi-tier sales networks, a robust supply chain, localized R&D capabilities and a
stellar reputation among consumers. All these factors made our passenger vehicles
popular in overseas markets and empowered a strong growth of business amidst
downturn of the global ICE vehicle market. We are the No. 1 exporter among
Chinese domestic brand passenger vehicle companies in terms of export volume of
passenger vehicles for 22 consecutive years since 2003, according to Frost &
SUMMARY
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Sullivan. In addition, we are a leader in many major passenger vehicles markets. For
example, we ranked first among Chinese domestic brand passenger vehicle
companies in Europe, South America, and Middle East and North Africa, and second
in North America and Asia (excluding China) in terms of sales volume in 2024,
respectively, according to the same source.
(1)
Our Brands and Products
We have five major brands, CHERY , JETOUR, EXEED, iCAR and LUXEED. Each of our
five major brands presents a distinct positioning, modality style and aesthetic experience to
satisfy the needs of target customers and capture the significant growth potentials across
market segments. During the Track Record Period, the revenue generated from our five major
brands accounted for 89.1%, 92.7%, 91.5% and 90.3% of our total revenue in 2022, 2023 and
2024 and the three months ended March 31, 2025, respectively.
CHERY — Mass market brand
As our signature brand, CHERY is positioned as a first-rated car brand of safety, comfort
and quality for the mass market and family use. CHERY was the first Chinese domestic
passenger vehicle brand to achieve an accumulated sales of one million units, according to
Frost & Sullivan. We sold more than 10 million units of CHERY brand vehicles as of the Latest
Practicable Date.
 The CHERY brand consists of core product series of Tiggo, Arrizo and Fulwin, as
well as OMODA and JAECOO, which mainly target overseas markets. Major
models include Tiggo 8, Tiggo 7, Tiggo 5x, Arrizo 8, OMODA 5 and Fulwin T9,
with each of the first five models achieving an average monthly sales volume of over
10,000 units in 2024 and Fulwin T9 recording a robust sales during the same year.
In particular, Tiggo 8 ranked No. 1 and No. 3 in the global and China markets,
respectively, among ICE vehicle models of Chinese domestic brand passenger
vehicles companies by sales volume of ICE vehicles in 2024, according to Frost &
Sullivan.
 We sold 813.1 thousand units, 1,141.2 thousand units and 1,523.3 thousand units of
CHERY brand vehicles, respectively, in 2022, 2023 and 2024, representing a CAGR
of 36.9%. We sold 358.7 thousand units of CHERY brand vehicles in the three
months ended March 31, 2025.
Note:
1 Rankings exclude sales volume of brands acquired from abroad by Chinese companies to compare sales
volumes of Chinese domestic brands only in the relevant local markets (hereinafter the same).
SUMMARY
–3–


--- page 14 ---
JETOUR — Brand for off-road travel
JETOUR targets customers who are passionate about family travel and outdoor leisure. In
January 2024, JETOUR brand vehicles quickly achieved an accumulated sales of one million
units since their launch in 2018.
 In 2024, the sales volume of JETOUR X70 ranked No. 4 among all B-class SUV
models globally, according to Frost & Sullivan.
 We sold 164.7 thousand units, 285.3 thousand units and 533.7 thousand units of
JETOUR brand vehicles, respectively, in 2022, 2023 and 2024, representing a
CAGR of 80.0%. We sold 148.0 thousand units of JETOUR brand vehicles in the
three months ended March 31, 2025.
EXEED — Tech-luxury vehicle brand
EXEED targets customers who value performance and elegance, and provides them with
a smooth and sophisticated travel experience.
 EXLANTIX ET (range-extended electric vehicle (REEV) version), a major model of
the EXEED brand, is equipped with our REEV powertrain, the first of this kind in
China that obtained technical validation by China Automotive Technology and
Research Center (CA TARC) as “Premium Drive — High-Quality Range Extender”,
according to Frost & Sullivan.
 In 2022, 2023 and 2024, we sold 47.1 thousand units, 109.5 thousand units and
135.8 thousand units of EXEED brand vehicles, respectively, representing a CAGR
of 69.7%. In 2024, the export volume of EXEED brand vehicles ranked No. 1 among
high-end Chinese domestic brands, according to the same source. We sold 22.0
thousand units of EXEED brand vehicles in the three months ended March 31, 2025.
iCAR — Brand for young generation
SUMMARY
–4–


--- page 15 ---
iCAR, targeting Generation Z customers who are keen on technology and value freedom,
is designed to bring in contemporary and smart travel experience.
 In 2024, iCAR 03 ranked fifth in terms of sales volume of A-class pure electric
SUVs in China, according to Frost & Sullivan. Launched in December 2024, iCAR
V23 ranked seventh in terms of sales volume of pure electric SUVs in China in
January 2025, according to the same source.
 In 2024, the sales volume of iCAR brand vehicles amounted to 64.5 thousand units,
ranking fourth among Chinese domestic brand A-class pure electric SUVs,
according to the same source. Since the pre-sale release in late 2023 of iCAR 03, the
first model under iCAR, we sold around 1,000 units of iCAR brand vehicles in 2023.
In the three months ended March 31, 2025, we sold 18.4 thousand units of iCAR
brands vehicles.
LUXEED — Brand for superior and intelligent NEVs
LUXEED, targeting customers who pursue intelligence, performance and innovation, is
designed to provide them with a transformative and smart driving experience.
 As of the Latest Practicable Date, we launched two models under the LUXEED
brand, namely S7, a smart sedan, and R7, a smart coupe SUV . In terms of sales
volume in China in January 2025, R7 ranked No. 1 among all mid- to large-sized
pure electric SUV models, according to Frost & Sullivan.
 In 2024 and the three months ended March 31, 2025, we sold 38.5 thousand units
and 33.0 thousand units of LUXEED brand vehicles.
Our ESG Initiatives
Adhering to the philosophy of “In somewhere, For somewhere,” we are committed to
providing green products to users worldwide and contributing to the sustainable development
of the society.
 Sustainable Development . We implement full value-chain carbon reduction
management. In 2024, renewable energy constituted 17% of our total energy
consumption, which increased by 9.4 percentage points compared to 2023. In the
same year, renewable electricity accounted for approximately 30% of our total
electricity usage, increased by 15.3 percentage points compared to the counterpart
in 2023.
SUMMARY
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--- page 16 ---
 Green Operations . We have received national “Green Factory” certifications for our
five production plants in China. In 2024, we launched 10 new models, nine of which
were NEV models, to continuously increase the proportion of NEVs in our product
portfolio.
Our ESG initiatives have won numerous accolades. We were named in the 2024 Fortune
China ESG Impact List by Fortune China, and recognized as a Green Supply Chain
Management Enterprise by the MIIT and Excellent Sustainable Development Practice Case by
the China Automotive Industry Association in 2024.
OUR COMPETITIVE STRENGTHS
We believe the following competitive strengths contribute to our success:
 Diversified products and brand portfolio to maximize brand equity;
 Comprehensive technological expertise underpinned by robust R&D capabilities to
achieve future technological breakthrough;
 Most globalized Chinese passenger vehicle company endeavoring to expand
overseas markets;
 Collaborative industry ecosystem to drive upstream advancement along the value
chain; and
 Capable management team and efficient organization contributing to corporate
success.
OUR STRATEGIES
We are committed to becoming an innovation-driven, globally trusted player in the
intelligent mobility ecosystem. To achieve this goal, we intend to steadfastly implement the
following strategies, continuously enhance corporate value, actively fulfill environmental and
social responsibilities and strengthen our brand awareness globally:
 To further expand product lineup and sharpen brand positioning to enhance our
brand equity;
 To continue to invest in R&D on next-generation technologies to strengthen our
competencies;
 To continue to enhance vehicle electrification and intelligentization to embrace
global mobility transformation; and
 To expand our international footprints with globalization strategy to solidify
overseas market leadership.
SUMMARY
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OUR PRODUCTS
Passenger Vehicles
During the Track Record Period, we sold passenger vehicles mainly in two product
categories, namely sedans and SUVs, with multiple powertrain options targeting mass market,
mid- to high-end and premium segments, to cater to the distinct and evolving needs and
preferences of customers. The following table illustrates the market positioning, product
category, powertrain option and MSRP range of major product series available for sale under
our five major brands as of the Latest Practicable Date:
Market
positioning (1)
Product
category Powertrain
MSRP range in
the PRC (3)
(RMB)
CHERY
– Tiggo series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mass market and
mid- to high-
end
SUV ICE/PHEV 57,900-203,900
– Arrizo series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mass market and
mid- to high-
end
Sedan ICE 59,900-148,900
– Fulwin series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end Sedan/SUV PHEV 99,900-229,900
– OMODA and JAECOO /H1118/H1118 —
(2) SUV ICE/PHEV/
BEV
— (2)
JETOUR
– JETOUR series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV ICE 93,900-191,900
– Shan Hai series /H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV PHEV 123,900-234,900
EXEED
– EXEED series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV ICE/PHEV 109,900-233,900
– EXLANTIX series /H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Sedan/SUV REEV/BEV 152,800-319,800
iCAR
– iCAR 03 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV BEV 109,800-169,800
– iCAR V23 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV BEV 99,800-149,800
LUXEED
–S 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Sedan BEV 229,800-329,800
–R 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Coupe SUV REEV/BEV 249,800-339,800
SUMMARY
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Notes:
1. According to Frost & Sullivan, China’s passenger vehicle market can be categorized into mainly three
market segments primarily in terms of selling prices, namely (i) mass market segment (below
RMB80,000), (ii) mid- to high-end segment (RMB80,000-RMB300,000) and (iii) premium segment
(above RMB300,000).
2. OMODA & JAECOO mainly target overseas markets with a mid- to high-end positioning.
3. We routinely publish MSRPs on our websites. The retail selling prices of our vehicles vary in different
markets.
Automotive Parts and Components
In addition to sales of passenger vehicles, we sell (i) engines, transmissions and
automotive parts and components primarily to third-party vehicle manufacturers and (ii) spare
parts and components in support of our after-sales services. For the years ended December 31,
2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our revenue
derived from sales of automotive parts and components was RMB8,675 million, RMB8,904
million, RMB15,864 million, RMB2,936 million and RMB5,743 million, respectively,
accounting for 9.4%, 5.5%, 5.9%, 5.3% and 8.4% of our total revenue for the same periods,
respectively.
OUR TECHNOLOGICAL PROWESS
Technological prowess lies at the core of our vehicle development and witnesses our
success to date. Through years, we have built a full-range technology stack including (i) Chery
Power, our powertrain systems; (ii) Mars Architecture, our vehicle development platform; (iii)
Lion Intelligent Cockpit, our intelligent cockpit system; and (iv) Our driving assistance system.
Chery Power — Our Powertrain Systems
Chery Power covers four core technologies, namely engine, transmission, electric drive,
and battery safety system. We are a frontrunner in the development and manufacturing of
engine and transmission systems in China automotive industry, according to Frost & Sullivan.
With industry-leading ICE and hybrid powertrain technologies, our powertrains are designed
to deliver driving experience in terms of energy efficiency, longest possible range and
acceleration. As of the Latest Practicable Date, our eight types of fuel engines and our hybrid
engines and hybrid DHT have been acclaimed as “China Top Ten” by Automobile and Sports,
a magazine hosted by the China Automotive News.
Mars Architecture — Our Vehicle Development Platform
Mars Architecture, mainly consisting of two core technologies — the vehicle platform
and the E/E architecture, is our platform for the design, development and engineering of our
vehicles. With modularized hardware and cross-platform software, Mars Architecture enables
us to achieve cost effectiveness in R&D, reduce development risks, and accelerate the launch
of new and reliable products, for models across different platforms.
SUMMARY
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Lion Intelligent Cockpit
Lion OS, our intelligent cockpit system, is designed to enhance the in-cabin experience
for both drivers and passengers by providing a safer and more comfortable driving environment
and intelligent in-cabin functions. Lion OS is tailored to match individual user preferences
leveraging our proprietary operating system and application software. Moreover, with modular
design, Lion OS is compatible with our vehicle models with minimal re-configuration.
Our Driving Assistance System
We provide driving assistance system for our passenger vehicles. Our vehicles model that
are equipped with our driving assistance system can meet the active safety regulations in both
China and EU and are rated five-stars or excellence by various evaluation programs or systems
including ENCAP , ANCAP , CNCAP , IVISTA and C-ICAP , adapting well to different road
conditions and complex scenarios in both China and overseas markets.
SALES AND MARKETING
Our Sales Network
We sell our passenger vehicles primarily through a network of dealerships in China and
overseas markets. The outlets of our dealers are strategically located in the major cities of
China and overseas countries and regions for marketing and sales of our vehicles. We have
established an extensive network of dealerships globally over the years. As of March 31, 2025,
we had 3,663 dealership outlets covering over 310 cities in the PRC and 2,958 overseas
dealership outlets in Asia (excluding China), Europe, Africa, Oceania and the Americas. See
“Business — Sales and Marketing — Our Sales Network” in this prospectus.
Pricing
Our pricing policy varies among different countries and regions, considering factors such
as market maturity, penetration rate, purchasing power, competition landscape and product
cost. We provide market-guided price to our dealers for their reference. We usually review our
pricing model at the different development stages of a vehicle model, in particular, the
beginning of the development, the completion of the development and prior to the formal
launch. In addition, we will review and adjust the market-guided price from time to time and
taking into prevailing market conditions.
SUMMARY
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--- page 20 ---
CUSTOMERS AND SUPPLIERS
Our Customers
During the Track Record Period, we sold our passenger vehicles primarily through dealers
in domestic and overseas markets. In addition, we also sold to overseas OEMs, overseas joint
ventures and trading companies during the same periods. We have a broad base of customers
and we do not believe that we have material concentration risks. The revenue generated from
our five largest customers in each period during the Track Record Period amounted to
RMB16,035 million, RMB23,799 million, RMB41,698 million and RMB12,989 million
accounted for 17.3%, 14.6%, 15.4% and 19.0% of our total revenue in 2022, 2023, 2024 and
the three months ended March 31, 2025, respectively. We typically settle with our five largest
customers with bank transfer or bank acceptance bills. See “Business — Customers” in this
prospectus.
Our Suppliers
We procure a wide variety of raw materials mainly including steel products, seats, tires,
battery cells and electronic components for our passenger vehicles. We also engage overseas
contract manufacturers to assemble our KD kits to passenger vehicles for sales in overseas
markets. A localized and stable supply chain is a key focus in production of vehicles. We select
suppliers very carefully, taking into account their price, quality, production capacity, financial
conditions, delivery scheme, business scale and reputation. In 2022, 2023, 2024 and three
months ended March 31, 2025, purchases of raw materials from our five largest suppliers in
each period during the Track Record Period amounted to RMB12,096 million, RMB20,503
million, RMB28,672 million and RMB8,903 million, respectively, accounting for 15.8%,
16.9%, 14.4% and 17.1% of our total purchases of raw materials for each of the same periods.
We typically settle payments with our five largest suppliers with bank transfer or bank
acceptance bills. See “Business — Suppliers” in this prospectus.
COMPETITION
The global and China passenger vehicle markets are highly competitive, driven by key
factors including (i) development of products that can meet diverse and evolving customer
needs; (ii) technological innovations in electrification and intelligentization; (iii) strong brand
equity; (iv) efficient production capabilities with robust and localized supply chain; and (v) an
extensive and locally adapted sales network and after-sales services. The competition in the
NEV market is increasingly intensified in both domestic and overseas markets. In the China
market, as the penetration rate of NEVs continues to rise, both traditional OEMs and emerging
NEV brands accelerate the speed of product launches. Competition is also intense in respect of
retail price, product design, intelligent cockpit, driving assistance systems, battery
performance, and charging efficiency. Meanwhile, competition is escalating in overseas
markets. Traditional overseas OEMs are leveraging their established brand recognition, global
supply chain systems, and manufacturing expertise to build up their NEV product portfolio
whereas Chinese domestic brand passenger vehicle companies are rapidly gaining market
SUMMARY
–1 0–


--- page 21 ---
shares by optimizing production process to minimize costs and catering to rapid responses to
market demands and customer preference. In response to such intense competition in the PRC,
China Association of Automobile Manufacturers (CAAM) and MIIT have issued related
initiatives, urging for strict adherence to the fair competition principles and implementing
strong measures to curb unfair pricing practices within the automotive industry. The
competition in the NEV market is no longer solely based on technological superiority or price
competitiveness, but increasingly on the overall capabilities including operational efficiency,
global expansion and brand building. We primarily compete with global passenger vehicle
companies and Chinese domestic brand passenger vehicle companies in both domestic and
overseas markets. In the future, we may also face competition from new entrants both in China
and globally that will increase the level of competition.
We are the second largest Chinese domestic brand passenger vehicle company and the
11th largest passenger vehicle company globally by sales volume in 2024, according to Frost
& Sullivan. We are the only one among the global top 20 passenger vehicle companies to
achieve over 25.0% sales volume increases of both NEVs and ICE vehicles and in both China
and overseas markets in 2024 compared to 2023, according to the same source. See “Industry
Overview — Competitive Landscape of Global Passenger V ehicle Market” for details.
Leveraging our cutting-edge technologies, strong R&D and manufacturing capabilities and an
extensive sales and distribution network, we believe we can capitalize the market growth
opportunities of global and China passenger vehicle markets.
RISK FACTORS
Our operations and the Global Offering involve certain risks and uncertainties, which are
set out in the section headed “Risk Factors” in this prospectus. Y ou should read that section in
its entirety carefully before you decide to invest in our H Shares. Some of the major risks we
face include:
 The automotive market is highly competitive, and we may not be successful in
competing in this industry;
 NEV market is highly competitive, and demand for NEVs may be cyclical and
volatile;
 Our results of operations during the Track Record Period may not be indicative of
our future performance;
 We face risks associated with the international sale of our vehicles and our
international operations. If we are unable to effectively manage these risks, our
results of operation, financial conditions, business and prospects may be materially
and adversely affected;
SUMMARY
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--- page 22 ---
 Our business is dependent on the strengths and market acceptance of our five major
brands. If we fail to maintain and enhance our brands, or if we incur excessive
expenses in this regard, our results of operation, financial conditions, business and
prospects may be materially and adversely affected;
 We rely on various suppliers to provide raw materials or certain key components of
our passenger vehicles. We are subject to the risks associated with volatility in the
prices of such raw materials or components. Our suppliers may fail to deliver such
raw materials or components as required; and
 Any delay in the launch, manufacture and delivery of our existing or future products
could have a material adverse effect on our business.
IMPACT OF COVID-19
The outbreak of COVID-19 has affected the Chinese and global economy. During the
COVID-19 outbreak in 2022, we had not experienced material disruptions in our production.
Our headquarter in Wuhu was temporarily closed for a short period of time, yet without any
material disruptions to our business operations. Our Directors confirmed that, during the Track
Record Period and up to the Latest Practicable Date, the COVID-19 outbreak did not materially
and adversely impact on our business, results of operations and financial condition nor caused
material disruption to our supply chain. Our revenue increased from RMB92,618 million in
2022 to RMB163,205 million in 2023 and further to RMB269,897 million in 2024,
representing a CAGR of 70.7%. Our revenue increased by 24.2%, from RMB54,910 million for
the three months ended March 31, 2024 to RMB68,223 million in the three months ended
March 31, 2025.
CHERY HOLDING’S EQUITY TRANSFER AND OUR SHAREHOLDERS
Prior to the Equity Transfer, Chery Holding had been our controlling Shareholder since
its establishment in 2010. Upon completion of the Equity Transfer on January 20, 2025, Chery
Holding has no longer held any of our Shares, and the shareholders of Chery Holding has held
our Shares directly. As at the Latest Practicable Date, we have a total of 22 Shareholders with
a dispersed shareholding structure including certain state-owned enterprises. Pursuant to the
Supervision and Administration Measures for the Trading of State-owned Assets of Enterprises
(جour Company is not a state-owned enterprise, a state-
controlled enterprise (Άุ) or a state-actually-controlled enterprise ( ਷ϞྼყછՓΆ
ุ) as defined therein. For further details, see “History, Development and Corporate Structure”
in this prospectus.
SUMMARY
–1 2–


--- page 23 ---
OUR SINGLE LARGEST SHAREHOLDER
As at the Latest Practicable Date, Wuhu Investment Holding held approximately 21.17%
of the issued share capital of our Company. Immediately following completion of the Global
Offering and the conversion of Domestic Unlisted Shares into H Shares (assuming the
Over-allotment Option is not exercised), Wuhu Investment Holding will hold approximately
20.08% of the enlarged issued share capital of our Company, and will continue to be our Single
Largest Shareholder. For further details about our Single Largest Shareholder, see
“Relationship with our Single Largest Shareholder” in this prospectus.
PRE-IPO INVESTORS
We completed several rounds of Pre-IPO Investments since our establishment. For further
details about our Pre-IPO Investors, see “History, Development and Corporate Structure —
Pre-IPO Investments” in this prospectus.
SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The following tables set forth summary financial data from our financial information
during the Track Record Period, extracted from the Accountants’ Report set out in Appendix
I to this prospectus. The summary financial data set forth below should be read together with,
and is qualified in its entirety by reference to, our financial statements in this prospectus,
including the related notes. Our financial information was prepared in accordance with HKFRS
Accounting Standards.
Summary of Consolidated Statements of Profit or Loss
The following table sets forth selected items of the consolidated statements of profit or
loss of our Group for the years indicated:
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(79,813) (137,115) (233,589) (46,747) (59,766)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,805 26,090 36,308 8,163 8,457
Other income and gains /H1118/H1118/H1118/H11183,822 4,232 6,251 1,174 3,652
Selling and distribution
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,207) (5,557) (8,380) (1,812) (2,182)
Administrative expenses /H1118/H1118/H1118/H1118(1,934) (4,070) (5,999) (1,887) (1,140)
SUMMARY
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--- page 24 ---
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(unaudited)
Research and development
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,646) (6,664) (9,243) (2,224) (2,272)
Impairment (losses)/gains on
financial and contract
assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(684) 223 258 424 13
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(130) (568) (1,719) (421) (99)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,405) (1,617) (2,310) (692) (872)
Share of profits and losses of
– Joint ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118640 854 851 258 112
– Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118247 382 595 188 98
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,508 13,305 16,612 3,171 5,767
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118(702) (2,861) (2,278) (695) (1,041)
Profit for the year/period /H1118 5,806 10,444 14,334 2,476 4,726
attributable to
– Owners of our Company /H1118/H1118 6,266 11,953 14,135 2,712 4,650
– Non-controlling interests /H1118/H1118 (460) (1,509) 199 (236) 76
Non-HKFRS Measures
To supplement our consolidated financial statements, which are presented in accordance
with HKFRSs, we also use adjusted profit (non-HKFRS measure) and adjusted EBITDA
(non-HKFRS measure) as additional financial measures, which are not required by, or
presented in accordance with, HKFRSs. We believe these measures provide useful information
to investors and others in understanding and evaluating our consolidated results of operations
in the same manner as they help our management. However, our presentation of adjusted profit
(non-HKFRS measure) and adjusted EBITDA (non-HKFRS measure) may not be comparable
to similarly titled measures presented by other companies. The use of these non-HKFRS
measures has limitations as an analytical tool, and you should not consider them in isolation
from, or as a substitute for an analysis of, our results of operations or financial condition as
reported under HKFRSs.
SUMMARY
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Adjusted Profit (non-HKFRS measure) and Adjusted EBITDA (non-HKFRS measure)
We define adjusted profit (non-HKFRS measure) as profit for the year/period adjusted by
adding equity-settled share-based compensation expenses. We then add back (i) income tax
expense, (ii) net finance costs, and (iii) depreciation and amortization to derive adjusted
EBITDA (non-HKFRS measure). The following table sets out a reconciliation from profit for
the year/period to adjusted profit (non-HKFRS measure) and adjusted EBITDA (non-HKFRS
measure) for the years/period indicated:
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(unaudited)
Reconciliation of profit for
the year/period to
adjusted profit
(non-HKFRS measure)
and adjusted EBITDA
(non-HKFRS measure)
Profit for the year/period /H1118/H1118 5,806 10,444 14,334 2,476 4,726
Add:
Equity-settled share-based
compensation expenses
(1) /H1118 – – 2,016 1,632 131
Adjusted profit
(non-HKFRS measure) /H1118/H1118 5,806 10,444 16,350 4,108 4,857
Add:
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118702 2,861 2,278 695 1,041
Net finance costs (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118599 500 1,350 442 658
Depreciation and
amortization (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,004 2,481 3,849 520 908
Adjusted EBITDA
(non-HKFRS measure) /H1118/H1118 9,111 16,286 23,827 5,765 7,464
Notes:
(1) Non-cash expenses arising from shares granted to selected employees. See note 37 to the Accountant’s
Report in Appendix I to this prospectus for details.
(2) Net finance costs represent finance costs less bank interest income.
(3) The amount of depreciation and amortization presented represents the depreciation of property, plant
and equipment, the amortization of other intangible assets, and the depreciation of right-of-use assets.
SUMMARY
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Revenue
During the Track Record Period, we generated a majority of revenue from the sales of
passenger vehicles and automotive parts and components. In addition, we also manufacture and
sell KD kits, the revenue of which are included in the sales of passenger vehicles. The
following table sets forth our revenue breakdown by product type for the years/periods
indicated:
For the year ended December 31,
For the three months ended
March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(unaudited)
Passenger vehicles (1)
ICE vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,258 75.9 143,316 87.8 187,891 69.6 45,951 83.7 42,974 63.0
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,253 13.2 7,912 4.9 58,931 21.9 4,596 8.4 18,665 27.3
– PHEVs and REEVs /H1118/H1118/H11181,301 1.4 2,727 1.7 35,314 13.1 2,584 4.7 10,709 15.6
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,952 11.8 5,185 3.2 23,617 8.8 2,012 3.7 7,956 11.7
Automotive parts and
components (2) /H1118/H1118/H1118/H1118/H1118/H1118/H11188,675 9.4 8,904 5.5 15,864 5.9 2,936 5.3 5,743 8.4
Others (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,432 1.5 3,073 1.8 7,211 2.6 1,427 2.6 841 1.3
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 100.0 163,205 100.0 269,897 100.0 54,910 100.0 68,223 100.0
Notes:
(1) Including sales of (1) passenger vehicles in the domestic and overseas markets; and (2) KD kits to be
assembled and sold as passenger vehicles. See “Business — Sales and Marketing — Other Sales Channels” and
“Business — Manufacturing — Overseas Production Facilities” in this prospectus.
(2) Mainly including sales of (1) engines, transmissions and other automotive parts and components; and (2) spare
parts and components in connection with our after-sales services.
(3) Including automotive business-related procurement, production, technology development and other supporting
services.
Our revenue increased from RMB92,618 million in 2022 to RMB163,205 million in 2023,
and further to RMB269,897 million in 2024, primarily due to (i) the sales increase of our ICE
vehicles driven by (a) the introduction of new ICE models and versions as well as our
continuous marketing efforts in both domestic and overseas markets; and (b) our expansion in
overseas markets; and (ii) the sales increase of our NEVs as a result of our efforts to optimize
our portfolio of NEVs. Our revenue increased from RMB54,910 million for the three months
ended March 31, 2024 to RMB68,223 million for the three months ended March 31, 2025,
primarily due to the sales volume growth of our NEVs.
SUMMARY
–1 6–


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Cost of Sales
Our cost of sales mainly comprises cost of materials for manufacturing of our products,
manufacturing costs and labor costs, which in aggregate accounted for 92.6%, 86.9%, 87.3%,
86.5% and 88.0% of our cost of sales, respectively, in 2022, 2023 and 2024 and the three
months ended March 31, 2024 and 2025. During the same periods, the cost of materials
constituted the most part of our cost of sales, accounting for 86.6%, 81.9%, 82.4%, 81.8% and
82.9% of our cost of sales, respectively.
Gross Profit and Gross Margin
The following table sets forth a breakdown of our gross profit and gross margin by
products for the years/period indicated:
For the year ended December 31,
For the three months ended
March 31,
2022 2023 2024 2024 2025
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(unaudited)
Passenger vehicles /H1118/H111810,751 13.0 24,111 15.9 32,572 13.2 7,482 14.8 7,246 11.8
Automotive parts and
components /H1118/H1118/H1118/H1118/H11181,678 19.3 1,702 19.1 3,243 20.4 586 20.0 1,175 20.5
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118376 26.3 277 9.0 493 6.8 95 6.7 36 4.3
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,805 13.8 26,090 16.0 36,308 13.5 8,163 14.9 8,457 12.4
For the years ended December 31, 2022, 2023 and 2024 and the three months ended
March 31, 2024 and 2025, our gross profit amounted to RMB12,805 million, RMB26,090
million, RMB36,308 million, RMB8,163 million and RMB8,457 million, respectively, and our
overall gross margin was 13.8%, 16.0%, 13.5%, 14.9% and 12.4%, respectively. The majority
of our gross profit was from sale of our passenger vehicles, which represented 84.0%, 92.4%,
89.7%, 91.7% and 85.7% of our total gross profit for the same periods, respectively.
The increases in our gross profit throughout the Track Record Period were primarily due
to the sales increase of our passenger vehicles. Our gross margin increased from 13.8% in 2022
to 16.0% in 2023, primarily as a result of the sales increase in overseas markets with higher
average selling prices and product mix optimization of our passenger vehicles. Our gross
margin then decreased to 13.5% in 2024, primarily as a result of (i) intensifying competition
in overseas markets in 2024 and the increase of recycling fees imposed on imported vehicles
in Russia since the fourth quarter of 2024; and (ii) increased sales in NEVs in our product mix
in the same year. Impacted by the same factors as stated in full year 2024, our gross margin
decreased from 14.9% for the three months ended March 31, 2024 to 12.4% for the three
months ended March 31, 2025.
SUMMARY
–1 7–


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Profit for the Y ear/Period
We achieved a profit of RMB5,806 million, RMB10,444 million, RMB14,334 million,
RMB2,476 million and RMB4,726 million, with a net profit margin of 6.3%, 6.4%, 5.3%, 4.5%
and 6.9%, for the years ended December 31, 2022, 2023 and 2024 and the three months ended
March 31, 2024 and 2025, respectively. The increase in our profit for the year in 2023 and 2024
was primarily attributable to the increase in our sales from passenger vehicles and product
portfolio optimization of passenger vehicles. Our adjusted profit (non-HKFRS Measure)
increased throughout the Track Record Period for the similar reasons, which increased from
RMB4,108 million for the three months ended March 31, 2024 to RMB4,857 million for the
three months ended March 31, 2025, when excluding the equity-settled share-based
compensation expenses.
Summary of Consolidated Statements of Financial Position
The following table sets forth a summary of our consolidated statements of financial
position as of the dates indicated:
As of December 31,
As of
March 31,
2022 2023 2024 2025
(RMB million)
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,341 49,718 51,595 52,871
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111887,619 129,716 162,401 157,607
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,379 147,104 165,802 160,395
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,166 17,749 22,270 24,288
Net current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,760 17,388 3,401 2,788
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,415 14,581 25,924 25,795
Net current liabilities
Our net current liabilities increased from RMB4,760 million as of December 31, 2022, to
RMB17,388 million as of December 31, 2023. This increase was primarily due to a substantial
increase in our current liabilities during the period, offset by a moderate increase in our current
asset. The increase of our current liabilities was primarily attributable to (i) an increase in trade
and bills payables of RMB22,700 million as a result of our business growth; (ii) an increase
in interest-bearing bank loans and other borrowings of RMB12,918 million; and (iii) an
increase in contract liabilities of RMB10,559 million. Meanwhile, our current assets increased
as a result of (i) an increase in inventories of RMB18,162 million; and (ii) an increase in cash
and cash equivalents of RMB22,362 million, partially offset by prepayment for the acquisition
of JETOUR business.
SUMMARY
–1 8–


--- page 29 ---
Our net current liabilities position improved from RMB17,388 million as of
December 31, 2023, to RMB3,401 million as of December 31, 2024. This was primarily due
to a substantial increase in our current assets during the period, offset by a moderate increase
in our current liabilities. The increase in current assets primarily includes (i) an increase in
trade receivables of RMB6,155 million; (ii) an increase in financial assets at FVTPL of
RMB7,618 million primarily as a result of our efforts to increase returns of our idle cash and
bank balances; (iii) an increase in financial assets at fair value through other comprehensive
income of RMB3,114 million due to the increase in bank acceptance bills as more payments
by customers were settled by such bank acceptance bills issued by reputable banks with higher
credit ratings; and (iv) an increase in cash and cash equivalents of RMB27,645 million.
Meanwhile, our current liabilities increased, but partially offset by (i) a decrease in
interest-bearing bank loans of RMB11,656 million; and (ii) a decrease in contract liabilities of
RMB3,270 million, as we (i) enabled multiple payment methods for some of our customers as
our business expanded; and (ii) expedited our product delivery progress.
Our net current liabilities position further improved from RMB3,401 million as of
December 31, 2024 to RMB2,788 million as of March 31, 2025. Such improvement was
primarily due to a decrease in our current liabilities during the period, slightly outpacing the
decrease in our current assets. The decrease in current liabilities primarily includes (i) a
decrease in interest-bearing bank loans and other borrowings of RMB3,554 million; (ii) a
decrease in other payables and accruals of RMB2,267 million; and (iii) a decrease in contract
liabilities of RMB2,231 million. The decrease in current assets primarily includes a decrease
in our cash and cash equivalents of RMB25,195 million, partially offset by (i) an increase in
financial assets at FVTPL of RMB9,699 million primarily as a result of our efforts to increase
returns of our idle cash and bank balances; (ii) an increase in our time deposits of RMB8,885
million; and (iii) an increase in trade receivables of RMB3,847 million.
Net assets
Our net assets increased from RMB8,415 million as of December 31, 2022 to RMB14,581
million as of December 31, 2023, primarily due to (i) our profit for the year of RMB10,444
million, partially offset by (ii) our dividend declared and paid of RMB1,094 million; and (iii)
a decrease in total equity of RMB4,050 million as a result of our acquisition of subsidiaries
which was accounted for as business combination under control. Our net assets further
increased to RMB25,924 million as of December 31, 2024, primarily due to (i) our profit for
the year of RMB14,334 million; (ii) the cost of share-based compensation of RMB2,016
million; and (iii) contribution from the shareholders of RMB1,907 million, partially offset by
a decrease in total equity of RMB7,320 million as a result of acquisition of JETOUR business
which was accounted for as business combination under common control. Our net assets as of
March 31, 2025 remained relatively stable at RMB25,795 million.
SUMMARY
–1 9–


--- page 30 ---
Summary of Consolidated Statements of Cash Flows
The following table sets forth selected cash flow data from our consolidated statements
of cash flows for the years/period indicated:
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Net cash flows from
operating activities /H1118/H1118/H1118/H1118/H11189,842 24,925 44,887 16,036 4,538
Net cash flows (used in)/
from investing activities /H1118 (4,949) 4,023 (3,177) (11,174) (22,095)
Net cash flows (used in)/
from financing activities /H1118 (825) (6,458) (13,783) (1,796) (7,838)
Net increase/(decrease) in
cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,068 22,490 27,927 3,066 (25,395)
Cash and cash
equivalents at
beginning of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,476 12,686 35,048 35,048 62,693
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118142 (128) (282) (138) 200
Cash and cash
equivalents at end of
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,976 37,498
SUMMARY
–2 0–


--- page 31 ---
KEY FINANCIAL RATIOS
The following table set forth our key financial ratios as of the date or for the year/period
indicated:
As of/for the year ended December 31,
As of/for the
three months
ended
March 31,
2022 2023 2024 2025
Return on equity (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111885.1% 90.8% 70.8% 73.1%
Return on total assets (2) /H1118/H1118/H1118/H1118/H11185.3% 6.9% 7.3% 8.9%
Current ratio (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.95 0.88 0.98 0.98
Quick ratio (4) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.81 0.67 0.76 0.74
Interest-bearing debt ratio (5) /H1118 27.9% 21.8% 11.9% 11.4%
Turnover growth (6) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 76.2% 65.4% 24.2%
Gearing ratio (7) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893.1% 91.9% 87.9% 87.7%
Notes:
(1) Return on equity is calculated based on profit for the year/period of our Company divided by the
arithmetic mean of the opening and closing balances of total equity and multiplied by 100%.
(2) Return on total assets is calculated based on profit for the year/period of our Company divided by the
arithmetic mean of the opening and closing balances of total assets and multiplied by 100%.
(3) Current ratio is calculated based on total current assets divided by total current liabilities as of the date
indicated.
(4) Quick ratio is calculated based on total current assets less inventories divided by total current liabilities
as of the date indicated.
(5) The interest-bearing debt ratio is calculated as interest-bearing debt (including interest-bearing bank
loans and other borrowings, lease liabilities and bonds payables) divided by total assets as of the date
indicated.
(6) Turnover growth represents the percentage change of our revenue in a year/period when compared with
that in the previous corresponding year/period during the Track Record Period.
(7) Gearing ratio is calculated based on the total liabilities as at the respective dates divided by total assets
as at the respective dates.
SUMMARY
–2 1–


--- page 32 ---
OFFERING STATISTICS
All statistics in the following table are based on the assumptions that (i) the Global
Offering has been completed and 297,397,000 H Shares are issued and sold in the Global
Offering and (ii) the Over-allotment Option is not exercised.
Based on an
Offer Price of
HK$27.75 per
Offer Share
Based on an
Offer Price of
HK$30.75 per
Offer Share
Market capitalization of our Shares (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HK$160,041
million
HK$177,342
million
Market capitalization of our H Shares (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HK$64,197
million
HK$71,137
million
Unaudited pro forma adjusted net tangible assets
per share /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118HK$5.99 HK$6.15
Notes:
(1) The calculation of market capitalization is based on 5,767,228,633 Shares expected to be in issue
immediately upon completion of the Global Offering, assuming the Over-allotment Option is not
exercised.
(2) The calculation of market capitalization of our H Shares is based on 2,313,396,074 H Shares expected
to be in issue immediately upon completion of the Global Offering and conversion of Domestic Unlisted
Shares into H Shares, without taking into account any allotment and issuance of H Shares upon exercise
of the Over-allotment Option.
WORKING CAPITAL SUFFICIENCY
Our Directors are of the view that, taking into account the financial resources available
to us, including cash and cash equivalents, our available banking facilities, cash flows from
operating activities and net proceeds from the Global Offering, we have sufficient working
capital for at least 12 months from the date of this prospectus.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commission and other fees
incurred in connection with the Global Offering. Assuming the Over-allotment Option is not
exercised and based on the Offer Price of HK$29.25 per Offer Share (being the mid-point of
the indicative Offer Price range), listing expenses to be borne by us are estimated to be
approximately RMB235 million (HK$258 million), comprising: (i) underwriting fees of
RMB139 million (HK$153 million); and (ii) non-underwriting-related expenses of RMB96
million (HK$105 million), which are further categorized into: (a) fees and expenses of legal
advisers and accountants of RMB62 million (HK$68 million); and (b) other fees and expenses
of RMB34 million (HK$37 million), approximately RMB85 million (HK$93 million) of which
was charged or is expected to be charged to our consolidated statements of profit or loss, and
SUMMARY
–2 2–


--- page 33 ---
approximately RMB150 million (HK$165 million) of which is expected to be deducted from
equity upon the completion of the Global Offering. The listing expenses are expected to
represent approximately 3.0% of the gross proceeds of the Global Offering, assuming an Offer
Price of HK$29.25 per Offer Share (being the mid-point of the indicative Offer Price range)
and that the Over-allotment Option is not exercised. The listing expenses above are the latest
practicable estimate for reference only, and the actual amount may differ from this estimate.
FUTURE PLANS AND USE OF PROCEEDS
Assuming an Offer Price of HK$29.25 per H Share (being the mid-point of the Offer Price
Range of between HK$27.75 and HK$30.75 per H Share) and the Over-allotment Option is not
exercised, we estimate that we will receive net proceeds of approximately HK$8,441.2 million
from the Global Offering after deducting the underwriting commissions and other estimated
expenses paid and payable by us in connection with the Global Offering. In line with our
strategies, we intend to use our proceeds from the Global Offering for the purposes and in the
amounts set forth below:
 Approximately 35.0% of the net proceeds, or HK$2,954.4 million, is expected to be
used for the R&D of passenger vehicles of different models and versions to further
expand our product portfolio.
 Approximately 25.0% of the net proceeds, or HK$2,110.3 million, is expected to be
used for the R&D in the next-generation vehicle and advanced technologies to
enhance our core technological competencies.
 Approximately 20.0% of the net proceeds, or HK$1,688.2 million, is expected to be
used to expand overseas markets and execute our globalization strategy.
 Approximately 10.0% of the net proceeds, or HK$844.1 million, is expected to be
used to upgrade our production facilities in Wuhu, Anhui province.
 Approximately 10.0% of the net proceeds, or HK$844.1 million, is expected to be
used for the working capital and general corporate purposes.
See “Future Plans and Use of Proceeds” in this prospectus.
DIVIDENDS
For the years ended December 31, 2022, 2023 and 2024 and the three months ended
March 31, 2025, dividends of nil, RMB1,094 million, nil and RMB3,993 million were declared
and paid, respectively. Our Board retains the discretion to distribute dividends in the future,
considering our operational outcomes, financial stability, cash necessities, and other pertinent
factors at the time. As of the date of this prospectus, we do not have any formal dividend policy.
The declaration, payment, and dividend amounts were subject to our existing articles of
association and will adhere to our Articles of Association which will take effect upon Listing.
SUMMARY
–2 3–


--- page 34 ---
Moreover, our Directors hold the authority to issue interim dividends on the currently held
shares of our Company and sanction their payment from legally accessible funds. It should be
noted that any future dividend declarations may vary from past patterns and will be determined
by our Board.
IMPACT OF U.S. AND EU TARIFF REGULATIONS AND U.S. RESTRICTIONS ON
SEMICONDUCTOR EXPORTS
The current tension in international trade and rising political tension may affect our
business operations and results of operation as this could potentially affect the demand of our
customers for passenger vehicles. On May 12, 2025, the PRC government and U.S. government
issued a joint announcement acknowledging that both parties will take actions to build a
sustainable and long-term trade relationship. In particular, the U.S. government took actions to
reduce the IEEPA tariff rate to 30% on imports from the PRC on a temporary basis for an initial
period of 90 days from May 14, 2025, which was extended for another 90 days on August 12,
2025. Nevertheless, other potential duties could be imposed depending on the changing
international trade environment. We did not generate any revenue from sales of passenger
vehicles to the U.S in each period during the Track Record Period. In addition, on October 29,
2024, the EU members voted to adopt provisional countervailing duties of up to 35.3% on
imports of Chinese-made EVs which entered into effect on October 30, 2024. The specific duty
rate is dependent of the Chinese EV manufacturers. The revenue from our exports of passenger
vehicles to EU accounted for less than 3.8% of our total revenue in each period during the
Track Record Period. Our Directors do not expect that the tariffs imposed by the U.S. and EU
regarding Chinese imports or NEVs would result in a material adverse impact on the business
operations and financial performance of our Group given that (i) we did not export passenger
vehicles directly to the U.S. in each period during the Track Record Period and as of the Latest
Practicable Date, we did not have specific plans to export passenger vehicles directly to the
U.S. and (ii) the sales of our passenger vehicles to the EU markets is relative small compared
to other overseas markets in each period during the Track Record Period and we plan to further
advance localized manufacturing and assembly and expand our overseas production network in
EU markets, thereby reducing tariff risks. On October 7, 2022, the U.S. Department of
Commerce, the U.S. Bureau of Industry and Security published rules that introduce new
restrictions related to semiconductors, semiconductor manufacturing, supercomputers, and
advanced computing items and end uses in Mainland China, Hong Kong or Macau. We
purchased automotive chips that can generally be exported without a license from the U.S. for
use in our passenger vehicles. As advised by our International Sanctions Legal Advisers, such
purchases are not currently affected by U.S. export control laws in any material respect. Based
on the conclusion reached by the International Sanctions Legal Advisers, the Directors are of
the view that the continued tightening of U.S. restrictions on semiconductor exports would not
have a material adverse impact on the business operations and financial performance of our
Group. See “Business – Impact of U.S. and EU Tariff Regulations and U.S. Restrictions on
Semiconductor Exports” for details.
SUMMARY
–2 4–


--- page 35 ---
BUSINESS ACTIVITIES IN REGIONS SUBJECT TO INTERNATIONAL SANCTIONS
During the Track Record Period, we had sales of passenger vehicles and auto parts to
customers located in the Relevant Regions which are subject to international sanctions. During
the Track Record Period, we primarily sold our passenger vehicles in Russia through a network
of local dealers. Our subsidiaries in Russia are responsible for sales, marketing and managing
our local dealerships. We primarily sold passengers vehicles under the brands and product
series of CHERY , JETOUR, EXEED and OMODA and JAECOO in Russia. In 2025, we begun
to downsize our Russian operations and in April, we entered into agreements to dispose a
portion of our local assets and distribution channels.
As advised by our International Sanctions Legal Advisers, (i) our activities in the
Relevant Regions did not represent a Primary Sanctioned Activity or a violation of the U.S.
primary sanctions and the secondary sanctions risk is relatively limited; and (ii) our business
dealings in the Relevant Regions did not implicate restrictive measures adopted by the UN, the
EU, the U.K., and Australia. See “Business – Business Activities in Regions Subject to
International Sanctions” for details.
RECENT DEVELOPMENTS AND NO MATERIAL ADVERSE CHANGE
Following March 31, 2025, we continued to scale our business steadily. As of July 31,
2025, our dealership network encompassed 3,639 dealership outlets in China and 3,169
overseas dealership outlets, compared to 3,663 dealership outlets in China and 2,958 overseas
dealership outlets as of March 31, 2025. In January 2025, we launched a new product series,
ZongHeng, under JETOUR brand and launched three new models, namely ZongHeng G700,
ZongHeng F700 and ZongHeng G900 under this new product series in April 2025. In July
2025, we further launched a new model, namely A9L under Fulwin product series.
Our Directors confirm that, up to the Latest Practicable Date, there had been no material
adverse change in our business, financial condition and results of operations since March 31,
2025, which is the end date of the years reported on in the Accountants’ Report as set out in
Appendix I to this prospectus, and there is no event since March 31, 2025 which would
materially affect the information in the Accountants’ Report as set out in Appendix I to this
prospectus.
SUMMARY
–2 5–


--- page 36 ---
In this prospectus, 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 prospectus.
“Accountants’ Report” the accountants’ report of our Group for the Track Record
Period as set out in Appendix I to this prospectus
“Acteco” Wuhu Acteco Powertrain Co., Ltd.* (इдਗɢ
ʮ̡), a limited liability company established
under the laws of the PRC in 2005, which was a
wholly-owned subsidiary of our Company as at the Latest
Practicable Date
“affiliate(s)” with respect to any specified person, any other person,
directly or indirectly, controlling or controlled by or
under direct or indirect common control with such
specified person
“AFRC” the Accounting and Financial Reporting Council
“Anhui SASAC” the State-owned Assets Supervision and Administration
Commission of Anhui Provincial People’s Government
“Articles” or “Articles of
Association”
the articles of association of our Company, conditionally
adopted on February 15, 2025 with effect upon the
Listing Date (as amended from time to time), a summary
of which is set out in Appendix V to this prospectus
“associate(s)” has the meaning ascribed thereto under the Listing Rules
“Board” or “Board of Directors” the board of directors of our Company
“Business Day” any day (other than a Saturday, Sunday or public holiday
in Hong Kong) on which banks in Hong Kong are
generally open for normal banking business
“Capital Market Intermediaries”
or “CMIs”
has the meaning ascribed thereto under the Listing Rules
and, unless the context requires otherwise, refers to the
capital market intermediaries named in “Directors,
Supervisors and Parties Involved in the Global Offering”
in this prospectus
DEFINITIONS
–2 6–


--- page 37 ---
“CCASS” the Central Clearing and Settlement System established
and operated by HKSCC
“Chairman Yin” Mr. Yin Tongyue ( ʙΝᚔ), our chairman of the Board,
executive Director and president
“Chery Auto Parts Procurement” Wuhu Chery Auto Parts Procurement Co., Ltd.* ( ጾಳփ
ʮ̡), a limited liability company
established under the laws of the PRC in 2005, which was
a wholly-owned subsidiary of our Company as at the
Latest Practicable Date
“Chery New Energy” Chery New Energy Automobile Co., Ltd.* ( փ๿อঐ๕ӛ
ʮ̡), a joint stock company established
under the laws of the PRC with limited liability in 2010,
which was a non-wholly-owned subsidiary of our
Company as at the Latest Practicable Date
“Chery Holding” Chery Holding Group Co., Ltd. (ʮ̡),
a limited liability company established under the laws of
the PRC in 2010, which was the controlling Shareholder
before the Equity Transfer and no longer held any of our
Shares as at the Latest Practicable Date
“Chery Russia” JSC Chery Automobile RUS, a limited liability company
established under the laws of Russia in 2005, which was
a wholly-owned subsidiary of our Company as at the
Latest Practicable Date
“Chery Sales” Anhui Chery Automobile Sales Co., Ltd.* ( τᏏփ๿ӛԓ
ʮ̡), a limited liability company established
under the laws of the PRC in 2000, which was a
wholly-owned subsidiary of our Company as at the Latest
Practicable Date
“Chery Technology” Wuhu Chery Technology Co., Ltd.* (ࠢ
ʮ̡), a limited liability company established under the
laws of the PRC in 2001, which was a wholly-owned
subsidiary of our Company as at the Latest Practicable
Date
DEFINITIONS
–2 7–


--- page 38 ---
“China” or “PRC” the People’s Republic of China, but for the purpose of
this prospectus and for geographical reference only and
except where the context requires, references in this
prospectus to “China” and the “PRC” do not apply to
Hong Kong, Macau and Taiwan
“close associate(s)” has the meaning ascribed thereto under the Listing Rules
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Companies (Winding Up and
Miscellaneous Provisions)
Ordinance” or “Companies
(WUMP) Ordinance”
the Companies (Winding Up and Miscellaneous
Provisions) Ordinance (Chapter 32 of the Laws of Hong
Kong), as amended, supplemented or otherwise modified
from time to time
“Company” or “our Company” Chery Automobile Co., Ltd. (ʮ̡), a
limited liability company established under the laws of
the PRC in 1997 and converted into a joint stock limited
liability company in the PRC on March 24, 2008
“Comprehensively Sanctioned
Country(ies)”
Cuba, Iran, North Korea, Syria, the Crimea, Kherson and
Zaporizhzhia regions and the so- called Luhansk People’s
Republic and so-called Donetsk People’s Republic
regions
“connected person(s)” has the meaning ascribed thereto under the Listing Rules
“connected transaction(s)” has the meaning ascribed thereto under the Listing Rules
“controlling shareholder” has the meaning ascribed thereto under the Listing Rules
“core connected person(s)” has the meaning ascribed thereto under the Listing Rules
“CSRC” China Securities Regulatory Commission ( ʕ਷ᗇՎ္ຖ
ึ)
“Director(s)” the director(s) of our Company
“Domestic Unlisted Shares” ordinary share(s) in the share capital of our Company
with a nominal value of RMB1.00 each, which is/are
subscribed for and paid up in Renminbi by domestic
investors and not listed or traded on any stock exchange
DEFINITIONS
–2 8–


--- page 39 ---
“EAR” the Export Administration Regulations administered by
the Bureau of Industry and Security
“Equity Transfer” the transfer of our Shares by Chery Holding to the
shareholders of Chery Holding in January 2025, details of
which are set out in the section headed “History,
Development and Corporate Structure — Corporate
Developments” in this prospectus
“EU” the European Union
“Extreme Conditions” extreme conditions as announced by the government of
Hong Kong in the case where a super typhoon or other
natural disaster of a substantial scale serious affects the
working public’s ability to resume work or brings safety
concern for a prolonged period
“FINI” “Fast Interface for New Issuance”, an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and
processing of specified information on subscription in
and settlement for all new listings
“Foreign Unlisted Shares” ordinary share(s) in the share capital of our Company
with a nominal value of RMB1.00 each which is/are
subscribed for and paid up in currency other than RMB
by foreign investors and not listed on any stock exchange
“Frost & Sullivan” Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., an
independent global market research and consulting
company
“General Rules of HKSCC” the General Rules of HKSCC as may be amended or
modified from time to time and where the context so
permits, shall include the HKSCC Operational
Procedures
“Generation Z” individuals born in the mid-1990s and up to mid-2000s
“Global Offering” the Hong Kong Public Offering and the International
Offering
DEFINITIONS
–2 9–


--- page 40 ---
“Group”, “our Group”, “we”,
“us” or “our”
our Company and its subsidiaries from time to time, or,
where the context so requires in respect of the period
before our Company became the holding company of our
present subsidiaries, the entities or the predecessors of
the present subsidiaries (as the case may be) which
carried on the business of the present Group at the
relevant time
“Guide for New Listing
Applicants”
the Guide for New Listing Applicants issued by the Stock
Exchange, as amended, supplemented or otherwise
modified from time to time
“H Share(s)” ordinary share(s) in the share capital of our Company
with a nominal value of RMB1.00 each, which will be
subscribed for and traded in HK dollars and listed on the
Stock Exchange
“H Share Registrar” Computershare Hong Kong Investor Services Limited
“Hengrui” Wuhu Hengrui Equity Investment Partnership (Limited
Partnership)* (ᛆҳ༟ΥྫΆุ(Υྫ)), a
limited partnership established under the laws of the PRC
in 2024, which is one of our employee stock ownership
platforms
“HK$”, “Hong Kong dollars”
or “HKD”
Hong Kong dollars, the lawful currency of Hong Kong
“HKFRS Accounting Standards” include all Hong Kong Financial Reporting Standards,
Hong Kong Accounting Standards and interpretations
issued by the Hong Kong Institute of Certified Public
Accountants
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly-owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC EIPO” the electronic initial public offering services offered by
HKSCC to HKSCC Participants
“HKSCC Nominees” HKSCC Nominees Limited, a wholly-owned subsidiary
of the HKSCC
DEFINITIONS
–3 0–


--- page 41 ---
“HKSCC Operational
Procedures”
the operational procedures of HKSCC, containing the
practices, procedures and administrative or other
requirements relating to HKSCC’s services and the
operations and functions of CCASS, FINI or any other
platform, facility or system established, operated and/or
otherwise provided by or through HKSCC, as from time
to time in force
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“Hong Kong” or “HK” the Hong Kong Special Administrative Region of the
People’s Republic of China
“Hong Kong Listing Rules”
or “Listing Rules”
the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited (as amended
from time to time)
“Hong Kong Offer Shares” the 29,739,700 H Shares initially being offered for
subscription in the Hong Kong Public Offering (subject
to reallocation as described in the section headed
“Structure of the Global Offering” in this prospectus)
“Hong Kong Public Offering” the offer for subscription of the Hong Kong Offer Shares
to the public in Hong Kong, on the terms and subject to
the conditions described in this prospectus, as further
described in the section headed “Structure of the Global
Offering — Hong Kong Public Offering” in this
prospectus
“Hong Kong Stock Exchange”
or “Stock Exchange”
The Stock Exchange of Hong Kong Limited
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering as
listed in the section headed “Underwriting — Hong Kong
Underwriters” in this prospectus
DEFINITIONS
–3 1–


--- page 42 ---
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated September 16, 2025
relating to the Hong Kong Public Offering and entered
into by, among others, our Company, the Joint Sponsors,
the Sponsor-Overall Coordinators, the Overall
Coordinators and the Hong Kong Underwriters, as further
described in the section headed “Underwriting —
Underwriting Arrangements — Hong Kong Public
Offering” in this prospectus
“iCAR Technology” iCAR Ecological Technology Co., Ltd.* (Ҧ
ʮ̡), a limited liability company established under
the laws of the PRC in 2015, which was a wholly-owned
subsidiary of Chery New Energy as at the Latest
Practicable Date
“IEEPA” International Emergency Economic Powers Act
“Independent Third Party(ies)” any entity or person who is not a connected person of our
Company within the meaning ascribed thereto under the
Listing Rules
“International Offer Shares” the 267,657,300 H Shares being initially offered for
subscription and purchased at the Offer Price under the
International Offering together, where relevant, with any
additional H Shares that may be sold and transferred
pursuant to any exercise of the Over-allotment Option,
subject to reallocation as described under the section
headed “Structure of the Global Offering” in this
prospectus
“International Offering” the offer of the International Offer Shares at the Offer
Price outside the United States in offshore transactions in
accordance with Regulation S under the U.S. Securities
Act or any other available exemption from registration
under the U.S. Securities Act, as further described in the
section headed “Structure of the Global Offering” in this
prospectus
DEFINITIONS
–3 2–


--- page 43 ---
“International Sanctions” all applicable laws and regulation to economic sanctions,
export controls, trade embargoes and wider prohibitions
and restrictions on international trade and investment
related activities, including those adopted administered
and enforced by the U.S. Government, the EU and its
member states, the UK, UN or Government of Australia
and other competent government authorities
“International Sanctions Legal
Advisers”
Hogan Lovells, our legal advisers as to International
Sanctions laws in connection with the Listing
“International Underwriters” the underwriters of the International Offering
“International Underwriting
Agreement”
the international underwriting agreement relating to the
International Offering and expected to be entered into by,
among others, our Company, the Overall Coordinators
and the International Underwriters on or around
September 23, 2025, as further described in the section
headed “Underwriting — Underwriting Arrangements —
International Offering” in this prospectus
“Jetour Sales” Wuhu Jetour Automobile Sales Co., Ltd.* ( ጾಳઠ௄ӛԓ
ʮ̡), a limited liability company established
under the laws of the PRC in 2017, which was a
wholly-owned subsidiary of our Company as at the Latest
Practicable Date
“Joint Bookrunners” the joint bookrunners as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering” in this prospectus
“Joint Global Coordinators” the joint global coordinators as named in the section
headed “Directors, Supervisors and Parties Involved in
the Global Offering” in this prospectus
“Joint Lead Managers” the joint lead managers as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering” in this prospectus
“Joint Sponsors” the joint sponsors of the listing of the H Shares on the
Hong Kong Stock Exchange as named in the section
headed “Directors, Supervisors and Parties Involved in
the Global Offering” in this prospectus
DEFINITIONS
–3 3–


--- page 44 ---
“Latest Practicable Date” September 10, 2025, being the latest practicable date for
the purpose of ascertaining certain information contained
in this prospectus prior to its publication
“Listing” the listing of the H Shares on the Main Board of the Hong
Kong Stock Exchange
“Listing Committee” the listing committee of the Hong Kong Stock Exchange
“Listing Date” the date, expected to be on or around Thursday,
September 25, 2025, from which the H Shares are listed
and dealings in the H Shares are permitted to take place
on the Hong Kong Stock Exchange
“Luxshare” Luxshare Limited and/or Luxshare Investment (HK)
Limited (as the case may be), due to the family estate
distribution, the vehicle to hold our Shares has been
changed from Luxshare Limited (a private company
limited by shares established in Hong Kong owned as to
50% by Ms. Wang Laichun (݆and 50% by her
brother) to Luxshare Investment (HK) Limited (a private
company limited by shares established in Hong Kong
ultimately owned as to 50% by Ms. Wang Laichun’s sister
and 50% by her another brother) in January 2025
“Luxshare Precision Industry” Luxshare Precision Industry Co., Ltd. (ٰ
ʮ̡), a joint stock company incorporated in the
PRC with limited liability in 2004, which is an associate
of Ms. Wang Laichun (݆and therefore a connected
person of our Company, whose A shares are listed on the
Shenzhen Stock Exchange under the stock code of
002475
“Macau” Macau Special Administrative Region of the PRC
“Main Board” the stock market (excluding the option market) operated
by the Hong Kong Stock Exchange which is independent
from and operated in parallel with the GEM of the Hong
Kong Stock Exchange
“Management and Employee
Stock Ownership Platform(s)”
Ruichuang, Hengrui and/or Zhenrui (as the case may be)
DEFINITIONS
–3 4–


--- page 45 ---
“MIIT” Ministry of Industry and Information Technology of the
PRC (ʷ௅)
“MOF” Ministry of Finance of the PRC (௅)
“MOFCOM” Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷ਠਕ
௅)
“NDRC” the National Development and Reform Commission of
the PRC (ึ)
“NPC” the National People’s Congress of the PRC ( ʕശɛ͏΍
ɽึ)
“OFAC” the U.S. Department of Treasury’s Office of Foreign
Assets Control
“Offer Price” the final offer price per Offer Share (exclusive of
brokerage of 1.0%, SFC transaction levy of 0.0027%,
AFRC transaction levy of 0.00015% and Hong Kong
Stock Exchange trading fee of 0.00565%) at which the
Offer Shares are to be subscribed for and issued pursuant
to the Global Offering, to be determined as described in
the section headed “Structure of the Global Offering” in
this prospectus
“Offer Shares” the Hong Kong Offer Shares and the International Offer
Shares, where relevant, with any additional H Shares to
be issued by our Company pursuant to the exercise of the
Over-allotment Option
“OIR Legal Adviser” Pillsbury Winthrop Shaw Pittman LLP , the legal advisers
of our Company as to the U.S. Outbound Investment Rule
“Over-allotment Option” the option expected to be granted by us to the
International Underwriters exercisable by the Overall
Coordinators (for themselves and on behalf of the
International Underwriters) under the International
Underwriting Agreement, to require our Company to allot
and issue up to an aggregate of 44,609,500 additional H
Shares at the Offer Price, to cover over-allocations in the
International Offering, if any, further details of which are
described in the section headed “Structure of the Global
Offering — Over-allotment Option” in this prospectus
DEFINITIONS
–3 5–


--- page 46 ---
“Overall Coordinators” has the meaning ascribed thereto under the Listing Rules
and, unless the context requires otherwise, refers to the
overall coordinators as named in the section headed
“Directors, Supervisors and Parties Involved in the
Global Offering” in this prospectus
“PBOC” the People’s Bank of China ( ʕ਷ɛ͏ვБ)
“PRC Legal Adviser” Jingtian & Gongcheng, the legal advisers of our
Company as to the PRC laws
“Pre-IPO Investment(s)” the Pre-IPO investments in our Company undertaken by
the Pre-IPO Investors, details of which are set out in the
section headed “History, Development and Corporate
Structure — Pre-IPO Investments” in this prospectus
“Pre-IPO Investor(s)” the existing Shareholder(s) who participated in our Pre-
IPO Investments, details of which are set out in the
section headed “History, Development and Corporate
Structure — Pre-IPO Investments” in this prospectus
“Price Determination Date” the date, expected to be on or before Tuesday, September
23, 2025 on which the Offer Price is to be fixed for the
purposes of the Global Offering
“Primary Sanctioned Activity” any activity in a Comprehensively Sanctioned Country or
(i) with; or (ii) directly or indirectly benefiting or
involving the property or interests in property of, a
Sanctioned Target by an entity incorporated or located in
a Relevant Jurisdiction or which otherwise has a nexus
with such jurisdiction with respect to the relevant
activity, such that it is subject to the relevant sanctions
law and regulation
“R&D” research and development
“Regulation S” Regulation S under the U.S. Securities Act
“Relevant Jurisdiction(s)” the U.S. Government, the EU and its member states, the
UK, UN or Government of Australia
DEFINITIONS
–3 6–


--- page 47 ---
“Relevant Persons” means the Company, together with its investors and
shareholders and persons who might directly or
indirectly, be involved in permitting the listing, trading
clearing and settlement of its shares including the Stock
Exchange and related group companies
“Renminbi” or “RMB” Renminbi, the lawful currency of the PRC
“Ruichuang” Wuhu Ruichuang Investment Co., Ltd.* (ٰ
ʮ̡) (formerly known as Wuhu Ruichuang
Investment Company Limited* (ʮ
̡)), a joint stock company established under the laws of
the PRC with limited liability in 2004, which is the stock
ownership platform mainly for the management of Chery
Holding and our Company
“SAFE” the State Administration of Foreign Exchange of the PRC
(ʕശɛ͏΍ձ਷̮ි၍ଣ҅)
“SAMR” the State Administration for Market Regulation of the
PRC (̹ఙ္ຖ၍ଣᐼ҅)
“Sanctioned Target” any person or entity (i) designated on any list of targeted
persons or entities issued under the sanctions-related law
or regulation of a Relevant Jurisdiction; (ii) that is, or is
owned or controlled by, a government of a
Comprehensively Sanctioned Country; or (iii) that is the
target of sanctions under the law or regulation of a
Relevant Jurisdiction because of a relationship of
ownership, control, or agency with a person or entity
described in (i) or (ii)
“SDN” any entity designated on the list of Specially Designated
Nationals and Blocked Persons
“Securities and Futures
Commission” or “SFC”
the Securities and Futures Commission of Hong Kong
“SFO” the Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
DEFINITIONS
–3 7–


--- page 48 ---
“Share(s)” ordinary share(s) in the share capital of our Company
with a nominal value of RMB1.00 each, comprising
Unlisted Share(s) and H Share(s)
“Shareholder(s)” holder(s) of our Share(s)
“Soueast Motor” Soueast Motor Corporation Ltd. (ی؇(ܔ)ٰ
ʮ̡), a joint stock company established under the
laws of the PRC with limited liability in 1992, which was
a non-wholly-owned subsidiary of our Company as at the
Latest Practicable Date
“Sponsor-Overall Coordinators” the sponsor-overall coordinators as named in the section
headed “Directors, Supervisors and Parties Involved in
the Global Offering” in this prospectus
“STA” the State Taxation Administration of the PRC ( ʕശɛ͏
೼ਕᐼ҅)
“State Council” the State Council of the PRC ( ʕശɛ͏΍ձ਷਷ਕ৫)
“subsidiary(ies)” has the meaning ascribed thereto under the Listing Rules
“substantial shareholder(s)” has the meaning ascribed thereto under the Listing Rules
“Takeovers Code” the Code on Takeovers and Mergers issued by the SFC, as
amended, supplemented or otherwise modified from time
to time
“Track Record Period” the three financial years ended December 31, 2024 and
the three months ended March 31, 2025
“U.S. dollars”, “US$” or “USD” United States dollars, the lawful currency of the United
States
“U.S. Securities Act” the U.S. Securities Act of 1933, as amended,
supplemented or otherwise modified from time to time,
and the rules and regulations promulgated thereunder
“Underwriters” the Hong Kong Underwriters and the International
Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
DEFINITIONS
–3 8–


--- page 49 ---
“UNICEF” United Nations International Children’s Emergency Fund
“United States” or “U.S.” the United States of America, its territories, its
possessions and all areas subject to its jurisdiction
“Unlisted Shares” Domestic Unlisted Shares and Foreign Unlisted Shares
“White Form eIPO ” the application for Hong Kong Offer Shares to be issued
in the applicant’s own name by submitting applications
online through the designated website of White Form
eIPO Service Provider at www.eipo.com.hk
“White Form eIPO Service
Provider”
Computershare Hong Kong Investor Services Limited
“Wuhu Construction Corporation” Wuhu Economic and Technological Development Zone
Construction Investment Co., Ltd.* ( ጾಳ຾᏶Ҧஔක೯
ʮ̡), formerly known as Wuhu
Economic and Technological Development Zone
Construction Corporation* (ணᐼ
ʮ̡), a limited liability company established under the
laws of the PRC in 1994 and one of our promoters
“Wuhu Investment Holding” or
the “Single Largest
Shareholder”
Wuhu Investment Holding Group Co., Ltd.* ( ጾಳ̹ҳ༟
ʮ̡) (formerly known as Wuhu
Investment Holding Co., Ltd.* (ʮ
̡)), a limited liability company established under the
laws of the PRC in 1998, which is the single largest
Shareholder
“Wuhu Finance Bureau” Wuhu Municipal Finance Bureau* (҅)
“Wuhu SASAC” the State-owned Assets Supervision and Administration
Commission of Wuhu Municipal People’s Government
“Zhenrui” Wuhu Zhenrui Equity Investment Partnership (Limited
Partnership)* (ᛆҳ༟ΥྫΆุ(Υྫ)), a
limited partnership established under the laws of the PRC
in 2024, which is one of our employee stock ownership
platforms
“%” per cent
DEFINITIONS
–3 9–


--- page 50 ---
For ease of reference, the names of the PRC established companies or entities, laws or
regulations have been included in this prospectus in both the Chinese and English languages
and in the event of any inconsistency, the Chinese versions shall prevail.
Certain amounts and percentage figures included in this prospectus have been subject to
rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures preceding them. Any discrepancies in any table or chart between the
total shown and the sum of the amounts listed are due to rounding.
* For identification purposes only
DEFINITIONS
–4 0–


--- page 51 ---
This glossary contains definitions of certain technical terms used in this prospectus
in connection with our Company. Such terms and their meanings may not correspond to
standard industry definitions or usage.
“2DHT” two-speed dedicated hybrid transmission
“3DHT” three-speed dedicated hybrid transmission
“6DCT” six-speed dual clutch transmission
“6MT” six-speed manual transmission
“7DCT” seven-speed dual clutch transmission
“8A T” eight-speed automatic transmission
“9CVT” nine-speed continuously variable transmission
“ACC” adaptive cruise control
“AEB” autonomous emergency braking
“ANCAP” Australasian New Car Assessment Program
“APA” automatic parking assist
“BEV” battery electric vehicle, an electric vehicle powered
solely by a battery
“BSD” blind spot detection
“C-ICAP” China Insurance Automotive Safety Index
“CAGR” compound annual growth rate
“CA TARC” China Automotive Technology and Research Center
“CLTC” China Light-duty V ehicle Test Cycle
“CNCAP” China New Car Assessment Program
“CNOA” city navigate on autopilot
GLOSSARY OF TECHNICAL TERMS
–4 1–


--- page 52 ---
“commercial vehicle” vehicles used for business purposes, primarily for
transporting goods or passengers rather than for personal
or household use
“CVT” continuously variable transmission
“DAC” digital-to-analog converter
“DCDC” a device that converts a source of direct current from one
voltage level to another
“DHT” dedicated hybrid transmission or one-speed dedicated
hybrid transmission
“DMS” driver monitoring system
“DVVT” dual variable valve timing
“E/E architecture” electrical/electronic architecture
“ENCAP” European New Car Assessment Programme
“HNOA” highway navigate on autopilot
“ICE” internal combustion engine
“ISA” intelligent speed adaptation
“IVISTA” Intelligent V ehicle Integrated Systems Test Area
“KD” knock down
“LCC” lane change control
“LKA” lane keep assist
“MCU” motor control unit
“MPV” multi-purpose vehicles
“MSRP” manufacturer’s suggested retail price
“MT” manual transmission
GLOSSARY OF TECHNICAL TERMS
–4 2–


--- page 53 ---
“NESTA” New EV Safety Technical Assessment
“NEV” new energy vehicle, primarily including BEVs, REEVs
and PHEVs
“NOA” navigation on Autopilot
“OBC” on-board charger
“OEM” original equipment manufacturer
“OTA” over-the-air
“passenger vehicle” vehicles primarily used for transporting passengers and
their carry-on luggage to meet the non-business travelling
needs of individuals or families, typically with a capacity
of no more than nine seats (including the driver), and
including types such as sedans and SUVs
“PDU” power distribution unit
“PHEV” plug-in hybrid electric vehicle, an electric vehicle with a
plug-in battery and fuel engine
“REEV” range-extended electric vehicle, an electric vehicle with a
fuel-powered range extender
“SUV” sport utility vehicle
“TGDI” turbocharged gasoline direct injection
“TJA” traffic jam assist
“Y oY” year-on-year
GLOSSARY OF TECHNICAL TERMS
–4 3–


--- page 54 ---
We have included in this prospectus 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 prospectus contains certain forward-looking statements and information relating to
us and our 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 prospectus,
the words “aim”, “anticipate”, “believe”, “can”, “could”, “estimate”, “expect”, “forecast”,
“going forward”, “intend”, “may”, “might”, “ought to”, “plan”, “potential”, “predict”,
“project”, “seek”, “should”, “will”, “wish”, “would” and the negative of these words and other
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 Company’s
management with respect to future events, operations, liquidity and capital resources, some of
which may not materialize or may change. These forward-looking statements are subject to
certain risks, uncertainties and assumptions, including the other risk factors as described in this
prospectus. Although we believe that our expectations expressed in these forward-looking
statements are reasonable, our expectations may later be found to be incorrect. Our actual
results could be materially different from our expectations. Important risks and factors that
could cause our actual results to be materially different from our expectations are generally set
forth in “Risk Factors”, “Business”, “Financial Information” and other sections in this
prospectus. Y ou should read thoroughly this prospectus with the understanding that our actual
future results may be materially different from and worse than what we expect.
Y ou are strongly cautioned that reliance on any forward-looking statements involves
known and unknown risks and uncertainties. The risks and uncertainties facing our Company
that could affect the accuracy of forward-looking statements include, but are not limited to, the
following:
 our business strategies, plans, objectives and goals and our ability to implement such
strategies, plans, objectives and goals;
 our future business development, financial conditions and results of operations;
 our ability to develop new services and bring them to market in a timely manner and
make enhancements to our existing services;
 our ability to acquire new users/customers and enhance their loyalty;
 changes to regulatory and operating conditions in the industry and markets in which
we operate;
 the future developments and competitive environment in our industry;
FORW ARD-LOOKING STATEMENTS
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 our ability to stay in compliance with laws and regulations that currently apply or
become applicable to our business both in China and internationally;
 our ability to maintain, protect, and enhance our intellectual property;
 margins, overall market trends, risk management and exchange rates;
 the actions and developments of our competitors;
 capital market development;
 other statements in this prospectus that are not historical fact; and
 all other risks and uncertainties described in the section headed “Risk Factors” in
this prospectus.
Since actual results or outcomes could differ materially from those expressed in any
forward-looking statements, we strongly caution investors against placing undue reliance on
any such statements. Any forward-looking statement speaks only as of the date on which such
statement is made, and, except as required by the Listing Rules, we undertake no responsibility
to update any forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of any subsequent
unanticipated event. Statements of or references to our intentions or those of any of our
Directors are made as of the date of this prospectus. Any such intentions may change in light
of future developments.
All forward-looking statements in this prospectus are expressly qualified by reference to
this cautionary statement.
FORW ARD-LOOKING STATEMENTS
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An investment in our H Shares involves significant risks. You should carefully
consider all the information in this prospectus and, in particular , the risks and
uncertainties described below before making an investment in our H Shares. The
occurrence of any of the following events could materially and adversely affect our
business, financial condition, results of operations or prospects. If any of these events
occur , the trading price of our H Shares could decline and you may lose all or part of
your investment.
These factors are contingencies that may or may not occur , and we are not in a
position to express a view on the likelihood of any such contingency occurring. The
information given will not be updated after the date hereof, and is subject to the
cautionary statements in “Forward-Looking Statements” in this prospectus.
RISKS RELATING TO OUR BUSINESS AND INDUSTRY
The automotive market is highly competitive, and we may not be successful in competing
in this industry.
The automotive market is highly competitive, whether in China or overseas markets. We
ranked second among Chinese domestic brand passenger vehicle companies, in terms of sales
volume (including export volume) with a market share of 11.8% in 2023 and 14.0% in 2024.
We directly compete with other Chinese and international automobile companies. In particular,
we directly compete with those automobile companies that have an established presence in
China and operate globally. We may also in the future face competition from new entrants both
in China and globally that will increase the level of competition. We believe that the primary
competitive factors in our markets include brand recognition, development time, product
design, production capacity, delivery timeline, product quality, pricing, product safety, energy
efficiency, technological innovation, supply chain management, sales and marketing
capabilities, distribution network, customer support, after-sales services and financing terms.
Many of our current and potential competitors have more financial, technical, operational, and
other resources than we do, and may be able to devote significant resources to the design,
development, manufacturing, distribution, promotion, sale, and support of their vehicles.
We expect competition in our industry to intensify in the future in light of continuing
consolidation in China and the worldwide automotive industry, intense price competition,
increasing number of automotive brands, and market segmentation driven by diversified
consumer demands. Increased competition may lead to lower vehicle sales volume and
increased inventory, which may result in downward price pressure and adversely affect our
results of operation, financial conditions, business and prospects. Our ability to successfully
compete against other vehicle brands will be fundamental to our future success in existing and
new markets and our market shares. We cannot assure you that we will be able to compete
successfully in our markets. Our competitors may introduce new vehicles or services that
exceed the quality or performance of our vehicles or services, which would adversely affect our
competitive position in the markets. They may also offer vehicles or services at more
competitive prices, which would have an adverse impact on our sales and profitability.
RISK FACTORS
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Changes in international trade policies, geopolitics and trade protection measures, export
control and economic or trade sanctions may affect our business, financial condition and
results of operations.
As we seek to expand our global footprint, our business operations and financial
performance may be influenced by international trade policies, geopolitics, trade protection
measures, export controls, and economic or trade sanctions. International trade policies and
geopolitics are subject to frequent changes and uncertainties, often driven by political,
economic, and social factors beyond our control. These changes could impact trade
agreements, tariffs, customs duties, and other aspects of international trade, potentially
increasing our operational costs and affecting our market access. Changes in trade protection
measures, such as anti-dumping duties, countervailing duties, or safeguard measures, could
lead to increased costs or restrictions on our exports. Export controls and economic or trade
sanctions could limit our ability to export our products or conduct business in certain markets.
Any non-compliance with these controls and sanctions could result in legal penalties,
reputational damage, and loss of export privileges.
The current tension in international trade and rising political tension, may affect our
business operations and results of operation as this could potentially affect our customer’s
demand for our passenger vehicles. In early 2025, the U.S. government issued multiple
executive orders implementing additional tariffs on imports from various jurisdictions,
including additional tariffs amounting to an aggregate of 145% on imports from the PRC that
took effect on April 10, 2025 (the IEEPA tariffs), and the proclamation invoking Section 232
of the Trade Expansion Act of 1962 that imposed a 25% tariff on imported automobiles with
effect from April 3, 2025 (Section 232 tariffs). On May 12, 2025, the PRC government and U.S.
government issued a joint announcement acknowledging that both parties will take actions to
build a sustainable and long-term trade relationship. In particular, the U.S. government took
actions to reduce the IEEPA tariff rate to 30% on imports from the PRC on a temporary basis
for an initial period of 90 days from May 14, 2025, which was extended for another 90 days
on August 12, 2025. Nevertheless, other potential duties could be imposed depending on the
changing international trade environment. In addition, on October 29, 2024, the EU members
voted to adopt provisional countervailing duties of up to 35.3% on imports of Chinese-made
EVs which entered into effect on October 30, 2024. The specific duty rate is dependent of the
Chinese EV manufacturers. In each period during the Track Record Period, we had no exports
of passenger vehicles to the US and our revenue from the exports of passenger vehicles to EU
accounted is relative small as a percentage to our total revenue. While the sales of our
passenger vehicles to the EU markets is relatively small compared to the other overseas
markets, unfavorable government policies on international trade may affect the demand for and
competitive position of our passenger vehicles. Moreover, we intend to expand our global sales
and service network in the European market. See “Business — Our Strategies.” We cannot
assure you that our current position with regard to the international trade policies will remain
the same. We may be subject to unfavorable policies that may affect our business, financial
condition and results of operation.
RISK FACTORS
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In response to the President Trump’s executive orders, the PRC government also imposed
additional tariffs, including additional tariff amounting to an aggregate of 125% on goods
imported into the PRC originating from the U.S. that took effect on April 12, 2025. Pursuant
to the joint announcement dated May 12, 2025, the PRC government is also committed to take
action to reduce the tariff rate to 10%. Such tariff rate is subject to a temporary imposition
suspension for an initial period of 90 days, which was also extended for another 90 days on
August 12, 2025. We have adopted a localized supply chain for the production of our passenger
vehicles in the PRC. We expect that the purchases amount of goods imported into the PRC
originating from the U.S. is estimated to be less than 2% of our total purchase amount of raw
materials in 2025. The situation may continue to develop and change rapidly. We cannot assure
that our current supply chain for production of our passenger vehicles in the PRC will remain
the same. We may encounter raw materials or key components shortages or cost increases due
to the changing and unpredictable international trade policies, which in turn may affect our
business, financial condition and results of operation.
In addition, on October 7, 2022, the U.S. Department of Commerce, the U.S. Bureau of
Industry and Security (“ BIS”) published rules that introduce new restrictions related to
semiconductors, semiconductor manufacturing, supercomputers, and advanced computing
items and end uses in Mainland China, Hong Kong or Macau. BIS’ rules on advanced
computing and semiconductor manufacturing were implemented in two key areas. First, these
rules impose restrictive export controls on certain advanced computing semiconductor chips
and software, transactions for supercomputer end-uses, and transactions involving certain
entities on the Entity List. Second, these rules impose new controls on certain semiconductor
manufacturing items and on transactions for certain integrated circuit (IC) end uses. We
purchased automotive chips that can generally be exported without a license (a type of products
that are generally consist of low-technology consumer goods and do not require a license to
export in most situations) from the U.S. for use in our passenger vehicles. However, as the
Entity List and other U.S. export control laws and regulations continue to expand and evolve,
future U.S. export controls may materially affect or target some of our significant suppliers or
customers, raw material and key components necessary for our operations, in which event our
business may be affected if we fail to promptly secure alternative sources of supply or demand
on terms acceptable to us.
The international trade policies and trade protection measures are likely subject to
frequent changes, and their interpretation and enforcement involve substantial uncertainties,
which may be heightened by national security concerns or driven by political and/or other
factors that are beyond our control. These may materially and adversely affect us and our
abilities to obtain technologies, systems or components that may be critical to our technology
infrastructure, product offerings and business operations. If any new tariffs, legislation and/or
regulations are implemented by the U.S. or other jurisdictions in the future, or if existing trade
agreements are renegotiated, such changes could adversely affect our business, financial
condition and results of operations. It may also be difficult or costly to comply with such
legislation and/or regulations, and would subject us to regulatory investigations, fines,
penalties or other actions and reputational harm.
RISK FACTORS
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NEV market is highly competitive, and demand for NEVs may be cyclical and volatile.
The NEV market is large yet competitive. Our competitors in passenger vehicles are
composed of both NEV manufacturers and ICE automakers that have penetrated the NEV
segment. We might be confronted with a higher level of competition in the future due to the
threat of new entrants. Our current and potential competitors may have more financial,
manufacturing, marketing or other resources than us, and may be able to devote more
significant resources to the design, development, manufacturing, distribution, promotion, sale
and support of their products as compared to our efforts.
We expect competition in NEV industry to persist, given the surging demand and
government incentives for alternative fuel vehicles, continuing globalization and consolidation
in the global automotive industry. Factors affecting competition include but not limited to
brand recognition, product design, delivery timeline, product quality, development time,
pricing, safety, energy efficiency, supply chain management, sales and marketing capabilities,
distribution network, customer support, after-sales service and financing terms. There can be
no assurance that we will compete successfully in all regards. Our competitors may introduce
new vehicles that exceed the quality or performance of our products, or offer customer service
that better meets customer needs, which could adversely impact our competitive positioning in
the market. They may also offer vehicles or services at lower prices, which could negatively
affect our sales and profitability. Increased competition may result in lower vehicle sales and
higher inventories, which could lead to downward pressure on prices and adversely affect our
business, financial condition, results of operations and prospects.
Our risk management and internal control systems may not be adequate or effective.
We have developed and implemented comprehensive risk management and internal
control policies that encompass various aspects of our business operations to supervise and
address a spectrum of operational, financial, legal and market risks that may be or have been
identified. While we seek to improve our risk management and internal control systems on a
continuous basis, we cannot assure you that these systems are sufficiently effective. See
“Business — Risk Management and Internal Control.” and “Business — Business Activities in
Region subject to International Sanctions — Risk Exposure and Internal Controls.” Since our
risk management and internal control systems depend on implementation by our employees, we
cannot assure you that our employees or other related third parties are sufficiently or fully
trained to implement these systems, or that their implementation will be free from human error
or mistakes. If we fail to timely update, implement, and modify, or fail to deploy sufficient
human resources to maintain our risk management policies and procedures, our results of
operation, financial conditions, business and prospects could be materially and adversely
affected.
RISK FACTORS
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Our results of operations during the Track Record Period may not be indicative of our
future performance.
We experienced fast growth in our revenue and net profit during the Track Record Period.
Our revenue was increased from RMB92,618 million in 2022 to RMB163,205 million in 2023,
and further to RMB269,897 million in 2024, representing a CAGR of 70.7%. Our net profit
increased from RMB5,806 million in 2022 to RMB10,444 million in 2023, and further to
RMB14,334 million in 2024, representing a CAGR of 57.1%. Our revenue and net profit
increased by 24.2% and 90.9%, from RMB54,910 million and RMB2,476 million in the three
months ended March 31, 2024 to RMB68,223 million and RMB4,726 million in the three
months ended March 31, 2025, respectively. We cannot assure you that we are able to sustain
our historical growth rates for various reasons, including uncertainty of our continuous
offerings of quality products to attract our users, failure of our global strategies or marketing
and sales strategies.
In addition, we plan to further grow our business by, among other things, (i) expanding
product lineup and sharpen brand positioning to continuously enhance our brand equity; (ii)
investing in R&D on next-generation technologies to strengthen our competencies; (iii)
enhancing vehicle electrification and intelligentization to embrace global mobility
transformation; and (iv) expanding our international footprints with globalization strategy to
solidify overseas market leadership. See “Business — Our Strategies.” To successfully grow
our business, we plan to continue to invest substantial financial, managerial and operational
resources to sustain our growth. However, we cannot assure you that we will be able to
continually obtain these resources in the future. For instance, we may not be able to obtain
additional internal and external capital to support our business growth on commercially
acceptable terms, or to retain and attract sufficient number of competent staff to support our
business development.
Our financial and operating results may vary from period to period due to various factors
beyond our control, including the economic growth, development or intensified competitive
within global automotive industry, as well as changes in laws, regulations and rules applicable
to global automotive industry. Any unfavorable change in the factors above may prevent us
from maintaining our historical growth rates. As a result of these, and other factors, we cannot
assure you that our future revenue will increase or that we will continue to be profitable.
Accordingly, investors should not rely on our historical results as an indication of our future
financial or operating performance.
RISK FACTORS
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We face risks associated with the international sale of our vehicles and our international
operations. If we are unable to effectively manage these risks, our results of operation,
financial conditions, business and prospects may be materially and adversely affected.
During the Track Record Period, we derived a substantial portion of our total revenue
from overseas markets. Our revenue from overseas markets was RMB30,387 million,
RMB77,060 million, RMB100,897 million and RMB26,289 million in 2022, 2023, 2024 and
the three months ended March 31, 2025, respectively, accounting for 32.8%, 47.2%, 37.4% and
38.5% of our total revenue in the same periods. As of the Latest Practicable Date, we sold our
passenger vehicles to over 100 countries and regions. Compared to operations in China, our
home market, conducting our business internationally, particularly in markets and countries in
which we have limited prior experience, subjects us to additional risks and challenges,
including:
 limited brand recognition;
 inability to maintain or enhance operational efficiency and cost savings, including
operational challenges due to distance, language, and cultural differences,
increasing difficulty for us in directing and monitoring the day-to-day overseas
operations and increasing difficulty to hire and retain qualified personnel on
commercially reasonable terms, or at all;
 compliance with multiple and potentially conflicting laws and regulations governing
various aspects of our operations, including competition, pricing, operation,
distribution network, transportation, logistics, tariffs, trade protection, and other
activities important to our business;
 competition with existing players in the automotive industry;
 exposure to business cultures where improper business practices may be prevalent;
 difficulties in managing, growing, and staffing international operations, in particular
manufacturing facilities and research centers;
 challenges in cultivating and maintaining productive relationships with local
business partners, such as agents and dealers;
 impact of import and export restrictions and changes in tariff and trade regulations;
 risks associated with legal systems subject to undue influence or corruption;
 vulnerability to changes in specific country’s or region’s political, social, or
economic conditions; and
 changes in geopolitical dynamics, including but not limited pandemic, war, and
terrorism.
RISK FACTORS
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Our ability to maintain and expand our presence in the international market will be
critical to the success of our business. However, there is no guarantee of this, and any of the
aforementioned risks could pose on significant challenges for us. If we are unable to manage
one or more of these risks adequately, our results of operation, financial conditions, business
and prospects may be materially and adversely affected.
Our business is dependent on the strengths and market acceptance of our five major
brands. If we fail to maintain and enhance our brands, or if we incur excessive expenses
in this regard, our results of operation, financial conditions, business and prospects may
be materially and adversely affected.
Our business and financial performance is heavily dependent on our ability to develop,
maintain and strengthen our brands. We sell our passenger vehicles under five major brands,
namely, CHERY , JETOUR, EXEED, iCAR and LUXEED. If we do not continue to develop,
maintain and strengthen our brands, we may lose the opportunity to improve our brand
awareness and build a critical mass of customers. Promoting our brands will likely depend
significantly on our ability to provide high-quality passenger vehicles as well as the success of
our sales and marketing efforts. While we seek to optimize resource allocation through careful
selection of sales and marketing channels, such efforts may not achieve the desired results. To
promote our brands, we may be required to adjust our branding practices, including utilizing
traditional media, celebrity endorsement and online media platforms, which could substantially
increase sales and marketing expenses. During the Track Record Period, our selling and
distribution expenses amounted to RMB3,207 million, RMB5,557 million, RMB8,380 million
and RMB2,182 million, accounting for 3.5%, 3.4%, 3.1% and 3.2% of our revenue in the
relevant periods, respectively. However, we cannot assure you that these activities will be
successful or that we will be able to achieve the desired promotional effect. If we fail to
develop and maintain our five major brands strong, our results of operation, financial
conditions, business and prospect will be materially and adversely impacted.
If incidents in relation to our passenger vehicles, such as self-ignition and road accidents,
occur or are perceived to have occurred, whether or not such incidents are by our fault, we
could be subject to adverse publicity which could be detrimental to our reputation and brand
image. See “— We may become subject to product liability claims, or choose to or be
compelled to undertake product recalls or take other similar actions, which could adversely
affect our brand image, business and results of operations.” In addition, we do not have
complete control over the third parties with whom we collaborate, whose misconduct may
expose us to negative publicity. Our passenger vehicles are also evaluated and reviewed by
third parties from time to time. Any negative reviews that compare us unfavorably with our
competitors could adversely affect consumers’ perceptions of our passenger vehicles. Given the
popularity of social media, any negative publicity, regardless of the factual accuracy, could
quickly proliferate and harm consumer perceptions and confidence in our brands.
RISK FACTORS
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We rely on various suppliers to provide raw materials or certain key components of our
passenger vehicles. We are subject to the risks associated with volatility in the prices of
such raw materials or components. Our suppliers may fail to deliver such raw materials
or components as required.
We procure raw materials and certain key components from various suppliers, including
but not limited to steel products, battery cells, electrical components, and various vehicle
components such as seats and tires. During the Track Record Period, our cost of materials
amounted to RMB69,144 million, RMB112,230 million, RMB192,395 million and RMB49,524
million, accounting for 86.6%, 81.9%, 82.4% and 82.9% of our cost of sales in the same
periods, respectively. Our future costs of raw materials, parts and components may be affected
by many factors, such as market demand, changes in supplier’s manufacturing capacity,
availability of substitute materials, interruptions in productions by suppliers or supply chain,
general economic conditions and natural disasters, all of which are out of our control. Due to
differences in timing between our purchases from suppliers and sales by our dealers to our
users, there is often a lead-lag effect that can negatively impact our margins in the short term
in the event of rising prices of raw materials, parts and components. If we fail to effectively
control the cost of raw materials, parts and components or fail to pass the increased costs to
our customers, our results of operation, financial conditions, business and prospects could be
materially and adversely affected.
We may encounter raw materials or key component shortages resulting from delay in
delivery, unsatisfactory quality, or production disruption of our suppliers. If our suppliers are
unable to supply or delay in supplying these raw materials or key components, or if the supply
agreements are terminated, it may be difficult to procure alternative supplies in a timely
manner, or at favorable prices. Any disruption in the supply of raw materials or key
components could temporarily interrupt the production of our passenger vehicles until we are
able to establish alternative supplies or to source sufficient quantities of the relevant raw
materials or key components from other suppliers. In addition, it may be time-consuming and
costly to identify alternative suppliers for certain highly customized components for our
passenger vehicles or to develop our own alternatives.
With our business expansion, we may from time to time significantly increase the
production of our passenger vehicles, and order additional raw materials or key components
from our suppliers within a relatively short time frame. Our suppliers may fail to satisfy our
needs, and even if they could, they may not be able to provide such raw materials or key
components in a timely manner or at favorable prices. If we cannot secure a qualified substitute
supplier in a timely manner, or at all, we may experience significant disruption in the supply
of essential components of our passenger vehicles and material delay in the delivery of our
passenger vehicles, which may materially and adversely impact our results of operation,
financial conditions, business and prospects.
RISK FACTORS
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Any delay in the launch, manufacture and delivery of our existing or future products
could have a material adverse effect on our business.
We continually introduce new models and versions to enrich our product portfolio and
offer customers more selections. See “Business — Our Products — Pipeline of Future V ehicle
Models.” We may experience delays in the launch, manufacture and delivery of new models
and new versions due to a variety of reasons, such as changes in market conditions,
technological challenges and lack of necessary funding, as well as disruptions in our supply
chain or manufacturing facilities. To the extent such delays occur, our growth prospects could
be adversely affected. We also plan to periodically perform facelifts or refresh existing models,
which could also be subject to delays. Any delay in the launch, manufacture and delivery of
our existing or future products, including in the construction and renovation of our production
facilities, or in performing facelifts to existing models, could lead to customer dissatisfaction
and materially and adversely affect our reputation, market, results of operation, financial
conditions, business and prospects.
We may be subject to risks associated with driving assistance and intelligent cockpit
technologies.
We may apply driving assistance and intelligent cockpit technologies in our vehicles,
which is subject to a number of risks, such as human errors, system malfunction and software
vulnerability etc.. From time to time there are accidents associated with such technologies. The
safety of driving assistance and intelligent cockpit technologies depends partly on user
interaction, and users may not be accustomed to such technologies. To the extent that accidents
associated with our driving assistance systems or intelligent cockpit occur, we could be subject
to product liability, government scrutiny and heightened regulatory oversight, which may
adversely impact our reputation, results of operation, financial conditions, business and
prospects.
As the laws evolve, driving assistance and intelligent cockpit technologies also face
regulatory changes to keep pace with the rapidly evolving nature of the technologies, which
may be beyond our control and anticipation. Our driving assistance and intelligent cockpit
systems may not meet evolving regulatory requirements, which will require us to re-design,
modify or update our driving assistance and intelligent cockpit hardware and related software
systems. This will cause us to incur additional costs, and results of operation, financial
conditions, business and prospects could be materially and adversely affected.
Our passenger vehicles may not perform to customer expectations and may contain
defects.
Our passenger vehicles may not perform in line with user expectations. Any product
defects or any other failure of our vehicles to perform or operate as expected could harm our
reputation and result in negative publicity, lost revenue, delivery delays, product recalls,
product liability claims, harm to our brand, warranty and other expenses that could materially
and adversely affect results of operation, financial conditions, business and prospects.
RISK FACTORS
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Our vehicles may contain design and manufacturing defects. The design and
manufacturing of our vehicles are complex and could contain latent defects and errors, which
may cause our vehicles to not perform or operate as expected or even result in property damage
or personal casualties. Furthermore, our vehicles use a substantial amount of third-party and
in-house software codes and complex hardware to operate. Advanced technologies are
inherently complex, and defects and errors may be revealed over time. Our control over the
long-term consistent performance of third-party services and systems is limited. While we have
performed extensive internal testing on our vehicles’ software and hardware systems, we have
a limited assess to the framework and standard of the long-term performance of our systems
and vehicles. We cannot assure you that we will be able to detect and fix any defects in the
vehicles on a timely basis, or at all.
In addition, there could be maloperation, negligence, or failure to follow protocols by our
employees or third-party service providers. Such human errors could result in failure of our
vehicles to perform or operate as expected. We cannot assure you that we will be able to
completely prevent human errors.
We may be subject to liabilities and disruption in operations in connection with accidents
that occur during the manufacturing process at production facilities.
In the course of operations and production, we implement and require our employees to
comply with safety measures and procedures as stipulated in our internal policies. As our
manufacturing process is complicated and inevitably involves operation of tools, equipment
and machinery and use of chemical materials, accidents resulting in employee injuries or even
deaths may occur, despite we did not experience any major disputes that lead to disruptions in
our Group’s operations. Such accidents may result in disruption of our operation and subject
us to liabilities, and we may not have adequate or sufficient insurance to cover such liabilities,
which could then adversely affect results of operation, financial conditions, business and
prospects.
We rely on an extensive dealership network to distribute our passenger vehicles, and we
may be subject to risks relating to the acts and services of our dealers.
We work with dealers to expand our vehicle sales coverage, which helps us increase sales
orders and generate revenues. During the Track Record Period, the majority of our vehicles
were sold through our dealers. In 2022, 2023, 2024 and the three months ended March 31,
2025, we generated RMB69,734 million, RMB128,809 million, RMB216,222 million and
RMB56,133 million revenue from sales through dealers, respective, representing 84.5%,
85.2%, 87.6% and 91.1% of our total revenue from sales of passenger vehicles, respectively,
for the same periods.
In addition, the performance of our dealers and their ability to sell our vehicles, maintain
our brand, provide customer services, expand their businesses and their sales network are
crucial to the future growth of our business and may directly affect our vehicle sales volume
and profitability. We may not be able to identify, attract, and retain a sufficient number of
RISK FACTORS
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dealers with the requisite experience and resources. We have limited control over the daily
business activities of our dealers, and our control over the sub-dealers may be even more
limited. If our dealers or sub-dealers fail to deliver high-quality customer service and resolve
customer complaints in a timely manner, or if any of their misconduct or unethical practice
leads to damages to our brand image and reputation, our business could be adversely affected.
For example, our dealers may delay in delivery of our vehicles or have disputes with end
customers and our sub-dealers may also engage in unauthorized misrepresentation to our end
customers. In any such event, end customers’ confidence in our brand image and reputation
could be adversely affected. In addition, non-compliance by any of our dealers or sub-dealers
with the relevant distribution agreements or our company policies may adversely affect the
overall sales of our vehicles and services we provide, and our ability to implement
development strategies. If we are unable to build or maintain well-developed, well-managed
dealership networks, our results of operation, financial conditions, business and prospects may
be adversely affected.
We cannot assure you that we are always able to accurately track the inventory level of
our dealers or to identify any excessive inventory build-up at various levels of our distribution
network. Moreover, our dealers may be unable to sell adequate amounts of their inventories of
our vehicles in a given period to end customers, which may result in a buildup of inventory
level. This could have a material adverse impact on the sales of our vehicles and, accordingly,
to our business, financial condition, results of operations, and prospects. Moreover, any
significant growth in our sales to certain dealers in the future, or changes to our sales and
service network, may give rise to competition among our dealers and increase the risk of
cannibalization. Any such behavior may harm our results of operation, financial conditions,
business and prospects.
We rely on third parties to provide services for our business.
We engage competent suppliers to provide services such as logistics, warehousing and IT
consulting for our business. The operations of these suppliers may be affected by various
factors such as improper management, equipment breakdowns, commercial disputes, labor
shortages or strikes and natural disasters. If any of these suppliers fails to provide reliable and
timely services, or the prices of such services increase significantly, the supply of our product
may be interrupted or our costs incurred for such third party service providers may increase.
In addition, we may not be able to identify suitable alternative suppliers, which could adversely
affect results of operation, financial conditions, business and prospects.
Our future success depends, in part, on our ability to expand our production capacity,
which is subject to risks and uncertainties.
Expansion of production capacity is crucial to our business operation, including
establishing new manufacturing bases to meet increasing market demands. See “Business —
Manufacturing” and “Future Plans and Use of Proceeds.”
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We plan our future production capacity based on our expectations regarding a number of
inherently uncertain factors, including anticipated demands for our passenger vehicles and
general market conditions. Our production capacity may not match the market demand. If the
demand for any of our passenger vehicles is lower than anticipated due to unforeseen changes
to consumer preferences or otherwise, our sales and profitability would suffer, we would not
achieve satisfactory or sustainable returns from our investment in the expansion of production
capacity and development of new passenger vehicles, all of which may have a material adverse
on our market position, financial condition and results of operation. Conversely, our expansion
of production capacity may fail to meet the increasing demand for our passenger vehicles, in
which case, our market share may be eroded. We may also subject to risks associated with
overseas production. See “— We face risks associated with the international sale of our
vehicles and our international operations. If we are unable to effectively manage these risks,
our results of operation, financial conditions, business and prospects may be materially and
adversely affected.”
In addition, our ability and efforts to expand our capacity and upgrade our manufacturing
facilities are subject to certain risks and uncertainties, such as our ability to raise capital at
reasonable cost or at all, manage delays and cost overruns and obtain the required permits,
licenses and approvals from relevant government authorities. Expansion of our capacity may
also be disrupted by catastrophe or other unexpected events.
Moreover, system upgrades at our manufacturing facilities may impact ordering,
production scheduling and other related manufacturing process that are complex, and could
impact or delay production targets. Any of these factors could materially and adversely affect
our results of operation, financial conditions, business and prospects.
Our industry is rapidly evolving and may be subject to unforeseen changes. Unforeseen
technological development may materially and adversely affect the demand for our
vehicles.
During the Track Record Period, the majority of our revenue was derived from sales of
ICE vehicles. In 2022, 2023 and 2024 and the three months ended March 31, 2025, our revenue
from sales of ICE vehicles accounted for 75.9%, 87.8%, 69.6% and 63.0%, respectively, of our
revenue, and our revenue from sales of NEVs accounted for 13.2%, 4.9%, 21.9% and 27.3%,
respectively, of our revenue. According to Frost & Sullivan, in recent years, there has been a
significant shift toward NEVs. In addition, the increasing intelligence of electric vehicles
provides consumers with more convenient experiences and better satisfies their evolving needs.
Furthermore, advancements in battery technology, leading to enhanced driving ranges and
reduced charging times, have fostered greater confidence in electric vehicles and encouraged
more widespread adoption. We cannot assure you that we will be able to keep up with changes
in the rapidly evolving automotive market. The regulatory framework governing the industry
is constantly evolving and may change for the foreseeable future. As our industry and our
business develop, we may need to modify our business model or change our products and
services. These changes may not achieve expected results, which could have a material and
adverse effect on our results of operations and prospects.
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Developments in new energy technology, such as advanced hydrogen or fuel cells may
materially and adversely affect our business and prospects in ways that we do not currently
anticipate. Any failure by us to successfully react to changes in existing technology could
materially harm our competitive position and may materially and adversely affect our results
of operation, financial conditions, business and prospects.
Our research and development efforts may not yield expected results.
Our R&D capabilities are critical to our success. The automotive markets are subject to
rapid technological changes and are evolving quickly in terms of technological innovation and
technique improvement. Our ability to launch new products which suit the evolving needs of
the market depends largely on our R&D capabilities. We have continuously made investments
in our research and development activities to launch new products and develop relevant
technologies. We have built a multi-tier, comprehensive R&D system, covering vehicle
platform architecture, powertrain systems, and vehicle intelligence technologies. In 2022, 2023
and 2024 and the three months ended March 31, 2025, our R&D expenditure amounted to
RMB4,128 million, RMB6,849 million, RMB10,544 million and RMB2,761 million,
respectively.
We will continue to invest extensive resources in R&D in order to lead technological
advances and remain competitive in the rapidly evolving automotive industry. However, even
if we are able to keep pace with changes in technology and develop new models, our existing
models could become obsolete more quickly than expected, potentially reducing our return on
investment. For example, we have developed and manufactured advanced engine and
transmission systems for ICE vehicles, PHEVs and REEVs. See “Business — Our
Technological Prowess — Chery Power — Our Powertrain Systems.” These innovative
technologies may have inherent risks of having a short life in terms of their benefits over
competing technologies, or may not be accepted by the market. Given the uncertain nature of
R&D activities, there can be no guarantee that we will continue to achieve technological
innovations and effectively commercialize such innovations. Consequently, even with
substantial expenditure in relevant R&D activities, we may not generate corresponding returns,
which may adversely affect our current market position. Any delay or obstruction in R&D in
these aspects could materially and adversely affect our business, reputation, results of
operations and prospects.
Any cyber-attacks, unauthorized access or control of our vehicles’ systems could result in
loss of confidence in us and our vehicles and harm our business.
Some of our vehicles contain complex information technology systems to support smart
technology functions and to accept and install regular OTA updates. We have designed,
implemented and tested security measures intended to prevent unauthorized access to our
information technology networks and our vehicles’ technology systems. However, hackers may
attempt to gain unauthorized access to modify, alter, and use such networks and systems. We
aim to remedy any reported and verified vulnerability in the security of our vehicles. However,
there can be no assurance that vulnerabilities will not be exploited in the future before they can
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be identified, or that our remediation efforts are or will be successful. Any cyber-attacks,
unauthorized access, disruption, damage, or control of our information technology networks or
our vehicles’ systems or any loss or leakage of data or information stored in our systems could
result in legal claims or proceedings. In addition, regardless of their veracity, reports of
cyber-attacks to our information technology networks or our vehicles’ systems or data, are
vulnerable to “hacking,” and concerns surrounding data security and privacy, could negatively
affect our brand and harm our results of operation, financial conditions, business and prospects.
Our business is subject to the evolving laws and regulations regarding data privacy and
protection, information security, and cybersecurity. Failure to address cybersecurity and
data privacy concerns could subject us to penalties, damage our reputation and brand,
and harm our business and results of operations.
We use our vehicles’ electronic systems to log, with necessary permission, certain
information about each vehicle’s use in order to aid us in vehicle diagnostics and repair and
maintenance, as well as to help us customize and optimize the driving and riding experiences.
Collection, possession, and use of our user’s data in conducting our business may subject us
to legislative and regulatory oversight in China and other jurisdictions, such as requiring
notification of any data breach, restricting our use of such information, and limiting our ability
to acquire new customers or market to existing customers. If users allege that we have
improperly collected, used, transmitted, released, or disclosed their personal information, we
could face legal claims and reputational damage. We may incur significant expenses to comply
with privacy, consumer protection and security standards and protocols imposed by laws,
regulations, industry standards or contractual obligations. If third parties improperly obtain and
use the personal information of our users, and we fail to protect data from these improper uses,
we may be required to expend significant resources to resolve these problems, and could be
further subject to penalties, including fines, suspension of business, and revocation of required
licenses, and our reputation and results of operations could be materially and adversely
affected.
We are subject to various data security and data protection laws and regulations in China.
See “Regulatory Overview — Regulations Relating to Cybersecurity and Data Security.” In
particular, on December 28, 2021, 13 government authorities, including the CAC, jointly
released the Cybersecurity Review Measures () (the “ Cybersecurity
Review Measures ”), which took effect on February 15, 2022. As advised by our legal adviser
as to PRC data compliance laws, and based on our consultation with China Cyber Security
Review, Certification and Market Regulation Big Data Center (which is entrusted by
Cybersecurity Review Office to accept public consultation regarding cybersecurity review), we
believe that our proposed listing in Hong Kong is not a “listing abroad” under the
Cybersecurity Review Measures. As of the Latest Practicable Date, we had not been notified
by any authorities of being classified as a critical information infrastructure operator nor had
we been required to undertake a cybersecurity review by the Cybersecurity Review Office for
the Global Offering.
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Many of the data-related legislations in China are relatively new and constantly evolving.
If any data that we possess belongs to data categories that are subject to heightened scrutiny,
we may be required to adopt stricter measures for the protection and management of such data.
Due to the complexity of the regulatory environment and the occasional amendments to laws
and regulations, we cannot predict the impact of the Cybersecurity Review Measures, if any,
at this stage, but we will closely monitor and assess any development in the rule-making
process. If the Chinese cyberspace administration or other competent authorities provide the
clearance of cybersecurity review and other specific actions to be taken by issuers like us, we
face uncertainties as to whether these additional procedures can be completed by us timely, or
at all, which in turn may subject us to government enforcement actions and investigations,
fines, penalties, suspension of our non-compliant operations, or removal of our app from the
relevant application stores, and other consequences that may materially and adversely affect
our business and results of operations.
In general, compliance with the existing and future laws and regulations related to data
security and personal information protection may be costly and subject us to negative publicity,
which could harm our reputation, business operations and results of operations.
We are subject to anti-corruption and anti-bribery and similar laws, and non-compliance
with such laws can subject us to administrative, civil and criminal fines and penalties,
collateral consequences, remedial measures and legal expenses, all of which could
adversely affect our business, results of operations, financial condition and reputation.
We are subject to anti-corruption, anti-bribery and similar laws and regulations in various
jurisdictions in which we conduct activities. We have direct or indirect interactions with
officials and employees of government agencies, state-owned entities and affiliates in the
ordinary course of business. These interactions subject us to an increased level of compliance-
related concerns. We have implemented policies and procedures designed to ensure compliance
by us and our Directors, officers, employees, representatives, consultants, agents and business
partners with laws and regulations. However, our policies and procedures may not be
sufficient, and our directors, officers, employees, representatives, consultants, agents, and
business partners could engage in improper conduct for which we may be held responsible.
Non-compliance with anti-corruption or anti-bribery laws and regulations could subject
us to whistleblower complaints, adverse media coverage, investigations, and severe
administrative, civil and criminal sanctions, collateral consequences, remedial measures and
legal expenses, all of which could materially and adversely affect our business, results of
operations, financial condition and reputation.
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Our business depends substantially on the continuing efforts of our officers, key
employees and qualified personnel, and our operations may be severely disrupted if we
lose their services.
Our success depends substantially on the continuing efforts of our senior management and
key employees. If one or more of our officers or key employees were unable or unwilling to
continue their services with us, we might not be able to replace them easily, in a timely manner,
or at all. As we build our brand and become more well-known, the risk of competitors or other
companies poaching our talent may increase. The automotive industry that we operate in is
characterized by high demand and intense competition for management and R&D talents, in
particular with those in the areas of engines, electrification and intelligent technologies, and we
cannot assure you that we will be able to attract or retain key personnel, qualified staff or other
skilled employees who have a significant impact on our daily production and operation
activities.
If any of our senior management and key employees terminates his or her services with
us, our business may be severely disrupted, our financial condition and results of operations
may be materially and adversely affected and we may incur additional expenses to recruit, train
and retain qualified personnel. We did not maintain any key person insurance on our key
personnel during the Track Record Period. If any of our senior management or key employees
joins a competitor or forms a competing company, we may lose customers, know-how and key
professionals and staff members. Each of our executive officers and key employees has entered
into an employment agreement and a non-compete agreement with us. However, if any dispute
arises between our executive officers or key employees and us, the non-competition provisions
contained in their non-compete agreements may not be enforceable.
We might experience work stoppage, labor shortage, increase in labor costs and other
labor related matters, which may disrupt our normal operation and adversely affect our
reputation and results of operations.
We rely on a significant number of employees to support our business and production. We
have implemented comprehensive policies and measures to protect the welfare and working
conditions of our employees, including providing competitive remuneration packages,
including salary and allowances, performance-based bonuses. See “Business — Employees.”
During the Track Record Period and up to the Latest Practicable Date, we did not experience
any major labor disputes, work stoppages or labor strikes that led to disruptions in our Group’s
operations. Despite our best efforts, we cannot guarantee we will not face any labor-related
issues, including labor disputes, strikes, or the inability to attract and retain qualified workers,
which may lead to work stoppages or labor shortages and significantly impact our ability to
meet customer demands and fulfil orders within the expected time frames. Furthermore, such
labor-related matters could incur additional costs associated with resolving labor disputes,
hiring temporary workers, or implementing contingent plans to mitigate the impact of labor
shortages. These additional expenses, coupled with potential revenue losses from delayed
deliveries, may negatively affect our profitability and overall results of operations.
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Moreover, we rely on a significant number of employees to support our business and
production. Our labor costs have been rising as a result of market conditions and regulatory
measures. Any significant increase in labor costs could adversely affect our margins and
profitability if we cannot pass on cost increases to our customers. Unless we are able to use
other appropriate means to reduce our cost of production, our profit margin may decrease and
our results of operation, financial conditions, business and prospects may be materially
adversely affected.
We may become subject to product liability claims, or choose to or be compelled to
undertake product recalls or take other similar actions, which could adversely affect our
brand image, business and results of operations.
We manufacture and sell passenger vehicles primarily through the network of dealership.
We also manufacture KD kits in China and sell them to overseas OEMs and joint ventures
under the “knock-down” model. See “Business — Manufacturing — Overseas Production
Facilities” for the details of “knock- down” model. We may become subject to product liability
claims for the passenger vehicles as well as KD kits we sold, which could harm results of
operation, financial conditions, business and prospects. The automotive industry experiences
significant product liability claims, and we face an inherent risk of exposure to claims in the
event our vehicles do not perform as expected or malfunction resulting in property damage,
personal injury, or death. Any product liability claim, with or without merit, could prove costly
and time-consuming to defend. A successful product liability claim against us could incur a
substantial monetary compensation. During the Track Record Period, We bore the liabilities for
five recalls with product recall expenses of RMB23.3 million in total paid to the users and
dealers. See “Business — Quality Control, Warranty and After-Sale Services and Product
Recall — Product Recall.” Moreover, a product liability claim could generate substantial
negative publicity about our vehicles and business and inhibit commercialization of our future
vehicles, which would materially and adversely affect our brand, results of operation, financial
conditions, business and prospects. Any insurance coverage might not be sufficient to cover all
potential product liability claims. Any lawsuit seeking significant monetary damages may
materially and adversely affect our reputation, business, financial condition, and results of
operations.
Automotive recalls have long been a critical aspect of our industry, serving as a reminder
that even well-engineered vehicles may occasionally require intervention to ensure public
safety. As consumer expectations have grown and technologies advanced, so too have the
standards for safety and the strategies employed to address recall issues. During the Track
Record Period, we initiated 12 product recalls. See “Business — Quality Control, Warranty and
After-Sale Services and Product Recall — Product Recall.” In the future, we may, voluntarily
or involuntarily, initiate a recall if any of our passenger vehicles, including any systems or
parts sourced from our suppliers, is proved to be defective or non-compliant with applicable
laws and regulations. Such recalls, whether voluntary or involuntary or caused by systems or
components engineered or manufactured by us or our suppliers, could involve significant
expenses and could adversely affect our brand image, results of operation, financial conditions,
business and prospects.
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Unauthorised modification to our vehicle may jeopardize our vehicle safety system.
Automobile enthusiasts may seek to modify our vehicles, including using third-party
aftermarket products, to alter their appearance or enhance their performance, which could
jeopardize our vehicle safety systems. We do not test, nor do we endorse, such modifications
or third-party products. In addition, the use of improper external cabling or unsafe charging
outlets can expose our NEV users to injury from high voltage electricity. Such unauthorized
modifications could reduce the safety of our vehicles and any accidents resulting from such
modifications could result in negative publicity which would adversely affect our brand and
consequently harm our results of operation, financial conditions, business and prospects.
We may need to defend ourselves against claims for intellectual property infringement,
which may be time-consuming and would cause us to incur substantial costs.
Intellectual property rights, such as trademarks, copyrights, patents, domain names,
know-how, and other proprietary right protect our brand image, product design and other
valuable rights. From time to time, we may receive communications from intellectual property
right holders regarding their proprietary rights. Companies holding patents or other intellectual
property rights may bring suits alleging infringement of such rights or otherwise assert their
rights and urge us to obtain licenses to use such patents and intellectual property rights. Our
applications and uses of trademarks relating to our design, software, or technologies could be
found to infringe existing trademark ownership and rights. In addition, if we or our employees
are determined to have infringed a third party’s intellectual property rights, we may be required
to do one or more of the following: (i) cease offering passenger vehicles or services that
incorporate or use the challenged intellectual property; (ii) pay substantial damages; (iii) seek
a license from the holder of the infringed intellectual property right, whose license may not be
available on reasonable terms or at all; (iv) redesign our passenger vehicles or relevant services
which would incur significant cost; or (v) establish and maintain alternative branding for our
passenger vehicles and services.
In the event of a successful claim of infringement against us and our inability to obtain
a license to the infringed technology or other intellectual property right, our results of
operation, financial conditions, business and prospects could be materially and adversely
affected. In addition, any litigation or claims, whether or not valid, could result in substantial
costs, negative publicity and diversion of resources and management attention.
We may not be able to prevent others from unauthorized use of our intellectual
properties, which could harm our business and competitive position.
We rely on a combination of patents, trademarks, copyrights, trade secrets, and
confidentiality agreements to protect our proprietary rights. We rely on trademark and patent
law, trade secret protection and confidentiality and licensing agreements to protect our
intellectual proprietary rights. In addition, any unauthorized use of our intellectual property by
third parties may adversely affect our current and future revenues and our reputation.
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There can be no assurance that our application for the registration with competent
government authorities of trademarks and other intellectual property rights related to our
current or future business will be approved, or our intellectual property rights will not be
challenged by third parties or found by the relevant governmental or judicial authority to be
invalid or unenforceable. If the relevant trademarks or other intellectual properties could not
be registered, we may fail to prevent others from using such intellectual properties, and our
results of operation, financial conditions, business and prospects may be materially and
adversely affected.
Furthermore, policing unauthorized use of proprietary technology is difficult and
expensive. Despite our efforts to protect our proprietary rights, third parties may attempt to
copy or otherwise obtain and use our intellectual property or seek court declarations that they
do not infringe upon our intellectual property rights. Monitoring unauthorized use of our
intellectual property is difficult and costly, and we cannot assure you that the steps we have
taken or will take will prevent misappropriation of our intellectual property. From time to time,
we may have to resort to litigation to enforce our intellectual property rights, which could
result in substantial costs and diversion of our resources.
In addition, the rights granted under any issued patents may not provide us with
meaningful protection or competitive advantages. The claims under any patents may not be
broad enough to prevent others from developing technologies that are similar or that achieve
results similar to ours. It is also possible that the intellectual property rights of others could bar
us from licensing and exploiting our patents. Numerous patents and pending patent
applications owned by others exist in the fields where we have developed and are developing
our technology. These patents and patent applications might have priority over our patent
applications and could subject our patent applications to invalidation. In addition, as our
patents may expire and may not be extended and our patent rights may be contested,
circumvented, invalidated or limited in scope, our patent rights may not protect us effectively.
We may from time to time be subject to claims, disputes, lawsuits and other legal and
administrative proceedings.
We are susceptible to claims and various legal and administrative proceedings. Claims
arising out of actual or alleged violations of law, breach of contract or torts could be asserted
against us by customers, business partners, suppliers, competitors, employees, governmental
entities or other parties in investigations and legal proceeding. Regardless of the merit of the
particular claim, legal and administrative proceedings may be expensive, time-consuming or
disruptive to our operations and distracting to management. In recognition of these
considerations, we may enter into agreements to settle litigation and resolve such disputes.
There is no assurance that such agreements can be obtained on acceptable term or at all or that
litigation will not occur. In addition, these agreements may also significantly increase our
operating expenses. During the Track Record Period and up to the Latest Practicable Date,
there was no legal or administrative proceeding pending or threatened against us that could,
individually or in the aggregate, have a material effect on our business, financial condition or
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results of operations. However, new legal or administrative proceedings and claims may arise
in the future, which may cause us to incur defense costs, and results of operation, financial
conditions, business and prospects could be materially and adversely affected.
Our business, financial condition and results of operations may be adversely affected by
international export controls and economic sanctions.
The United States and other jurisdictions or organizations, including the EU, the United
Nations, the United Kingdom and Australia, have, through executive orders, legislation or
other regulatory means, implemented measures that impose economic sanctions and export
controls against such countries or against targeted industry sectors, companies, entities and/or
organization and individuals within such countries. For a summary of such sanctions regimes,
see “Regulatory Overview — Sanctions Laws and Regulations.”
During the Track Record Period, we had sales to non-sanctioned customers located in the
Balkans (Serbia), Belarus, Cuba, Democratic Republic of the Congo, Egypt, Ethiopia, Hong
Kong, Iran, Iraq, Lebanon, Libya, Myanmar, Nicaragua, Russia, Somalia, Tunisia, Turkey,
Ukraine (excluding the Crimea/so-called Luhansk People’s Republic and so-called Donetsk
People’s Republic regions/Kherson/Zaporizhzhia regions), V enezuela and Y emen (“ Relevant
Regions ”). Among the Relevant Regions, Iran and Cuba are Comprehensively Sanctioned
Countries. The Group had ceased its sales to Iran and Cuba as of December 31, 2024. During
the Track Record Period, none of the Group’s customers in the Relevant Regions were
Sanctioned Targets. It is the view of our International Sanctions Legal Advisers that the
Group’s activities in the Relevant Regions as discussed in details in “Business — Business
Activities in Regions Subject to International Sanctions” did not result in any violation of
primary International Sanctions.
The United States has through executive orders provided grounds for agencies, including
OFAC, to designate entities viewed to be “operating in” certain sectors in the Relevant
Regions. The Russian “transportation” sector is a sector where participants are subject to
designation risks by OFAC pursuant to EO 14024. There is a risk that OFAC may view the
Group as operating in the “transportation” sector of Russia by virtue of the Group’s sales of
automobiles to Russia and the Group’s subsidiaries in Russia. However, OFAC through FAQs
explained that a sector determination made pursuant to EO 14024 does not automatically
impose sanctions on all persons who operate or have operated in the sector. Only persons
determined by the relevant U.S. government authorities pursuant to EO 14024 for operating or
having operated in the certain sectors as determined by OFAC are designated as sanctioned. As
of the Latest Practicable Date, we were not designated under EO 14024 and we were not aware
of any Chinese vehicle manufacturer designated under EO 14024. As advised by our
International Sanctions Legal Advisers, considering the specific factors of our activities
discussed in details in “Business — Business Activities in Regions Subject to International
Sanctions”, the U.S. secondary sanctions risk is relatively limited for the Group’s operations
relating to the “transportation” sector in Russia. We plan to downscale our presence and sales
in Russia to mitigate the relevant sanction risks. See “Business — Business Activities in
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Regions Subject to International Sanctions.” The downscaling of our presence and sales in
Russia may adversely affect our results of operations and financial conditions if we are not able
to increase our revenue from the sales from other markets to substitute the downscaling of sales
in Russia.
International Sanctions are constantly evolving, and new persons and entities are
regularly added to the list of Sanctioned Targets. Further, new requirements or restrictions
could come into effect which might increase the scrutiny on our business or result in one or
more of our business activities being deemed to be sanctionable. We cannot provide any
assurance that our past or future business will be free of sanctions risk or our business will
conform to the expectations and requirements of the authorities of the U.S. or any other
jurisdictions. Our business and reputation could be adversely affected if the authorities of U.S.,
the EU, the UN, the U.K., Australia or any other jurisdictions were to determine that any of our
past or future activities constitutes a violation of the relevant sanctions or provide a basis for
a sanctions designation of our Group. Moreover, our business and results of operations could
be adversely affected if we downscale our business presence and sales in the jurisdictions
subject to sanctions risks. For details on our business operations in the Regions subject to
International Sanctions, see “Business — Business Activities in Regions Subject to
International Sanctions.”
Failure to make adequate contributions to various employee benefit plans may subject us
to penalties.
PRC laws and regulations require us to participate in various government sponsored
employee benefit plans. These benefit plans include social insurance, housing provident fund
and other welfare-oriented payment obligations. PRC laws require that we contribute to the
plans in amounts equal to certain percentages of salaries of our employees up to maximum
amounts specified by the local government at locations where we operate our business. As of
the Latest Practicable Date, we had not received any notice for payment of penalties of social
insurance premium and housing provident funds from the competent authorities, nor had we
been subject to any material administrative penalties during the Track Record Period and up to
the Latest Practicable Date. However, if the relevant PRC authorities hold a different view with
us and, for instance, determine that we shall make supplemental contributions, that we are not
in compliance with labor laws and regulations or that we are subject to fines or other
administrative penalties, our results of operation, financial conditions, business and prospects
may be adversely affected.
On July 31, 2025, the Supreme People’s Court of the PRC has issued the Interpretation
II by the Supreme People’s Court of the PRC on Legal Issues in the Trial of Labor Dispute
Cases* (༆ᙑ(ɚ)) (the “ Interpretation
II”), which takes effect from September 1, 2025. Pursuant to the Interpretation II, it is a
statutory obligation on both the employers and employees to participate in the social insurance.
Any arrangement not to participate in social insurance, either by unilateral undertaking or
mutual agreement, is invalid. Further, the Interpretation II specifies that If the employee
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terminates the labor contract on the grounds that the employer has failed to make social
insurance contributions as required by law, and claims economic compensation from the
employer, the People’s Court of the PRC shall uphold the claim.
In light of the Interpretation II, as advised by the PRC Legal Advisor, in each of the period
during the Track Record Period and up to the Latest Practicable Date, (i) our Company and our
major subsidiaries in the PRC (a) made social insurance contributions for all our employees
and (b) did not make any arrangement with their employees not to participate in the social
insurance, either by unilateral undertakings or mutual agreements and (ii) there were no
incidents with regard to the termination of the labour contracts between our Company (or any
of our major subsidiaries in the PRC) and our respective employees, which was initiated by our
employees, on the grounds that we had failed to make social insurance contributions. As further
advised by our PRC Legal Advisor, the Interpretation II dose not a material and adverse impact
on our business operation and financial position. See “History, Development and Corporate
Structure — Our Major Subsidiaries” in this Prospectus for details of the major subsidiaries of
our Company in the PRC. However, if the relevant PRC authorities hold a different view with
us and determine that we are not in compliance with the Interpretation II, our results of
operation, financial conditions, business and prospects may be adversely affected.
There are defects in our titles of, or rights to use, certain properties.
As of March 31, 2025, our Company and major subsidiaries in China had not obtained the
building ownership certificate of some of our owned property for production facilities and
office space with a GFA accounting for less than 0.2% of the aggregate GFA of the owned
properties of our Company and major subsidiaries in China. We have obtained a confirmation
letter from the relevant competent authority indicating that such a defect does not constitute a
material non-compliance of relevant laws and regulations. As advised by our PRC Legal
Adviser, the defect of such owned property would not materially and adversely affect our
business operations. See “Business — Properties — Owned Properties.” Moreover, the
landlord of four of the leased properties of our Company and major subsidiaries in China had
not provided us with valid title certificates. See “Business — Properties — Leased Properties.”
Any dispute or claim in relation to the title to the properties we occupy, including any litigation
involving allegations of illegal or unauthorized use of these properties, may result in us having
to relocate our operations and may materially and adversely affect our operations, financial
condition, reputation and future growth. In addition, there can be no assurance that the PRC
government will not amend or revise existing property laws, regulations or rules to require
additional approvals, licenses or permits, or to impose stricter requirements on us to obtain or
maintain relevant title certificates for the properties that we occupy.
We may face penalties for the non-registration of our lease agreements in China.
As of the Latest Practicable Date, the lease agreements with respect to the properties we
and our major subsidiaries leased for production facilities and office space in the PRC had not
conducted filing registration with the relevant PRC government authorities. As advised by our
PRC Legal Adviser, failure to complete the lease registration will not affect the validity of the
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lease agreements according to PRC law, but we may have a maximum penalty of RMB10,000
imposed on us for each non-registered lease if we fail to complete the registration of any of our
future lease agreements after we are requested to do so by the competent PRC government
authorities. See “Business — Properties — Leased properties.” During the Track Record Period
and up to the Latest Practicable Date, we had not received any such request or suffered any
such fine from the relevant PRC government authorities. We cannot assure you that our lessor
will cooperate with us to register such leases due to factors beyond our control or our use of
the relevant properties will not be further challenged in the future. Any of these may have an
adverse effect on our results of operation, financial conditions, business and prospects.
Failure to obtain, renew, or retain licenses, permits or approvals may affect our ability to
conduct or expand our business.
We are required to obtain applicable licenses, permits, and approvals from different PRC
regulatory authorities in order to conduct or expand our business. V arious governmental
authorities in the PRC have promulgated various regulations on designing, developing,
manufacturing, and selling passenger vehicles. Our vehicle factories have obtained requisite
approvals to manufacture and assemble vehicles.
There is no assurance that the PRC regulatory authorities will not issue or promulgate
new regulations governing automotive industry that might require us to obtain additional
licenses, permits or approvals for our current or future business operations. Failure to obtain,
renew or retain such licenses, permits or approvals may materially and adversely affect our
business operations and financial condition. In addition, as we expand to more overseas
markets, we will be subject to regulatory requirements of local markets, and may need to obtain
additional licenses and permits for our business operations. We cannot guarantee that if and
when needed, we will be able to obtain such licenses and permits in a timely manner, or at all.
We incurred net current liabilities as of December 31, 2022, 2023 and 2024 and March 31,
2025.
We recorded net current liabilities of RMB4,760 million, RMB17,388 million, RMB3,401
million and RMB2,788 million as of December 31, 2022, 2023 and 2024 and March 31, 2025,
respectively. Our net current liabilities increased as of December 31, 2023 primarily due to the
increase in trade and bills payables, interest-bearing bank loans and contract liabilities, which
is in line with the substantial business growth in the same year. Our net current liabilities
improved as of December 31, 2024, primarily due to our increased current asset including an
increase in (i) trade receivables, (ii) financial assets at FVTPL, (iii) financial assets at fair
value through other comprehensive income and (iv) cash and cash equivalent. Our net current
liabilities improved as of March 31, 2025, primarily due to a decrease in (i) interest-bearing
bank loans and other borrowings, (ii) other payables and accruals and (iii) contract liabilities.
See “Financial Information — Net Current Liabilities”.
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We cannot assure you that we will continue to improve the net current liabilities position
or have a net current assets position in the future. The net current liabilities position, if recurs
in the future, would expose us to liquidity risk which could restrict our ability to make
necessary capital expenditure or develop business opportunities, and our business, operating
results and financial condition could be materially and adversely affected.
If we fail to effectively manage our inventory, our results of operation, financial
conditions, business and prospects may be materially and adversely affected.
We are exposed to inventory risks in partial with regards to automobile parts or
component and raw materials that may adversely affect our financial condition, results of
operations, and prospects as a result of increased competition, seasonality, new model
launches, rapid changes in vehicle life cycles and pricing, vehicle defects, changes in consumer
demand and consumer spending patterns, and other factors. In order to operate our business
effectively and meet our users’ demands and expectations, we must maintain a certain level of
inventory to avoid overstocking or understocking issues and ensure timely delivery. We
determine our level of inventory based on our experience and assessment of user demands and
number of orders from users.
However, forecasts are inherently uncertain, and the actual demand for our vehicles may
not align with our forecasts. If we fail to accurately forecast the demand, we may experience
inventory obsolescence or inventory shortage risk. Inventory levels in excess of demand may
result in inventory write-downs or write-offs and the sale of excess inventory at discounted
prices, which could adversely affect our profitability. We recognized net written-down of
inventories to net realizable value of RMB61 million, RMB431 million, RMB982 million and
RMB434 million in 2022, 2023 and 2024 and the three months ended March 31, 2025. In
addition, if we underestimate the demand for our vehicles, we may not be able to manufacture
a sufficient number of vehicles to meet such unanticipated demand, which could result in
delays in the delivery of our vehicles and harm our reputation.
Any of the above may materially and adversely affect our financial condition and results
of operations. As we plan to continue to expand our vehicle offerings, we may continue to face
challenges in effectively managing our inventory.
Our warranty reserves may be insufficient to cover future warranty claims, which could
adversely affect our financial performance.
We accrue a warranty reserve for the vehicles sold, which includes the best estimates of
projected costs to repair or replace vehicles under warranties. These estimates are primarily
based on the estimates of the nature, frequency, and average costs of future claims. We
reevaluate the adequacy of the warranty accrual on a regular basis. We cannot assure you that
such reserves will be sufficient to cover future claims. During the Track Record Period, the
amount of warranties utilized was RMB1,101 million, RMB2,222 million, RMB3,504 million
and RMB861 million, respectively. As of December 31, 2022, 2023 and 2024 and March 31,
2025, our warranty balance was RMB2,643 million, RMB5,623 million, RMB9,498 million
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and RMB10,850 million, respectively. We could, in the future, become subject to a significant
and unexpected warranty claim, resulting in significant expenses, which would in turn
materially and adversely affect our business, prospects, financial condition and results of
operation.
If we fail to fulfill our obligations under our contracts with customers in respect of
contract liabilities, our results of operation, financial conditions, business and prospects
may be adversely affected.
As of March 31, 2025, our contract liabilities amounted to RMB13,088 million. Our
contract liabilities primarily represent advance payments from customers for goods and rebated
payables to customers. See “Financial Information — Certain Balance Sheet Items — Contract
Liabilities.” If we fail to fulfill our obligations under our contracts with customers, we may not
be able to convert such contract liabilities into revenue, and our customers may also require us
to refund the purchase price we have received, which may adversely affect our cash flow and
liquidity condition, our ability to meet our working capital requirements and our results of
operations and financial condition. In addition, if we fail to fulfill our obligations under our
contracts with customers, it may adversely affect our relationship with such customers, which
may also affect our reputation, results of operation, financial conditions, business and
prospects in the future.
Our insurance coverage may not be sufficient to cover all the losses associated with our
business operations.
We face various risks in connection with our business. We currently have insurance
coverage for our properties and fixed assets, plant and equipment and inventories, which we
consider to be exposed to major business risks. We also maintain third-party insurance policies
covering certain potential risks and liabilities including product liability. We cannot assure you
that our insurance coverage is sufficient to prevent us from any loss, or that we will be able
to successfully claim our losses under our current insurance policies on a timely basis, or at all.
If we incur any loss that is not covered by our insurance policies, or the compensated amount
is significantly less than our actual loss, our results of operation, financial conditions, business
and prospects could be materially and adversely affected.
We are subject to credit risk in collecting trade receivables due from the customers.
During the Track Record Period, a majority of our trade receivables were outstanding for
less than one year. Sales of our passenger vehicles are normally settled in advance of delivery.
However, in the case of long-standing customers with bulk purchases and a good repayment
history, we may offer them credit terms that are generally between 30 and 180 days. During the
Track Record Period, our trade receivables turnover days were 35.8 days, 26.2 days, 21.0 days
and 26.9 days, respectively. As of December 31, 2022, 2023 and 2024 and March 31, 2025, we
had total trade receivables of RMB9,521 million, RMB11,268 million, RMB17,423 million and
RMB21,270 million, respectively, after deducting the provision for impairment of RMB1,273
million, RMB1,353 million, RMB1,065 million and RMB1,068 million, respectively, as of the
same dates. See “Financial Information — Certain Balance Sheet Items — Trade and Other
Receivables” in this prospectus. There is no assurance that all such amounts due to our Group
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will be settled on time or at all, and we are subject to credit risk in collecting the trade
receivables due from the customers. Our Group’s performance, liquidity and profitability will
be adversely affected if significant amounts due to our Group are not settled on time. The
bankruptcy or deterioration of the credit condition of any of our major customers could also
materially and adversely affect our business.
We are exposed to changes in the fair value of our financial assets measured at fair value
through profit or loss (“FVTPL”) and our financial assets measured at fair value through
other comprehensive income (“FVTOCI”). Fluctuations in these values would affect our
results of operations and financial condition.
As of December 31, 2022, 2023 and 2024 and March 31, 2025, we recorded financial
assets measured at FVTPL of RMB14,172 million, RMB12,037 million, RMB19,640 million
and RMB29,336 million, respectively. As of the same dates, we recorded financial assets
measured at FVTOCI of RMB2,708 million, RMB4,756 million, RMB7,860 million and
RMB2,084 million, respectively. Fair values of financial assets measured at FVTPL and
financial assets measured at FVTOCI are determined based on quoted prices in active markets,
other market-observable inputs, or unobservable inputs using valuation techniques. See Note
47 to the Accountants’ Report as set out in Appendix I to this prospectus.
For financial assets measured at FVTPL and FVTOCI, factors beyond our control can
significantly influence and cause adverse changes to the market-observable inputs that we use
and thereby affect the fair value of such financial assets. These factors include, but are not
limited to, general economic condition, changes in market interest rates, stability of the capital
markets, shifts in our creditworthiness and other market-driven variables. Any of factors could
cause the fair values to fluctuate or our estimates to vary from actual results, which could
materially and adversely affect our results of operation and financial condition. Additionally,
judgment and estimation are required in establishing the relevant valuation techniques where
market-observable data for certain financial assets are not readily available, which inherently
involves a certain degree of uncertainty. Changes in assumptions relating to our valuation could
result in material adjustments to the fair value of such financial assets, which may have a
material adverse effect on our financial position and results of operations.
We have granted, and may continue to grant, certain awards under our share incentive
plans, which may result in increased share-based compensation expenses, affect our
financial condition and results of operations, and potentially dilute the shareholding of
our existing shareholders.
We adopted share incentive plans including share-based compensation to incentivize and
reward the eligible participants including middle and senior management and key employees
who have contributed to our success. In 2022, 2023 and 2024 and the three months ended
March 31, 2025, we incurred share-based payments of nil, nil, RMB2,016 million and RMB131
million, respectively. We believe the granting of share-based compensation is of significant
importance to our ability to attract and retain key personnel and employees. We may continue
to grant share-based compensation to employees in the future. As a result, our expenses
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associated with share-based compensation may increase, which may affect our financial
condition and results of operations. Issuance of additional Shares with respect to such
share-based payment may dilute the shareholding percentage of our existing Shareholders.
We may be subject to risks associated with our transfer pricing arrangement.
During the Track Record Period, our sales and exporting activities involved the
intra-Group transactions (the “ Intra-Group Transactions ”). See “Business – Intra-Group
Transactions.” Our Transfer Pricing Advisor conducted independent analysis and confirmed
that, during the Track Record Period, the weighted average price and/or profit levels of the
Intra-Group Transactions conducted by the Group is within the range of the respective arm’s
length price and/or profit margin. Therefore, the Transfer Pricing Advisor is of the view that
our pricing arrangements have been in compliance with the applicable laws, regulations and
guidelines, including the transfer pricing guidelines for multinational enterprises and tax
administrations promulgated by Organization for Economic Co-operation and Development
(the “ OECD ”) (the “ OECD Transfer Pricing Guidelines ”), and there is no material transfer
pricing risk identified on the Intra-Group Transactions of the Group during the Track Record
Period. However, there were uncertainties associated with the profit allocation and the tax
position in respect of the Intra-Group transactions. The tax treatments of these transaction
arrangements may be subject to interpretation by the respective tax authorities in the PRC and
overseas. There is no assurance that the tax authorities will not subsequently challenge the
appropriateness of our transfer pricing arrangements or that the relevant regulations or
standards governing such arrangement will not be subject to future changes. If any competent
tax authority in the PRC or overseas later considers that our transfer pricing arrangements do
not comply with the relevant transfer pricing laws and regulations, we may face adverse tax
consequences including additional taxes, interests or penalties, which may result in a higher
overall tax liability for us and may adversely affect our business, financial condition and
operating results.
Our operations may be significantly disrupted by risks associated with natural disasters,
epidemics, and other outbreaks.
Our operations are vulnerable to interruption and damage from natural disasters and other
calamities, such as fires, floods, severe weather conditions, earthquakes, power failures, civil
unrest, and acts of terrorism. Due to their nature, we cannot predict the incidence, timing and
severity of catastrophes. In addition, changing climate conditions, primarily rising global
temperatures, may be increasing, or may in the future increase, the frequency and severity of
natural catastrophes. If any such catastrophes or extraordinary events were to occur in the
future, our ability to operate our business could be seriously impaired, and therefore adversely
affect our results of operation, financial conditions, business and prospects.
In addition, our business could be affected by public health epidemics and pandemics,
such as the outbreak of Ebola, SARS, avian influenza, H1N1, or COVID-19 virus or other
disease. Even if we are not directly affected, such disaster or disruption could affect the
operations or financial conditions of our customers or our supply chain, which could harm our
results of operations. If any of our employees is suspected of having contracted a contagious
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disease, we may be required to apply quarantines or suspend our operations. Furthermore, any
future outbreak may restrict economic activities in affected regions, resulting in reduced
business volume, temporary closure of our offices or otherwise disrupt our business operations
and adversely affect our results of operation, financial conditions, business and prospects.
Our operations rely on complex information technology systems and networks and our
business and reputation may be impacted by information technology system failures,
network disruptions or cybersecurity breaches.
We rely extensively on information technology systems, some of which are supported by
third party vendors including cloud-based systems and managed service providers, to manage
and operate our business. We invest in new information technology systems designed to
improve our operations. We may have failures of these systems in the future. If these systems
cease to function properly, if these systems experience security breaches or disruptions or if
these systems do not provide the anticipated benefits, our ability to manage our operations
could be impaired, which could have a material adverse impact on results of operation,
financial conditions, business and prospects.
We may be subject to information technology system failures or network disruptions
caused by natural disasters, accidents, power disruptions, telecommunications failures, acts of
terrorism or war, computer viruses, physical or electronic break-ins, or other events or
disruptions. System redundancy and other continuity measures may be ineffective or
inadequate, and our business continuity and disaster recovery planning may not be sufficient
for all eventualities. Such failures or disruptions could adversely impact our business by,
among other things, preventing access to our internet services, interfering with customer
transactions or impeding the assembling and shipping of our products.
Our information technology systems have been, and will likely continue to be, subject to
computer viruses or other malicious codes, unauthorized access attempts, phishing and other
cyberattacks. We continue to assess potential threats and make investments seeking to address
and prevent these threats, including monitoring of our networks and systems and upgrading
skills, employee training and security policies for us and our third-party providers. However,
because the techniques used in these cyberattacks change frequently and may be difficult to
detect for periods of time, we may face difficulties in anticipating and implementing adequate
preventative measures. To date, we have seen no material impact on our business or operations
from these attacks; however, we cannot guarantee that our security efforts will prevent
breaches or breakdowns to our or our third-party providers’ databases or systems. If the
information technology systems, networks or service providers we rely upon fail to function
properly or if we or one of our third-party providers suffer a loss, significant unavailability of
or disclosure of our business or stakeholder information and our business continuity plans do
not effectively address these failures on a timely basis, we may be exposed to reputational,
competitive and business harm as well as litigation and regulatory action, including
administrative fines. The costs and operational consequences of responding to breaches and
implementing remediation measures could be significant.
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We are subject to various environmental and safety laws and regulations that could
impose substantial costs upon us and cause delays in building our manufacturing
facilities.
We are subject to multiple environmental and safety laws and regulations related to the
manufacture of our vehicles, including the use of hazardous materials in the manufacturing
process and the operation of our manufacturing plant. Such laws and regulations govern the
use, storage, discharge and disposal of hazardous materials during the manufacturing process.
If our factories or any of our other future constructions fails to comply with applicable
regulations, we could be subject to substantial liability for clean-up efforts, personal injury or
fines or be forced to close or temporarily cease the operations of the relevant factory or other
constructions, any of which could have a material adverse effect on our results of operation,
financial conditions, business and prospects.
Changes in Environmental, Social and Governance (ESG) compliance requirements could
have an adverse impact on our business, operating results and financial condition.
With the rising awareness of ESG issues, including with respect to waste disposal,
packaging waste, greenhouse gas emissions and environmental protection, more stringent laws
and regulations that affect our business operations may be adopted. Accordingly, we may need
to devote more effort and resources to ensure our compliance with such laws or regulations. We
have adopted a series of measures aiming to ensure our compliance with the ESG-related laws
and regulations applicable to us. See “Business — Environment, Social and Governance
Matters.” There can be no assurance that these measures can effectively help us to navigate the
complex and evolving regulatory environment. Changes in existing ESG-related laws and
regulations or the promulgation of new ESG-related laws and regulations may increase our
compliance costs, and accordingly may have an adverse impact on our results of operation,
financial conditions, business and prospects.
RISKS RELATING TO DOING BUSINESS IN THE JURISDICTIONS WHERE WE
OPERATE
Any slowdown in the growth of regional or global economy could affect our business,
results of operations and financial condition.
The growth of the regional and global economy has slowed in recent years. It remains
uncertain whether, and for how long, the regional and global economic slowdown will persist.
There are considerable uncertainties over the long-term effects of the monetary and fiscal
policies adopted by the central banks and financial authorities of some of the world’s leading
economies. There have been concerns over war, unrest and terrorist threats in certain countries
and regions, which have resulted in volatility in oil and other markets. Regional economic
conditions are sensitive to global economic conditions, changes in domestic economic and
political policies as well as the expected overall economic growth rate.
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It is unclear whether these challenges and uncertainties will be effectively managed or
resolved and what effects they may have on the global political and economic conditions in the
long term. Any economic slowdown or negative business sentiment could have an indirect
potential impact on our automotive industry. In addition, continued turbulence in the
international markets may adversely affect our ability to access capital markets to meet
liquidity needs. As a result, our business operations and financial performance may be
adversely affected.
Changes in the economic, political and social conditions as well as government policies in
the countries and regions where we operate could adversely affect our business and
prospects.
A substantial part of our assets and operations are located in China. In addition, we
operate our business in a number of other geographic markets including the ones in the Asia
(excluding China), Europe, Africa, Americas and Oceania. Accordingly, our business, financial
condition and results of operations could also be influenced by political, economic and social
conditions in these markets. Economic growth in each of our geographic markets has been
uneven, both geographically and among various sectors within any one of the relevant
economies. Any economic downturn, whether actual or perceived, further decrease in economic
growth rates or an otherwise uncertain economic outlook in our geographic markets or any
other market in which we may operate could affect our business, financial condition and results
of operations. Changes in the economic or political environment in the countries and regions
where we operate could increase our costs, increase our exposure to legal and business risks,
disrupt our operations and affect our results of operations.
Uncertainties embedded in the legal systems of certain geographic markets where we
operate could affect our business, financial condition and results of operations.
Legal systems of the geographic markets where we operate vary significantly from
jurisdiction to jurisdiction. Some jurisdictions have a civil law system based on written statutes
and others are based on common law. Unlike the common law system, prior court decisions
under the civil law system may be cited for reference but have limited precedential value.
The legal systems of some geographic markets where we operate are consistently
evolving. Laws and regulations that are recently enacted may not sufficiently cover all aspects
of economic activities in such markets. In particular, the interpretation and enforcement of
these laws and regulations are subject to future implementations, and the application of some
of these laws and regulations to our businesses is not settled. Since local administrative and
court authorities are authorized to interpret and implement statutory provisions and contractual
terms, it may be difficult to evaluate the outcome of administrative and court proceedings and
the level of legal protection we have in many of the geographic markets where we operate.
Local courts may have discretion to reject enforcement of foreign awards or arbitration awards.
These uncertainties may affect our judgment on the relevance of legal requirements and our
ability to enforce our contractual rights or claims. In addition, the regulatory uncertainties may
be exploited through unmerited or frivolous legal actions, claims concerning the conduct of
third parties, or threats in attempt to extract payments or benefits from us.
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Furthermore, many of the legal systems in the geographic markets where we operate are
based in part on their respective government policies and internal interpretations, some of
which are not published on a timely basis or at all and may have retroactive effects. There are
other circumstances where key regulatory definitions are unclear, imprecise or missing, or
where interpretations that are adopted by regulators are inconsistent with interpretations
adopted by a court in analogous cases. As a result, we may not be aware of our violation of
certain policies or rules until sometime after the violation. In addition, administrative and court
proceedings in certain of our geographic markets may be protracted, resulting in substantial
costs and diversion of resources and management attention.
It is possible that a number of laws and regulations may be adopted or construed to be
applicable to us in our geographic markets and elsewhere that could affect our businesses and
operations. Scrutiny and regulations of the industries in which we operate may further increase,
and we may be required to devote additional legal and other resources to addressing these
regulations. Changes in current laws or regulations or the imposition of new laws and
regulations in our geographic markets may slow the growth of our industries and affect our
business, financial condition and results of operations.
Fluctuations in exchange rates may result in foreign currency exchange losses and may
have a material adverse effect on your investment.
The change in the value of the Renminbi against the Hong Kong dollar and other
currencies may fluctuate and is affected by, among other things, changes in China’s political
and economic conditions and China’s foreign exchange policies, as well as supply and demand
in the local market. As such, it is difficult to predict how market forces or government policies
may impact the exchange rate between Renminbi, the Hong Kong dollar or other currencies in
the future. During the Track Record Period, the majority of our revenues and expenditures were
denominated in Renminbi, as well as most of our financial assets. However, our proceeds from
the Global Offering will be denominated in Hong Kong dollars. As a China-based company,
any significant change in the exchange rates of the Hong Kong dollar against Renminbi may
materially adversely affect any dividends payable on, our H Shares in Hong Kong dollars.
We face foreign exchange risks. Fluctuations in exchange rates could have a material and
adverse effect on our results of operations and financial performance.
A substantial portion of our revenues and cost of sales is denominated in RMB. However,
as we operate part of our business in foreign jurisdictions, we are subject to risks associated
with foreign currency exchange fluctuations. Through other income and gains and other
expense, we incurred net foreign exchange gains of RMB504 million and RMB2,439 million
in 2022 and the three months ended March 31, 2025 and net foreign exchange losses of
RMB141 million in 2023 and RMB851 million in 2024. Moreover, we recognized a currency
translation gain of RMB77 million and RMB131 million through other comprehensive income
in 2022 and 2024, respectively and we recognized a currency translation loss of RMB419
million and RMB1,017 million through other comprehensive loss in 2023 and the three months
RISK FACTORS
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ended March 31, 2025, respectively. See “Financial Information — Results of Operations —
Other Income and Gains.” We cannot guarantee that future fluctuations of exchange rates
would not have a material adverse impact on our financial condition and results of operations.
Changes in the value of foreign currencies could increase our RMB costs for, or reduce
our RMB revenues from, our foreign operations or overseas sales. The fluctuation of foreign
exchange rates also affects the value of our monetary and other assets and liabilities
denominated in foreign currencies. We cannot guarantee that future fluctuations of exchange
rates would not have a material adverse impact on our financial condition and results of
operations.
We preferentially utilize natural hedges to reduce our foreign exchange risk exposures.
Where natural hedges cannot sufficiently cover our risk exposures, we may utilize other
hedging instruments, depending on the relevant circumstances. During the Track Record
Period, our derivative financial instruments mainly include forward currency contracts and
interest rate swaps. As of December 31, 2022, 2023 and 2024 and March 31, 2025, our
derivative financial assets amounted to RMB241 million, RMB31 million, nil and nil,
respectively, while our derivative financial liabilities amounted to RMB3 million, RMB86
million, nil and nil, respectively, as of the same dates. However, the availability and
effectiveness of these hedging measures may be limited, and we may not be able to adequately
cover our exposure or at all.
We are subject to the currency exchange regulatory system and it may limit our ability to
pay dividends and other obligations, and affect the value of your investment.
The conversion and remittance of foreign currencies are subject to PRC foreign exchange
regulations. As we may convert our revenue in Renminbi into other currencies to meet our
foreign currency obligations, such as payments of dividends on our H Shares, there is no
assurance that we will have sufficient foreign exchange to meet these requirements. Under
existing PRC foreign exchange regulations, payments of current account items, including profit
distributions, interest payments and trade and service-related foreign exchange transactions,
can be made in foreign currencies without prior SAFE approval by complying with certain
procedural requirements. However, any changes to these foreign exchange policies that prevent
us from obtaining sufficient foreign currencies may affect our ability to pay dividends in
foreign currencies to our Shareholders.
Y ou may experience difficulties in effecting service of legal process and enforcing
judgments against us and our management.
We are incorporated under the laws of the PRC with limited liability, and substantially all
of our assets are located in the PRC. In addition, the majority of our Directors and Supervisors
and all of our senior management personnel reside within the PRC, and substantially all their
assets are located within the PRC. As a result, it may not be possible to effect service of process
within the United States or elsewhere outside the PRC upon us or most of our Directors,
Supervisors and senior management personnel.
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When it comes to trans-jurisdictional recognition and enforcement of judgments, the PRC
does not have treaties providing for the reciprocal recognition and enforcement of judgments
of courts with the United States, the United Kingdom, Japan or many other countries. In
addition, Hong Kong has no arrangement for the reciprocal enforcement of judgments with the
United States. As a result, recognition and enforcement in mainland China or Hong Kong of
judgments of a court obtained in the United States and any of the other jurisdictions mentioned
above may be uncertain.
On July 14, 2006, the Supreme People’s Court of the PRC and the Government of
the Hong Kong Special Administrative Region signed an Arrangement on Reciprocal
Recognition and Enforcement of Judgments in Civil and Commercial Matters (ʫήၾ
τર) (the “2006
Arrangement”). Under the 2006 Arrangement, where any designated People’s Court of the PRC
or Hong Kong court has made an enforceable final judgment requiring payment of money in
a civil and commercial case pursuant to a choice of court agreement, any party concerned may
apply to the relevant People’s Court of mainland China or Hong Kong court for recognition and
enforcement of the judgment. Therefore, it is not possible to enforce a judgment rendered by
a Hong Kong court in mainland China if the parties in dispute have not agreed to enter into
such a choice of court agreement in writing. Therefore, it may not be possible to enforce a
judgment rendered by a Hong Kong court in mainland China if the parties in dispute have not
entered into a jurisdiction agreement in writing under the 2006 Arrangement.
As between mainland China and Hong Kong, the new arrangement entered into between
the Supreme People’s Court of the PRC and the government of the Hong Kong Special
Administrative Region on January 18, 2019 which took effect on January 29, 2024, has lifted
the requirements for a choice of court agreement in writing in a civil or commercial case under
the previous regime on bilateral recognition and enforcement. However, the 2006 Arrangement
will remain applicable to a “jurisdiction agreement in writing” as defined in the 2006
Arrangement which is entered into before the 2019 Arrangement taking effect. However, since
the 2019 Arrangement is newly effected and promulgated, the interpretation, application and
enforcement must be determined in accordance with the relevant laws and regulations in effect
at the time.
Payment of dividends is subject to laws and regulations in regions where we operate.
Under the PRC laws, dividends may be paid only out of distributable profits. Our
distributable profits represent our distributable net profits less appropriations to statutory
surplus reserve, general reserve, and discretionary surplus reserve (as approved by our
Shareholders’ meeting). Our distributable net profit represents the lowest of (i) our net profit
attributable to our equity holders for a period plus distributable profits or net of accumulated
losses, if any, at the beginning of such period, as determined under PRC GAAP , and (ii) our
net profit attributable to our equity holders for the period plus distributable profits or net of
accumulated losses, if any, at the beginning of such period, as determined under HKFRS
Accounting Standards. As a result, we may not have sufficient distributable profits to make
dividend distributions to our Shareholders in the future, including in respect of periods where
we register an accounting profit. Any distributable profits that are not distributed in a given
year are retained and available for distribution in subsequent years.
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RISKS RELATING TO THE GLOBAL OFFERING
There has been no prior public market for our H Shares and the liquidity and market
price of our H Shares may be volatile.
Prior to the completion of the Global Offering, there has been no public market for our
H Shares. There can be no guarantee that an active trading market for our H Shares will
develop or be sustained after the completion of the Global Offering. The Offer Price is the
result of negotiations between our Company and the Overall Coordinators (for themselves and
on behalf of the Underwriters), which may not be indicative of the price at which our H Shares
will be traded following completion of the Global Offering. The market price of our H Shares
may drop below the Offer Price at any time after completion of the Global Offering.
The trading price of our H Shares may be volatile, which could result in substantial losses
to you.
The trading price of our H Shares may be volatile and could fluctuate widely in response
to factors beyond our control, including general market conditions of the securities markets in
Hong Kong, China, the United States and elsewhere in the world. In particular, the performance
and fluctuation of the market prices of other companies with business operations located
mainly in mainland China that have listed their securities in Hong Kong may affect the
volatility in the price of and trading volumes for our H Shares. A number of mainland
China-based companies have listed their securities, and some are in the process of preparing
for listing their securities, in Hong Kong. Some of these companies have experienced
significant volatility, including significant price declines after their initial public offerings. The
trading performances of the securities of these companies at the time of or after their offerings
may affect the overall investor sentiment towards mainland China-based companies listed in
Hong Kong and consequently may impact the trading performance of our H Shares. Pursuant
to the applicable PRC law, within the 12 months following the Listing Date, all existing
Shareholders (including the Pre-IPO Investors) could not dispose of any of the Shares held by
them. Due to such lock-up requirement, the liquidity and trading volume of the H Shares in the
short term following the Global Offering may be significantly affected. These factors may
significantly affect the market price and volatility of our H Shares, regardless of our actual
operating performance.
Y ou will incur immediate and substantial dilution and may experience further dilution if
we issue additional Shares in the future.
The Offer Price of the Offer Shares is higher than the net tangible asset value per H Share
immediately prior to the Global Offering. Therefore, purchasers of the Offer Shares in the
Global Offering will experience an immediate dilution in pro forma consolidated net tangible
asset value. In order to expand our business, we may consider offering and issuing additional
Shares in the future. Purchasers of the Offer Shares may experience dilution in the net tangible
asset value per H Share of their H Shares if we issue additional Shares in the future at a price
which is lower than the net tangible asset value per H Share at that time. Furthermore, we may
issue Shares pursuant to any existing or future equity incentive plan, which would further
dilute our Shareholders’ interests in our Company.
RISK FACTORS
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Future sales or perceived sales of substantial amount of our Shares in the public market,
especially by our Directors, executive officers and substantial Shareholders, could
materially and adversely affect the prevailing market price of our Shares.
Future sales of a substantial number of our Shares, especially by our Directors, executive
officers and substantial Shareholders, or the perception or anticipation that such sales might
occur, could negatively impact the market price of our Shares and our ability to raise equity
capital in the future at a time and price that we deem appropriate. A certain amount of the
Shares controlled by our existing Shareholders are subject to certain lock-up periods beginning
on the date on which trading in our Shares commences on the Stock Exchange. While we
currently are not aware of any intention of such persons to dispose of significant amounts of
their Shares after the expiry of the lock-up periods, we cannot assure you that they will not
dispose of any Shares they may own now or in the future. Market sale of Shares by such
Shareholders and the availability of these Shares for future sale may have a negative impact
on the market price of our Shares.
Our Single Largest Shareholder may not be aligned with the interests of the other
Shareholders.
Immediately upon completion of the Global Offering (assuming the Over-allotment
Option is not exercised), our Single Largest Shareholder will be entitled to exercise
approximately 20.08% the issued share capital of our Company. Our Single Largest
Shareholder may, through their voting power at the Shareholders’ meetings, have significant
influence over our business and affairs, including decisions for mergers or other business
combinations, acquisition or disposition of assets, issuance of additional shares or other equity
securities, timing and amount of dividend payments, and our management. Our Single Largest
Shareholder may not act in the best interests of our minority Shareholders.
We are a mainland China enterprise and we are subject to mainland China tax on our
global income and any gains on the sales of H Shares and dividends on the H Shares may
be subject to mainland China income taxes.
Under the PRC EIT Law and its implementation rules, subject to any applicable tax treaty
or similar arrangement between the mainland China and a non-mainland China investor’s
jurisdiction of residence that provides for a different income tax arrangement, mainland China
withholding tax at the rate of 10% is normally applicable to dividends from mainland China
sources payable to investors that are non-mainland China resident enterprises, which do not
have an establishment or place of business in mainland China, or which have an establishment
or place of business in mainland China if the relevant income is not effectively connected with
such establishment or place of business. Any gains realized on the transfer of shares by such
investors are subject to a 10% mainland China income tax rate if such gains are regarded as
income from sources within mainland China unless a treaty or similar arrangement provides
otherwise.
RISK FACTORS
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Under the PRC Individual Income Tax Law () and its
implementation rules, dividends from sources within mainland China paid to foreign individual
investors who are not mainland China residents are generally subject to a mainland China
withholding tax at a rate of 20% and gains from mainland China sources realized by such
investors on the transfer of shares are generally subject to a 20% mainland China income tax
rate, in each case, subject to any reduction or exemption set forth in applicable tax treaties and
laws in mainland China. Pursuant to the Circular on Questions Concerning the Collection of
Individual Income Tax Following the Repeal of Guo Shui Fa [1993] No. 045 (਷೼೯
[1993]045) (Guo Shui Han [2011] No. 348)
(਷೼Ռ[2011]348 ໮) dated June 28, 2011, issued by the SA T, dividends paid to non-mainland
China resident individual holders of H Shares are generally subject to individual income tax
of mainland China at the withholding tax rate of 10%, in which the non-mainland China
resident individual holder of H Shares resides as well as the tax arrangement between mainland
China and Hong Kong. Non-mainland China resident individual holders who reside in
jurisdictions that have not entered into tax treaties with mainland China are subject to a 20%
withholding tax on dividends received from us. However, pursuant to the Circular Declaring
that Individual Income Tax Continues to be Exempted over Income of Individuals from
Transfer of Shares () issued by the
MOF of mainland China and the SA T on March 30, 1998, gains of individuals derived from the
transfer of listed shares of enterprises may be exempt from individual income tax. In addition,
on December 31, 2009, the MOF, the SA T and the CSRC jointly issued the Circular on
Relevant Issues Concerning the Collection of Individual Income Tax over the Income Received
by Individuals from Transfer of Listed Shares Subject to Sales Limitation (ɛᔷᜫɪ
) (Cai Shui [2009] No. 167) which states
that individuals’ income from the transfer of listed shares on certain domestic exchanges shall
continue to be exempted from individual income tax, except for the relevant shares which are
subject to sales restrictions as defined in the Supplementary Circular on Relevant Issues
Concerning the Collection of Individual Income Tax over the Income Received by Individuals
from Transfer of the Listed Shares Subject to Sales Limitations (ࠢ
) (Cai Shui [2010] No. 70). As of the Latest
Practicable Date, the aforesaid provision has not expressly provided that individual income tax
shall be collected from non-mainland China resident individuals on the sale of shares of
mainland China resident enterprises listed on overseas stock exchanges.
If mainland China income tax is imposed on gains realized from the transfer of our H
Shares or on dividends paid to our non-mainland China resident investors, the value of your
investment in our H Shares may be affected. Furthermore, our Shareholders whose jurisdictions
of residence have tax treaties or arrangements with mainland China may not qualify for
benefits under such tax treaties or arrangements.
RISK FACTORS
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Certain facts, forecasts, statistics and information in this prospectus relating to the
automotive industry may not be fully reliable.
Certain facts, forecasts and statistics in this prospectus relating to the automotive industry
in which we operate are obtained from various sources that we believe are reliable, including
official government publications and third-party reports, either commissioned by us or publicly
accessible, and other publicly available sources. We have taken reasonable care in the
reproduction or extraction of the such information. However, we cannot guarantee the quality
or reliability of these sources. Specifically, neither we, the Joint Sponsors, the Sponsor-Overall
Coordinators, the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners,
the Joint Lead Managers, the Capital Market Intermediaries, the Underwriters, nor our or their
respective affiliates or advisers have verified such information. Due to possibly flawed or
ineffective collection methods or discrepancies between published information and market
practice and other problems, the statistics in this prospectus relating to the automotive industry
may be inaccurate or may not be comparable to statistics produced for other markets, and
should not be unduly relied upon. As such, no representation as to the accuracy of such facts,
forecasts and statistics obtained from various sources is made. Moreover, these facts, forecasts
and statistics involve risk and uncertainties and are subject to change based on various factors
and should not be unduly relied upon. Further, there can be no assurance that they are stated
or compiled on the same basis, or with the same degree of accuracy, as may be the case
elsewhere.
We cannot assure you that we will declare and distribute any dividends in the future. If
we do not pay dividends in the foreseeable future after the Listing, you must rely on price
appreciation of our H Shares for a return on your investment.
We cannot assure you when and in what form dividends will be paid on our H Shares after
the Global Offering. The declaration and distribution of dividends is at the complete discretion
of the Board, and our ability to pay dividends or make other distributions to our Shareholders
is subject to various factors, including our business and financial performance, capital and
regulatory requirements and general business conditions. We may not be able to have sufficient
or any profits to enable us to make dividend distributions to our Shareholders in the future,
even if our financial statements indicate that our operations have been profitable. As a result
of the above, we cannot assure you that we will make/can make dividend payments on our H
Shares in the future. See “Financial Information — Dividends.”
If we retain most, or all, of our available funds and any future earnings after the Global
Offering to fund the development and commercialization of our new product candidates, we
may not expect to pay any cash dividends in the foreseeable future. Therefore, you may not be
able to rely on an investment in our H Shares as a source for any future dividend income.
Even if our Board decides to declare and pay dividends, the timing, number and form of
future dividends, if any, will depend on our future results of operations and cash flow, our
financial condition, general business conditions and business strategies, expected working
capital requirements and future expansion plans, legal, regulatory and other contractual
RISK FACTORS
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restrictions and other factors deemed relevant by our Board. Accordingly, the return on your
investment in our H Shares will likely depend entirely upon any future price appreciation of
our H Shares. There is no guarantee that our H Shares will appreciate in value after the Global
Offering or even maintain the price at which you purchased the Shares. Y ou may not realize
a return on your investment in our H Shares and you may even lose your entire investment in
our H Shares.
There are risks that the U.S. Outbound Investment Rule may subject U.S. investors of the
H Shares to regulatory requirements.
On October 28, 2024, the U.S. Department of the Treasury (the “ Treasury ”) issued the
Provisions Pertaining to U.S. Investments in Certain National Security Technologies and
Products in Countries of Concern (the “ Outbound Investment Rule ”). The Outbound
Investment Rule, effective on January 2, 2025, is aimed at exerting greater U.S. government
oversight over U.S. direct and indirect investments in certain key sectors involving China and
introduces new hurdles and uncertainties for cross-border collaborations, investments and
funding opportunities of entities with ties to China in such key sectors. It targets investments
involving entities associated with “countries of concern,” currently defined as only China
(including Hong Kong and Macau), and imposes investment prohibition or notification
requirements on a wide range of U.S. person investment transactions in a “person of a country
of concern” engaged in “covered activities” relating to three sectors: (i) semiconductors and
microelectronics, (ii) quantum information technologies, and (iii) certain artificial intelligence
systems (together, the “ relevant sectors ”).
Under the Outbound Investment Rule, a “covered foreign person” includes (1) a “person
of a country of concern” that engages in a “covered activity” as well as (2) a person that holds
ownership or governance over one or more persons identified in (1), if that person derives more
than 50% of revenue or net income, or incurs more than 50% of its capital expenditures or
operating expenses, from such person(s), individually or in the aggregate. We do not believe
that the Company is a “covered foreign person” as defined under the Outbound Investment
Rule. The Company does not engage in “covered activities” and therefore would not be a
“covered foreign person” under item (1) above. In addition, although some of the Company’s
subsidiaries may be deemed to engage in “covered activities” under the Outbound Investment
Rule, the percentage of the aggregated revenue, net income, capital expenditure and operating
expenses of these subsidiaries as compared to that of the Company is minimal and well below
the 50% threshold for a “covered foreign person”. As such, according to our OIR Legal
Advisors, the Company would also not be a “covered foreign person” under item (2) above.
In addition, as advised by our OIR Legal Advisors, any investment by a U.S. person in
the Company’s H Shares would not constitute a “covered transaction” under the Outbound
Investment Rule because the Company is not a “covered foreign person.” Furthermore, after
the Company’s H Shares becomes publicly traded, an investment by a U.S. person in such
publicly traded H Shares of the Company would be an excepted transaction pursuant to 31
C.F.R. §850.501 and therefore would also not constitute a “covered transaction” under the
Outbound Investment Rule.
RISK FACTORS
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However, the Treasury has issued only limited guidance to clarify provisions in the
Outbound Investment Rule, especially in relation to definitions of terms that comprise covered
activities. As such, there are uncertainties under the Outbound Investment Rule, and we cannot
assure you that the Treasury will not take a different view from us and treat an investment in
our H Shares by a U.S. person as a covered transaction that requires notification in a timely
manner or is prohibited under the Outbound Investment Rule. In addition, we cannot predict
how the Outbound Investment Rule will be enforced, and neither can we guarantee that there
will not be an expansion to the scope of the Outbound Investment Rule, a change in
interpretation to broaden its application, or an enactment of similar laws or regulations that
impinge upon our business activities in the future.
The uncertainty in the interpretation and enforcement of the Outbound Investment Rule
may reduce U.S. investors’ interest in our equity securities. In such a case, the trading price of
our H Shares may be adversely affected. It could also be detrimental to our business, financial
condition and prospects.
This prospectus contains forward-looking statements relating to our plans, objectives,
expectations and intentions, which may not represent our overall performance for periods
of time to which such statements relate.
This prospectus contains certain statements and information that are “forward-looking”
and uses forward-looking terminology such as “anticipate,” “believe,” “could,” “estimate,”
“expect,” “may,” “ought to,” “should” or “will” or similar terms. Those statements include,
among other things, the discussion of our growth strategy and expectations concerning our
future operations, liquidity and capital resources. Investors in the H Shares are cautioned that
reliance on any forward-looking statements involves risks and uncertainties and that any or all
of those assumptions could prove to be inaccurate, and, as a result, the forward-looking
statements based on those assumptions could also be incorrect. The uncertainties in this regard
include, but are not limited to, those identified in this section, many of which are not within
our control. In light of these and other uncertainties, the inclusion of forward-looking
statements in this prospectus should not be regarded as representations by us that our plans or
objectives will be achieved and investors should not place undue reliance on such forward-
looking statements. We do not undertake any obligation to update publicly or release any
revisions of any forward-looking statements, whether as a result of new information, future
events or otherwise. See “Forward-Looking Statements.”
Y ou should read the entire prospectus carefully, and we strongly caution you not to place
any reliance on any information contained in press articles and/or other media regarding
us, our business, our industry or the Global Offering.
Y ou are strongly advised to read the entire prospectus carefully and are cautioned against
placing any reliance on the information in any press article or any other media coverage which
contains information not disclosed or not consistent with the information included in this
prospectus.
RISK FACTORS
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Prior to the completion of the Global Offering, there may be press and media coverage
regarding our Group and the Global Offering. Our Directors would like to emphasize to
prospective investors that we do not accept any responsibility for the accuracy or completeness
of such information, and such information is not sourced from or authorized by our Directors
or our management team. Our Directors make no representation as to the appropriateness,
accuracy, completeness and reliability of any information or the fairness or appropriateness of
any forecast, view or opinion expressed by the press or other media regarding our Group or our
H Shares. In making decisions as to whether to invest in our H Shares, prospective investors
should rely only on the financial, operational and other information included in this prospectus.
By applying to purchase our H Shares in the Global Offering, you will be deemed to have
agreed that you will not rely on any information other than that contained in this prospectus
and the Global Offering. To the extent that any such information is inconsistent or conflicts
with the information contained in this prospectus, we disclaim responsibility for it and you
should not rely on such information.
RISK FACTORS
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In preparation for the Global Offering, our Company has sought and has been granted
with the following waivers from strict compliance with the relevant provisions of the Listing
Rules:
W AIVER IN RESPECT OF MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rules 8.12 and 19A.15 of the Listing Rules, we must have a sufficient
management presence in Hong Kong. This normally means that at least two of our executive
Directors must be ordinarily resident in Hong Kong.
Since most of the business operations of our Group are managed and conducted outside
of Hong Kong, and our executive Directors ordinarily reside outside Hong Kong, we consider
it practicably difficult and commercially unreasonable for us to arrange two executive
Directors to be ordinarily reside in Hong Kong, either by means of relocation of the executive
Directors to Hong Kong or appointment of additional executive Directors. Therefore, we do not
have, and in the foreseeable future will not have, sufficient management presence in Hong
Kong for the purpose of satisfying the requirements under Rules 8.12 and 19A.15 of the Listing
Rules.
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 8.12 and 19A.15
of the Listing Rules, provided that our Company implements the following arrangements:
(a) we have appointed Mr. Zhang Guozhong (׀our executive Director) and
Ms. Zhan Ni ( ༗֋) (our joint company secretary) as our authorized representatives
pursuant to Rule 3.05 of the Listing Rules. The authorized representatives will act
as our Company’s principal channel of communication with the Stock Exchange.
The authorized representatives will be readily contactable by phone and email to
promptly deal with enquiries from the Stock Exchange, and will also be available to
meet with the Stock Exchange to discuss any matter within a reasonable period of
time upon request of the Stock Exchange;
(b) when the Stock Exchange wishes to contact our Directors on any matter, each of the
authorized representatives will have all necessary means to contact all of our
Directors (including our independent non-executive Directors) promptly as and
when required, including means to communicate with our Directors when they are
travelling. Our Company will also inform the Stock Exchange as soon as practicable
in respect of any change in the authorized representatives in accordance with the
Listing Rules. We have provided the contact details of each Director (such as mobile
phone numbers, office phone numbers (if any), email addresses and fax numbers (if
any)) to each of the authorized representatives and the Stock Exchange;
(c) we confirm and will ensure that all Directors who do not ordinarily reside in Hong
Kong possess or can apply for valid travel documents to visit Hong Kong and can
meet with the Stock Exchange within a reasonable period upon the request of the
Stock Exchange;
W AIVERS FROM STRICT COMPLIANCE WITH LISTING RULES
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(d) we have appointed China International Capital Corporation Hong Kong Securities
Limited as our compliance adviser upon Listing pursuant to Rule 3A.19 of the
Listing Rules for a period commencing on the Listing Date and ending on the date
on which we comply with Rule 13.46 of the Listing Rules in respect of our financial
results for the first full financial year commencing after the Listing Date. Our
compliance adviser will serve as the additional channel of communication with the
Stock Exchange when the authorized representatives are not available and will have
access at all times to our authorized representatives, our Directors and our senior
management as prescribed by Rule 3A.23 of the Listing Rules; and
(e) meetings between the Stock Exchange and our Directors can be arranged through
our authorized representatives or our compliance adviser, or directly with our
Directors within a reasonable time frame.
W AIVER IN RESPECT OF APPOINTMENT OF JOINT COMPANY SECRETARIES
Pursuant to Rules 3.28 and 8.17 of the Listing Rules, we must appoint a company
secretary who, by virtue of his/her academic or professional qualifications or relevant
experience, is, in the opinion of the Stock Exchange, capable of discharging the functions of
the company secretary. Note 1 to Rule 3.28 of the Listing Rules provides that the Stock
Exchange considers the following academic or professional qualifications to be acceptable:
(a) a member of The Hong Kong Chartered Governance Institute;
(b) a solicitor or barrister as defined in the Legal Practitioners Ordinance (Chapter 159
of the Laws of Hong Kong); and
(c) a certified public accountant as defined in the Professional Accountants Ordinance
(Chapter 50 of the Laws of Hong Kong).
Note 2 to Rule 3.28 of the Listing Rules further provides that the Stock Exchange
considers the following factors in assessing the “relevant experience” of the individual:
(a) length of employment with the issuer and other issuers and the roles he/she played;
(b) familiarity with the Listing Rules and other relevant laws and regulations including
the SFO, the Companies Ordinance, the Companies (Winding Up and Miscellaneous
Provisions) Ordinance and the Takeovers Code;
(c) relevant training taken and/or to be taken in addition to the minimum requirement
under Rule 3.29 of the Listing Rules; and
(d) professional qualifications in other jurisdictions.
W AIVERS FROM STRICT COMPLIANCE WITH LISTING RULES
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Pursuant to paragraph 13 of Chapter 3.10 of the Guide for New Listing Applicants, the
Stock Exchange will consider a waiver application by an issuer in relation to Rules 3.28 and
8.17 of the Listing Rules based on the specific facts and circumstances. Factors that will be
considered by the Stock Exchange include:
(a) whether the issuer has principal business activities primarily outside Hong Kong;
(b) whether the issuer was able to demonstrate the need to appoint a person who does
not have the Acceptable Qualification (as defined under paragraph 11 of Chapter
3.10 of the Guide for New Listing Applicants) nor Relevant Experience (as defined
under paragraph 11 of Chapter 3.10 of the Guide for New Listing Applicants) as a
company secretary; and
(c) why the directors consider the individual to be suitable to act as the issuer’s
company secretary.
Further, pursuant to paragraph 13 of Chapter 3.10 of the Guide for New Listing
Applicants, such waiver, if granted, will be for a fixed period of time (the “ Waiver Period ”)
and on the following conditions:
(a) the proposed company secretary must be assisted by a person who possesses the
qualifications or experience as required under Rule 3.28 of the Listing Rules and is
appointed as a joint company secretary throughout the Waiver Period; and
(b) the waiver will be revoked if there are material breaches of the Listing Rules by the
issuer.
Our Company has appointed Ms. Zhan Ni ( ༗֋)( “ Ms. Zhan ”), the assistant to the
president and head of the office of the Board, as one of our joint company secretaries. She has
the relevant experience of our administrative and corporate matters as a joint company
secretary but presently does not possess any of the qualifications under Rules 3.28 and 8.17 of
the Listing Rules, and may not be able to solely fulfill the requirements of the Listing Rules.
Therefore, we have appointed Ms. Y u Wing Sze ( Я൘་)( “ Ms. Yu ”), an associate member (a
holder of practitioner’s endorsement) of The Hong Kong Chartered Governance Institute
(formerly known as The Hong Kong Institute of Chartered Secretaries) and The Chartered
Governance Institute (formerly known as The Institute of Chartered Secretaries and
Administrators) in the United Kingdom, who fully meets the requirements stipulated under
Rules 3.28 and 8.17 of the Listing Rules to act as the other joint company secretary and to
provide assistance to Ms. Zhan for an initial period of three years from the Listing Date to
enable Ms. Zhan to acquire the “relevant experience” under Note 2 to Rule 3.28 of the Listing
Rules so as to fully comply with the requirements set forth under Rules 3.28 and 8.17 of the
Listing Rules.
W AIVERS FROM STRICT COMPLIANCE WITH LISTING RULES
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Given Ms. Y u’s professional qualification and experience, she will be able to explain to
both Ms. Zhan and us the relevant requirements under the Listing Rules and other applicable
Hong Kong laws and regulations. Ms. Y u will also assist Ms. Zhan in organizing Board
meetings and Shareholders’ meetings of our Company as well as other matters of our Company
which are incidental to the duties of a company secretary. Ms. Y u is expected to work closely
with Ms. Zhan and will maintain regular contact with Ms. Zhan, the Directors and the senior
management of our Company. In addition, Ms. Zhan will comply with the annual professional
training requirement under Rule 3.29 of the Listing Rules to enhance her knowledge of the
Listing Rules during the three-year period from the Listing Date. She will also be assisted by
our compliance adviser and our legal advisers as to the Hong Kong laws on matters in relation
to our ongoing compliance with the Listing Rules and the applicable laws and regulations.
Since Ms. Zhan does not possess the formal qualifications required of a company
secretary under Rule 3.28 of the Listing Rules, we have applied to the Stock Exchange for, and
the Stock Exchange has granted, a waiver from strict compliance with the requirements under
Rules 3.28 and 8.17 of the Listing Rules such that Ms. Zhan may be appointed as a joint
company secretary of our Company. The waiver is valid for an initial period of three years from
the Listing Date on the conditions that (a) Ms. Zhan must be assisted by Ms. Y u, who possesses
the qualifications and experience required under Rule 3.28 of the Listing Rules and is
appointed as a joint company secretary throughout the Waiver Period; and (b) the waiver shall
be valid for a period of three years from the Listing Date and will be revoked immediately if
and when Ms. Y u ceases to provide such assistance to Ms. Zhan as a joint company secretary
or if there are material breaches of the Listing Rules by our Company.
Before the expiration of the initial three-year period, the qualifications of Ms. Zhan will
be re-evaluated to determine whether the requirements as stipulated in Rules 3.28 and 8.17 of
the Listing Rules can be satisfied and whether the need for ongoing assistance will continue.
We will liaise with the Stock Exchange before the expiration of the three-year period to enable
it to assess whether Ms. Zhan, having benefited from the assistance of Ms. Y u for the preceding
three years, will have acquired the skills necessary to carry out the duties of a company
secretary and the relevant experience within the meaning of Note 2 to Rule 3.28 of the Listing
Rules so that a further waiver will not be necessary.
POST-TRACK RECORD PERIOD ACQUISITION
Pursuant to Rules 4.04(2) and 4.04(4)(a) of the Listing Rules, the accountants’ report to
be included in a listing document must include the income statements and balance sheet of any
business or subsidiary acquired, agreed to be acquired or proposed to be acquired since the date
to which the latest audited accounts of the issuer have been made up in respect of each of the
three financial years immediately preceding the issue of the listing document.
W AIVERS FROM STRICT COMPLIANCE WITH LISTING RULES
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On April 22, 2025, Chery Automobile Hong Kong Trade Co. Ltd. (Ϟ
ʮ̡)( “ Chery HK ”), Anhui Ruicheng Xinche Zhilian Industry Fund Partnership Enterprise
(Limited Partnership)* (ΥྫΆุ(Υྫ)) (“ Ruicheng
Zhilian ”) and Anhui Guohai Ruicheng Xinche Linkage V enture Capital Fund Partnership
Enterprise (Limited Partnership)* (ΥྫΆุ(Υ
ྫ)) (“ Ruicheng Linkage ”), QCraft and its subsidiaries, Mr. Y u Qian ( ɲᙛ), Mr. Hou Cong
(ᑋ), Mr. Da Fang ( ɽ˙), Mr. Wang Kun ( ӓ䃑), Mfalcon Limited, Toqui Limited (“ Toqui”),
Frosty Limited (“ Frosty ”) and Cateye Limited entered into a share subscription agreement (the
“SSA”), pursuant to which, among others, QCraft as the issuer agreed to issue an aggregate of
2,501,131 ordinary shares and 17,161,153 series D preferred shares, and each of Chery HK,
Ruicheng Zhilian and Ruicheng Linkage agreed to subscribe for (i) 1,942,219, 349,320 and
209,592 ordinary shares of QCraft for a consideration of US$1.94, US$0.35 and US$0.21,
respectively; and (ii) 13,326,259, 2,396,809 and 1,438,085 series D preferred shares of QCraft
for a consideration of US$59,629,460.81, US$10,724,723.17 and US$6,434,833.90,
respectively.
On April 23, 2025, Chery HK, Ruicheng Zhilian and Ruichen Linkage entered into four
share transfer agreements with original shareholders of QCraft (together with the SSA, as the
“Transaction Documents ”), including:
(i) a share transfer agreement with Toqui, pursuant to which, among others, Toqui
agreed to sell 5,498,513 ordinary shares of QCraft, and each of Chery HK, Ruicheng
Zhilian and Ruicheng Linkage agreed to purchase 4,269,795, 767,949 and 460,769
ordinary shares of QCraft for a consideration of US$2,067,491.59, US$371,851.04
and US$223,110.63, respectively;
(ii) a share transfer agreement with Frosty, pursuant to which, among others, Frosty
agreed to sell 5,968,682 ordinary shares of QCraft, and each of Chery HK, Ruicheng
Zhilian and Ruicheng Linkage agreed to purchase 4,634,898, 833,615 and 500,169
ordinary shares of QCraft for a consideration of US$2,244,279.64, US$403,647.42
and US$242,188.45, respectively;
(iii) a share transfer agreement with IDG China V enture Capital Fund V L.P . and IDG
China V Investors L.P . (collectively, “ IDG”), pursuant to which, among others, IDG
agreed to sell 17,758,465 preferred shares of QCraft, and each of Chery HK,
Ruicheng Zhilian and Ruicheng Linkage agreed to purchase 13,511,650, 2,654,259
and 1,592,556 preferred shares of QCraft for a consideration of US$12,430,718.25,
US$2,441,918.27 and US$1,465,151.09, respectively;
(iv) a share transfer agreement with Afflatus Limited (“ Afflatus ”), pursuant to which,
among others, Afflatus agreed to sell 1,246,031 series A-1 preferred shares of
QCraft, and Chery HK agreed to purchase 1,246,031 series A-1 preferred shares of
QCraft for a consideration of US$1,146,348.52.
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Before completion of the transactions under the Transaction Documents (the
“Acquisition ”), we did not hold any equity interest in QCraft. Upon completion of the
Acquisition, each of Chery HK, Ruicheng Zhilian and Ruicheng Linkage held approximately
17.97%, 3.23% and 1.94% equity interests in QCraft, respectively, and QCraft was not
consolidated in the accounts of our Group.
As at the date of this prospectus, Chery HK is our wholly-owned subsidiary. The general
partner of Ruicheng Zhilian and Ruicheng Linkage is Hefei Ruicheng Private Equity Fund
Management Co., Ltd. *(ʮ̡), which is owned as to 80% by Wuhu
Chery Capital Management Co., Ltd. *(ʮ̡)( “ Chery Capital
Management ”). Chery Capital Management is a joint venture owned as to 50% by Chery
Holding and 50% by us, and is not consolidated in our account.
The consideration of the Acquisition was determined after arm’s length negotiation with
reference to, among others, (i) the financial conditions of QCraft and its subsidiaries; (ii) the
business potential of QCraft and its subsidiaries; and (iii) the market conditions in the
autonomous driving industry. The consideration was fully settled with respective internal funds
of Chery HK, Ruicheng Zhilian and Ruicheng Linkage on May 13, 2025, June 26, 2025 and
June 26, 2025, respectively.
QCraft is a world-leading company providing autonomous driving solutions, and is an
Independent Third Party. Founded in 2019, it boasts a lightweight, fast, and efficient
tech-driven autonomous driving team. QCraft has pioneered a globally leading high-efficiency
automated technology infrastructure known as the “Autonomous Driving Super Factory” and
has accumulated a full-stack self-developed core technology system. With “data-driven +
efficiency improvement” at its core, QCraft achieves rapid iteration and efficient
implementation of autonomous driving. According to the audited financial accounts of QCraft
for the year ended December 31, 2024, its total assets amounted to approximately RMB232.42
million as of December 31, 2024, its total revenue amounted to approximately RMB111.93
million and net loss before taxation amounted to approximately RMB497.49 million for the
year ended December 31, 2024.
The Acquisition has been in line with our investment policy to make strategic equity
investments in a company that is synergistic to its business, having considered the core
competitiveness, strategic value and growth potential of QCraft. The Acquisition can provide
a competitive edge over other competitors and help us capture a larger market share and
establish a strong foothold in the autonomous vehicle market.
Each of Mfalcon Limited, Toqui, Cateye Limited and Frosty, all incorporated in the
British Virgin Islands, is an investment holding company, among which, Mfalcon Limited is
wholly owned by Mr. Y u Qian ( ɲᙛ), Toqui Limited is wholly owned by Mr. Da Fang ( ɽ˙),
Cateye Limited is wholly owned by Mr. Hou Cong (ᑋ), and Frosty Limited is wholly owned
by Mr. Wang Kun ( ӓ䃑) as at the date of completion of the Acquisition. To the best of the
knowledge of our Directors, each of Mfalcon Limited, Toqui, Cateye Limited, Frosty and their
respective ultimate beneficial owners are Independent Third Parties.
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IDG China V enture Capital Fund V L.P . and IDG China V Investors L.P ., both Cayman
exempted limited partnership, Independent Third Parties, are venture capital funds with a
primary purpose of making equity investments, mainly in seed and growth stage companies in
China, focusing on companies in the information technology, media, healthcare, energy, clean
technology and non-technology consumer businesses and services related industries, including,
but not limited to, companies engaged in software, internet, telecom, media and managed
healthcare business.
Afflatus Limited is an investment holding company, and is an Independent Third Party.
To the best of the information, knowledge and belief of our Directors having made all
reasonable enquiries, QCraft, Toqui, Frosty, IDG, Afflatus and their respective ultimate
beneficial owners are Independent Third Parties.
In light of the Acquisition, under Rules 4.04(2) and 4.04(4)(a) of the Listing Rules, we
are required to present in this prospectus the financial information of the Acquisition during the
Track Record Period. 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
4.04(2) and 4.04(4)(a) of the Listing Rules on the following basis:
(1) The requested waiver would not prejudice the interests of the investing public to our
Company
(i) The scale of the business operated by QCraft, as compared to that of our Group, is
not material at all. For illustration purposes only, applying the relevant size tests
under Rule 14.07 of the Listing Rules by using the unaudited management accounts
of QCraft for the year ended December 31, 2024, all applicable percentage ratios (as
defined under Rule 14.04(9) of the Listing Rules) are far less than 5%.
(ii) Our Group is not able to exercise control over QCraft at its board or shareholders’
level. The financials of QCraft are not and will not be consolidated into the
financials of our Group.
(iii) The Acquisition does not result in any material change to the financial position of
our Group since the end of the Track Record Period, and all information that is
reasonably necessary for the potential investors to make an informed assessment of
our Company’s activities or financial position has been included in the Prospectus.
As such, our Company considers that a waiver from compliance with Rules 4.04(2)
and 4.04(4)(a) of the Listing Rules would not prejudice the interests of the investing
public.
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(2) It would be impracticable and unduly burdensome to reproduce historical financial
information for strict compliance with Rules 4.04(2) and 4.04(4)(a) of the Listing Rules
(i) It will require considerable time and resources for our Company and its reporting
accountants to fully familiarize with the respective accounting policy of QCraft and
to gather and compile the necessary financial information and supporting documents
for disclosure in the Prospectus.
(ii) Having considered the time and resources required to obtain, compile and audit such
historical financial information in conformity with our Company’s accounting
policies, it would be unduly burdensome for our Company to prepare and include the
financial information of QCraft during the Track Record Period in the Prospectus.
(3) Alternative information has been provided in the Prospectus
We have provided in this section alternative information in connection with the
Acquisition that would be required for a discloseable transaction under Chapter 14 of the
Listing Rules.
CONTINUING CONNECTED TRANSACTIONS
We have entered into certain transactions which will constitute continuing connected
transactions of our Company under the Listing Rules following the completion of the Listing.
We have applied to the Stock Exchange for, and the Stock Exchange has granted us, a waiver
from strict compliance with the applicable requirements under Chapter 14A of the Listing
Rules in respect of such partially-exempt continuing connected transactions upon completion
of the Listing. For further details in this respect, see the section headed “Continuing Connected
Transactions” in this prospectus.
CONSENT UNDER PARAGRAPH 18 OF CHAPTER 4.15 OF THE GUIDE FOR NEW
LISTING APPLICANTS IN RESPECT OF SUBSCRIPTIONS OF OFFER SHARES BY
CLOSE ASSOCIATES OF EXISTING SHAREHOLDERS
Rule 10.04 of the Listing Rules provides that a person who is an existing shareholder of
the issuer may only subscribe for or purchase any securities for which listing is sought which
are being marketed by or on behalf of a new applicant either in his or its own name or through
nominees if the conditions in Rule 10.03(1) and (2) of the Listing Rules are fulfilled.
Paragraph 5(2) of the Placing Guidelines (the “ Placing Guidelines ”) provides, inter alia,
that without the prior written consent of the Stock Exchange, no allocations will be permitted
to directors or existing shareholders of the applicant or their close associates, whether in their
own names or through nominees unless the conditions set out in Rules 10.03 and 10.04 of the
Listing Rules are fulfilled.
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Paragraph 14 of Chapter 4.15 of the Guide for New Listing Applicants sets out the
conditions required to be fulfilled when the Stock Exchange considers granting a waiver and
consent from Rule 10.04 of the Listing Rules to placing to existing shareholders or their close
associates (the “ Existing Shareholder Conditions ”).
Paragraph 18 of Chapter 4.15 of the Guide for New Listing Applicants provides that the
Stock Exchange will grant a consent and/or waiver to allow an existing shareholder and/or its
close associates and a cornerstone investor to subscribe or purchase further Offer Shares in the
initial public offering without fulfilment of the Existing Shareholder Conditions subject to the
disclosure of details of the allocation in the listing document and/or the allotment results
announcement, and the following:
(a) The offer (excluding any over-allocation) has a total value of at least HK$1 billion;
(b) Securities allocated to all existing shareholders and their close associates (whether
as cornerstone investors and/or as placees) as permitted under this exemption do not
exceed 30% of the total number of securities offered; and
(c) Each director, chief executive, controlling shareholder and, in the case of PRC
issuers, supervisor of the applicant must have confirmed that no securities have been
allocated to them or their respective close associates under this exemption.
(together, the “ Size-based Exemption Conditions ”).
As further described in the section headed “Cornerstone Investors”, the beneficial owner
of each of Huangshan Construction Investment (Hong Kong) International Limited
(“Huangshan Construction Investment ”), Jinghui Ruiying (Hong Kong) Limited (“ Jinghui
Ruiying ”) and Hefei Jianhui Zhanxin Cornerstone Investment Company Limited (“ Hefei
Jianhui ”) is the State-owned Assets Supervision and Administration Commission of
Huangshan Municipal People’s Government, the State-owned Assets Supervision and
Administration Commission of Hefei Municipal People’s Government (“ Hefei SASAC ”) and
the Hefei SASAC, respectively. Therefore, each of Huangshan Construction Investment,
Jinghui Ruiying and Hefei Jianhui is considered to be a close associate of certain existing
Shareholders, namely Wuhu Investment Holding, Anhui Credit Financing Guaranty Group Co.,
Ltd.* (ʮ̡), Anhui Provincial Investment Group Holding Co.,
Ltd.* (ʮ̡) and Wuhu Construction Corporation. GOTION HIGH-
TECH (HK) LIMITED (“ Gotion HK ”) is a close associate of the Company’s existing
Shareholder, Hefei Gotion High-tech Power Energy Co., Ltd. (ʮ
̡). Each of Huangshan Construction Investment, Jinghui Ruiying, Hefei Jianhui and Gotion
HK has entered into a cornerstone investment agreement with our Company. For further details
of the cornerstone investments, please refer to the section headed “Cornerstone Investors”.
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We have applied to the Stock Exchange for, and the Stock Exchange has granted to us,
a consent under paragraph 18 of Chapter 4.15 of the Guide for New Applicants for allocation
of securities to Huangshan Construction Investment, Jinghui Ruiying, Hefei Jianhui and Gotion
HK, who are close associates of our existing Shareholders and will subscribe for Offer Shares
as cornerstone investors in the International Offering, on the conditions that:
(i) the final offering size of the Global Offering (excluding any additional H Shares
which may be issued upon exercise of the Over-allotment Option) will be of a total
value of at least HK$1 billion as required by paragraph 18(i) of Chapter 4.15 of the
Guide for New Listing Applicants;
(ii) the Offer Shares allocated to Huangshan Construction Investment, Jinghui Ruiying,
Hefei Jianhui and Gotion HK and any other existing shareholders and their close
associates (whether as cornerstone investors and/or as placees) (if any) as permitted
under this exemption do not exceed 30% of the total number of the H Shares offered,
which is in compliance with paragraph 18(ii) of Chapter 4.15 of the Guide for New
Listing Applicants;
(iii) each Director, chief executive and Supervisor of the Company has confirmed that no
securities have been allocated to them or their respective close associates under this
exemption as required by paragraph 18(iii) of Chapter 4.15 of the Guide for New
Listing Applicants;
(iv) our Company will comply with the public float requirement under Rule 8.08(1) (as
amended and replaced by Rule 19A.13A) of the Listing Rules; and
(v) details of the allocation to such investors will be disclosed in the allotment results
announcement to be published in connection with the Global Offering.
CONSENT IN RESPECT OF THE PROPOSED SUBSCRIPTION OF H SHARES BY
CERTAIN CORNERSTONE INVESTOR WHO IS A CONNECTED CLIENT
Paragraph 5(1) of Appendix F1 to the Listing Rules provides that no allocations will be
permitted to “connected clients” of the overall coordinator(s), any syndicate member(s) (other
than the overall coordinator(s)) or any distributor(s) (other than syndicate member(s))
(collectively, the “ Distributors ”, and each a “ Distributor ”), without the prior written consent
of the Stock Exchange.
Paragraph 13(7) of the Appendix F1 to the Listing Rules states that “connected client” in
relation to an exchange participant means any client which is a member of the same group of
companies as such exchange participant.
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CICC Financial Trading Limited (“ CICC FT ”) has entered into a cornerstone investment
agreement with, among others, the Company and China International Capital Corporation Hong
Kong Securities Limited (“ CICCHKS ”). CICC FT and China International Capital
Corporation Limited will enter into a series of cross border delta-one OTC swap transactions
(the “ Greenwoods OTC Swaps ”) with each other and the ultimate clients (the “ CICC FT
Ultimate Clients (Greenwoods) ”), pursuant to which CICC FT will hold the Offer Shares on
a non-discretionary basis to hedge the Greenwoods OTC Swaps, while the economic risks and
returns of the underlying Offer Shares are passed to the CICC FT Ultimate Clients
(Greenwoods). CICC FT and CICCHKS, one of the Joint Sponsors, Overall Coordinators and
Underwriters of the Global Offering, are members of the same group of companies.
Accordingly, CICC FT is a connected client of CICCHKS.
We have applied for, and the Stock Exchange has granted, a consent under paragraph 5(1)
of Appendix F1 to the Listing Rules to permit CICC FT (in connection with Greenwoods OTC
Swaps) (the “ Connected Client Cornerstone Investor ”) to participate in the Global Offering
as a cornerstone investor on the following basis and conditions as set out in Paragraph 5 of
Chapter 4.15 of the Guide for New Listing Applicants:
(a) any Offer Shares to be allocated to the Connected Client Cornerstone Investor will
be held on behalf of independent third parties;
(b) the cornerstone investment agreement of the Connected Client Cornerstone Investor
does not contain any material terms which are more favorable to them (as the case
may be) than those in other cornerstone investment agreements;
(c) no preferential treatment has been, nor will be, given to CICC FT by virtue of their
relationship with CICCHKS, respectively, in any allocation of Offer Shares in the
International Offering other than the assured entitlement under the relevant
cornerstone investment agreement;
(d) CICC FT confirms that to the best of its knowledge and belief, it has not received
and will not receive preferential treatment in the allocation of Offer Shares in the
Global Offering as a cornerstone investor by virtue of its relationship with
CICCHKS, other than the assured entitlement under the relevant cornerstone
investment agreement;
(e) each of the Company, the Overall Coordinators, the Connected Client Cornerstone
Investor has provided the Stock Exchange with written confirmations in accordance
with Chapter 4.15 of the Guide for New Listing Applicants; and
(f) details of the cornerstone investment and details of the allocations will be disclosed
in this prospectus and the allotment results announcement.
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DIRECTORS’ RESPONSIBILITY FOR THE CONTENTS OF THIS PROSPECTUS
This prospectus, for which our Directors (including any proposed director who is named
as such in this prospectus) collectively and individually accept full responsibility, includes
particulars given in compliance with the Companies (Winding Up and Miscellaneous
Provisions) Ordinance, the Securities and Futures (Stock Market Listing) Rules (Chapter 571V
of the Laws of Hong Kong) and the Listing Rules for the purpose of giving information to the
public with regard to our Group. Our Directors, having made all reasonable enquiries, confirm
that to the best of their knowledge and belief, the information contained in this prospectus is
accurate and complete in all material respects and not misleading or deceptive, and there are
no other matters the omission of which would make any statement herein or this prospectus
misleading.
CSRC FILING
According to the Overseas Listing Trial Measures, we are required to complete the filing
procedures with the CSRC in connection with the proposed Listing. We have submitted a filing
to the CSRC for application for the Listing on February 28, 2025. The CSRC confirmed the
completion of our filing on August 26, 2025.
GLOBAL OFFERING
This prospectus is published solely in connection with the Hong Kong Public Offering,
which forms part of the Global Offering. For applicants under the Hong Kong Public Offering,
this prospectus contains the terms and conditions of the Hong Kong Public Offering.
The Hong Kong Offer Shares are offered solely on the basis of the information contained
and representations made in this prospectus and on the terms and subject to the conditions set
out herein and therein. No person is authorised to give any information in connection with the
Global Offering or to make any representation not contained in this prospectus, and any
information or representation not contained herein and therein must not be relied upon as
having been authorised by our Company, the Joint Sponsors, the Sponsor-Overall Coordinators,
the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers and the Capital Market Intermediaries, any of the Underwriters, any of our or their
respective directors, officers, employees, agents or representatives of any of them or any other
parties involved in the Global Offering.
The Listing is sponsored by the Joint Sponsors and the Global Offering is managed by the
Overall Coordinators. Pursuant to the Hong Kong Underwriting Agreement, the Hong Kong
Public Offering is fully underwritten by the Hong Kong Underwriters under the terms of the
Hong Kong Underwriting Agreement, subject to agreement on the Offer Price to be determined
between the Overall Coordinators (for themselves and on behalf of the Underwriters) and our
Company on the Price Determination Date. The International Offering is expected to be fully
underwritten by the International Underwriters subject to the terms and conditions of the
International Underwriting Agreement, which is expected to be entered into on or about the
Price Determination Date.
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The Offer Price is expected to be determined by agreement between the Overall
Coordinator (for themselves and on behalf of the Underwriters) and our Company by 12:00
noon on Tuesday, September 23, 2025. If, for any reason, the Offer Price is not agreed between
the Overall Coordinators (for themselves and on behalf of the Underwriters) and our Company
by 12:00 noon on Tuesday, September 23, 2025, the Global Offering will not proceed and will
lapse.
See the section headed “Underwriting” for further information about the Underwriters and
the underwriting arrangements.
PROCEDURES FOR APPLICATION FOR HONG KONG OFFER SHARES
The application procedures for the Hong Kong Offer Shares are set forth in “How to
Apply for Hong Kong Offer Shares” in this prospectus.
STRUCTURE AND CONDITIONS OF THE GLOBAL OFFERING
Details of the structure of the Global Offering, including its conditions, are set forth in
the section headed “Structure of the Global Offering” in this prospectus.
RESTRICTIONS ON OFFER AND SALE OF SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to, or be deemed by his acquisition of the Shares to, confirm that he is aware
of the restrictions on offers and sales of the Hong Kong Offer Shares described in this
prospectus.
No action has been taken to permit a public offering of the Offer Shares or the distribution
of this prospectus in any jurisdiction other than Hong Kong. Accordingly, without limitation
to the following, this prospectus may not be used for the purpose of, and does not constitute,
an offer or invitation in any jurisdiction or in any circumstances in which such an offer or
invitation is not authorized or to any person to whom it is unlawful to make such an offer or
invitation. The distribution of this prospectus and the offering and sales of the Offer Shares 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
authorization by the relevant securities regulatory authorities or an exemption therefrom. In
particular, the Hong Kong Offer Shares have not been publicly offered or sold, directly or
indirectly, in the PRC or the United States.
APPLICATION FOR LISTING ON THE STOCK EXCHANGE
We have applied to the Listing Committee of the Stock Exchange for the listing of, and
permission to deal in our H Shares in issue and to be issued pursuant to the Global Offering
(including the additional H Shares which may be issued pursuant to the exercise of the
Over-allotment Option).
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Dealings in the H Shares on the Stock Exchange are expected to commence on Thursday,
September 25, 2025. Save as disclosed in this prospectus, no part of our share or loan capital
is listed on or dealt in on any other stock exchange and no such listing or permission to list is
being or proposed to be sought on the Stock Exchange or any other stock exchange as at the
date of this prospectus. All the Offer Shares will be registered on the Hong Kong share register
of our Company in order to enable them to be traded on the Stock Exchange.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotment made in respect of any application will be invalid if the listing of,
and permission to deal in, the H Shares on the Stock Exchange is refused before the expiration
of three weeks from the date of the closing of the application lists, or such longer period (not
exceeding six weeks) as may, within the said three weeks, be notified to our Company by or
on behalf of the Stock Exchange.
PROFESSIONAL TAX ADVICE RECOMMENDED
Potential investors in the Global Offering are recommended to consult their professional
advisors as to the taxation implications of subscribing for, purchasing, holding or disposal of,
and/or dealing in the H Shares or exercising rights attached to them. None of us, the Joint
Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers and the Capital Market
Intermediaries, any of the Underwriters, any of our or their respective directors, officers,
employees, agents or representatives of any of them or any other parties involved in the Global
Offering accepts responsibility for any tax effects on, or liabilities of, any person resulting
from the subscription, purchase, holding, disposition of, or dealing in, the H Shares or
exercising any rights attached to them.
OVER-ALLOTMENT OPTION AND STABILIZATION
Details of the arrangements relating to the Over-allotment Option and stabilization are set
out in the section headed “Structure of the Global Offering” in this prospectus.
H SHARE REGISTER OF MEMBERS AND HONG KONG STAMP DUTY
All of the H Shares issued pursuant to applications made in the Global Offering and
converted from our Domestic Unlisted Shares will be registered on our H Share register of
members to be maintained in Hong Kong by our H Share Registrar, Computershare Hong Kong
Investor Services Limited. Our principal register of members will be maintained by us in the
PRC.
Dealings in the H Shares registered in our H Share register of members will be subject
to Hong Kong stamp duty.
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H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
Subject to the granting of the listing of, and permission to deal in, the H Shares on the
Stock Exchange and compliance with the stock admission requirements of HKSCC, the H
Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement
in CCASS with effect from the date of commencement of dealings in the H Shares on the Stock
Exchange or any other date as determined by HKSCC. Settlement of transactions between
Exchange Participants is required to take place in CCASS on the second settlement day after
any trading day. All activities under CCASS are subject to the General Rules of HKSCC and
HKSCC Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS. Investors should seek the advice of their brokers or other professional advisors for
details of those settlement arrangements as such arrangements may affect their rights and
interests.
EXCHANGE RATE CONVERSION
Solely for convenience purposes, this prospectus contains translations among certain
amounts denominated in Renminbi, Hong Kong dollars and U.S. dollars. No representation is
made that any amounts could actually be converted into another currency at the rates indicated,
or at all. Unless otherwise indicated: (i) the translation between Renminbi and Hong Kong
dollars was based on the rate of RMB0.91226 to HK$1, the exchange rate prevailing on
September 10, 2025 published by the PBOC for foreign exchange transactions, (ii) the
translation between Renminbi and U.S. dollars was based on the rate of RMB7.1062 to US$1,
the exchange rate prevailing on September 10, 2025 published by the PBOC for foreign
exchange transactions, and (iii) the translations between U.S. dollars and Hong Kong dollars
were based on the rate of US$1 to HK$7.7897, as calculated according to the rates indicated
in (i) and (ii).
LANGUAGE
If there is any inconsistency between the English version of this prospectus and the
Chinese translation of this prospectus, the English version of this prospectus shall prevail
unless otherwise stated. However, if there is any inconsistency between the names of any of
the entities mentioned in this English prospectus which are not in the English language and
their English translations, the names in their respective original languages shall prevail.
ROUNDING
Any discrepancies in any table in this prospectus between total and sum of amounts listed
therein are due to rounding.
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For further information of our Directors and Supervisors, please see the section
headed “Directors, Supervisors and Senior Management” in this prospectus.
DIRECTORS
Name Address Nationality
Executive Directors
Mr. Yin Tongyue
(ʙΝᚔ΋͛)
Room 1807, Building S2
Weixing Park Avenue Yihao
Jiujiang District
Wuhu, Anhui
PRC
Chinese
Mr. Zhang Guozhong
(΋͛)
Room 601, Unit 4, Building 26
Xiangyuan
West Tianmenshan Road
Jinghu District
Wuhu, Anhui
PRC
Chinese
Non-executive Directors
Ms. Wang Laichun
(ɾɻ)
Room A, 20/F, Imperial Seafront
Tower 1
Imperial Cullinan
No. 10, Hoi Fai Road
Tai Kok Tsui
Kowloon
Hong Kong
Chinese
(Hong Kong)
Ms. Li Jing
(ҽ౺ɾɻ)
Room 101, Building 573
Royal Lake Garden
No. 189, Jindian Road
Jinxi Town
Kunshan, Jiangsu
PRC
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Name Address Nationality
Mr. Wang Jinhua
(ശ΋͛)
Room 801, Unit 2, Building 13
Baijinwan
Zhangjiashan Road
Jinghu District
Wuhu, Anhui
PRC
Chinese
Mr. Wang Xiaowei
(ˮѽਃ΋͛)
Room 502, Unit 1, Building 40
Western Zone
Eastern Star City
Jiujiang District
Wuhu, Anhui
PRC
Chinese
Mr. Bao Siyu
(Ⴇ΋͛)
Room 1202, Unit 2, Building 4
Zone A
Fengming Lake Apartments
Jiujiang District
Wuhu, Anhui
PRC
Chinese
Mr. Yin Xiangling
(ʙୂჯ΋͛)
Room 1706, Building 1
Shuimu Chuncheng
No. 1, Yingsong Road
Luyang District
Hefei, Anhui
PRC
Chinese
Mr. Hu Jingyuan
(ห๕΋͛)
Room 304, Building 16
High Speed Times Square
Hangzhou Road
Baohe District
Hefei, Anhui
PRC
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
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Name Address Nationality
Independent Non-executive Directors
Mr. Shang Wenjiang
(ਠ˖Ϫ΋͛)
Room 901, Gate 4, Building 2
No. 23 Huangsi Street
Xicheng District
Beijing
PRC
Chinese
Mr. Y ang Mianzhi
(เಗʘ΋͛)
No. 601, Unit 2, Building 2
Fangqingyuan, Baoshengli
Haidian District
Beijing
PRC
Chinese
Mr. Y e Shengji
(໢ସਿ΋͛)
No. 501, Gate 3, Building 24
Ziyuyuan
Weiguo Road
Hedong District
Tianjin
PRC
Chinese
Mr. Lu Feng
(΋͛)
Room 208, Apartment 11
Langrun Park
Peking University
No. 5 Summer Palace Road
Haidian District
Beijing
PRC
Chinese
Mr. Y ang Shanlin
(΋͛)
Room 1102, Building 180
South Village
No. 193 Tunxi Road
Hefei University of Technology
Baohe District
Hefei, Anhui
PRC
Chinese
Mr. Lai Ni Hium, Frank
(ኇϧඪ΋͛)
18A Han Kung Mansion
26 Tai Koo Shing Road
Tai Koo Shing
Hong Kong
Australian and
Portuguese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 103 –


--- page 114 ---
SUPERVISORS
Name Address Nationality
Mr. Wu Y unfei
(΋͛)
Room 602, Unit 1, Building 7
Weixing Town Phase II
Jiujiang District
Wuhu, Anhui
PRC
Chinese
Mr. Xu Hui
(ฯ΋͛)
Room 302, Unit 2, Building 2
Lanshan Yiju
No. 7 Xingjiashan
Jinghu District
Wuhu, Anhui
PRC
Chinese
Mr. Cai Changfeng
(ቜ΋͛)
Room 1604, Building B13
Meijia Yinxiang
Wuhu, Anhui
PRC
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 104 –


--- page 115 ---
PARTIES INVOLVED IN THE GLOBAL OFFERING
Joint Sponsors China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings (Hong Kong)
Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Capital (Hong Kong) Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
Sponsor-Overall Coordinators China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings (Hong Kong)
Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong) Brokerage
Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 105 –


--- page 116 ---
Overall Coordinators China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings
(Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong)
Brokerage Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Joint Global Coordinators China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings
(Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong)
Brokerage Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 106 –


--- page 117 ---
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Joint Bookrunners China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings
(Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong)
Brokerage Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
BOCI Asia Limited
26/F, Bank of China Tower
1 Garden Road
Central
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 107 –


--- page 118 ---
ABCI Capital Limited
11/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F
United Centre
No. 95 Queensway
Hong Kong
Joint Lead Managers China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings
(Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong)
Brokerage Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
BOCI Asia Limited
26/F, Bank of China Tower
1 Garden Road
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 108 –


--- page 119 ---
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
ABCI Securities Company Limited
10/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F
United Centre
No. 95 Queensway
Hong Kong
Capital Market Intermediaries China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbour View Street
Central
Hong Kong
Huatai Financial Holdings
(Hong Kong) Limited
62/F, The Center
99 Queen’s Road Central
Hong Kong
GF Securities (Hong Kong)
Brokerage Limited
27/F, GF Tower
81 Lockhart Road
Wanchai
Hong Kong
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 109 –


--- page 120 ---
BOCI Asia Limited
26/F, Bank of China Tower
1 Garden Road
Central
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
ABCI Capital Limited
11/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
ABCI Securities Company Limited
10/F
Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Futu Securities International
(Hong Kong) Limited
34/F
United Centre
No. 95 Queensway
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 0–


--- page 121 ---
Legal Advisers to our Company As to Hong Kong and U.S. laws:
Baker & McKenzie
14/F, One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
As to PRC laws:
Jingtian & Gongcheng
34/F, Tower 3, China Central Place
77 Jianguo Road
Chaoyang District, Beijing
PRC
As to PRC data compliance laws:
Zhong Lun Law Firm
22-31/F
South Tower of CP Center
20 Jin He East Avenue
Chaoyang District
Beijing
PRC
As to International Sanctions laws:
Hogan Lovells
11/F, One Pacific Place
88 Queensway
Hong Kong
As to U.S. Outbound Investment Rule;
Pillsbury Winthrop Shaw Pittman LLP
1200 Seventeenth Street NW
Washington, DC 20036
The United States
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
– 111 –


--- page 122 ---
Legal Advisers to the Joint Sponsors
and the Underwriters
As to Hong Kong and U.S. laws:
Linklaters
11/F, Alexandra House
Chater Road
Central
Hong Kong
As to PRC laws:
Haiwen & Partners
20/F, Fortune Financial Center
5 Dong San Huan Central Road
Chaoyang District
Beijing
PRC
Auditors and Reporting Accountants Ernst & Y oung
Certified Public Accountants
Registered Public Interest Entity Auditor
27/F, One Taikoo Place
979 King’s Road
Quarry Bay
Hong Kong
Industry Consultant Frost & Sullivan (Beijing) Inc., Shanghai
Branch Co.
Suite 2504, Wheelock Square
1717 Nanjing West Road
Shanghai
PRC
Receiving Banks Bank of China (Hong Kong) Limited
1 Garden Road
Hong Kong
Industrial and Commercial Bank of China
(Asia) Limited
33/F, ICBC Tower
3 Garden Road, Central
Hong Kong
China Construction Bank (Asia)
Corporation Limited
26th Floor, CCB Tower
3 Connaught Road Central
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL OFFERING
–1 1 2–


--- page 123 ---
Registered Office No. 8, Changchun Road
Economic Technology and Development Area
Wuhu, Anhui
PRC
Headquarter and Principal Place of
Business in the PRC
No. 8, Changchun Road
Economic Technology and Development Area
Wuhu, Anhui
PRC
Principal Place of Business in Hong Kong 31/F, Tower Two
Times Square
1 Matheson Street
Causeway Bay
Hong Kong
Company’s Website www.chery-auto.com
(information contained in this website does
not form part of this prospectus)
Joint Company Secretaries Ms. Zhan Ni ( ༗֋ɾɻ)
No. 8, Changchun Road
Economic Technology and Development Area
Wuhu, Anhui
PRC
Ms. Y u Wing Sze ( Я൘་ɾɻ)
(an associate member of both The Hong
Kong Chartered Governance Institute and
The Chartered Governance Institute in the
United Kingdom)
31/F, Tower Two
Times Square
1 Matheson Street
Causeway Bay
Hong Kong
Authorized Representatives Mr. Zhang Guozhong (΋͛)
Ms. Zhan Ni ( ༗֋ɾɻ)
CORPORATE INFORMATION
–1 1 3–


--- page 124 ---
Risk Control and Audit Committee Mr. Lai Ni Hium, Frank ( ኇϧඪ΋͛)
(Chairman)
Mr. Shang Wenjiang ( ਠ˖Ϫ΋͛)
Mr. Y ang Mianzhi ( เಗʘ΋͛)
Mr. Y ang Shanlin (΋͛)
Mr. Wang Jinhua (ശ΋͛)
Mr. Hu Jingyuan (ห๕΋͛)
Mr. Bao Siyu (Ⴇ΋͛)
Nomination and Remuneration
Committee
Mr. Shang Wenjiang ( ਠ˖Ϫ΋͛)
(Chairman)
Ms. Li Jing ( ҽ౺ɾɻ)
Mr. Wang Xiaowei ( ˮѽਃ΋͛)
Mr. Zhang Guozhong (΋͛)
Mr. Lu Feng (΋͛)
Mr. Y e Shengji ( ໢ସਿ΋͛)
Mr. Y ang Mianzhi ( เಗʘ΋͛)
Strategy and Sustainable Development
Committee
Mr. Yin Tongyue ( ʙΝᚔ΋͛) (Chairman)
Ms. Wang Laichun (ɾɻ)
Mr. Wang Jinhua (ശ΋͛)
Mr. Zhang Guozhong (΋͛)
Mr. Yin Xiangling ( ʙୂჯ΋͛)
Mr. Lai Ni Hium, Frank ( ኇϧඪ΋͛)
Mr. Y e Shengji ( ໢ସਿ΋͛)
Compliance Adviser China International Capital Corporation
Hong Kong Securities Limited
29/F, One International Finance Centre
1 Harbor View Street
Central
Hong Kong
H Share Registrar Computershare Hong Kong Investor
Services Limited
Shops 1712-1716
17th Floor, Hopewell Centre
183 Queen’s Road East
Wanchai
Hong Kong
Principal Banks Industrial and Commercial Bank of China,
Wuhu Branch
Development Zone Sub-branch
40 Yinhu North Road
Jiujiang District
Wuhu, Anhui
PRC
CORPORATE INFORMATION
–1 1 4–


--- page 125 ---
The information and statistics set out in this section and other sections of this
prospectus were extracted from the Frost & Sullivan Report, which was commissioned by
us, and from various official government publications and available resources from
public market research. We engaged Frost & Sullivan to prepare the Frost & Sullivan
Report in connection with the Global Offering. The information from official government
sources has not been independently verified by us any of the Joint Sponsors, Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Underwriters, any of
their respective directors and advisers, or any other persons or parties involved in the
Global Offering (other than Frost & Sullivan), and no representation is given as to its
accuracy. We have no reason to believe that such information is false or misleading or
that any fact has been omitted that would render such information false or misleading.
For discussion of risks related to our industry, please see the section headed “Risk
Factors — Risks Relating to Our Business and Industry” in this prospectus.
OVERVIEW OF GLOBAL PASSENGER VEHICLE MARKET
Global Passenger Vehicle Market Size
The global passenger vehicle industry is entering a stage of maturity after a century of
development. The global passenger vehicle industry is undergoing a significant transformation
in light of continuous advancement of technologies, such as electrification and
intelligentization, as well as increasing awareness on environmental protection. Overall, the
global passenger vehicle market is large and maintains a steady growth momentum. The total
sales of global passenger vehicle reached 74.3 million units in 2024, is expected to grow at a
CAGR of 3.5% from 2025 to 2030 to 90.1 million units in 2030, hitting a landmark of 100
million units by 2035.
Core Growth in Mature Markets
Given the differences in size of economy, economic development, infrastructure
construction, and industrial foundation, there is currently an imbalance in the regional
development of the global passenger vehicle market. Among all regional markets, in terms of
the global passenger vehicle sales in 2024, mature markets such as China, North America and
Europe accounted for 30.4%, 23.9% and 19.5%, with sales volumes of 22.6 million units, 17.8
million units and 14.5 million units respectively. These mature markets are expected to grow
moderately at 1.5%, 2.7% and 2.4%, respectively, from 2025 to 2030. Despite a relatively
moderate growth in the mature markets, their massive market sizes are expected to create a
base effect and contribute an average increase of over 1 million units in the global passenger
vehicle market each year.
INDUSTRY OVERVIEW
–1 1 5–


--- page 126 ---
The increase in the volume of passenger vehicles in the mature markets and the structural
transformation brought by electrification and intelligentization are expected to continue
driving the growth of the global passenger vehicle market, and providing the key growth
momentum for market players, including OEMs, parts suppliers and other players along the
industry chain and facilitate the development of global automotive industry.
Global Passenger Vehicle Sales
(1), Breakdown by Regions
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
70.1
Unit: Millions
59.3
63.6
68.7 72.3 74.3 75.9 78.3 81.0 83.9 86.9 90.1
20.7
19.4
19.9
21.0 21.9 22.6 23.1 23.5 23.9 24.2 24.5 24.8
3.6 3.9 4.317.8 14.7 15.9
5.0 5.2 5.9 5.6
16.2 17.2 17.8 18.1 18.5 19.0 19.5 20.1 20.7
0.8
1.2
1.0
1.0
1.1
2.3
3.0
1.2
2.8
1.4
3.1
1.5
3.3
2.1 2.6 3.1
1.8
5.14.7
7.87.57.16.66.1
16.6
12.7 13.2 12.7 13.9 14.5 14.7 15.0 15.3 15.6 16.0 16.59.8
8.1 8.6 9.7 9.8 9.0 9.3 9.5 9.7 10.0 10.3 10.6
China Europe South America Rest of the World
Asia (Ex. China) North America Middle East & North Africa
3.8
CAGR 2019-2024 2025E-2030E
Global
China
Asia (Ex. China)
Europe
North America
South America
Middle East & North Africa
1.2%
1.8%
-1.6%
-2.7%
0.0%
-1.1%
14.2%
3.5%
1.5%
2.8%
2.4%
2.7%
8.7%
21.4%
4.6
0
10
20
30
40
50
60
70
80
90
100
2.72.43.3
Source: International Organization of Motor V ehicle Manufacturers (OICA), China Association of Automobile
Manufacturers (CAAM), Frost & Sullivan Report
Note:
1. Exclude export
Structural Opportunities in Emerging Markets
Comparatively speaking, emerging markets such as South America, the Middle East and
North Africa, and Asia (excluding China) are expected to grow at a higher CAGR from 2025
to 2030. Specifically, the projected CAGR from 2025 to 2030 is 8.7% for South America,
21.4% for the Middle East and North Africa, and 2.8% for Asia (excluding China), among
which the passenger vehicle sale in South East Asia is projected to grow at a CAGR of 4.9%.
This growth is primarily driven by low penetration rates and an immature passenger vehicle
sector in these regions.
INDUSTRY OVERVIEW
–1 1 6–


--- page 127 ---
Accelerating urbanization and rising income levels of local residents continuously
stimulate the demand for personal mobility, driving the robust demand for passenger vehicles
market in these emerging markets which are relatively underdeveloped with, low penetration
of passenger vehicles and less matured sector. Economies of emerging market such as Brazil,
Chile, India, and several Southeast Asian countries are continuously developing, with an
expanding middle class and increasing per capita disposable income, which is expected to lead
to a rapid growth in the demand for passenger vehicles. Additionally, as automotive technology
continues to advance and global OEMs expand their localization strategies in these emerging
markets, the cost of automotive production is gradually decreasing, which further improves the
penetration rate of passenger vehicles.
Structural Changes in the Global Passenger V ehicle Market
In terms of vehicle types, sedans and SUVs are two major types of passenger vehicles,
with MPV playing a relatively smaller part. In 2019, the sales volumes of sedans, SUVs and
MPVs were 36.1 million units, 29.9 million units and 4.1 million units, respectively,
corresponding to market shares of 51.5%, 42.7% and 5.8% respectively. In 2024, the sales
volumes of sedans, SUVs and MPVs were 29.2 million units, 41.7 million units and 3.4 million
units respectively, corresponding to market shares of 39.3%, 56.1% and 4.6% respectively.
Sedans have a more compact body design, making them ideal for commuting and urban
driving. This offers consumers an economical and convenient driving experience. On the other
hand, SUVs are known for their spaciousness, comfort and off-road capability, making them
suitable for travel over various terrains. In recent years, the demand for SUVs has surged due
to the growing interest in family travel and outdoor activities. Consequently, the market share
of SUVs has been rising. Looking ahead, as consumer needs diversify and market segments
like urban SUVs and off-road variants expand, the market share of SUVs is expected to
continue growing, reaching 68.1% by 2030.
Global Passenger Vehicle Sales, Breakdown by Type of Vehicle
0
20
40
60
80
100
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
2019-2024 2025E-2030E
Total
Sedan
SUV
MPV
1.2%
-4.2%
6.9%
-3.5%
3.5%
-2.7%
6.7%
4.3%
CAGR
Unit: Millions
Sedan SUV MPV
70.1
59.3
63.6
68.7 72.3 74.3 75.9 78.3 81.0 83.9 86.9 90.1
36.1
28.7
29.1
30.8
30.3 29.2 28.1 27.2 26.4 25.7 25.1 24.6
29.9 27.7 31.6 34.8 38.7 41.7 44.4 47.4 50.5 53.7 57.1 60.6
4.1 2.8 2.9 3.0 3.3 3.4 3.3 3.7 4.1 4.5 4.7 4.9
Source: International Organization of Motor V ehicle Manufacturers (OICA), China Association of Automobile
Manufacturers (CAAM), Frost & Sullivan Report
INDUSTRY OVERVIEW
–1 1 7–


--- page 128 ---
In terms of powertrain type, in 2019, the sales volumes of ICE vehicles, BEVs and PHEVs
were 68.0 million units, 1.5 million units and 0.6 million units, respectively, representing the
market shares of 97.0%, 2.2% and 0.8%, respectively. In 2024, the sales volume of these
vehicles had shifted significantly, whereby ICE vehicles experienced a decrease to 57.2 million
units, while BEV and PHEV sales increased to 10.7 million and 6.3 million units respectively.
The market shares for these categories in 2024 were 77.0% for ICE vehicles, 14.5% for BEVs,
and 8.5% for PHEVs.
ICE vehicles dominate the market, yet with decreasing market share from 2019 to 2024,
while NEVs are claiming market shares. On the demand side, most consumers still prefer ICE
vehicles. This is especially true in the regions where infrastructure for electric vehicle is still
developing. On the supply side, fossil fuel remains the predominant energy source globally,
with a highly mature industrial chain, and the global market for ICE vehicles is still substantial.
Although NEVs currently have a small market share, their growth is expected to continue.
This is due to increasing global environmental awareness, technological advancements and
improvements in intelligentization. By 2030, NEVs are projected to make up 47.0% of the
market.
Global Passenger Vehicle Sales, Breakdown by Power Type
0
20
40
60
80
100
0
20
40
60
80
100
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
0.0
0.6
0.0
0.9
0.0
1.8
0.0
2.7
0.04.0 0.06.3 0.0 0.0 0.1 0.1 0.17.3 9.4 10.2 11.5 12.2 14.04.4 7.4 9.7 10.7 13.5 16.7 19.7 23.4 25.9 28.3
47.848.748.9
51.152.1
55.057.258.658.6
57.4
56.3
68.0
70.1
59.3
63.6
68.7 72.3 74.3 75.9 78.3 81.0 83.9 86.9 90.1
2019-2024 2025E-2030E
Total
ICE
BEV
PHEV
1.2%
-3.4%
48.2%
62.6%
3.5%
-2.8%
14.8%
15.9%
CAGR
Unit: Millions
ICE BEV PHEV Others2
1.5 2.0 0.0
Notes:
1. For statistical purpose, PHEV includes REEV in this section.
2. Others mainly include fuel cell vehicles.
INDUSTRY OVERVIEW
–1 1 8–


--- page 129 ---
Trends and Drivers of Global Passenger Vehicle Market
Increasing Penetration of NEVs with Regional Disparities
In recent years, there’s been a significant shift towards NEVs due to global efforts to cut
carbon emissions and growing consumer awareness about sustainability. Governments around
the world support this change with incentives for NEV purchases and investments in charging
infrastructure. The increasing intelligence of NEVs offers more convenient driving experience
and better meets consumers’ evolving needs. Advancements in battery technology have also
played a key role, improving driving ranges and reducing charging times. This has boosted
confidence in NEVs and encouraged more people to adopt them. As a result, the penetration
of NEVs is expected to continue to enhance and become a main driver for the development of
passenger vehicle market. The global penetration rate of NEVs is expected to increase from
23.0% in 2024 to 47.0% by 2030.
The penetration rate of NEVs varies significantly across different regions due to factors
like energy prices, charging infrastructure, government policies and consumer awareness. In
2024, China had a high NEV penetration rate of 48.9%. In contrast, regions outside China had
an overall penetration rate of 11.7%. Among these regions, Europe led with a 19.8%
penetration rate, followed by North America at 9.0%, and South America at only 2.8%.
Looking ahead, China, Europe, and North America are expected to be the primary markets for
NEVs. Additionally, the market share of NEVs in Asia (excluding China) is anticipated to grow
significantly.
NEV Penetration Rate in Major Regions, 2024 & 2030E
0%
10%
20%
30%
40%
50%
60%
70%
80%
China Europe North America Middle
East & North
Africa
Asia
(Ex. China)
South America
48.9%
76.9%
19.8%
61.2%
9.0%
34.4%
8.7%
23.7%
3.4%
31.3%
2.8%
10.2%
0
10
20
30
40
50
60
70
80
Global NEV Penetration Rate in 2030E2030E
Global NEV Penetration Rate in 20242024
23.0%
47.0%
INDUSTRY OVERVIEW
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--- page 130 ---
Global NEV Passenger Vehicle Sales (1), Breakdown by Regions, 2024 & 2030E
2024 2030
2.6%
45.1%
23.9%
16.8%
16.8%
9.4%
64.7%
South America
Asia (Ex. China)
Middle East & North Africa
Rest of the worldChina
Europe
North America
0.7%
6.2% 2.6%
1.8%
7.8%
0.5% 1.2%
Source: International Organization of Motor V ehicle Manufacturers (OICA), China Association of Automobile
Manufacturers (CAAM), Frost & Sullivan Report
Note:
(1) Exclude export
Rapid Development of Technological Innovation and Intelligent Technology
Technological innovation is rapidly transforming the passenger vehicle industry to make
it more intelligent. V ehicle intelligence encompasses advancements in assistance driving and
smart cockpits.
Currently, assistance driving technology has achieved full automation for steering and
braking, progressing into hands-free driving, which significantly enhances the comfort, safety,
and convenience of driving experience. Smart cockpits, equipped with advanced technology
such as AI assistants, making it more user-friendly and intelligent. Additionally, users can
continuously update in vehicle’s system through OTA technology, allowing the vehicle to
evolve throughout its lifecycle and provide ongoing value enhancement to users.
By 2030, as assistance driving technology continues to advance and market acceptance
grows, the penetration rate of assistance driving vehicles is expected to grow both globally and
in China. This indicates a clear trend towards the adoption of higher levels of assistance driving
technology.
INDUSTRY OVERVIEW
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--- page 131 ---
Continuous Adjustments on Global Strategies by OEMs
OEMs continuously adjust their global strategies in recent years. Chinese OEMs expand
their global presence by building production plants, assembly lines, and supply chains overseas
to boost their competitiveness. Meanwhile, traditional global OEMs strategically streamline to
focus on their core markets and optimize their resource allocation. With rising geopolitical
tensions, the global supply chain is shifting towards regional restructuring. As a result, OEMs
from various countries are increasingly turning to localized procurement to enhance the
stability and resilience of their supply chains.
COMPETITIVE LANDSCAPE OF GLOBAL PASSENGER VEHICLE MARKET
Evolution of Competitive Landscape
In recent years, the global passenger vehicle market has experienced significant changes.
With the industry’s shift towards electrification and intelligentization, traditional global OEMs
have experienced slower sales growth. Meanwhile, Chinese OEMs have gained a competitive
edge. In 2019, only five Chinese OEMs were among the top 20 global OEMs in terms of sales
volume, holding a combined market share of less than 9%. However, in 2024, six Chinese
OEMs had made the list, with a combined market share of 21.6%. Thanks to technological
advancements and the development in the new energy sector, Chinese OEMs have steadily
improved their industry status, while the overall ranking of global OEMs remains relatively
stable.
Top 20 Automotive Groups in terms of
Global Passenger Vehicle Sales in 2019
Top 20 Automotive Groups in terms of
Global Passenger Vehicle Sales in 2024
Ranking Group Ranking Group Ranking Group Ranking Group
1 Group A (2) 11 Group K (12) 1 Group B (3) 11 The Group
2 Group B (3) 12 Group L (13) 2 Group A (2) 12 Group L (13)
3 Group C (4) 13 Group M (14) 3 Group D (5) 13 Group J (11)
4 Group D (5) 14 Group N (15) 4 Group C (4) 14 Group N (15)
5 Group E (6) 15 Group O (16) 5 Group T (21) 15 Group K (12)
6 Group F (7) 16 Group P (17) 6 Group U (22) 16 Group R (19)
7 Group G (8) 17 Group Q (18) 7 Group E (6) 17 Group V (23)
8 Group H (9) 18 Group R (19) 8 Group G (8) 18 Group O (16)
9 Group I (10) 19 The Group 9 Group F (7) 19 Group Q (18)
10 Group J (11) 20 Group S (20) 10 Group M (14) 20 Group P (17)
Source: International Organization of Motor V ehicle Manufacturers (OICA), China Association of Automobile
Manufacturers (CAAM), Frost & Sullivan Report
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Notes:
(1) The bolded entries represent Chinese OEMs.
(2) Group A was established in 1937 and is headquartered in Wolfsburg, Germany. Its business covers the
manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on
Frankfurt Stock Exchange.
(3) Group B was established in 1933 and is headquartered in Toyota City, Aichi, Japan. Its business covers the
manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on
Tokyo Stock Exchange and Nagoya Stock Exchange.
(4) Group C was established in 2004 and is an alliance of three automotive groups headquartered in
Boulogne-Billancourt, France; Y okohama, Kanagawa, Japan; and Tokyo, Japan, respectively. Its business
covers the manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs.
(5) Group D was established in 2000 and is an alliance of two automotive groups that both headquartered in Seoul,
South Korea. Its business covers the manufacturing and sales of passenger vehicles, commercial vehicles,
include ICEs and NEVs, and is listed on the Korea Exchange.
(6) Group E was established in 1908 and is headquartered in Detroit, Michigan, United States. Its business covers
the manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed
on the New Y ork Stock Exchange.
(7) Group F was established in 1948 and is headquartered in Minato, Tokyo, Japan. Its business covers the
manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on
TSE and the New Y ork Stock Exchange.
(8) Group G was established in 1903 and is headquartered in Dearborn, Michigan, United States. Its business
covers the manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and
is listed on the New Y ork Stock Exchange.
(9) Group H was established in 2014 is an alliance of two automotive groups that headquartered in Turin, Italy
and Auburn Hills, Michigan, United States. Its business covers the manufacturing and sales of passenger
vehicles, commercial vehicles, include ICEs and NEVs, and is listed on the New Y ork Stock Exchange.
(10) Group I was established in 1976 and is headquartered in the town of Ruel-Marmaison, France. Its business
covers the manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and
is listed on Euronext Paris.
(11) Group J was founded in 1909 and is headquartered in Hamamatsu, Shizuoka, Japan. Its business covers the
manufacture and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on
TSE.
(12) Group K was founded in 1926 and is headquartered in Stuttgart, Germany. Its business covers the
manufacturing and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on
Frankfurt Stock Exchange.
(13) Group L was founded in 1916 and is headquartered in Munich, Germany. Its business covers the manufacture
and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on Frankfurt Stock
Exchange and the New Y ork Stock Exchange.
(14) Group M was founded in 1986 and is headquartered in Hangzhou, Zhejiang, China. Its products include
passenger vehicles, commercial vehicles, include ICEs and NEVs. Its subsidiaries are listed on the Stock
Exchange, the New Y ork Stock Exchange, and NASDAQ respectively.
(15) Group N was founded in 1984 and is headquartered in Shanghai, China. Its business covers the manufacture
and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on Shanghai Stock
Exchange.
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(16) Group O was founded in 1920 and is headquartered in Hiroshima, Japan. Its business covers the manufacture
and sale of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on TSE.
(17) Group P was founded in 1953 and is headquartered in Tokyo, Japan. Its business covers the manufacture and
sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on TSE.
(18) Group Q was founded in 1984 and is headquartered in Baoding, Hebei, China. Its business covers the
manufacture and sales of passenger vehicles, commercial vehicles, include ICEs, and NEVs, and is listed on
Shanghai Stock Exchange and the Stock Exchange.
(19) Group R was founded in 1996 and is headquartered in Chongqing, China. Its business covers manufacturing
and sales of passenger vehicles, commercial vehicles, include ICEs and NEVs, and is listed on Shenzhen Stock
Exchange.
(20) Group S was founded in 1868 and is headquartered in Mumbai, India. Its business covers passenger vehicles,
commercial vehicles, include ICEs and NEVs, and their subsidiaries are listed on Bombay Stock Exchange and
National Stock Exchange of India.
(21) Group T was founded in 2021 and is an alliance of two automotive groups headquartered in Amsterdam,
Netherlands and Ruel-Marmaison, France. Its business covers passenger vehicles, commercial vehicles,
include ICEs and NEVs, and is listed on the New Y ork Stock Exchange, Euronext Paris and Italian Stock
Exchange.
(22) Group U was established in 1995 and is headquartered in Shenzhen, Guangdong, China. Its business covers
the manufacturing and sales of NEVs, including passenger vehicles and commercial vehicles, and is listed on
the Stock Exchange and Shenzhen Stock Exchange.
(23) Group V was founded in 2003 and is headquartered in Austin, Texas, United States. Its business covers the
manufacturing and sales of NEVs, including passenger vehicles and commercial vehicles, and is listed on
NASDAQ.
China’s passenger vehicle industry has achieved significant advancements in
technological innovation and product quality, boosting the product competitiveness. The
market share of domestic brands in the China market has grown rapidly, from 34.4% in 2019
to 58.5% in 2024. This trend is expected to continue and Chinese domestic brands are expected
to capture 69.6% market share by 2030 according to Frost & Sullivan.
In recent years, the international recognition of Chinese domestic brands has steadily
grown. More overseas consumers gain a deeper understanding of and trust in these brands.
Since 2021, the export volume of Chinese passenger vehicles increased rapidly. In 2023, China
exported 4.1 million passenger vehicles, surpassing Japan to become the world’s largest
passenger vehicle exporter.
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As a result, the market share of Chinese domestic brands in global passenger vehicle sales
has been steadily increasing. It rose from 12.0% in 2019 to 24.0% in 2024, and is projected to
reach 26.8% by 2030.
Chinese Domestic Brands’ Sales as a Percentage of Global Sales
China domestic brand’s sales China domestic brands’ sales as a
percentage of global salesGlobal passenger vehicle sales
20242019 2030E
8.4
70.1
12.0%
Unit: %, Millions
24.0%
26.8%
74.3
17.8
24.1
90.1
Source: International Organization of Motor V ehicle Manufacturers (OICA), China Association of Automobile
Manufacturers (CAAM), Frost & Sullivan Report
Key Competition Factors of Global Passenger Vehicle Market
The competition of global passenger vehicle market is driven by several key factors; (i)
development of products that meet changing customer needs; (ii) leadership in technological
innovation, especially in areas like electrification and assistance driving; (iii) strong and
influential brand; (iv) efficient production capabilities, supported by a robust and localized
supply chain; and (v) an extensive and locally adapted sales network and after-sales services.
Together, these elements help OEMs maintain a competitive edge in the complex global
passenger vehicle industry.
Drivers for the Global Development of Chinese Domestic Brands
Breakthroughs in Traditional Technology and Leadership in Electrification and
Intelligentization
Chinese domestic brands have made impressive advancement in traditional technologies
like engines and transmissions. Over the years, they’ve achieved significant breakthroughs,
with several performance indicators now meeting or even exceeding international standards.
This progress allows ICE vehicle users around the world to enjoy high-quality driving
experiences at more competitive prices.
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In recent years, Chinese domestic brands progressed significantly in electrification,
particularly in developing electric and hybrid powertrain technologies. These innovations have
significantly outpaced traditional overseas OEMs, and positioned China as a leader in the
global NEV sector. Additionally, with the global trend towards intelligentization in the
passenger vehicle market, Chinese domestic brands have ramped up their R&D investments in
areas like assistance driving and smart cockpits. They extensively use large AI models in
assistance driving and smart cockpits. This technology offers customers smart driving
experiences and personalized interactions.
Efficient R&D, Supply Chain, and Production Systems
Thanks to the efficient R&D iteration capabilities of Chinese domestic brands, the
development cycles for new versions and products have significantly shortened. This allows
them to promptly reflect customer needs and technological advancements into their product
designs and provide users with cutting-edge features through remote OTA updates.
China passenger vehicle industry has built a sound, mature, and stable supply chain
system. Combined with strong quality and cost management capabilities and efficient
manufacturing processes, Chinese domestic brands are able to consistently offer more
economical, practical, and high-quality passenger vehicles.
Actively Expanding Global Layout and Enhancing Brand Influence
Attributable to significant investments and close cooperation with domestic and
international partners, Chinese domestic brands have established a robust global sales network,
providing timely and efficient after-sales services to customers. With strong technical research
and development capabilities, continuously improving product quality, and value-for-money
products, Chinese domestic brands intensify their brand influence worldwide. This has led to
growing consumer recognition and brand loyalty, both domestically and internationally.
Chinese domestic brands are increasingly adapting their vehicle models sold overseas to
meet local requirements and preferences. This approach enhances their market competitiveness
and customer satisfaction in international markets. According to the 2024 China Initial Quality
Study (IQS) by J.D. Power, four Chinese domestic brands ranked among the top ten
mass-market brands, a significant improvement from just one in 2019.
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OVERVIEW OF CHINA PASSENGER VEHICLE MARKET
The Development of China Passenger Vehicle Market
There are three periods in the development path of China passenger vehicle market:
 Rapid Growth Period (2001-2017): After China joined the World Trade
Organization in 2001, global OEMs began flooding into the China market and
forming joint ventures. This influx of international players significantly boosted the
industry’s growth. During this time, China’s economy grew rapidly and residents’
disposable income increased, which, along with supportive government policies,
created an ideal environment for the passenger vehicle market to thrive. As a result,
passenger vehicle sales in China surged from 1.2 million units in 2001 to 24.7
million units in 2017, achieving a CAGR of 20.8%.
 Steady Market Period (2018-2020): During this period, China passenger vehicle
market began to stabilize. The sales volume of passenger vehicles in China has
stayed above 20 million units each year during this period. Meanwhile, NEVs
started to gain more attention and received increased policy support.
 Growth in NEVs and the Rise of Chinese Domestic Brands (Since 2021): Since
2021, the sales volume of NEVs have experienced rapid growth, with a CAGR of
78.2% from 2020 to 2024. This significant growth in the NEV segment, along with
the enhancement of core competitiveness, has allowed Chinese domestic brands to
increase their market share in China’s passenger vehicle market from 33.6% in 2020
to 58.5% in 2024. Further growth is expected in the coming years.
China Passenger Vehicle Market Size
The China passenger vehicle market is vast and dynamic. In 2024, passenger vehicle sale
volume in China reached 22.7 million units, with a CAGR of 1.9% from 2019 to 2024. The
sales volume is expected to reach 24.8 million units by 2030, with a CAGR of 1.4% from 2025
to 2030.
In 2024, first-tier cities made up 14.1% of the China passenger vehicle market, while
second-tier and lower-tier markets collectively held 85.9%. First-tier cities often have
restrictions on the number of license plates, so market growth is expected to be steady. In
contrast, as residents’ income rises, the demand for passenger vehicles in second-tier and
lower-tier markets is increasing, showing significant development potential.
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China Passenger Vehicle Sales Volume
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
20.7
19.3 19.8
21.0 21.9 22.7 23.1 23.5 23.8 24.3 24.6 24.8
2019-2024 2025E-2030E
CAGR 1.9% 1.4%Unit: Millions
0
5
10
15
20
25
Source: China Association of Automobile Manufacturers (CAAM), Frost & Sullivan Report
Note: China’s passenger vehicle sales volume excludes export volume.
In 2024, ICE vehicles made up the majority of the market, accounting for 51.1% market
share. However, with continuous advancements in assistance driving, hybrid power systems,
and battery technologies, along with strong domestic policy support, the market share of NEVs
has risen significantly, from 4.8% in 2019 to 48.9% in 2024, and is expected to reach 77.0%
by 2030.
NEVs mainly include BEV and PHEV models. PHEV models combine electric and
gasoline propulsion systems, allowing them to meet commuting needs in pure electric mode
and switch to gasoline power for long trips or when charging infrastructure is unavailable. Due
to the low prevalence of charging stations in China, PHEV models could effectively alleviate
potential buyers’ ‘range anxiety.’
As a result, with technological advancements, PHEV models demonstrate better fuel
economy and flexibility, making them popular in the market. It’s forecasted that PHEV sales
will grow at a CAGR of 11.5% from 2025 to 2030, with market share increasing from 25.1%
in 2025 to 40.3% in 2030, playing a crucial role in driving future market growth.
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Penetration Rate of Different Power Type in China Passenger Vehicle Market
90.0%
100.0%
70.0%
80.0%
50.0%
60.0%
30.0%
40.0%
10.0%
0.0%
20.0%
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
3.1%1.0%0.9% 6.7% 11.9%
21.1% 25.1% 29.0% 32.4% 35.4% 37.8% 40.3%
4.7%3.9% 12.1%
21.4%
23.7%
27.8%
31.2%
34.0%
35.7% 36.6% 36.6% 36.7%
23.0%25.6%28.0%31.9%37.0%43.7%51.1%
64.4%
71.9%
84.8%
94.3%95.2%
ICE BEV PHEV
Source: China Association of Automobile Manufacturers (CAAM), Frost & Sullivan Report
Notes:
(1) China’s passenger vehicle sales volume excludes export volume.
(2) For statistical purpose, PHEV includes REEV in this section.
Penetration of Foreign Brands in China Passenger Vehicle Market
Historically, the China passenger vehicle market was dominated by foreign brands.
However, in recent years, Chinese domestic brands have rapidly strengthened their position.
They have advanced technologies applicable to traditional ICE vehicle such as engines and
transmissions, while strategically capitalizing on trends like electrification and
intelligentization. With their high quality and cost-effective products, Chinese domestic brands
have accelerated their rise in the market. Their market share in China has increased from 34.4%
in 2019 to 58.5% in 2024. With continuous technological innovation and product upgrades,
Chinese domestic brands are expected to maintain a leading position and achieve a market
share of 69.6% by 2030.
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Penetration Rate of Brands from Different Countries in China Passenger Vehicle Market
90.0%
100.0%
70.0%
80.0%
50.0%
60.0%
30.0%
40.0%
10.0%
0.0%
20.0%
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
14.2%14.9%15.6%16.4%17.2%18.0%18.8%
23.0%
22.4%
24.2%
26.9%26.8%
10.2%10.8%11.5%12.1%12.9%13.6%14.4%
18.1%21.7%22.5%25.0%23.4%
69.6%68.1%66.6%64.8%62.9%60.8%58.5%
48.5%43.5%39.8%33.6%34.4%
8.5%9.0%9.7%9.8%9.0%
0.6%
5.2%5.4%5.7%6.0%6.3%6.6% 4.9%
0.6%0.7%0.7%0.8%0.8%0.9%1.5%1.7%2.6%3.6%4.6%
0.5%0.4%0.2%0.3%0.2%0.5%0.8%1.0%1.1%1.2%1.1%1.8%
China Germany Japan US South Korea Others
Source: China Association of Automobile Manufacturers (CAAM), Frost & Sullivan Report
Note:
1. The penetration rate of brands from different countries is calculated based on passenger vehicle insurance
registration volumes.
Competitive Landscape of Passenger Vehicle Market for Chinese Domestic Brands
The passenger vehicle market in China holds great potential and is highly competitive due
to the presence of numerous players. The Group ranked second among Chinese domestic brand
passenger vehicle companies, in terms of sales volume (including export volume) with a
market share of 11.8% in 2023 and 14.0% in 2024.
The following table presents top five Chinese domestic brand companies measured by
passenger vehicle sales volume (including export volume) in 2023 and 2024:
Ranking Company Market Share in 2023 Market Share in 2024
(%) (%)
1 /H1118/H1118/H1118/H1118/H1118/H1118Company A (2) 20.6% 23.7%
2 /H1118/H1118/H1118/H1118/H1118/H1118The Group 11.8% 14.0%
3 /H1118/H1118/H1118/H1118/H1118/H1118Company B (3) 11.6% 12.1%
4 /H1118/H1118/H1118/H1118/H1118/H1118Company C (4) 10.9% 9.2%
5 /H1118/H1118/H1118/H1118/H1118/H1118Company D (5) 7.0% 5.9%
Others 38.1% 35.1%
Source: Frost & Sullivan Report
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Notes:
(1) The ranking is based on passenger vehicle sales volume (including exports volume) in 2023 and 2024.
(2) A Chinese OEM that is responsible for the passenger vehicle business and commercial vehicle business
under Group U, with a focus on the sales of NEVs. It was established in 2006 and is headquartered in
Shenzhen.
(3) A Chinese OEM listed on the Stock Exchange that is responsible for the passenger vehicle business and
commercial vehicle business under Group M, with sales covering ICEs and NEVs. It was established in
1996 and is headquartered in Hangzhou.
(4) A Chinese OEM listed on Shenzhen Stock Exchange that is responsible for the passenger vehicle
business and commercial vehicle business under Group R, with sales covering ICEs and NEVs. It was
established in 1996 and is headquartered in Chongqing.
(5) A Chinese OEM listed on the Stock Exchange and Shanghai Stock Exchange that is responsible for the
passenger vehicle business and commercial vehicle business under Group Q, with sales covering ICEs
and NEVs. It was established in 1984 and is headquartered in Baoding.
Drivers and Trends of Chinese Domestic Brands Passenger Vehicle Market
Technological Advancement Driving High-quality Development of Chinese Domestic Brands
Technological innovation is indeed a core driver for the growth of Chinese domestic
brands. After years of research and development investment, Chinese domestic brands have
built strong technical expertise for ICE vehicles, such as engines and transmissions, which has
achieved the technological level of international mainstream OEMs. With the development of
electrification, intelligentization, and vehicle connectivity, Chinese domestic brands continue
to innovate in the electric systems, assistance driving, and smart cockpit technologies, offering
high-performance and intelligent products that meet the market demand for cutting-edge
technologies.
Efficient technological advancements have allowed Chinese domestic brands to create
high-end products with better performance and more features. These advancements have also
reduced the costs of technology applications, making advanced functions like assistance
driving and smart cockpits available in mid- to low-priced models. This trend will continue as
technology progresses. The combination of brand elevation and cost optimization is expected
to continuously enhance the competitiveness of Chinese domestic brands, driving a steady
increase of their market share.
Diverse Market Demand Driving Segmentation and Rapid Broadening Product Matrix
As the national economy and residents’ income continue to rise, as well as new
technologies emerge, Chinese consumers’ demands for passenger vehicles are becoming more
diverse and rapidly changing. Besides basics like brand, economy, space, and quality, they now
want their cars with stylish looks, advanced technology, rich features, eco-friendliness, and a
complete ecosystem. To meet these varied demands, Chinese domestic brands create more
specialized product lines and quickly update their product matrix based on consumer needs.
Their deep understanding of local consumers allows them to tailor their products to different
usage scenarios.
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Long-term Leadership Supported by Efficient Production Capabilities and Comprehensive
Ecosystem
Thanks to China’s vast manufacturing system and abundant engineer talent, Chinese
domestic brands have built comprehensive production capabilities, quality control, and supply
chain systems. This allows them to manage costs and quality effectively while delivering
high-quality, cost-effective passenger vehicles to customers promptly. This enhances their
competitiveness in the China passenger vehicle market. Additionally, a well-developed
industrial ecosystem provides extensive innovation and R&D support, enabling China brands
to lead in electrification and intelligent technologies.
OVERVIEW OF CHINESE DOMESTIC BRANDS IN OVERSEAS PASSENGER
VEHICLE MARKET
Market Size of Chinese Domestic Brands in China Passenger Vehicle Export Market
In recent years, China’s automotive supply chain has distinguished itself through stability,
technological innovation, and comprehensive coverage of both traditional components like
chassis and engines, as well as new energy components such as batteries and electric motors.
With significant technological innovation and quality enhancement, Chinese domestic brands
have significantly grew in the export volume of passenger vehicles since 2021. In 2023 and
2024, China became the world’s largest passenger vehicle exporting country.
In 2024, the export volume of China passenger vehicles by Chinese domestic brands
reached 4.14 million units, demonstrating a remarkable CAGR of 53.3% from 2019 to 2024.
The primary export regions were Europe, Asia, and Middle East & North Africa, which
accounted for 35.8%, 19.9%, and 16.4% of the total exports, respectively. This growth has been
driven by the continuous upgrading of Chinese products. Looking ahead, the export volume of
passenger vehicles by Chinese domestic brands is expected to reach 6.96 million units by 2030,
with a CAGR of 8.5% from 2025 to 2030.
ICE vehicles currently dominate China’s passenger vehicle export market. In 2024, the
export volume of ICE vehicles by Chinese domestic brands reached 3.10 million units, making
up 74.9% of the total China passenger vehicle exports. Looking forward, NEVs are expected
to become a new growth driver for the exports of Chinese domestic brand. It’s forecasted that
the export volume of BEVs and PHEVs will grow at a CAGR of 18.9% and 28.7% respectively,
from 2025 to 2030.
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--- page 142 ---
0
2,000
1,000
3,000
4,000
5,000
6,000
7,000
2019 2020 2021 2022 2023 2024 2025E 2026E 2027E 2028E 2029E 2030E
392 504 631 774874 880 1,097 1,360 1,649 1,971 2,295 2,612
3,576
3,571
3,570
3,542
3,466
3,320
3,102
2,373
1,425
982550463489 610
1,227
1,949
3,325
4,142
4,636
5,124
5,583
6,045
6,497
6,962
2019-2024 2025E-2030E
ICE
BEV
PHEV
Total
46.3%
103.8%
175.9%
53.3%
1.5%
18.9%
28.7%
8.5%
CAGR
Unit: Thousands
ICE
BEV
PHEV
29821916078471971 25 53 226 477
35.8%
19.9%
16.4%
9.5%
7.8%
10.6%
Rest of the World
Middle East & North Africa
South America
North America
Asia
Europe
The Proportion of China Domestic Brands Passenger Vehicle Export Regions, 2024
China Passenger Vehicle Exports Volume by Domestic Brands, Breakdown by Power Type
Source: China Association of Automobile Manufacturers (CAAM), Frost & Sullivan Report
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Competitive Landscape of China Passenger Vehicle Export Market by Chinese Domestic
Brands
Ranking of China Passenger V ehicle Export Market by Chinese Domestic Brands Companies
The Group is the largest domestic brand company in terms of passenger vehicle export
volume in 2023 and in 2024. The following table presents the ranking of Chinese domestic
brand companies measured by passenger vehicle export volume in 2023 and 2024:
Company Ranking in 2023 Ranking in 2024
The Group /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811
Company E (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822
Company B (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834
Company D (4) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845
Company A (5) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853
Source: Frost & Sullivan Report
Notes:
(1) The ranking is based on passenger vehicle exports volume for the period indicated.
(2) A Chinese OEM that is responsible for the domestic brand passenger vehicle business under Group N,
with sales covering ICEs and NEVs. It was established in 2007 and is headquartered in Shanghai.
(3) A Chinese OEM listed on the Stock Exchange that is responsible for the passenger vehicle business and
commercial vehicle business under Group M, with sales covering ICEs and NEVs. It was established in
1996 and is headquartered in Hangzhou.
(4) A Chinese OEM listed on the Stock Exchange and Shanghai Stock Exchange that is responsible for the
passenger vehicle business and commercial vehicle business under Group Q, with sales covering ICEs
and NEVs. It was established in 1984 and is headquartered in Baoding.
(5) A Chinese OEM that is responsible for the passenger vehicle business and commercial vehicle business
under Group U, with a focus on the sales of NEVs. It was established in 2006 and is headquartered in
Shenzhen.
Drivers and Trends of Chinese Domestic Brands in Overseas Passenger Vehicle Markets
Promotion of Localization in Global Strategies
As Chinese domestic brands aim to strengthen their presence in overseas passenger
vehicle markets, building overseas production capacity will be a key trend. This involves
establishing production plants, assembly lines, and supply chains in key global markets to
streamline logistics, avoid trade barriers, reduce costs, and improve efficiency. At the same
time, Chinese domestic brands are actively setting up R&D centers and sales networks in
global key markets to better understand and meet local market demands and consumer
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preferences. These efforts enhance their competitiveness in the international market. These
localization initiatives have become a crucial part of the long-term strategy of Chinese
domestic brands to strengthen their global presence.
Passenger V ehicles of Diversified Power Type in Export Market
In 2024, the export volume of ICE vehicles by Chinese domestic brands accounted for
74.9% of the total market. While ICE vehicles remain a driving force for Chinese domestic
brands in overseas markets, new energy vehicles are expected to become an increasingly
important driver of export growth. The export volume of NEVs by Chinese domestic brands
reached 1.04 million units in 2024, with a CAGR of 109.1% from 2019 to 2024, demonstrating
a strong growth momentum. With the global advocacy for greener, more sustainable modes of
transportation, the share of NEV in export market is expected to further increase, making NEVs
a key factor in driving the international expansion of Chinese domestic brands in the coming
years.
Enhancing Brand Images in Global Market
As the global passenger vehicle industry evolves and competition intensifies, Chinese
domestic brands are focusing on brand building and differentiated competition. With increased
investment in R&D, these brands are shifting their product offerings toward higher-end,
high-value models. This includes improving product quality, incorporating advanced
technologies, and enhancing vehicle intelligence to position their brands as premium options.
The higher level of intelligence, enhanced brand power, and shift toward high-value products
help improve the global brand image of Chinese domestic brands, thereby enhancing their
global competitiveness.
Historical Price Trends of Major Automotive Raw Materials and Components
The prices of passenger vehicles are influenced by various factors such as macroeconomic
conditions, supply and demand dynamics, and market outlook. For ICE vehicles, the cost
structure is heavily reliant on the engine, transmission system and other mechanical parts,
which require high-strength metals and high-quality materials. Steel, being a primary material
for passenger vehicles, plays a significant role in this cost structure.
Automotive chips in passenger vehicles encompass diverse categories including
microcontroller units (MCUs), power semiconductors, memory chips and analog chips, each
serving distinct functions with varying price points. The total automotive chips cost per vehicle
in China has demonstrated sustained growth in recent years, primarily driven by two major
factors: first, the continuous rise in NEV penetration rate as NEVs require a higher number of
chips as compared to ICE vehicles; second, the growing adoption of assistance driving
technology in passenger vehicles as the cost of assistance driving chips is relatively high.
However, the price level of a single type of automotive chips is experiencing price declines.
This is mainly due to the continuous enhancement of cost-performance ratios in domestic chips
that accelerates their substitution for imported alternatives, and product iterations brought by
technological advancements.
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In recent years, steel prices have been on a downward trend. This decline is largely
attributed to a decrease in demand, which has been caused by a slowdown in real estate and
infrastructure investment growth, as well as overcapacity in the steel industry. This trend in
steel prices can have a notable impact on the overall cost of ICE vehicles.
China Steel Price Index (CSPI)
70
80
90
100
110
120
130
140
150
Jan-2022
Jun-2022
Dec-2022
Jun-2023
Dec-2023
Jun-2024
Dec-2024
Source: China Iron and Steel Association, Frost & Sullivan Report
Note:
1. The base time for the China Steel Price Index (CSPI) is April 1994, and the index value at that time was set
at 100.
On the other hand, NEVs have a different cost structure. The cost structure of NEVs is
primarily influenced by the cost of power batteries. Since 2022, the price of power batteries in
China has been on a downward trend. This decline is driven by several factors, including the
reduction in raw material prices, advancements in technology, and heightened market
competition. These factors are expected to continue pushing power battery prices down in the
future.
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China Power Battery Cell Price
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
Jan-2022
Jun-2022
Dec-2022
Jun-2023
Dec-2023
Jun-2024
Dec-2024
Prismatic Power Battery Cell (LFP) Prismatic Power Batter y Cell (NCM)
Unit:    RMB/Wh
Source: Frost & Sullivan Report
IMPACT OF TARIFFS TO THE GLOBAL AND CHINA PASSENGER VEHICLE
MARKET
Impact of Tariffs on the Global Passenger Vehicle Market
Tariff policies have impacted the global passenger vehicle market in several significant
ways. From a supply chain perspective, the imposition of tariffs by the United States on
Mexico and Canada has disrupted the highly integrated automotive industry in North America.
Global OEMs have to adjust their production plans in response, further accelerating the trend
toward localized manufacturing. Moreover, tariffs have increased the cost of importing
automotive components, driving up overall production expenses, which in turn, has resulted in
higher vehicle prices and increased costs for consumers.
Impact of Tariffs on the China Passenger Vehicle Market
In recent years, Chinese domestic passenger vehicle brands have rapidly emerged,
experiencing growing demand in overseas markets. However, certain countries have imposed
high tariffs on Chinese automotive exports, posing challenges to the global expansion of
Chinese OEMs. For instance, the U.S. has levied additional tariffs on Chinese vehicles,
significantly raising the cost of market entry and weakening the price competitiveness of
Chinese brands.
While China’s exports of passenger vehicles to the U.S. account for a relatively small
share, the automotive components sector in China may face more pronounced impacts. As one
of the world’s leading exporters of automotive components, China encounters potential
challenges due to U.S. tariff policies. In response to these challenges, Chinese companies are
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optimizing their supply chains, expanding into alternative markets, and accelerating
localization efforts in overseas regions. These strategic moves help them enhance
competitiveness and mitigate the risks associated with trade barriers.
Future trends of the NEV market in the PRC
The NEV penetration rate in China’s passenger vehicle market is projected to rise from
48.9% in 2024 to 76.9% by 2030, indicating robust growth momentum with significant
untapped potential. From a regional perspective, tier 3 and 4 cities are emerging as the next
growth frontier, driven by rising disposable incomes and the expansion of charging
infrastructure into lower-tier markets. This growth is further bolstered by the accelerating
adoption of assistance driving technologies, which, combined with continuous advancements
in NEV performance and intelligent features, are driving steady improvements in consumer
acceptance. As a result, China’s NEV market demand is shifting from policy-driven to
market-driven, further accelerating the widespread adoption of NEVs.
Future trends of the overseas NEV market
The overseas NEV penetration rate has shown consistent growth, rising from 2.1% in
2019 to 11.8% in 2024, with projections reaching 36.0% by 2030, driven by increased
consumer environmental awareness, regional economic growth, and supportive policies. This
growth in NEV sales is driving charging infrastructure development across overseas markets,
creating a positive feedback loop for further market penetration. As consumer expectations for
safety, convenience, and intelligence evolve, NEVs’ intelligent features are gaining broader
acceptance among overseas consumers. In this context, Chinese OEMs can leverage their
assistance driving advantages to establish technological differentiation from traditional
overseas OEMs, which is expected to enhance their market share in overseas NEV markets.
Introduction of various automotive production method and the relevant market trends
Automotive production method mainly include whole vehicle production, contract
manufacturing, and CKD/SKD/DKD production. Complete vehicle production refers to OEMs
manufacturing entire vehicles in their own factories, suitable for companies with mature supply
chains and large-scale production. Contract manufacturing involves brand owners outsourcing
vehicle production to third-party manufacturers to reduce fixed asset investment and increase
production flexibility. CKD/SKD/DKD production (Completely Knocked Down, Semi
Knocked Down, and Direct Knocked Down) refers to the export of automotive products in
various levels of assembly - from completely disassembled components (CKD), to partially
assembled kits (SKD), to nearly complete vehicles (DKD) -with final assembly carried out in
the target overseas market to reduce tariffs and meet localization requirements. These three
models each have their own advantages, and OEMs choose the most suitable production
method based on market demand and strategic considerations.
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Currently, China automotive export market mainly adopts a dual production model of
complete vehicle exports and CKD/SKD/DKD assembly. In the future, with the continuous
growth of export volume, Chinese OEMs will accelerate the transition from CKD/SKD/DKD
assembly to localized manufacturing. Some companies have already begun investing in
factories in overseas target markets to reduce costs and improve market responsiveness. At the
same time, joint ventures and deeper collaboration with local supply chains will become a key
trend to enhance market adaptability.
SOURCE OF INFORMATION
Our Company commissioned Frost & Sullivan, an independent market research company,
to conduct an analysis of, and to produce a report on the passenger vehicle market. The
information from Frost & Sullivan disclosed in this prospectus is extracted from the Frost &
Sullivan Report. We have agreed to pay a fee of RMB298,000 to Frost & Sullivan in connection
with the preparation of the Frost & Sullivan Report. The payment of such amount was not
contingent upon the success of the Listing or on the results of the report. The Frost & Sullivan
Report was prepared using both primary and secondary research obtained from various sources.
Primary research involved interviews with leading industry participants in passenger vehicle
market and other experts related to the business of our Company. Secondary research involved
reviewing company reports, independent research reports and data based on Frost & Sullivan’s
own research database and government database. In compiling and preparing the report, Frost
& Sullivan has adopted the following assumptions:
 The social, economic and political environments of the PRC, and other primary
countries worldwide will remain stable during the forecast period, which will ensure
a sustainable and steady development of the passenger vehicle industry;
 There are no significant material changes in government policies in respect of the
passenger vehicle market.
Frost & Sullivan believes that the basic assumptions used in preparing its report,
including those used to make future projections, are factual, correct and not misleading. Frost
& Sullivan has independently analyzed the information, but the accuracy of the conclusions of
its review largely relies on the accuracy of the information collected.
Except as otherwise noted, all of the data and forecasts contained in this section are
derived from the Frost & Sullivan Report. Our Directors confirm that after taking reasonable
care, there is no material adverse change in the overall market information since the date of the
Frost & Sullivan Report that would materially qualify, contradict or have an impact on such
information.
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OVERVIEW OF LA WS AND REGULATIONS IN THE PRC
This section sets out a summary of the most significant aspects of laws and regulations
in the PRC which are material to our business operations.
Regulations Relating to Production Access for Automobiles
Since January 1, 2001, the government authorities, from time to time, released the Public
Notice of Automobile V ehicle Manufacturer and Products (ʮѓ)
(hereinafter referred to as the “ Public Notice ”) to administer the new automobile vehicle
products of manufacturers. The inclusion on the Public Notice is a prerequisite for automobile
manufacturers to be able to manufacture automobiles, including assembling complete
built-ups, and for customers to be able to register their automobiles with the public security
authorities. The MIIT has been the authority in charge of the release of the Public Notice since
August 2008. The automobile manufacturers listed in the Public Notice shall only manufacture
and sell the vehicle models authorised by the Public Notice. Any manufacturers that produce
or sell automobile products or vehicles not included in the Public Notice shall be subject to
penalties. The Policy provides that in order to be registered in the Public Notice, the
automobile products must pass compliance tests of various safety standards, technical
specifications and environmental protection requirements.
According to the Regulations on the Administration of Investments in the Automobile
Industry () issued by the NDRC on December 10, 2018 and
effective on January 10, 2019, both whole vehicle and other investment projects are subject to
filing management by local development and reform authorities, with whole vehicle investment
projects to be filed with provincial development and reform authorities.
Further, the MIIT promulgated various admission regulations for different types of
vehicle manufacturers and products, such as the Administrative Rules on Admission of
Passenger V ehicle Manufacturers and Products ()
promulgated on November 4, 2011, and the Administrative Provisions on Admission of
New-Energy V ehicle Manufacturers and Products (ɝ၍ଣ஝
) promulgated on January 6, 2017, amended on July 24, 2020 and effective from
September 1, 2020. In order to optimize the administration on admission of the vehicle
manufacturers and products, the MIIT promulgated the Administrative Regulation on
Admission of Road Motor V ehicle Manufacturers and Products ( ༸༩ዚਗԓሿ͛ପΆุʿପ
, the “ New Admission Regulation ”) on November 27, 2018, which took
effect on June 1, 2019. The New Admission Regulation unifies various admission regulations
for different types of road vehicle manufacturers and products and simplifies the admission
administrative procedures on the vehicle manufacturing.
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According to the Special Administrative Measures (Negative List) for the Access
of Foreign Investment (2024) (݄(૶ఊ)(2024و))
(hereinafter referred to as the “ 2024 Negative List ”) promulgated by the MOFCOM and the
NDRC on September 6, 2024 and effective on November 1, 2024, as well as the Catalogue of
Industries for Encouraging Foreign Investment (2022) ( ོᎸ̮ਠҳ༟ପุͦ፽(2022 ϋ
وpromulgated by the NDRC and the MOFCOM on October 26, 2022 and effective on
January 1, 2023, the manufacturing of NEVs is not a prohibited or restricted industry of foreign
investment. At the same time, restrictions on the proportion of foreign investment in passenger
vehicle manufacturing and the establishment of two or fewer joint ventures producing similar
whole vehicle products by the same foreign investor are lifted.
Regulations Relating to Automobile Sales and Protection of Consumer Rights and
Interests
According to the Measures for the Administration of Automobile Sales ( ӛԓቖਯ၍ଣ
) promulgated by the MOFCOM on April 5, 2017 and effective on July 1, 2017, local
competent commerce departments at or above the county level shall supervise and manage the
automobile sales and relevant activities of providing relevant services within their respective
administrative regions. Automobile suppliers and dealers shall file the basic information
through the National Automobile Circulation Information Management System of the
competent commerce department of the State Council within 90 days from the date of obtaining
their business licenses. Where there is any change to the information, its update shall be made
within 30 days from the date of the change. Automobile suppliers and dealers shall sell
automobiles, accessories, and other related products that comply with the relevant national
provisions and standards. A dealer shall, at its business premise, expressly indicate the prices
of the products to be sold and the standards for various service fees, and shall not sell any
product at increased price or collect any additional fee. A dealer shall expressly indicate the
product quality assurance, warranty services, and other after-sales service policies that
consumers need to know for the automobiles to be sold.
According to the Law of the PRC on the Protection of Consumer Rights and Interests
() promulgated by the Standing Committee of the
National People’s Congress (the “ SCNPC ”) on October 31, 1993, amended on October 25,
2013, and effective on March 15, 2014, business operators shall guarantee that their provided
commodities or services meet the requirements on personal and property safety. For
commodities and services which may endanger personal or property safety, business operators
shall provide consumers with true explanations and clear warnings, explaining and indicating
the correct methods of using commodities or receiving services and the methods for preventing
damage. After discovering any defects which may endanger personal or property safety in their
provided commodities or services, business operators shall immediately report to the relevant
administrative departments and inform consumers; and take measures such as cessation of sale,
issuance of a warning, recall, harmless treatment, destruction, and cessation of production or
service. Business operators who fail to comply with consumer protection regulations shall bear
civil or criminal liability in accordance with law.
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Regulations Relating to Product Quality and Recall of Defective Automobile Products
According to the Product Quality Law of the PRC ()
promulgated by the SCNPC on February 22, 1993, latest amended on December 29, 2018, and
effective on the same day, the market regulatory authorities of the State Council are responsible
for the supervision and administration of the quality of products of the whole country.
Producers and sellers shall be prohibited to produce or sell industrial products that do not come
to the requirements and demands for physical health and safety of body and property. Producers
shall be responsible for the quality of the products they produce, and the products shall not
pose unreasonable danger to personal or property safety. The products shall have functional
performance and the adopted product standards shall be indicated on the products or their
packaging. If a defect in the product causes damage to the person or property of others, the
victim may claim compensation from the producer of the product or from the seller of the
product. Producers or sellers who produce or sell substandard products will be ordered to cease
production and sales, the illegally produced or sold products will be confiscated, and a fine will
be imposed. If there is any illegal income, the illegal income will also be confiscated. If the
circumstances are serious, the business license shall be revoked. If a crime is constituted,
criminal responsibility shall be investigated in accordance with law.
According to the Regulations on the Administration of the Recall of Defective
Automobile Products (̜Ϋ၍ଣૢԷ) promulgated by the State Council on
October 22, 2012 and amended on March 2, 2019, the product quality supervision department
of the State Council shall be responsible for the national supervision and administration of the
recall of defective automobile products. If an automobile producer learns that an automobile
product may be defective, it shall immediately organize an investigation and analysis, and
truthfully report the investigation and analysis results to the product quality supervision
department of the State Council. If an automobile producer confirms that the automobile
products are defective, it shall immediately stop producing, selling, and importing defective
automobile products, and implement a recall of all defective automobile products. At the same
time, a recall plan shall be formulated and filed with the product quality supervision and
administration department of the State Council. The filed recall plan with amendments shall be
re-filed. If the producer fails to implement a recall, the product quality supervision department
of the State Council shall order the recall. Automobile producers who conceal defects, refuse
to recall after being ordered to do so, or fail to stop production, sales, or import of defective
automobile products will be ordered to make corrections and fined. If there is any illegal
income, the illegal income will also be confiscated. If the circumstances are serious, the
relevant license shall be revoked by the licensing authority.
According to the Measures for the Implementation of the Regulations on the
Administration of the Recall of Defective Automobile Products (̜Ϋ၍ଣૢԷ
) published on November 27, 2015 and amended on October 23, 2020 by the
General Administration of Quality Supervision, Inspection and Quarantine of the PRC (which
was merged with the SAMR, the SAMR shall be responsible for the supervision and
administration of the recall of defective automobile products nationwide. A producer
implementing a recall shall formulate a recall plan and file it with the SAMR. At the same time,
it shall notify the business operator in an effective manner. Producers modifying the recall plan
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that has already been filed shall file it again with the SAMR and submit explanatory materials.
Producers shall publish information on defective automobile products and relevant information
on recalls through newspapers, websites, radio, television, and other means that are easily
accessible to the public, and inform car owners of the defects in the automobile products,
emergency response measures to avoid damage, and measures taken by the producers to
eliminate defects.
According to the Notice of the General Office of the State Administration for Market
Regulation on Further Strengthening the Supervision on the Recall of V ehicle Remote Upgrade
(OTA) Technology (ආɓӉ̋੶ӛԓჃ೻ʺॴ(OTA)Ҧஔ̜Ϋ္၍
) promulgated by the SAMR on November 23, 2020 and effective on the same day,
producers who use OTA to carry out technical service activities for sold vehicles shall file with
the Quality Development Bureau of the SAMR. Producers who use OTA to eliminate defects
in automobile products and implement recalls shall formulate a recall plan and file it with the
Quality Development Bureau of the SAMR. If the OTA method fails to effectively eliminate
defects or causes new defects, producers shall take recall measures again.
According to the Guiding Opinions on Further Strengthening the Construction of Safety
System for NEV Enterprises (ኬจԈ)
issued by the MIIT, the Ministry of Public Security, the Ministry of Transport, the Ministry of
Emergency Management, and the SAMR on March 29, 2022, enterprises shall comprehensively
enhance the safety capabilities of enterprises in safety management mechanism, product
quality, operation monitoring, after-sales service, accident response, and handling, as well as
network security, improve the safety of NEVs, and promote the high-quality development of
the NEV industry.
Regulations Relating to Compulsory Product Certification
According to the Administrative Regulations on Compulsory Product Certification
(amended in 2022) (֛2022ࠈࡌ)) promulgated by the SAMR
on July 3, 2009, amended on September 29, 2022, and became effective on November 1, 2022,
the SAMR is in charge of the compulsory product certification nationwide, and is responsible
for the organization, implementation, supervision, administration, and comprehensive
coordination of the compulsory product certification of the whole country, while local market
regulation and administration authorities at county level or above are responsible for the
supervision and administration of compulsory product certification activities within their
jurisdiction. With respect to products which are subject to compulsory product certification,
China has issued a uniform catalogue of products, uniform compulsory technical requirements,
standards and compliance review procedures, uniform certification signs, and uniform
fee-charging standards. According to the List of the First Batch of Products Subject to
Compulsory Product Certification (ͦ፽), which was
issued by the SAMR jointly with the Certification and Accreditation Administration of the PRC
and effective from December 3, 2001, the motor vehicles and their safety accessories, motor
vehicle tires, and safety glass in the absence of the compulsory product certificate and the
mandatory certification mark of China shall not leave the factory, or be exported or put on sale.
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Regulations Relating to Battery Recycling for NEVs
The Interim Measures for the Administration of Recycling Traction Batteries of NEVs
(), which was promulgated by the MIIT, the
Ministry of Science and Technology, the Ministry of Ecology and Environment, the Ministry
of Transport, the MOFCOM, the SAMR, and the National Energy Administration on January
26, 2018 and effective on August 1, 2018, implements the system of extended responsibility of
producers, according to which the main responsibility for traction battery recycling is borne by
automobile manufacturers, and relevant enterprises shall fulfill their corresponding
responsibilities in all aspects of traction battery recycling and utilization to ensure the effective
use and environmentally friendly disposal of traction batteries.
According to the Interim Provisions on Traceability Management of Traction Battery
Recycling for NEVs (), which was
issued by the MIIT on July 2, 2018 and effective from August 1, 2018, the “Integrated
Management Platform for National Monitoring of NEVs and Traceability of Traction Battery
Recycling and Utilization” (္಻ၾਗɢႅཥϫΫϗл͜๑๕ၝΥ၍ଣ̨̻)
shall be established to collect information on the whole lifecycle of traction battery production,
sales, use, disposal, recycling, and utilization, and to monitor the fulfillment of the
responsibility of battery recycling and utilization by the subjects of each link. From the
effective date of the Provisions, the NEV products that have obtained the Announcement of
Road Power-Driven V ehicle Manufacturing Enterprises and Products and the imported NEVs
that have obtained compulsory product certification are managed in a traceable manner. For the
NEV products that have obtained access approval and the imported NEVs that have obtained
compulsory product certification before the effective date of the Provisions, the
implementation of traceability management will be delayed for 12 months. If, after the
deadline, it is necessary to use traction batteries that are not coded according to national
standards in the process of maintenance or other processes, an explanation shall be submitted.
Favorable Policies on Automobiles Industry in China
1. Government Subsidies for Automobile Purchasers
According to the Notice of Further Effectively Completing the Work Concerning Trade-in
of V ehicles (), which was issued by the
MOFCOM and other six ministries and commissions on August 15, 2024 and became effective
on the same day, restates the aforementioned increased subsidy standard, increases the central
financial support, optimizes the vehicle scrapping renewal review and allocation regulation
process and emphasizes on strengthening supervision and administration. For eligible subsidy
applications filed between April 24, 2024 and January 10, 2025 (including applications for
which the subsidy granting has been completed), subsidies shall be granted according to the
increased standard specified in this notice; for applications for which the subsidies have been
granted according to the former standard, the difference shall be made up according to the
standard specified in this notice. Moreover, the Notice on Effectively Completing the Work
Concerning 2025 Trade-in of V ehicles (ਂλ2025), which
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was issued by the MOFCOM and other seven ministries and commissions on January 14, 2025
and became effective on the same day, on one hand, the scope of vehicles eligible for vehicle
scrapping and replacement has been further expanded. This includes incorporating the scenario
of scrapping fuel vehicles meeting Level IV national emission standards and subsequently
purchasing passenger NEVs in the scope of the subsidy program. Additionally, the registration
time for passenger NEV eligible for scrapping has been extended by 6 months to December 31,
2018, while for other vehicles, it has been extended by 1 year: for gasoline passenger vehicles,
it has been extended to June 30, 2012; for diesel and other fuel passenger vehicles, it has been
extended to June 30, 2014. On the other hand, the subsidy standards for vehicle replacement
have been improved. Individual consumers who transfer a passenger vehicle registered under
their own name and purchase a new passenger NEV will be eligible for replacement subsidies
up to RMB15,000 per vehicle in 2025.
According to the Notice on Launching Pilot Reforms for Automobile Circulation and
Consumption () jointly issued by the
MOFCOM and other seven ministries and commissions on January 20, 2025, and effective
immediately, pilot reforms for automobile circulation and consumption will be conducted
during the period 2025-2027. The initiative aims to stimulate vitality in the automotive
consumer market and promote high-quality development of the automobile industry. The
reforms primarily focus on five key areas: (i) stabilizing and expanding automobile
consumption; (ii) facilitating efficient circulation of used vehicles; (iii) cultivating an
automotive cultural environment; (iv) enhancing the recycling system for end-of-life vehicles;
(v) advancing the digitalization of automobile circulation and consumption.
2. Exemption from Vehicle Purchase Tax
According to the Announcement on the Exemption of V ehicle Purchase Tax on New
Energy V ehicles (ʮѓ) jointly promulgated
by the MOF, the STA and the MIIT on September 18, 2022 and came into effect on the same
date, it is expressively stated that the tax exemption period for purchase of new energy vehicles
was further extended to December 31, 2023.
According to the Announcement on Continuing and Optimizing the V ehicle Purchase Tax
Reduction and Exemption Policy for New Energy V ehiclesᚃձᎴʷอঐ๕ӛԓԓሿ
ʮѓ jointly promulgated by the MOF, the STA and the MIIT on June 19,
2023 and came into effect on the same date, it is expressively stated that the purchase tax
exemption period for purchase of new energy vehicles was further extended to December 31,
2025; of which the tax exemption amount for each new energy passenger vehicle is not more
than RMB30,000; vehicle purchase tax for new energy vehicles with purchase dates from
January 1, 2026 to December 31, 2027 is reduced by half, of which the tax reduction amount
for each new energy passenger vehicle is not more than RMB15,000.
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3. Exemption of Vehicle and Vessel Tax
According to the Notice of Preferential V ehicle and V essel Tax Policies for Energy-saving
and New-energy V ehicles and V essels (ஷ
) jointly promulgated by the MOF, the Ministry of Transport, the SA T, and the MIIT on
July 10, 2018 and effective from the same date, purely electric commercial vehicles, plug-in
(including extended-range) hybrid vehicles, and fuel cell commercial vehicles are exempt from
vehicle and vessel tax, whereas purely electric passenger vehicle and fuel cell passenger
vehicles are not subject to vehicle and vessel tax. The Catalogue of NEV Models Enjoying
V ehicle and V essel Tax Reduction and Exemption (ঐ๕Դ͜อ
ͦ፽) jointly promulgated by MIIT and the SA T from time to time lists the
NEV models eligible for enjoying vehicle and vessel tax reduction and exemption.
4. Corporate Average Fuel Consumption and NEV Credits Scheme for Vehicle
Manufacturers and Importers
According to the Measure on the Parallel Administration of the Corporate Average Fuel
Consumption and NEV Credits of Passenger V ehicle Enterprises (ऊঃ
) jointly promulgated by the MIIT, the MOF, the
MOFCOM, the General Administration of Customs, and the SAMR on September 27, 2017 and
effective from April 1, 2018, and latest amended on June 29, 2023 and implemented on August
1, 2023, the MIIT shall establish a vehicle fuel consumption and new energy vehicle points
management platform, to comprehensively promote the publicity, transfer, transaction and
other work of the average fuel consumption and new energy vehicle points of enterprises.
Passenger vehicles enterprises shall, according to the requirements of the MIIT, submit the
relevant data of the fuel consumption of passenger vehicles manufactured and imported by
them and new energy passenger vehicles; and conduct transfer or trading of points through the
vehicle fuel consumption and new energy vehicle points management platform.
5. Recent Policies to Promote NEV Consumption
Pursuant to the Opinions on Further Unleashing Consumption Potential to Promote
Sustained Recovery of Consumption (จԈ)
issued and implemented by the General Office of the State Council on April 20, 2022, it
emphasizes to break down the barriers of consumption restrictions. One of the initiatives is to
steadily increase the consumption of automobiles and other consumption in bulk stocks and no
additional vehicle purchase restriction measures shall be issued in all regions. In the regions
where purchase restrictions have been implemented, it shall gradually increase the number of
vehicle increment indicators, relax the eligibility criteria for vehicle purchasers, and gradually
remove vehicle purchase restrictions based on local conditions. It also vigorously develop
green consumption and continue to support the acceleration of development of NEVs, as well
as fully tap into the consumption potential in counties and townships, while emphasizing on
guiding enterprises to carry out promotions in rural areas with the focus on automobiles and
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home appliances, encouraging eligible areas to introduce NEVs and green smart home
appliances to the countryside, and promoting the construction of charging piles (stations) and
other supporting facilities, so as to fully explore consumption potentials from counties and
villages.
According to the Notice on the Measures for Invigorating Automobile Circulation and
Boosting Automobile Consumption ()
issued by 17 departments including the MOFCOM and implemented on July 5, 2022, it
provided to (1) support the purchase and use of NEVs; (2) accelerate the activation of the
second-hand cars market; (3) promote vehicle renewal consumption; (4) promote the
sustainable and healthy development of the parallel import of vehicles; (5) optimize the
environment for vehicle use; (6) enrich vehicle financing services.
Pursuant to the Notice on the Campaign of Promoting NEVs in Rural Areas for 2024
(࢝2024), which was issued by the MIIT and other
four ministries and commissions on May 15, 2024 and became effective on the same day, from
May to December 2024, the following measures shall be taken to promote NEVs in rural areas:
(i) selecting suitable NEV models for rural markets that have a good reputation and reliable
quality (as listed in the Model Catalogue of the 2024 NEV Promotion in Rural Areas (2024 ϋ
ͦ፽)) and conducting various activities, such as centralized exhibitions,
test rides, and test drives, to enrich consumer experiences and provide diverse options; (ii)
organizing charging and battery swapping services, as well as financial services such as
insurance underwriting, insurance claims, and credit services for NEVs; (iii) coordinating
after-sales services, such as maintenance, in rural areas and addressing the shortcomings of
matched environment in rural areas; and (iv) implementing support policies such as trade-ins
and improvement of charging and swapping facilities in rural areas to deliver substantial
monetary benefits directly to consumers.
Regulations Relating to Cybersecurity and Data Security
Pursuant to the Cybersecurity Law of the PRC () issued
by the SCNPC on November 7, 2016 and implemented on June 1, 2017 (hereinafter referred
to as the “ Cybersecurity Law ”), network operators shall, according to the requirements of
laws and requirements as well as the mandatory requirements of national and industry standard,
develop internal security management mechanisms, and take technical measures and other
necessary measures to ensure network security and stable operation. Personal information and
important data collected and produced by critical information infrastructure (“ CII”) during
operation shall be stored within PRC; where due to business requirements it is truly necessary
to provide it overseas, a security assessment shall be conducted according to the requirements
of relevant departments. Network operators in violation of the provisions of this law may be
subject to penalties, such as being ordered to make rectifications, given warnings or fines,
confiscated of unlawful gains, ordered to a temporary suspension of operations, a suspension
of business for corrections, a shutting down of websites, a revocation of relevant operations
permits, etc. Pursuant to the Notice to Seek Public Comments on the Decision to Revise the
Cybersecurity Law of the PRC (Draft for Comments) (ҷ<ʕശɛ͏΍ձ਷ၣഖτΌ
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ج>֛(ᅄӋจԈᇃ))( “ Cybersecurity Law Revision Draft ”) issued by the Cyberspace
Administration of China (hereinafter referred to as the “ CAC”) on September 12, 2022, the
violations of the Cybersecurity Law might be subject to more severe punishment if the
Cybersecurity Law Revision Draft is implemented in its current form. Specifically, the
Cybersecurity Law Revision Draft enhanced the punishment against violations of the network
operation security obligation, the CII operation security obligation, and the network
information security obligation by increasing the upper limits of the fines and imposing
additional punishment. The Cybersecurity Law Revision Draft also enhanced the punishment
against personal information infringement by referencing to the punishment under applicable
laws which would include relevant punishment under the Personal Information Protection Law.
As of the Latest Practicable Date, the Cybersecurity Law Revision Draft has not been formally
adopted.
According to the Data Security Law of the PRC () passed
by the SCNPC on June 10, 2021 and implemented on September 1, 2021, the state establishes
a classified and tiered system for data protection. When conducting data handling activities,
one shall comply with laws and regulations, establish a sound, full-range data security and
management system, organize and conduct data security education and training, as well as take
corresponding technical measures and other necessary measures to protect data safety. The use
of the internet and other information networks to carry out data handling activities shall, on the
basis of the hierarchical network security protection system, fulfill the obligations of data
security protection. The handlers of important data shall, in accordance with relevant
provisions, carry out risk assessment on their data handling activities on a regular basis and
submit risk assessment reports to the relevant competent authorities. Those who fail to fulfill
the legal obligations of data security protection will be ordered to correct, warned, fined,
suspended with their business or suspended for rectification, or revoked of relevant business
licenses.
According to the Measures for Data Security Administration in the Industry and
Information Technology Field (Trial Implementation) (ج
(༊Б)) promulgated by the MIIT on December 8, 2022 and effective from January 1, 2023,
data handlers in the field of industry and information technology refer to all types of subjects
in the field of industry and information technology, such as industrial enterprises, software and
information technology service providers, telecommunications business operators obtaining a
telecommunications business permit, and radio frequency and station users that independently
determine handling purposes and handling methods in data handling activities. According to
the degree of harm caused by data tampering, destruction, divulgence, or illegal acquisition or
utilization of data to national security, public interest, or the lawful rights and interests of
individuals and organizations, among others, industrial and information data can be divided
into three levels: general data, important data, and core data. The MIIT will organize the
formulation of the standards and specifications on the classification and grading of data,
identification and confirmation of important data and core data, graded data protection, etc. in
the field of industry and information technology, guide the management of data classification
and grading, and formulate specific catalogs of important data and core data of industry and
implement dynamic management. Data handlers in the field of industry and information
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technology shall assume the principal responsibility for the security of data handling activities
and implement graded protection of various types of data. In addition, the Measures for Data
Security Administration in the Industry and Information Technology Field (Trial
Implementation) stipulates the data security monitoring and early warning and emergency
management mechanism, as well as the relevant reporting and notification obligations of the
data handlers in the field of industry and information technology under such mechanisms.
The Administrative Provisions on Security Vulnerability of Network Products ( ၣഖପ
) was jointly promulgated by the MIIT, the CAC, and the Ministry of
Public Security on July 12, 2021, and effective on September 1, 2021. Network product
providers and network operators shall establish channels to receive information of security
vulnerability of their respective network products and shall examine and fix such security
vulnerability in a timely manner. According to the Cybersecurity Law, the Administrative
Provisions on Security Vulnerability of Network Products provide that network product
providers are required to report relevant information of security vulnerability of network
products to the MIIT within two days and to provide technical support for network product
users. Network operators shall take measures to examine and fix security vulnerability after
discovering or acknowledging that their networks, information systems, or equipment have
security vulnerability. Network operators who violate the Provisions shall be dealt with by the
relevant competent authorities in accordance by the law, and those who constitute relevant
violations under the Cybersecurity Law shall be punished in accordance with the Cybersecurity
Law.
According to the Several Provisions on Administration of Automobile Data Security (For
Trial Implementation) (֛(༊Б))( “ Several Provisions on
Automobile Data ”) jointly promulgated by the CAC, the NDRC, the MIIT, the Ministry of
Public Security, and the Ministry of Transport on August 16, 2021, and effective on October 1,
2021, automobile data handlers (including automobile manufacturers, components and parts
and software suppliers, dealers, maintenance organizations, and mobility service enterprises)
shall handle automobile data (including personal information data and important data involved
during the design, production, sales, use, operation, and maintenance of automobile) in a
lawful, legitimate, specific and clear manner. Automobile data handlers are encouraged by the
Several Provisions on Automobile Data to adhere to the following principles: the principle of
in-vehicle handling, i.e., do not transfer data out of the vehicle unless it is indeed necessary;
the principle of non-collection by default; the principle of appropriate accuracy and coverage;
and the principle of data desensitization. Operators collecting personal information shall obtain
the consent of the person being collected upon or comply with other requirements stipulated
in laws, regulations or administrative rules. The Several Provisions on Automobile Data also
provided that important data means the data that may endanger national security, public
interests, or the lawful rights and interests of individuals or organizations once it has been
tampered with, destroyed, leaked, or illegally obtained or used, including geographic
information, passenger flow, vehicle flow and other data of important sensitive areas, operating
data of vehicle charging networks, personal information involving more than 100,000 personal
information subjects, video and image data outside the vehicles that contain face information,
license plate information, etc. Important data shall be stored domestically by laws. If such data
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need to be provided outside China due to business needs, the data shall go through the security
assessment organized by the CAC. To handle important data, automobile data handlers shall
conduct risk assessment in accordance with the regulations and submit risk assessment reports
to related departments at provincial level. In addition, automobile data handlers handling
important data shall, by December 15 of each year, report to the related departments at
provincial level the information on automobile data security management. The implementation
of such requirement on annual report is subject to the authority of related departments at
provincial level. Illegal automobile data handlers shall bear administrative punishment by laws
and if a crime is committed, shall bear criminal liability.
Pursuant to the Notice of the Ministry of Industry and Information Technology on
Strengthening Network Safety and Data Safety Work of V ehicle Connectivity (ࢹڦ
) promulgated by the MIIT and
effective on September 15, 2021, all Internet of V ehicles companies shall establish a network
security and data security management system, which defines responsible persons and
management departments and implements the responsibilities of network security and data
security protection. Enterprises related to the Internet of V ehicles shall adopt management and
technical measures to strengthen the security protection of automobiles, networks, platforms
and data in accordance with the requirements of relevant standards for Internet of V ehicles
network security and data security and shall monitor, prevent and promptly deal with network
security risks and threats, ensure that data is effectively protected and legally used, and
maintain the safe and stable operation of the Internet of V ehicles.
According to the Regulations on Protecting the Security of Critical Information
Infrastructure (ᚐૢԷ) promulgated by the State Council on
July 30, 2021, and effective on September 1, 2021, CII means network facilities and
information systems in important industries and fields that may seriously endanger national
security, national economy and people’s livelihood, and public interests in the event that they
are damaged or lose their functions or their data are leaked. The protection authorities shall be
responsible for organizing the identification of CII of respective industries and fields, notify
the operators concerned of the identification results in a timely manner. The Regulations
emphasize that no individual or organization may engage in any activity of illegally hacking
into, interfering with, or damaging any critical information infrastructure or endanger the CII
security.
On April 13, 2020, the Cybersecurity Review Measures () was
jointly promulgated by the CAC, the NDRC, the MIIT, the Ministry of Public Security, the
Ministry of State Security, the MOF, the MOFCOM, the PBOC, the SAMR, the National Radio
and Television Administration, the National Administration of State Secrets Protection and the
State Cryptography Administration, revised on December 28, 2021, by the aforementioned
departments and the China Securities Regulatory Commission, and the revised Cybersecurity
Review Measures formally became effective on February 15, 2022. According to the revised
Cybersecurity Review Measures, operators of online platforms with personal information of
more than one million users must apply for a cybersecurity review with the Cybersecurity
Review Office when they are seeking for listing in a foreign country. In the meantime, the
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member organizations of the cybersecurity review working mechanism have the discretion to
initiate a cybersecurity review on any data handling activity if they deem a data handling
activity affects or may affect national security. The specific implementation rules on
cybersecurity review are subject to further clarification by subsequent regulations.
On September 24, 2024, the CAC announced the Cyber Data Security Regulations ( ၣ
ഖᅰኽτΌ၍ଣૢԷ), which became effective on January 1, 2025, stipulates that cyber data
handlers who carry out cyber data handling activities that affect or may affect national security
shall undergo national security review in accordance with relevant state regulations. In
addition, the Cyber Data Security Regulations also regulate other specific requirements in
respect of the cyber data handling activities conducted by cyber data handlers in the view of
personal data protection, important data safety, cross-border data transfer safety management
and obligations of network platform service provider. Cyber data handlers shall identify and
declare important data in accordance with relevant state regulations. For data confirmed as
important data, relevant regions and departments shall promptly inform cyber data handlers or
make public announcements. Cyber data handlers shall fulfill their responsibilities for cyber
data security protection. Handlers of important data shall designate persons in charge of cyber
data security and establish cyber data security management institutions. Cyber data security
management institutions shall fulfill their responsibilities for cyber data security protection.
Handlers of important data shall conduct risk assessments of their cyber data handling
activities on an annual basis and submit risk assessment reports to relevant competent
departments at or above the provincial level.
On July 7, 2022, the CAC officially issued the Measures for the Security Assessment of
Cross-border Data Transmission ()( “ the Measures ”), which
became effective and was implemented on September 1, 2022. The Measures applies to the
security assessment conducted by data handlers where they provide overseas parties with
important data and personal information collected and generated during the operation in the
PRC. Based on the Measures, data handlers shall apply for the security assessment of
cross-border data transfer to the CAC through the provincial cyberspace administration in the
place where they operate if their data cross-border data transfer activities fulfill certain
thresholds.
According to the Regulations on Promoting and Standardizing Cross-Border Data
Transfer ()( “ the Regulations ”) issued by the CAC and
effective on March 22, 2024, data collected and generated in activities such as international
trade, transnational manufacturing and marketing and provided to overseas, excluding personal
information or important data, are exempt from the requirement of declaring security
assessment for cross-border data transfers, establishing the standard contract for cross-border
transfer of personal information, and obtaining personal information protection certification.
Data handlers other than operators of CII who provide important data to overseas or who have
provided personal information (excluding sensitive personal information) of more than one
million people or sensitive personal information of more than 10,000 people cumulatively
since January 1 of the current year shall declare security assessment for cross-border data
transfers, except for those specified in Articles 3, 4, 5, and 6 of the Regulations. Personal
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information handlers shall provide personal information overseas by entering into standard
contract with overseas recipient and file with the provincial cyberspace administration or
obtaining personal information certification if the following conditions are simultaneously
met: (1) data handlers other than CII operators; and (2) where the personal information of more
than 100,000 individuals and less than 1,000,000 individuals (excluding sensitive personal
information) has been cumulatively provided overseas since January 1 of the current year, or
where the sensitive personal information of less than 10,000 individuals has been cumulatively
provided overseas since January 1 of the current year, except for those specified in the
provisions of Articles 3, 4, 5 and 6 of the Regulations. According to the Article 3 of the
Regulations, if the cross-border transferred data has not been notified or publicly disclosed by
relevant departments or regions as important data, data handlers do not need to declare security
assessment for cross-border data transfers as the important data handlers. According to Articles
4, 5, and 6 of the regulations, the following are the main exemptions from the requirement to
declare security assessment for cross-border data transfers, establish the standard contract for
cross-border transfer of personal information, and obtain personal information protection
certification: (i) providing personal information collected and generated overseas by data
handlers overseas after being handled in China without involving domestic personal
information or important data; (ii) providing personal information overseas is necessary for the
conclusion or performance of a contract to which the individual is a party concerned, such as
cross-border shopping, cross-border mailing, cross-border remittances, cross-border payments,
cross-border account opening, air ticket and hotel reservations, visa processing, exam services,
etc.; (iii) providing employee personal information overseas is necessary for implementation of
cross-border human resources management in accordance with legally formulated labor rules
and regulations and legally signed collective contracts; (iv) providing personal information
overseas is necessary to protect the life, health, and property safety of natural persons in
emergency situations; (v) data handlers other than operators of CII have provided personal
information (excluding sensitive personal information) overseas of less than 100,000 people
cumulatively since January 1 of the current year; (vi) data handlers in pilot free trade zones
provide data overseas outside the negative list formulated, approved, and filed by the pilot free
trade zone in accordance with the law. In case of any inconsistency between the Regulations
and other regulations such as the Security Assessment Measures for Cross-border Data
Transfers () (Decree No. 11 of the Cyberspace Administration of
China) issued on July 7, 2022 and the Measures on the Standard Contract for Cross-border
Transfer of Personal Information () (Decree No. 13 of the
Cyberspace Administration of China) issued on February 22, 2023, the Regulations shall
prevail.
According to the Amendment (IX) to the Criminal Law of the PRC ( ʕശɛ͏΍ձ਷
ࣩ(ɘ)) promulgated by the SCNPC on August 29, 2015, and effective on
November 1, 2015, network service providers who violate the information network security
management obligations stipulated by relevant laws and refuse to make rectification after being
ordered to do so shall be subject to criminal penalties if the circumstances is serious as those
stipulated in the Amendment (IX) to the Criminal Law of the PRC.
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Regulations Relating to Intelligent Connected Vehicles and Autonomous Driving
Pursuant to the Rules for the Administration of the Road Testing and Demonstrative
Application of Intelligent Connected V ehicles (for Trial Implementation) ( ౽ঐၣᑌӛԓ༸
༩಻༊ၾͪᇍᏐ͜၍ଣ஝ᇍ(༊Б)) jointly issued by the MIIT, the Ministry of Public
Security, and the Ministry of Transport on July 27, 2021 and effective on September 1, 2021,
any entity intending to conduct a road testing of intelligent connected vehicles must obtain a
temporary vehicle license plate for each tested vehicle. An applicant entity must satisfy the
relevant requirements, which include that it must be an independent legal person registered in
the PRC with the capacity to conduct intelligent connected vehicles-related businesses such as
manufacturing, technological research and development and testing of vehicles and vehicle
parts, with full civil legal capacity for compensation relating to potential personal injury and
losses of properties arising from road-testing of intelligent connected vehicles, which has
established protocol to test and assess the performance of the autonomous driving function of
the intelligent connected vehicles and is capable of conducting real-time remote monitoring of
the vehicles under road testing, and with the ability of event recording, analysis, and
reproduction of the vehicles under road testing and ensuring the network security of the
vehicles under road testing and the remote monitoring platforms; the vehicle under road testing
must be equipped with a control system that can switch between autonomous driving mode and
manual operation mode in a safe, quick, and simple manner and must ensure that the vehicle
can be switched to manual operation mode in real-time under any circumstances. The tested
vehicle must be equipped with the functions of recording, storing, and real-time monitoring the
condition of the vehicle and is able to transmit real-time data of the vehicle, such as labelling,
mode of control, location, speed, acceleration and direction of vehicles; the applicant entity
must sign an employment contract or a labor service contract with the driver of the tested
vehicle, while the driver must be a licensed driver for the relevant model with more than three
years of driving experience and a track record of safe driving and is familiar with the testing
protocol for autonomous driving system and proficient in operating the system. The applicant
entity must insure each tested vehicle for at least RMB5 million against car accidents or
provide a letter of guarantee covering the same. In addition, during testing, the testing entity
should mark the words “autonomous driving test” on the body of each tested vehicle in a
prominent color and should not use autonomous driving mode unless in the permitted testing
areas specified in the declaration. In addition, the testing entity is required to submit to the
relevant competent authorities of provincial and municipal governments a periodical testing
report every six months and a final testing report within one month after completion of the road
testing. In the case of a car accident-causing severe injury or death of personnel or vehicle
damage, the testing entity must report the accident to the relevant authority within 24 hours and
submit a complete accident analysis report covering the cause of the accident, final liability
allocation results, etc. within five working days after the traffic enforcement agency
determines the liability for the accident.
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According to the Opinions of the Ministry of Industry and Information Technology on
Strengthening the Administration of Access of Intelligent Connected V ehicle Manufacturers
and Products (จԈ)
promulgated by the MIIT and effective on July 30, 2021, enterprises producing automobile
products with autonomous driving function shall ensure that the automobile products at least
satisfy the following requirements: (1) it is capable of automatically identifying the failure of
the autonomous driving system and whether the designed operating conditions are continuously
met, and taking risk mitigation measures to achieve the minimum risk level; (2) it is equipped
with human-machine interaction function displaying the operating condition of the autonomous
driving system; (3) it has an event data recording system and autonomous driving data
recording system to meet relevant functions, performance and safety requirements for accident
reconstruction, liability determination and cause analysis, etc.; (4) it must satisfy the safety
requirements to ensure functional safety, expected functional safety, network safety and other
process safety, as well as testing requirements such as simulation nature, closed area, actual
road, network safety, software upgrade, and data recording to avoid foreseeable and
preventable accidents under the designed operating conditions of the tested vehicles.
Pursuant to the Notice of the Ministry of Industry and Information Technology on
Strengthening Network Safety and Data Safety Work of V ehicle Connectivity (ࢹڦ
) promulgated by the MIIT and
effective on September 15, 2021, enterprises engaged in vehicle connectivity shall strengthen
the prevention and protection of intelligent connected vehicles safety, vehicle connectivity’s
network safety, vehicle connectivity’s service platform safety and data safety, and improve the
safety standard system for network safety and data safety.
Regulations Relating to Personal Privacy and Personal Information Protection
Pursuant to the PRC Civil Code (Պ) adopted by the NPC on
May 28, 2020, and effective on January 1, 2021, the personal information of natural persons
is protected by law. Any organization or individual must legally obtain the relevant personal
information of others and must ensure the security of the relevant information, and must not
illegally collect, use, handle, or transmit the personal information of others, nor illegally trade,
provide, or disclose the personal information of others.
According to the Personal Information Protection Law of the PRC (ࡈ
)( “ Personal Information Protection Law ”) adopted by the SCNPC on
August 20, 2021, and effective on November 1, 2021, no organization or individual may
infringe upon natural persons’ rights and interests relating to personal information. The
Personal Information Protection Law clarifies that personal information shall be handled under
the principles of lawfulness, legitimacy, necessity, and good faith and shall be handled for a
clear and reasonable purpose, directly related to the handling purpose and in a manner that has
the minimum impact on the rights and interests of individuals, and limited to the minimum
scope necessary for achieving the handling purpose. It shall be handled under the principle of
openness, transparency and the quality of personal information shall be guaranteed and security
measures shall be taken to prevent personal information from being leaked, tampered, or lost.
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The Personal Information Protection Law provides the circumstances under which a personal
information handler could handle personal information and the requirements for such
circumstances, such as when (1) the individual’s consent has been obtained; (2) the handling
is necessary for the conclusion or performance of a contract to which the individual is a party
concerned; (3) the handling is necessary to fulfill statutory duties and statutory obligations; (4)
the handling is necessary to respond to public health emergencies or protect natural persons’
life, health, and property safety under emergency circumstances; (5) the personal information
that has legally been made public by the relevant individual or otherwise is handled within a
reasonable scope; (6) personal information is handled within a reasonable scope to conduct
news reporting, public opinion-based supervision, and other activities in the public interest; or
(7) under any other circumstance as provided by any law or administrative regulation. It also
stipulates the obligations of a personal information handler. No organization or individual may
illegally collect, use, handle, or transmit personal information, illegally buy or sell, provide or
make personal information public, or engage in the handling of personal information that
endangers the national security or public interests. The Personal Information Protection Law
clarifies the definition of “sensitive personal information”, which means personal information
that, once leaked or illegally used, may result in damage to the personal dignity of nay natural
person or endanger personal or property security, including information on biometrics,
religious beliefs, specific identities, medical health, financial accounts, and personal
whereabouts, among others. Where a personal information handler handles sensitive personal
information with the individual’s consent, a separate consent shall be obtained from the
individual. Where any law or administrative regulation provides that written consent shall be
obtained for handling sensitive personal information, such provision shall prevail.
The Announcement of Conducting Special Supervision Against the Illegal Collection and
Use of Personal Information by Apps (࢝APPٙ
ʮѓ) jointly promulgated and implemented by the CAC, the MIIT, the Ministry of Public
Security, and the SAMR on January 23, 2019, reiterates that App operators should collect and
use personal information in strict compliance with the responsibilities and obligations under
the Cybersecurity Law. In addition, the Methods of Identifying Illegal Acts of Apps to Collect
and Use Personal Information ( APP) jointly
promulgated and implemented by the CAC, the MIIT, the Ministry of Public Security, and the
SAMR on November 28, 2019, clarifies specific circumstances of illegal collection and use of
personal information, including “failing to publish the rules on the collection and use of
personal information”, “failing to explicitly explain the purposes, methods and scope of the
collection and use of personal information”, “collecting and using personal information
without the users’ consent”, “collecting personal information unrelated to the services it
provides and beyond necessary principle”, “providing personal information to others without
the users’ consent”, and “failing to provide the function of deleting or correcting the personal
information according to the laws” or “failing to publish information such as ways of filing
complaints and reports.”
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According to the Several Provisions on Automobile Data, when handling personal
information, automobile data handlers shall obtain personal consent or comply with other
circumstances stipulated by laws and administrative regulations. If the automobile data
handlers collect personal information outside the vehicle for the purpose of ensuring driving
safety, but are unable to obtain personal consent, the automobile data handlers shall anonymize
the data by means such as deleting the pictures containing identifiable natural persons or
partially contouring the facial information in the pictures.
In addition, the Notice of the Supreme People’s Court, the Supreme People’s
Procuratorate, and the Ministry of Public Security on Lawfully Punishing Criminal Activities
Infringing upon the Personal Information of Citizens (৫e௰৷ɛ͏Ꮸ࿀৫eʮ
) issued in 2013 and the Interpretation
of the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues
Regarding Legal Application in Criminal Cases Infringing upon the Personal Information of
Citizens (߰ܛج
༆ᙑ) issued on May 8, 2017, and effective on June 1, 2017, clearly stipulate the
conviction and sentencing standards for crimes related to infringement of personal information.
Regulations Relating to Restriction in Value-Added Telecommunications Services
According to the PRC Telecommunications Regulations (ૢԷ)
promulgated by the State Council on September 25, 2000, and last amended and implemented
on February 6, 2016 and the Catalogue of Telecommunications Services (ุਕʱᗳͦ
፽), the state establishes a licensing system for telecommunications services according to the
different categories of the services. Telecommunications services are divided into two
categories: basic telecommunications services and value-added telecommunications services.
Basic telecommunications services refer to the provision of public network infrastructure,
public data transmission, and basic voice communication services, while value-added
telecommunications services refer to the provision of telecommunications and information
services by utilizing the public network infrastructure. Anyone that intends to be engaged in
basic telecommunications services shall obtain a Basic Telecommunications Business License
(ุਕ຾ᐄ஢̙ᗇ) issued by competent authorities. Anyone that intends to be
engaged in value-added telecommunications business shall obtain a V alue-added
Telecommunications Business License (ุਕ຾ᐄ஢̙ᗇ) issued by competent
authorities. An operator violating the laws due to failure in obtaining relevant business licenses
will face penalties such as correction orders, warnings, fines, confiscation of illegal gains, and
in case of severe circumstances, be ordered to suspend business for rectification.
According to the Catalogue of Telecommunications Services (2015) (ุਕʱᗳͦ
፽(2015) ) promulgated by the MIIT on December 28, 2015, and last amended and
implemented on June 6, 2019, value-added telecommunications services are divided into two
categories. The first category of value-added telecommunications services includes “internet
data center services, content distribution network services, domestic Internet virtual private
network services and Internet access services.” The second category of value-added
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telecommunications services includes “online data processing and transaction processing
services, domestic multi-party communications services, storage and forwarding services, call
center services, information services, coding, and regulation conversion services.”
According to the Measures for the Administration of Internet Information Services ( ʝ
) promulgated by the State Council on September 25, 2000, and last
amended and effective on December 6, 2024, internet information services refer to the
provision of information through internet to web users. Internet information services are
divided into two categories: non-commercial internet information services and commercial
internet information services. A commercial internet information service provider shall obtain
a V alue-added Telecommunications Business License (ุਕ຾ᐄ஢̙ᗇ) from
relevant telecommunications administrative agencies. According to the Administrative
Measures for the Licensing of Telecommunications Business Operations (ุਕ຾ᐄ஢̙
) promulgated by the MIIT on March 1, 2009, last amended on July 3, 2017, and
effective from September 1, 2017, the MIIT and provincial administrations of
telecommunications are in charge of the review and approval of business licenses. For a
V alue-Added Telecommunications Business License, it shall be valid for five years and can be
renewed by submitting a renewal application within 90 days before its expiration.
Under the 2024 Negative List, the provision of value-added telecommunications services
falls into the restricted category (except for e-commerce, domestic multi-party
communications, store-and-forward, and call center services) and the foreign shareholding
ratio shall not exceed 50%.
According to the Provisions on the Administration of Foreign-funded
Telecommunications Enterprises () promulgated by the State
Council on December 11, 2001, and last amended on March 29, 2022 and effective on May 1,
2022, foreign-invested enterprises that meet the requirements, have qualifications, and comply
with relevant laws and regulations on foreign investment can apply for value-added
telecommunications services. The competent department for acceptance and review is the
MIIT.
Regulations Relating to Environmental Protection
1. Environmental Protection
Pursuant to the PRC Environmental Protection Law (),
promulgated by the SCNPC on December 26, 1989 and came into effect on the same day, latest
amended on April 24, 2014 and came into effect on January 1, 2015, the waste discharge
licensing system has been implemented in the PRC and entities that discharge wastes shall
obtain a Waste Discharge License ( રϮ஢̙ᗇ). Furthermore, facilities for the prevention and
control of pollution at a construction project shall be designed, constructed and put into
operation simultaneously with the major construction works of the construction project.
Environmental protection authorities impose various administrative penalties on persons or
enterprises in violation of the Environmental Protection Law. Such penalties include warnings,
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fines, orders to rectify within a prescribed period, orders to cease construction, orders to
restrict or suspend production, orders to make recovery, orders to disclose relevant information
or make an announcement, imposition of administrative action against relevant responsible
persons, and orders to shut down enterprises. In addition, environmental organizations may
also bring lawsuits against any entity that discharges pollutants detrimental to the public
welfare.
2. Environmental Impact Assessment
Pursuant to the Environmental Impact Assessment Law of the PRC ( ʕശɛ͏΍ձ਷ᐑ
) promulgated by the SCNPC on October 28, 2002, came into effect on
September 1, 2003 and latest amended on December 29, 2018, the State implements
administration by classification on the environmental impact of construction projects according
to the level of impact on the environment. The construction unit shall prepare an environmental
impact report or an environmental impact form or complete an environmental impact
registration form (the “ Environmental Impact Assessment Documents ”) for reporting and
filing purposes. If the Environmental Impact Assessment Documents of a construction project
have not been reviewed by the approving authority in accordance with the law or have not been
granted approval after the review, the construction unit is prohibited from commencing
construction works.
In accordance with the Administrative Regulations on Environmental Protection of
Construction Projects (ᚐ၍ଣૢԷ) promulgated by the State Council on
November 29, 1998, last amended on July 16, 2017, and effective from October 1, 2017, the
PRC practices a system that evaluates the environmental impact of a construction project. A
construction unit should submit an environmental impact report or environmental impact
statement before the commencement of the construction project for approval or submit the
environmental impact registration form in accordance with the requirements of the
environmental protection administrative department of the State Council for record. Besides,
after the completion of the construction project for which the environmental impact report and
the environmental impact statement are prepared, the construction unit should inspect and
accept the environmental protection facilities for a project and prepare an acceptance report in
compliance with the standards and procedures stipulated by the environmental protection
administrative department of the State Council. For construction projects which are built in
phases, put into production or use in phases, its corresponding environmental protection
facilities shall be inspected and accepted in phases.
Pursuant to the Interim Measures on Administration of Environmental Protection for
Acceptance Examination Upon Completion of Construction Projects (ڭ
) which was promulgated on November 20, 2017 and came into effect on the
same day, the construction unit is the responsible party for the acceptance of the environmental
protection facilities for the completion of the construction project, and shall, in accordance
with the procedures and standards stipulated in relevant regulations, organize the acceptance
of the environmental protection facilities, prepare the acceptance report, disclose the relevant
information, accept social supervision, ensure that the environmental protection facilities to be
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constructed for the construction project are put into operation or used at the same time as the
main project, and be responsible for the truthfulness, accuracy and completeness of the
acceptance content, conclusions and information disclosed, and shall not falsify the acceptance
process. The major construction works of the construction project cannot be put into operation
until the supporting facilities for environmental protection pass the inspection.
3. Pollutant Discharge Permit
According to the Catalog of Classified Administration of Pollutant Discharge License for
Stationary Pollution Sources (2019 V ersion) (๕રϮ஢̙ʱᗳ၍ଣΤ፽(2019 ϋ
و)) issued by the Ministry of Ecology and Environment on December 20, 2019, key
management, simplified management and registration management of pollutant discharge
permits are implemented according to factors such as the amount of pollutants generated, the
amount of emissions, the degree of impact on the environment, etc., and only pollutant
discharge entities that implement registration management do not need to apply for a pollutant
discharge permit.
The State Council issued the Regulation on Pollutant Discharge Permit Administration
(રϮ஢̙၍ଣૢԷ) on January 24, 2021 to further enhance the pollutant discharge
administration. The administration on pollutant discharge units is divided into key management
and simplified management pursuant to the amount of pollutant caused and discharged and the
impact on the environment. Their view, decision and information disclosure of pollutant
discharge licenses shall be handled through the national pollutant discharge license
management information platform. The pollutant discharge license is valid for 5 years and the
discharging units should apply for renewal 60 days before the expiry for continues pollutant
discharge.
Regulations Relating to Work Safety
According to the Work Safety Law of the PRC (), which
was promulgated by the SCNPC on June 29, 2002 and latest amended on June 10, 2021, entities
that engage in production and business operation activities in PRC shall set up and perfect the
responsibility system for work safety, improve the conditions for work safety, strengthen the
education and training on work safety for employees, provide articles of labor protection that
meet the national standards or industrial standards for their employees, and perform the
obligations related to work safety as stipulated by the Work Safety Law of the PRC and other
laws and regulations.
Regulations Relating to Fire Safety Inspection and Acceptance
Pursuant to the Fire Safety Law of the PRC () promulgated by
the SCNPC in April 29, 1998, last amended and effective on April 29, 2021, and the Interim
Provisions on Administration of Fire Protection Design Review and Acceptance of
Construction Projects () promulgated by the
Ministry of Housing and Urban-Rural Development on April 1, 2020, last amended on August
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21, 2023 and became effective on October 30, 2023, the fire protection design or construction
of a construction project must conform to the national fire protection technical standards for
project construction and construction projects shall undergo the fire protection design review
and acceptance system. The production workshops of labor-intensive enterprises with a total
construction area of more than 2,500 square meters and the construction units of other special
construction projects must apply to the fire control department for fire protection design
review, and complete the fire protection acceptance procedures after the completion of the
construction project. The construction unit of other construction projects must complete the
fire protection filing of the fire protection design and the completion acceptance within five
working days after the completion acceptance of the construction project. If a construction
project fails to pass the fire safety inspection before it is put into use, or does not meet the fire
safety requirements after the inspection, it will be ordered to suspend the construction and use
of such project, or suspend production and business, and be imposed a fine.
Regulations Relating to Land and Construction Projects
1. Land Grants
Under the Interim Regulations on Assignment and Transfer of the Rights to the Use of the
State-Owned Urban Land of the PRC (ᕄ਷ϞɺήԴ͜ᛆ̈ᜫձᔷᜫᅲБ
ૢԷ) promulgated by the State Council on May 19, 1990, last amended on November 29,
2020, and effective on the same date, China adopts a system of assignment and transfer of the
right to use state-owned land. The assignment of land use rights may be carried out by
agreement, bidding, or auction. The land user shall pay the premium of the land use right to
the State, and the State may assign such right to the user for an agreed term. The land user who
has obtained the land use right may, within the term of land use, transfer, lease, or mortgage
the land use right or use it for other economic activities.
2. Planning of a Construction Project
Pursuant to the regulations abovementioned and the PRC Urban Real Estate
Administration Law () promulgated by the SCNPC on
July 5, 1994, last amended on August 26, 2019, and effective on January 1, 2020, an
assignment contract shall be signed between the regional land administration authority and
land users for the assignment of land use rights. The land user is required to pay the land
premium as provided in the assignment contract. After the full payment of the land premium,
the land user must register with the land administration authority and obtain a land use rights
certificate to acquire the land use rights. The land user shall develop, utilize, and operate the
land in accordance with the provisions of the assignment contract and the requirements of
urban planning.
Pursuant to the Administrative Measures on Planning of Assignment and Transfer of
Urban State-owned Land Use Rights ()
promulgated by the Ministry of Construction (the predecessor of the Ministry of Housing and
Urban-Rural Development) on December 4, 1992, amended on January 26, 2011, and effective
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on the same date, the land assignee shall apply to the urban planning administrative authority
for a construction land planning permit. Pursuant to the Urban and Rural Planning Law ( ʕ
) promulgated by the SCNPC on October 28, 2007 and last
amended on April 23, 2019 and implemented on the same date, a construction work planning
permit must be obtained by a construction unit from the relevant competent urban and rural
planning authority for the construction of any structure, fixture, road, pipeline, or other
construction project within the planning zone of a city or town.
Pursuant to the Administrative Measures on Construction Permit of Construction Projects
() promulgated by the Ministry of Construction on October 15,
1999, last amended on March 30, 2021, and effective on the same date, for the construction,
renovation, and decoration of all kinds of buildings within the territory of China and the
auxiliary facilities thereof, the installation of supporting lines, pipes, and equipment, and the
construction of municipal infrastructure projects in cities and towns, the construction unit
shall, before starting construction, apply to the housing and urban-rural development
administrative department of the people’s government at or above the county level where the
project is located for a construction permit in accordance with the Measures. For a construction
project with investment less than RMB300,000 or construction area less than 300 square
meters, the construction unit is not required to apply for a construction permit.
According to the Provisions on Inspection and Acceptance upon Completion of Buildings
and Municipal Infrastructure () promulgated
by the Ministry of Housing and Urban-Rural Development on December 2, 2013, and effective
on the same date, construction units of all types of buildings and municipal infrastructure
projects that are newly built, expanded, or rebuilt within the territory of China shall file with
the competent construction authority of the local people’s government at or above the county
level where the project is located within 15 days from the date when the project is completed
and accepted.
Regulations Relating to Leased Properties
According to the Administrative Measures for Commercial Housing Leases (܊גۜ
), which was promulgated by the Ministry of Housing and Urban-Rural
Development on December 1, 2010 and became effective on February 1, 2011, the lessor and
the lessee shall complete property leasing registration and filing formalities within 30 days
from execution of the property lease contract with the development (real estate) department of
the People’s Government of the centrally-administered municipality, municipality or county
where the leased property is located. Failure to complete the relevant lease registration may
subject the parties to the lease agreement a fine between RMB1,000 to RMB10,000.
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Regulations Relating to Intellectual Property Rights
1. Patents
According to the Patent Law of the PRC () (Order No. 55 of
the President of the PRC) (the “ Patent Law ”), which became effective on June 1, 2021, and
the Implementation Rules of the Patent Law of the PRC ()
(the “ Implementation Rules of the Patent Law ”), which became effective on January 20,
2024, the patent administrative department under the State Council is responsible for the
administration of patent-related work nationwide and the patent administration departments of
provincial or autonomous regions or municipal governments are responsible for administering
patents within the respective administrative areas. The Patent Law and the Implementation
Rules of the Patent Law provide for three types of patents, namely inventions, utility models
and designs. Invention patents are valid for twenty years, while utility model patents are valid
for ten years, and design patents are valid for fifteen years, in each case from the date of
application. The Chinese patent system adopts a “first come, first file” principle, which means
that where more than one person files a patent application for the same invention, a patent will
be granted to the person who files the application first. An invention or a utility model must
possess novelty, inventiveness and practical applicability to be patentable. Third parties must
obtain consent or a proper license from the patent owner to use the patent. Otherwise, the
unauthorized use constitutes an infringement on the patent rights.
2. Copyrights
Pursuant to the Copyright Law of the PRC () promulgated
by the SCNPC on September 7, 1990, last amended on November 11, 2020, and effective on
June 1, 2021, copyrights include personal rights such as the right of publication and that of
attribution, as well as property rights such as the right of reproduction and that of distribution.
Copyright protection extends to internet activities, products, and software products transmitted
through the internet. Reproducing, distributing, performing, projecting, broadcasting,
compiling a work, or communicating the same to the public via an information network without
permission from the owner of the copyright therein, unless otherwise provided under the
Copyright Law of the PRC, shall constitute infringement of copyrights. The infringer shall,
bear civil liabilities, such as ceasing the infringement, eliminating the impact, making an
apology, and compensating for the loss.
According to the Computer Software Copyright Registration Procedures (ၑዚழ΁
) promulgated by the National Copyright Administration of the PRC on
February 20, 2002, and effective on the same date, registration of software copyrights and
registration of exclusive licensing contracts and transfer contracts of software copyrights shall
be standardized. The National Copyright Administration is in charge of the administration of
software copyright registration throughout the country and recognizes the Copyright Protection
Center of China as the software registration organization. The Copyright Protection Center of
China will grant registration certificates to applicants of computer software copyrights that
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comply with the provisions of the Computer Software Copyright Registration Procedures (ࠇ
) and the Regulations for the Protection of Computer Software
(ᚐૢԷ) (amended in 2013).
According to the Regulations on the Protection of Computer Software (ڭ
ᚐૢԷ) promulgated by the State Council on June 4, 1991, last amended on January 30,
2013 and implemented on March 1, 2013, computer software must be independently developed
by the developer and has been fixed on certain tangible object. Software developed by Chinese
citizens, legal persons, or other organizations, whether published or not, shall be entitled to the
copyright in accordance with this Regulation. Software copyright owners may register with a
software registration agency recognized by the copyright administrative department of the
State Council. The registration certificate issued by the software registration agency shall be
the preliminary evidence of the registration.
3. Trademarks
Pursuant to the Trademark Law of the PRC () promulgated by
the SCNPC on August 23, 1982, last amended on April 23, 2019, and effective on November
1, 2019, and the Implementation Rules of the Trademark Law of the PRC ( ʕശɛ͏΍ձ਷
ૢԷ) promulgated by the State Council on August 3, 2002, and amended on
April 29, 2014 and implemented on May 1, 2014, registered trademarks in China include
commodity trademarks, service trademarks, collective marks, and certification marks.
The Trademark Office of China National Intellectual Property Administration is
responsible for trademark registration and administration in China. The period of validity of a
registered trademark shall be ten years. If a registrant needs to continue to use the registered
trademark after the period of validity, an application for renewal of registration shall be made
every ten years. Application for renewal of registration shall be submitted within 12 months
prior to the expiry date. The registrant of registered trademark may license the other party to
use its registered trademark by entering into a trademark licensing agreement. The trademark
licensing agreement shall be filed with the Trademark Office for record. The licensor shall
supervise the quality of the goods for which the trademark is used and the licensee shall assure
the quality of relevant goods. The first to file principle is adopted in the registration of
trademarks in China. Where trademark for which a registration application has been made is
identical or similar to another trademark which 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. Applying for
registration of a trademark shall not prejudice the existing right first obtained by others, nor
could any person register in advance a trademark that has already been used by another party
and has already gained a sufficient degree of reputation through such party’s use. Using a
trademark identical or similar to the registered trademark on the same or similar commodities
without the permission of the trademark registrant constitutes an infringement on the exclusive
right to use a registered trademark. The infringer shall, in accordance with the regulations,
undertake to cease the infringement, take remedial measures, and compensate for losses.
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4. Domain Names
In accordance with the Administrative Measures on Domain Names ( ʝᑌၣਹΤ၍ଣ
) promulgated by the MIIT on August 24, 2017, and effective on November 1, 2017 to
replace the Administrative Measures of China on Domain Names ( ʕ਷ʝᑌၣഖਹΤ၍ଣ፬
) promulgated in November 2004, the MIIT supervises and administrates the domain name
service nationwide. Domain name registrations are handled through domain name service
agencies established under the relevant regulations, and applicants become domain name
holders upon successful registration.
Regulations Relating to Foreign Exchange and Overseas Investment
Pursuant to the Regulations on the Administration of Foreign Exchange of the PRC ( ʕ
ശɛ͏΍ձ਷̮ි၍ଣૢԷ) promulgated by the State Council on January 29, 1996, and last
amended and effective on August 5, 2008, matters on foreign exchange administration in China
can be divided into current accounts (such as trade-related income and expenses and payments
of interest and dividends) and capital accounts (such as direct equity investment, loans and
divestment). Funds under current accounts or capital accounts can only be remitted in or out
after going through foreign exchange (such as settlement or purchase) related procedures upon
obtaining necessary permits and reasonable review.
The Circular of the State Administration of Foreign Exchange on Further Improving and
Adjusting Foreign Exchange Administration Policies on Direct Investment (̮ි၍ଣ҅
) (hereinafter referred to as the
“Circular 59 ”), which was promulgated by the SAFE on November 19, 2012, and last amended
on October 10, 2018, part of which was abolished on December 30, 2019, substantially amends
and simplifies the foreign exchange procedures. Pursuant to Circular 59, the opening of various
special purpose foreign exchange accounts, such as pre-establishment expenses accounts,
foreign exchange capital accounts, and deposits accounts, the reinvestment of RMB proceeds
derived by foreign investors within the PRC, and remittance of foreign exchange profits and
dividends by a foreign-invested enterprise to its foreign shareholders no longer require the
approval or verification of the SAFE, and multiple capital accounts for the same entity may be
opened in different provinces. In February 2015, the SAFE promulgated the Notice on Further
Simplifying and Improving Foreign Exchange Administration Policies on Direct Investment
(), part of which was abolished in
December 2019. It stipulates that banks shall, on behalf of the SAFE, directly examine and
handle foreign exchange registration under domestic direct investment and overseas direct
investment, and the SAFE and its branches shall exercise indirect supervision over foreign
exchange registration of direct investment through banks.
On May 11, 2013, the SAFE promulgated the Provisions on Foreign Exchange
Administration over Domestic Direct Investment by Foreign Investors (ટ
) (hereinafter referred to as the “ Circular 21 ”), which became effective
on May 13, 2013, amended on October 10, 2018, and partially abolished on December 30,
2019. Circular 21 stipulates that the SAFE and its local branches shall manage foreign
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investors’ direct investment within the PRC through registration, and banks shall handle the
foreign exchange business of direct investment within the PRC according to the registration
information provided by the SAFE or its branches.
Pursuant to the Notice on Issues Concerning the Administration of Foreign Exchange in
Overseas Listing () promulgated by the SAFE on
December 26, 2014 and effective on the same date, a domestic company shall, within 15
working days from the date of the end of its overseas listing, register the overseas listing with
the administration of foreign exchange at the place of its establishment. The proceeds from an
overseas listing of a domestic company may be remitted to the domestic account or deposited
in an overseas account, but the use of the proceeds shall be consistent with the relevant content
included in the document and other disclosure documents.
Pursuant to the Notice of the State Administration of Foreign Exchange on Reform of the
Management Method for the Settlement of Foreign Exchange Capital of
Foreign-Invested Enterprises (ഐි၍ଣ
) (hereinafter referred to as the “ Circular 19 ”), which was promulgated on
March 30, 2015, became effective on June 1, 2015, and partially abolished on December 30,
2019 and March 23, 2023, respectively, foreign-invested enterprises could settle their foreign
exchange capital on a discretionary basis based on the actual needs of their business operations.
Foreign invested enterprises are prohibited from using the foreign exchange capital settled in
RMB: (1) for any expenditures beyond the business scope of the foreign-invested enterprises
or forbidden by laws and regulations; (2) for direct or indirect securities investment; (3) to
provide entrusted loans (unless permitted in the business scope), repay inter-company loans
(including advances to third parties) or repay RMB bank loans that have been on-lent to a third
party; and (4) to purchase real estate not for self-use purposes (save for real estate enterprises).
Pursuant to the Notice of the State Administration of Foreign Exchange on Reforming and
Standardizing the Foreign Exchange Settlement Management Policies of Capital Accounts
() (hereinafter referred to
as the “ Circular 16 ”) promulgated and implemented by the SAFE on June 9, 2016 and partially
amended on December 4, 2023, discretionary foreign exchange settlement applies to foreign
exchange capital, foreign debt offering proceeds, and remitted foreign listing proceeds, and the
corresponding RMB capital converted from foreign exchange may be used to extend loans to
related parties or repay inter-company loans (including advances by third parties).
On January 26, 2017, the SAFE issued and implemented on the same date the Notice on
Improving the Check of Authenticity and Compliance to Further Promote Foreign
Exchange Management Reform (ஷ
) (hereinafter referred to as the “ Circular 3 ”), which stipulates several capital control
measures with respect to the outbound remittance of profits from domestic entities to offshore
entities, including (1) when handling remittance of profit at an amount of over US$50,000 for
domestic institutions, banks shall review board resolutions regarding profit distribution, the
original version of tax filing records and audited financial statements to check if the
transactions are genuine; and (2) domestic entities shall make up for previous years’ losses
before remitting the profits. In addition, pursuant to Circular 3, domestic entities shall make
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detailed explanations to the bank in respect of the sources of the capital and its utilization
arrangements, and provide board resolutions, contracts, and other supporting materials when
undergoing the filing procedures in connection with an outbound investment.
On October 23, 2019, the SAFE promulgated the Notice on Further Facilitating
Cross-Board Trade and Investment (Hui Fa [2019] No. 28) (ک
(ි೯[2019]28 ໮)) which became effective on the same date (except for Clause
2 of Article 8, which became effective on January 1, 2020, and partly amended on December
4, 2023). The Notice cancels restrictions on domestic equity investments made with capital
funds by non-investing foreign-funded enterprises. In addition, restrictions on the use of funds
for foreign exchange settlement of domestic accounts for the realization of assets have been
removed and restrictions on the use and foreign exchange settlement of foreign investors’
security deposits have been relaxed. Eligible enterprises in the pilot areas are also allowed to
use revenue under capital accounts, such as capital funds, foreign debt offering proceeds, and
remitted foreign listing proceeds for domestic payments without providing supporting
materials to the bank in advance for authenticity verification on an item by item basis, while
the use of funds should be true, in compliance with applicable rules and conforming to the
current administrative regulations for use of revenue from capital accounts.
According to the Notice on Optimizing Foreign Exchange Management to Support the
Development of Foreign Businesses () issued
by the SAFE on April 10, 2020, eligible enterprises are allowed to use revenue under capital
accounts, such as capital funds, foreign debt offering proceeds, and remitted foreign listing
proceeds for domestic payments without providing supporting materials to the bank in advance
for authenticity verification; provided that the use of funds should be true, in compliance with
applicable rules and conforming to the current administrative regulations for use of revenue
from capital accounts. Relevant banks should conduct spot checks in accordance with relevant
provisions.
Regulations on Overseas Direct Investment
Pursuant to the Regulations on the Foreign Exchange Administration of the Overseas
Direct Investment of Domestic Institutions () issued
by the SAFE on July 13, 2009 and came into effect on August 1, 2009, upon obtaining approval
for overseas investment, an enterprise in mainland China shall apply for foreign exchange
registration for its overseas direct investments. According to the Notice of the State
Administration of Foreign Exchange on Further Simplifying and Improving the Foreign
Exchange Management Policies for Direct Investment, the administrative approval for foreign
exchange registration approval under overseas direct investment has been canceled, and the
banks are entitled to review and carry out foreign exchange registration under overseas direct
investment directly.
Pursuant to the Measures for the Administration of Overseas Investment ( ྤ̮ҳ༟၍
) which was issued by the MOFCOM on September 6, 2014 and came into effect on
October 6, 2014, the MOFCOM and the commerce departments at provincial levels shall
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subject the overseas investment of enterprises to recordation or confirmation management,
depending on the actual circumstances of investment. Overseas investment involving any
sensitive country or region, or any sensitive industry shall be subject to confirmation
management. Overseas investment under other circumstances shall be subject to recordation
management.
Pursuant to the Administrative Measures for Outbound Investment by Enterprises ( Ά
) promulgated by the NDRC on December 26, 2017 and came into
effect on March 1, 2018, the investing activities of enterprises in mainland China such as
acquiring overseas ownerships, controlling rights, operating and management rights and other
relevant interests by way of investing assets and interests or providing financing and
guarantees to control its overseas enterprises, either directly or indirectly, are required to
obtain approval or filing with the NDRC in accordance with the relevant conditions of the
overseas investment projects. Outbound investment projects that involve sensitive countries
and regions or sensitive industries shall be subject to administration of verification and
approval by the NDRC and non-sensitive outbound investment projects shall be subject to
administration by record-filing. For non-sensitive projects of US$300 million or above
invested by local enterprise in mainland China or carried out by overseas enterprises controlled
by them, the investors shall file with the NDRC and non-sensitive outbound investment
projects, of which the investment amount of investors in mainland China is less than US$300
million (exclusive) shall file with the provincial counterpart of the NDRC.
Regulations Relating to Import and Export of Goods and Technology
1. Foreign Trade
According to the Foreign Trade Law of the PRC () (the
“Foreign Trade Law ”) promulgated by the SCNPC on May 12, 1994, and subsequently
amended on December 30, 2022, foreign trade operators have been exempted from the
registration requirement since December 30, 2022. The amended law grants the PRC
government the authority to allow the free import and export of commodities and technologies,
except where specified otherwise by other laws and administrative regulations.
Prior to the amendment on December 30, 2022, under the earlier version of the Foreign
Trade Law, foreign trade operators engaged in the import and export of commodities or
technologies were obligated to apply for registration with the foreign trade authorities under
the State Council or their delegated agencies for record-keeping purposes. This registration
requirement was mandatory, unless exempted by other applicable laws, administrative
regulations, or stipulations set forth by the foreign trade authorities under the State Council.
Failure to comply with these provisions meant that the Customs Department would not proceed
with customs clearance for imported or exported commodities.
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2. Customs Law
In addition, according to the Customs Law of the PRC ()
enacted by the SCNPC on January 22, 1987, and subsequently amended on April 29, 2021,
effective from the same date, the Customs of the PRC is vested with the authority for the
supervision and administration of entry and exit points. Under the framework of pertinent laws
and administrative regulations, the Customs exercises its jurisdiction over various aspects,
including the inspection and regulation of vehicles, goods, luggage, postal articles, and other
items entering and departing the country. This mandate encompasses the assessment and
collection of customs duties, taxes, and fees, as well as the prevention and detection of
smuggling activities, compilation of customs statistics, and execution of related customs
procedures.
Furthermore, as delineated in the Regulations of PRC Customs on Administration of
Recordation of Declaration Entities ()
promulgated by the General Administration of Customs on November 19, 2021, and
implemented from January 1, 2022, the term “customs declaration entities” pertains to
consignees and consignors of import and export goods, as well as customs declaration
enterprises officially registered with the customs authorities. Entities seeking recordation are
required to hold valid market entity qualifications. Specifically, importers and exporters must
also possess records as foreign trade operators. The recordation status of customs declaration
entities is of a permanent nature, while temporary recordation holds a validity period of one
year. Upon expiration, entities are entitled to reapply for recordation.
3. Imported and Exported Commodities Inspection
According to the Law of the PRC on Import and Export Commodity Inspection ( ʕശ
) which was promulgated by the SCNPC on February 21, 1989
and implemented on August 1, 1989, and last revised on April 29, 2021, and the Regulations
for the Implementation of the Law of the PRC on Import and Export Commodity Inspection
(ૢԷ) which was promulgated by the State
Council on August 31, 2005 and implemented on December 1, 2005, and last revised on
March 29, 2022, the General Administration of Customs is responsible for inspection of import
and export commodities. The entry- exit inspection and quarantine authorities shall conduct
inspection on the import and export commodities listed in the catalogue and other import and
export commodities that shall be subject to the inspection of the entry-exit inspection organs
as prescribed by laws and administrative regulations. For the import and export commodities
other than those that are subject to statutory inspection by the entry-exit inspection and
quarantine authorities as mentioned above, the entry-exit inspection and quarantine authorities
may conduct random inspection in accordance with state regulations. No import commodity
subject to statutory inspection that has not been inspected could be sold or used. No export
commodity subject to statutory inspection that has not been inspected or fails to pass the
inspection could be exported.
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Regulations Relating to Taxation
1. Enterprise Income Tax (EIT)
According to the Enterprise Income Tax Law of the PRC (੻೼
) amended by the SCNPC and came into effect on December 29, 2018, and the
Implementation Rules of the Enterprise Income Tax Law of the PRC ( ʕശɛ͏΍ձ਷Άุ
ૢԷ) amended by the State Council and came into effect on January 20, 2025,
an enterprise which is established within the PRC in accordance with the laws or established
in accordance with any laws of foreign country (region) but with an actual management entity
within the PRC shall be regarded as a resident enterprise. A resident enterprise shall be subject
to an EIT of 25% of any income generated within or outside the PRC. Preferential enterprise
income tax is granted to industries and projects that are supported and encouraged by the
country. For high and new technology enterprises that need key support of the country are
entitled to enjoy the reduced enterprise income tax rate of 15%.
2. Value-added Tax (V AT)
According to the Interim Regulations on V alue-added Tax of the PRC ( ʕശɛ͏΍ձ
೼ᅲБૢԷ) issued on December 13, 1993, by the State Council, came into effect on
January 1, 1994, and latest amended on November 19, 2017, as well as the Implementation
Rules for the Interim Regulations on V alue-Added Tax of the PRC (೼
) issued on December 25, 1993, by the Ministry of Finance and the STA,
came into effect on the same day and last amended on October 28, 2011 and effective on
November 1, 2011, any entities and individuals engaged in the sale of goods or provision of
processing, repair and replacement services, and import of goods within the territory of the
PRC are taxpayers of V A T and shall pay the V A T in accordance with the laws and regulations.
The rate of V A T for sale of goods is 17% unless otherwise specified, such as the rate of V A T
for sale of transportation services is 11%. With the V A T reforms in the PRC, the rate of V A T
has been changed several times. According to the Notice on Adjusting V A T Rates (ሜ዆
) issued by the Ministry of Finance and the STA on April 4, 2018, the tax
rates of 17% and 11% applicable to any taxpayer’s V A T taxable sale or import of goods are
adjusted to 16% and 10%, respectively, this adjustment became effective on May 1, 2018.
According to the Announcement on Relevant Policies for Deepening the V A T Reform (׵
ʮѓ) jointly issued by the Ministry of Finance, the STA and the
General Administration of Customs on March 20, 2019, further adjustment was made on V A T
reform, which came into effect on April 1, 2019. The tax rate of 16% applicable to the V A T
taxable sale or import of goods shall be adjusted to 13%, and the tax rate of 10% applicable
thereto shall be adjusted to 9%. On December 25, 2024, the SCNPC promulgated the
V alue-Added Tax Law of the PRC (), which will become
effective on January 1, 2026, and the Interim Regulations on V alue-added Tax of the PRC will
be abolished.
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3. Urban Maintenance and Construction Tax and Educational Surcharges
According to the Urban Maintenance and Construction Tax Law of the PRC ( ʕശɛ͏
) (Order No. 51 of the President of the PRC), which became
effective on September 1, 2021, the payers of excise tax and V A T are taxpayers of urban
maintenance and construction tax, and shall pay urban maintenance and construction tax in
accordance with the provisions of this Law. The tax rates shall be: 7% for taxpayers the
domiciles of which/who are in urban areas; 5% for taxpayers the domiciles of which/who are
in county or township centers or; 1% for taxpayers the domiciles of which/whom are in places
other than urban areas, county and township centers.
According to the Interim Provisions on the Collection of Educational Surcharges ( ᅄϗ
) (Order No. 588 of the State Council of the PRC), which became
effective on July 1, 1986 and was last amended and implemented on January 8, 2011, taxpayers
of consumption tax, V A T and business tax shall pay educational surcharges. The tax rate of
education surcharges shall be 3% of the actual amount of V A T, business tax and consumption
tax paid by the entities and individuals and paid at the same time respectively along with the
V A T, business tax and consumption tax. It also provides that all education surcharges paid by
enterprises shall be paid out of sales revenue (or business income).
4. Stamp Duty
According to the Stamp Duty Law of the PRC () (Order No.
89 of the President of the PRC), which became effective on July 1, 2022, the entities and
individuals that conclude taxable certificates, or conduct securities transactions shall be
taxpayers of stamp duty. Taxable certificates include written contracts (loan contracts, financial
lease contracts, purchase and sale contracts, contract for contracting, construction contracts,
transportation contracts, technology contracts, leasing contracts, warehousing contracts,
custodial contracts, property insurance contracts, etc.), certificates of property rights transfer,
business account books, securities transactions, etc.
5. Consumption Tax
Pursuant to Interim Regulations on Consumption Tax of the PRC ( ʕശɛ͏΍ձ਷ऊ
൬೼ᅲБૢԷ) enacted by the State Council on December 13, 1993, and amended on
November 10, 2008 and implemented on January 1, 2009, organization or individual engaging
in production, commissioned processing and import of the consumer goods listed under this
regulation, and other organizations and individuals prescribed by the State Council selling
consumer goods listed under this regulation, shall be liable to pay consumption tax pursuant
to this regulation.
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Regulations Relating to Labor and Employment
Pursuant to the Labor Law of the PRC () promulgated by the
SCNPC on July 5, 1994, last amended on December 29, 2018, and effective on the same date,
employers must ensure the safety and hygiene of the workplace in accordance with national
laws and regulations, provide relevant training to their employees to prevent accidents during
work, and reduce occupational hazards.
Pursuant to Labor Contract Law of the PRC ()
promulgated by the SCNPC on June 29, 2007, last amended on December 28, 2012, and
effective on July 1, 2013, employers must execute written labor contracts with each employee.
The salary of each employee shall not be lower than the local minimum wage standard.
Pursuant to the Social Insurance Law of the PRC ()
promulgated by the SCNPC on October 28, 2010, last amended on December 29, 2018, and
effective on the same date, and other relevant regulations, employees should participate in five
types of social insurance covering pension insurance, medical insurance, unemployment
insurance, maternity insurance, and work-related injury insurance. Maternity insurance
premiums and work-related injury insurance premiums are paid by the employer, and pension
insurance premiums, medical insurance premiums, and unemployment insurance premiums are
paid by the employer and employees jointly.
Pursuant to the Regulations on the Administration of Housing Funds (၍ଣ
ૢԷ) promulgated by the State Council on April 3, 1999, last amended on March 24, 2019,
and effective on the same date, employers shall register with the competent housing provident
fund management center and pay housing funds for its employees. If the employer fails to pay
the housing fund within the prescribed time, it may be ordered to pay within a certain period
of time, and if it still fails to pay, compulsory enforcement by the court can be applied.
Regulations Relating to Dividend Distribution
The Company Law of the PRC and the Foreign Investment Law are the main laws and
regulations regulating the dividend distribution of foreign-invested enterprises in the PRC.
According to the regulatory mechanism provided by the abovementioned laws, a foreign-
invested enterprise in the PRC may only pay dividends out of accumulated profits (if any)
determined in accordance with the PRC accounting standards and regulations. The PRC
companies (including foreign-invested enterprises) are required to draw at least 10% of their
after-tax profits into the statutory reserve fund until the relevant reserve fund reaches 50% of
their registered capital, except as otherwise provided by the laws on foreign investment; and
no profit shall be distributed before making up any loss in the previous fiscal years. Retained
profits for previous fiscal years may be distributed together with distributable profits for the
current fiscal year.
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Regulations Relating to Anti-Unfair Competition and Anti-Monopoly
1. Anti-Monopoly
Pursuant to the Anti-Monopoly Law of the PRC ()
promulgated by the SCNPC on August 30, 2007, and implemented on August 1, 2008, and last
revised on June 24, 2022, prohibited monopolistic conducts include monopoly agreements,
abuse of dominant market position, and concentration of business operators that may have the
effect of eliminating or restricting competition.
Monopoly Agreements
Competing operators shall not enter into monopoly agreements that have the effect
of excluding or restricting competition, such as boycotting transactions, fixing or altering
commodity prices, restricting commodity production, or fixing commodity prices for
resales to third parties, unless the agreement satisfies the exemption conditions stipulated
in the Anti-Monopoly Law of the PRC (), for example,
where the operators can prove that they do not have the effect of excluding or restricting
competition, or where the operators can prove that their shares in relevant market is lower
than the standards set by the anti-monopoly law enforcement agency of the State Council
and meets other conditions stipulated by it, or improving technology, enhancing the
competitiveness of small and medium-sized operators, and maintaining legitimate rights
and interests in cross-border economic and trade cooperation. Meanwhile, the operators
shall not enter into monopoly agreements with other operators or provide substantial
support to other operators to reach monopoly agreements. If the regulations are violated,
the punishments include orders to cease the relevant acts, confiscation of illegal income,
and a penalty of not less than 1% but not more than 10% of the sales in the previous year;
if there are no sales in the previous year, a penalty of not more than RMB5,000,000 shall
be imposed. Where the monopoly agreement reached has not been implemented, a penalty
of less than RMB3,000,000 would be imposed. If relevant violation is critically serious,
causing material adverse impact and severe consequences, the anti-monopoly law
enforcement agency of the State Council may determine the specific amount of penalty
of not less than two times but not more than five times the amount of the aforementioned
fine.
The Provisions on the Prohibition of Monopoly Agreements ( ຫ˟ᕹᓙ՘ᙄ஝
) issued by the SAMR on March 10, 2023, and effective on April 15, 2023, further
provided for the prevention and prohibition of monopoly agreement-related matters, and
replaced some of anti-monopoly rules and regulations previously issued by the SAMR.
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Abuse of Dominant Market Position
A business operator with a dominant market position shall not abuse its dominant
market position, such as selling commodities at an unfairly high price or purchasing
commodities at an unfairly low price, selling commodities at prices below cost without
justifiable reasons and rejecting to trade with trading counterparts without justifiable
reasons. In case of violation of the prohibition on abuse of dominant market position, the
punishments include orders to cease relevant acts, confiscation of illegal gains, and a
penalty of not less than 1% but not more than 10% of the sales in the previous year. If
relevant violation is critically serious, causing material adverse impact and severe
consequences, the anti-monopoly law enforcement agency of the State Council may
determine the specific amount of penalty of not less than two times but not more than five
times the amount of the aforementioned fine.
The Provisions on Prohibition of Abuse of Dominant Market Position ( ຫ˟ᏺ͜
) issued by the SAMR on March 10, 2023, and effective on
April 15, 2023, further prevents and curbs abuse of dominant market position.
Concentration of Business Operators
Business operators shall declare the concentration reaching the threshold of
declaration prescribed by the State Council to the anti-monopoly law enforcement agency
of the State Council before implementing concentration. Concentration of business
operators refers to the following circumstances: (1) merger of business operators; (2) a
business operator acquires control over other business operators by acquiring their
equities or assets; or (3) a business operator acquires control over other business
operators or is able to exert a decisive influence on other business operators by contract
or any other means. Where a business operator fails to comply with the mandatory
reporting requirements, and has or may have the effect of excluding or restricting
competition, the anti-monopoly law enforcement agency of the State Council has the
power to order to cease the implementation of the concentration, dispose of shares or
assets and transfer the business within a time limit, and take other necessary measures to
restore to the state before the concentration, and impose a penalty of not more than 10%
of the sales in the previous year; if the operators fail to implement concentration
according to regulations and do not have the effect of excluding or restricting
competition, a penalty of not more than RMB5,000,000 would be imposed. If relevant
violation is critically serious, causing material adverse impact and severe consequences,
the anti-monopoly law enforcement agency of the State Council may determine the
specific amount of penalty of not less than two times but not more than five times the
amount of the aforementioned fine.
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The Provisions on the Review of Business Operator Concentration (ණʕᄲ
) issued by the SAMR on March 10, 2023, and effective on April 15, 2023,
further provides for matters such as the declaration and review of the concentration of
business operators and the investigation of the illegal implementation of the concentration
of business operators.
2. Anti-Unfair Competition
Pursuant to the Anti-Unfair Competition Law of the PRC ( ʕശɛ͏΍ձ਷ˀʔ͍຅ᘩ
) promulgated by the SCNPC on September 2, 1993, last amended on April 23, 2019,
and effective on the same date, operators are not allowed to use improper means to engage in
market transactions and harm competitors, including but not limited to: the use of power or
influence to influence transactions, market confusion, commercial bribery, misleading false
propaganda, infringement of trade secrets, low-price sales, unfair prize-winning sales, and
commercial slander. Any operator who violates the Anti-Unfair Competition Law of the PRC
by engaging in the aforementioned unfair competition activities will be ordered to suspend the
relevant illegal activities, eliminate the impact of such activities, or be liable for damages
caused to any party. Relevant supervision and inspection departments may also confiscate
illegal gains or impose fines on the relevant operators.
According to the Interim Provisions on Banning Commercial Bribery (ຫ˟ਠุ༡
) (Order No. 60 of the State Administration for Industry and Commerce of
the PRC) which became effective on November 15, 1996, commercial bribery refers to an act
of offering money or property or using other means by an operator to the other entity or
individual for the purposes of selling or buying goods, among which other means refer to the
means used to provide any types of benefits other than money or property. Operators who sell
or purchase goods through bribery may be fined and have the illegal proceeds confiscated,
depending on the circumstances; if a crime is committed, the operator will be held criminally
liable in accordance with the law.
Regulations Relating to Filing of Overseas Listing by Domestic Enterprises
Pursuant to the Opinions on Strictly Cracking Down on Illegal Securities Activities in
Accordance with the Law (จԈ) jointly promulgated
and implemented by the General Office of the CPC Central Committee and the General Office
of the State Council on July 6, 2021, it is required to strengthen the supervision of China
concept stock companies and revise the special regulations on the overseas offering of shares
and listing of these companies, and clarify the responsibilities of domestic industry supervising
and regulatory authorities.
The Trial Measures for the Administration of Overseas Securities Offering and Listing
of Securities by Domestic Enterprises ()
(hereinafter referred to as the “ Trial Measures for the Administration of Overseas Listing ”)
and its relevant supporting implementation rules, issued by the CSRC on February 17, 2023,
and implemented on March 31, 2023, implements unified filing management for direct and
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indirect overseas issuance and listing of securities by domestic enterprises, and the issuer shall
perform filing procedures and report relevant information to the securities regulatory
authorities under the State Council. Issuers directly listed overseas shall file with the CSRC
within 3 working days after submitting the application documents for overseas issuance and
listing. It is also stipulated that in the following circumstances, domestic enterprises shall not
issue securities and be listed overseas: (1) it is clearly prohibited from listing for financing by
laws, administrative regulations, or relevant provisions of the PRC; (2) overseas issuance or
listing of securities may jeopardize national security as reviewed and determined by the
relevant competent authorities of the State Council in accordance with the law; (3) the
domestic enterprises or their controlling shareholders, de facto controllers have committed
corruption, bribery, embezzlement of property, misappropriation of property, or criminal
offences that disrupted the socialist market economic order within the last three years; (4)
domestic enterprises are being investigated in accordance with the law due to suspected
criminal or major illegal activities, and there is no clear conclusion or opinion yet; (5) there
is a significant ownership dispute over the equity held by the controlling shareholders or
shareholders controlled by the controlling shareholders or de facto controllers. The Trial
Measures also require listed enterprises to comply with the following requirements: (1) comply
with laws, administrative regulations, and relevant regulations of the PRC on foreign
investment, state-owned asset management, industry supervision, and overseas investment; (2)
domestic enterprises issuing securities and be listed overseas shall formulate articles of
association, improve the internal control system, and standardize corporate governance and
financial and accounting matters in accordance with the Company Law of the PRC, the
Accounting Law of the PRC () and other laws, administrative
regulations, and relevant regulations of the PRC; (3) comply with the confidentiality laws and
regulations of the PRC, and take necessary measures to implement confidentiality
responsibilities; if it involves providing personal information and important data overseas, it
shall comply with the laws, administrative regulations, and relevant regulations of the PRC; (4)
domestic enterprises issuing securities and be listed overseas shall strictly abide by the security
laws, administrative regulations, and relevant provisions of the PRC on foreign investment,
network security, data security, etc., and earnestly fulfill their obligations to safeguard national
security. If security review is involved, relevant security review procedures shall be carried out
in accordance with the law before submitting the application for issuance and listing of
securities to overseas securities regulatory authorities, stock exchanges, etc.; (5) the target
investors for overseas issuance and listing of securities by domestic enterprises shall be foreign
investors, except where domestic enterprises directly issue and list securities overseas to
implement equity incentives or issue securities to purchase assets, or as otherwise stipulated by
the PRC; (6) the purposes and investment directions of the proceeds shall comply with the
laws, administrative regulations, and relevant regulations of the PRC; (7) the foreign exchange
and cross-border flow of relevant funds shall comply with the regulations of the PRC on
cross-border investment and financing, foreign exchange administration, and cross-border
RMB management. After the overseas issuance and listing of the issuers, the following major
events shall be reported to the CSRC within 3 working days from the date of occurrence and
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announcement: (1) change of control; (2) measures including investigation and penalties taken
by overseas securities regulatory authorities or relevant competent authorities; (3) conversion
of listing status or listing segment; or (4) voluntary termination of listing or mandatory
termination of listing.
The Provisions on Strengthening the Confidentiality and File Management Work Related
to the Overseas Issuance and Listing of Securities by Domestic Enterprises (̋੶ྤʫ
) issued by the CSRC, the MOF,
the State Secrecy Bureau and the State Archives Administration on February 24, 2023, and
implemented on March 31, 2023, specifies that domestic enterprises and securities companies
and securities service institutions that provide corresponding services shall, by strictly abiding
by the relevant laws and regulations of the PRC and the requirements therein, strengthen the
legal awareness of guarding state secrets and strengthening file management, establish sound
confidentiality and file work systems, take necessary measures to implement confidentiality
and file management responsibilities, and shall not leak national secrets and work secrets of
state organizations and undermine national and public interests. Domestic enterprises that
provide accounting files or copies of accounting files to relevant securities companies,
securities service institutions, overseas regulatory institutions, and other units and individuals
shall comply with the corresponding procedures in accordance with relevant regulations of the
PRC. Work manuscripts generated in the PRC by securities companies and securities service
institutions that provide corresponding services for overseas issuance and listing of securities
by domestic enterprises shall be kept in the PRC. Where files need to be transferred outside of
the PRC, it shall be subject to the approval procedures in accordance with relevant regulations
of the PRC.
H Share Full Circulation
Full circulation means listing and circulation on the Stock Exchange of the domestic
Unlisted Shares (including unlisted domestic shares held by domestic shareholders prior to
overseas listing, unlisted domestic shares additionally issued after overseas listing, and
Unlisted Shares held by foreign shareholders) of H-share companies. On November 14, 2019,
the CSRC issued the Guidelines for the Full Circulation Program for Domestic Unlisted Shares
of H-share Companies ( H΅͡ሗ“ஷ”ˏ), which was
amended on August 10, 2023, allowing certain qualified H-share companies and H-share
companies intended for listing to apply to the CSRC for full circulation. According to the
Guidelines for the Full Circulation Program for Domestic Unlisted Shares of H-share
Companies, shareholders of domestic Unlisted Shares may determine by themselves through
consultation the amount and proportion of shares, with filing to the CSRC by an H-share
company commissioned for this purpose. After the application for full circulation has been
filed by the CSRC, an H-share company shall submit a report on the relevant situation to the
CSRC within 15 days after the registration with the CSDC of the shares related to the
application has been completed.
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According to the Guide for “Full Circulation” Business of H Shares ( Hٰ“ஷ”ุ
) issued by the Shenzhen Branch of China Securities Depository and Clearing
Corporation Limited (the “CSDCC Shenzhen Branch”) on September 20, 2024 amended on
June 27, 2025 and became effective on June 30, 2025, the H-share companies shall transfer the
full amount of cash dividends in RMB to the bank account of CSDCC Shenzhen Branch before
16:00 on the distribution date of cash dividends as published in the announcement. The CSDCC
Shenzhen Branch shall complete clearing of the dividend funds within three H-share “full
circulation” working days after the distribution date of cash dividends as published in the
announcement, and then the dividend funds will be released to domestic securities companies,
and the domestic securities companies will release the dividend funds to the investors.
According to the Trial Measures for the Administration of Overseas Listing, in respect of
a domestic company directly listed overseas, shareholders holding its unlisted domestic shares
who apply to convert such shares held by them into listed overseas shares and to be listed in
an overseas stock exchange, shall comply with the relevant regulations of the CSRC and entrust
domestic enterprises to file with the CSRC.
OVERVIEW OF SANCTIONS LA WS AND REGULATIONS
Set out below is a summary of the sanctions regimes imposed by U.S., the United Nations,
the EU, the United Kingdom and United Kingdom overseas territories and Australia. This
summary does not set out the laws and regulations relating to the U.S., the United Nations, the
EU, the United Kingdom and Australian sanctions in their entirety.
U.S.
Treasury regulations
OFAC is the primary agency responsible for administering U.S. sanctions programs
against targeted countries, entities, and individuals. “Primary” U.S. sanctions apply to “U.S.
persons” or activities involving a U.S. nexus (e.g., funds transfers in U.S. currency even if
performed by non-U.S. persons), and “secondary” U.S. sanctions apply extraterritorially to the
activities of non-U.S. persons even when the transaction has no U.S. nexus. Generally, U.S.
persons are defined as entities organized under U.S. law (such as companies and their U.S.
subsidiaries); any U.S. entity’s domestic and foreign branches (sanctions against Iran and Cuba
also apply to U.S. companies’ foreign subsidiaries or other non-U.S. entities owned or
controlled by U.S. persons); U.S. citizens or permanent resident aliens (“green card” holders),
regardless of their location in the world; individuals physically present in the United States;
and U.S. branches or U.S. subsidiaries of non-U.S. companies.
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Depending on the sanctions program and/or parties involved, U.S. law also may require
a U.S. company or a U.S. person to “block” (freeze) any assets/property interests owned,
controlled or held for the benefit of a sanctioned country, entity, or individual when such
assets/property interests are in the United States or within the possession or control of a U.S.
person. Upon such blocking, no transaction may be undertaken or effected with respect to the
asset/property interest – no payments, benefits, provision of services or other dealings or other
type of performance (in case of contracts/agreements) – except pursuant to an authorization or
license from OFAC.
OFAC’s comprehensive sanctions programmes currently apply to Cuba, Iran, North
Korea, Syria, the Crimea, the so-called Luhansk People’s Republic and the Donetsk People’s
Republic regions. OFAC also prohibits virtually all business dealings with persons and entities
identified in the SDN List. An entity that a party on the SDN List owns (defined as a direct or
indirect ownership interest of 50% or more, individually or in the aggregate) is also blocked,
regardless of whether that entity is expressly named on the SDN List. Additionally, U.S.
persons, wherever located, are prohibited from approving, financing, facilitating, or
guaranteeing any transaction by a non-U.S. person where the transaction by that non-U.S.
person would be prohibited if performed by a U.S. person or within the United States.
United Nations
The United Nations Security Council (the “ UNSC ”) can take action to maintain or restore
international peace and security under Chapter VII of the United Nations Charter. Sanctions
measures encompass a broad range of enforcement options that do not involve the use of armed
force. Since 1966, the UNSC has established 30 sanctions regimes.
The UNSC sanctions have taken a number of different forms, in pursuit of a variety of
goals. The measures have ranged from comprehensive economic and trade sanctions to more
targeted measures such as arms embargoes, travel bans, and financial or commodity
restrictions. The UNSC has applied sanctions to support peaceful transitions, deter non-
constitutional changes, constrain terrorism, protect human rights and promote non-
proliferation.
There are 14 ongoing sanctions regimes which focus on supporting political settlement of
conflicts, nuclear non-proliferation, and counter-terrorism. Each regime is administered by a
sanctions committee chaired by a non-permanent member of the UNSC. There are ten
monitoring groups, teams and panels that support the work of the sanctions committees.
United Nations sanctions are imposed by the UNSC, usually acting under Chapter VII of
the United Nations Charter. Decisions of the UNSC bind members of the United Nations and
override other obligations of United Nations member states.
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European Union
Under EU sanction measures, there is no ‘blanket’ ban on doing business in or with a
jurisdiction targeted by sanctions measures. It is not generally prohibited or otherwise
restricted for a person or entity to do business (involving non-controlled or unrestricted items)
with a counterparty in a country subject to EU sanctions where that counterparty is not a
Sanctioned Target and not engaged in prohibited activities, such as exporting, selling,
transferring or making certain controlled or restricted products available (either directly or
indirectly) to, or for use in a jurisdiction subject to sanctions measures, provided that no funds
and economic resources are made available to the Sanctioned Targets.
United Kingdom
UK sanctions are in force under the Sanctions and Anti-Money Laundering Act 2018 (“the
UK Sanctions Act”), which enables the transition of existing EU sanctions programs and the
establishment of autonomous UK regimes. The United Kingdom is no longer an EU member
state as of January 1, 2021. Starting from January 1, 2021, the United Kingdom applies its own
sanctions programs through regulations setting out the specific measures under each UK
sanctions regime.
Australia
The Australian restrictions and prohibitions arising from the sanctions laws apply broadly
to any person in Australia, any Australian anywhere in the world, companies incorporated
overseas that are owned or controlled by Australians or persons in Australia, and/or any person
using an Australian flag vessel or aircraft to transport goods or transact services subject to
United Nations sanctions.
OVERVIEW OF LA WS AND REGULATIONS IN SPAIN
This section sets out a summary of material laws and regulations related to our
manufacturing business in Spain.
Regulations Regarding the Industrial Sector
Industry Act 21/1992, of July 16 establishes the foundations for the organization of the
industrial sector in Spain. Such Act classifies as very serious the voluntary non-compliance
with the requirements established in industrial regulations whenever they cause serious risk or
damage to people, flora, fauna, property or the environment, and as serious infractions
operating manufacturing installations or the exercise of industrial activities in Spain without
the corresponding authorization. Serious infractions could be fined with up to 6 million euros
and very serious infractions with up to 100 million euros and closure of the establishment or
suspension of the activity for up to 5 years.
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Regulations Regarding Vehicles Manufacturing
Regulation (EU) 2018/858 imposes on automobile manufacturers the duty to ensure that
all vehicles, systems, components, and separate technical units introduced into the market of
the EU — Spain included — comply with type-approval requirements. Manufacturers are
responsible for production conformity and must keep detailed records of claims and
non-compliance issues detected in relation to the vehicles and components they have
introduced in the market. In case of non-compliance, manufacturers may be subject to
administrative sanctions, including fines and the withdrawal of type-approval, which would
prevent the commercialization of the affected products.
Additionally, in Spain, for manufactured vehicles to be put into circulation, Royal Decree
2822/1998, of December 23, which approves the General V ehicle Regulations (“GVR”),
requires a previous administrative authorization whereby the authorities verify that vehicles are
in perfect working order and conform in their characteristics, equipment, spare parts, and
accessories to the technical specifications established in the GVR for each category. This
administrative authorization is substantiated in the EU or national type-approval of vehicles,
their parts, and pieces, so that all motor vehicles must be approved in Spain or the EU as an
indispensable condition for their registration and circulation. Details for both national
type-approval and EU type-approval procedures in Spain are laid out in Royal Decree
750/2010, of June 4.
Regulation (EU) 2019/631, which establishes performance standards for CO2 emissions
from new passenger cars and new light commercial vehicles, imposes on automobile
manufacturers the obligation to comply with specific CO2 emission limits for their vehicle
fleets put in the EU market, with limits periodically adjusted according to technological
advances. In case of non-compliance, manufacturers could face significant financial fines.
Regulations Regarding Environmental Aspects
Before car factories are built in Spain, Act 21/2013, of December 9, on environmental
assessment regulates the bases that should govern the environmental assessment of their
projects, to ensure their impact is compatible with the environment. If the assessment of its
environmental impact is negative, additional investments in mitigation measures may be
required or the project be prohibited, without prejudice to the fines that may apply, of up to
2,404,000 euros.
Royal Legislative Decree 1/2016, of December 16, which approves the revised text of the
Act on integrated pollution prevention and control, obliges large industrial installations
—which include car factories — to have an integrated environmental authorization and to
comply with the conditions established therein, setting their emission limit values, to ensure
the existence of a system of pollution prevention and control in terms of production and waste
management. Carrying out the activity without said integrated environmental authorization is
considered as very serious infraction if it causes damage to the environment or to the health
and safety of people and could be fined up to 2 million euros and the accessory sanction of
permanent/temporary closure of the premises.
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Management of End-Of-Life Vehicles and Parts
Royal Decree 265/2021, of April 13, establishes comprehensive measures for the
management of vehicles sold in Spain, at the end of their life cycle, focusing on the prevention
of waste and the proper treatment of vehicle components to protect human health and the
environment.
Manufacturers are to design and manufacture vehicles in a way that limits the use of
hazardous substances such as lead, mercury, cadmium, and hexavalent chromium. V ehicles
should be designed to facilitate their reuse, dismantling, decontamination, and recycling at the
end of their life cycle.
Regarding the collection and treatment of end-of-life vehicles, manufacturers are
responsible for guaranteeing and financing the collection and proper treatment of these
vehicles, especially when their market value is negative. This obligation ensures that
end-of-life vehicles and their parts (from wheels to batteries) are managed in an
environmentally sound manner.
Additionally, manufacturers must ensure the availability of collection facilities across
Spain. Manufacturers can fulfill these obligations through individual or collective systems of
extended producer responsibility. Moreover, they are required to submit annual reports
detailing the market introduction of vehicles, the waste generated, collected and treated, as
well as the organization, functioning, and financing of the extended producer responsibility
system.
Non-compliance with these obligations will result in fines.
Legal Guarantee and Defective Product Regimes Under the Spanish Consumer Act For
Manufacturers
Spanish Consumer Act (RDL 1/2007, November 16) establishes specific protection
measures for consumers in relation to the lack of conformity of purchased products (including
vehicles). In the event of lack of conformity, consumers are entitled to claim repair or
replacement of the non-conforming product and a price reduction or the termination of the
agreement. Although the seller of the product is typically directly liable to the consumer for
any lack of conformity, the manufacturer may also be held directly liable for the lack of
conformity when it relates to the origin, identity, or suitability of the products, or when it is
impossible or excessively burdensome for the consumer to pursue a claim against the seller.
The seller or manufacturer are liable for any lack of conformity that exists at the time of
delivery of the product and that becomes apparent within a period of 3 years from the date of
delivery. Furthermore, the legal regime governing liability for defective products is directly
applicable to the manufacturer. In this context, the manufacturer of a product is directly and
objectively liable for damages caused by defective products or parts for a period of 10 years
from the date on which the product causing the damage was put into circulation.
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Overview of Labor Regulations in Spain
The key Spanish labor laws are the Workers’ Statute Act (RDL 2/2015, October 3) and
Collective Bargaining Agreements (“CBA”). Senior managers may be subject to Royal Decree
1382/1985, of August 1st. The Workers’ Statute Act covers employer-employee rights and
obligations, including contracts, working hours, holidays, and terminations. However, CBAs
often enhance these rights and labour conditions. In the automotive sector, it is common to
apply the metal industry CBA. Additionally, non-EU employees must comply with immigration
and labor laws, including obtaining the appropriate work permits. Non-compliance with labor
regulations can lead to sanctions under the Labor Act on Infringements and Sanctions (RDL
5/2000, August 4).
Competition Law
Business entities in Spain are subject to EU and Spanish Competition Act. EU
competition law applies to restrictive conducts, which may affect trade between Member
States, and it is mainly enforced by the European Commission, whereas Spanish act applies to
restrictive conducts with effects in Spain, and it is enforced by the Spanish national
competition authority and also regional competition authorities, where they exist.
The main rules at EU level are articles 101 and following of the Treaty on the Functioning
of the EU; and the main Spanish statute is Act 15/2007, of July 3, for the Defense of
Competition.
Competition law aims at protecting and fostering free, undistorted and effective
competition in all sectors of the economy, which is considered a general interest. The main
fields of regulation of competition law that could affect the company are the following:
– The prohibition of any agreements or concerted practices that have as their object
or effect the prevention, restriction or distortion of competition. These practices
include, inter alia , price fixing; limiting or controlling production, distribution,
technical development or investment; or sharing or allocating markets. Except for
those cases where conduct can benefit from an exemption if certain conditions are
met, prohibited agreements and practices are null and void and may lead to fines of
up to 10% of the total worldwide turnover of the infringing company in the
preceding business year.
– The prohibition of abusive conducts if the company held a dominant position in a
given market. Abuse of dominance is also subject to fines of up to 10% of the total
worldwide turnover of the infringing company in the preceding business year.
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– Control of concentrations between companies. In case that the company enters into
certain corporate transactions, such as mergers, acquisitions or the incorporation of
full-function joint ventures, they may require prior notification and authorization by
competition authorities. Failure to comply with the obligation to notify or the
implementation of the transaction before clearance may lead to the imposition of
fines.
– Control of State aid measures, i.e., any economic advantage — in any form
whatsoever — conferred from State resources to companies on a selective basis and
resulting in a distortion of competition. EU law establishes a general prohibition of
State aid, but such aid can be considered admissible or justified under certain
conditions. State aid measures require in some cases prior authorization from the
European Commission before they are granted. In case of breach of applicable EU
State aid law, it may be required to pay back the aid with interests.
Currently, there is a legal initiative in the Spanish parliament to amend the Act for the
Defense of Competition, which would, among other measures, introduce the settlement
procedure for competition investigations, in line with the European Commission practice, and
increase the fines that can be imposed.
Data Protection
Under the EU General Data Protection Regulation and Spanish Organic Act 3/2018 of
December 5, on data protection, companies must legally collect and process personal data,
providing clear and accessible information about the processing of such data. Users have rights
over their personal data, including the right of access, rectification, erasure, restriction of
processing, data portability, and objection. Companies must implement appropriate technical
and organizational measures to ensure a level of security appropriate to the risk. Transfers of
personal data outside the European Economic Area can only be made to countries that offer an
adequate level of protection or through appropriate safeguards, such as standard contractual
clauses or binding corporate rules.
Cybersecurity
Under the EU General Data Protection Regulation, in the event of a security breach
affecting personal data, the affected company must notify the competent supervisory authority.
Additionally, if the breach is likely to result in a high risk to the affected individuals, it must
also be communicated to them. Moreover, vehicle manufacturers will be additionally bound by
cybersecurity obligations under the European NIS2 Directive (Directive (EU) 2022/2555 on
measures for a high common level of cybersecurity across the Union), currently being
transposed into Spanish law, requiring manufacturers to implement appropriate measures to
manage cybersecurity risks, including identification, assessment, and mitigation of potential
threats as well as the appointment of a cybersecurity officer and providing continuous training
to directors and staff on this matter.
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Tariffs
The general rules and procedures applicable to goods brought into or taken out of the EU
customs territory — which comprises the territories of EU Members — are set out in the Union
Customs Code (“ Regulation (EU) No 952/2013 of the European Parliament and of the Council
of 9 October 2013 laying down the Union Customs Code ”), supplemented by Commission
Delegated Act 2015/2446 (“ Commission Delegated Regulation (EU) 2015/2446 of 28 July 2015
supplementing Regulation (EU) No 952/2013 of the European Parliament and of the Council
as regards detailed rules concerning certain provisions of the Union Customs Code ”) and
Commission Implementing Act 2015/2447 (“ Commission Implementing Regulation (EU)
2015/2447 of 24 November 2015 laying down detailed rules for implementing certain
provisions of Regulation (EU) No 952/2013 of the European Parliament and of the Council
laying down the Union Customs Code ”).
In general, the goods brought into the EU must be cleared by customs, which could trigger
the payment of tariffs, indirect taxes, or other trade defense measures. Tariffs apply based on
the origin, value, and classification of goods, with a general 10% tariff in the case of complete
vehicles imported from third countries with no customs preferences, like China.
The EU has a trade defense policy based on World Trade Organization rules to protect
against unfair trade practices, which is set out in the following regulations:
(1) Regulation (EU) 2016/1036: Protection against dumped imports.
(2) Regulation (EU) 2016/1037: Protection against subsidized imports.
(3) Regulation (EU) 2015/478: Common rules for imports.
(4) Regulation (EU) 2015/755: Common rules for imports from certain third countries.
Additionally, regarding electric vehicles, it has been recently approved the Commission
Implementing Regulation (“ Commission Implementing Regulation (EU) 2024/2754 imposing a
definitive countervailing duty on imports of new battery electric vehicles for the transport of
persons from China ”).
Intellectual and Industrial Property Regulations
Intellectual and industrial property regulations in Spain are designed to protect the rights
of authors and owners of works, inventions, trademarks, designs, and trade secrets. Under these
regulations it is essential to respect the IP Rights of third parties to avoid infringements that
might entail payment of damages to the owners of said IP Rights or other remedies (e.g., cease
of a given conduct). To legally use and/or exploit the IP Rights of third parties, it is necessary
to obtain the corresponding assignments of rights or license agreements. Some of those rights
(i.e., trademarks and designs) may also be protected as EU trademarks and EU designs within
the territory of the entire EU, including Spain, by virtue of registrations with the EU
Intellectual Property Office.
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Tax Regulations
Corporate Income Tax
Income earned by Spanish resident companies is taxed on a worldwide basis under the
Corporate Income Tax (“ CIT”). Although the general CIT tax rate is 25%, certain rules (such
as a patent box regime aligned with OECD standards) can reduce the effective tax rate.
V alue Added Tax
V A T is an indirect tax on the consumption of goods and services harmonized within the
EU. It applies in Spain, except in the Canary Islands, Ceuta and Melilla. Excluding exempt
activities, entrepreneurs and companies must levy V A T at each stage of the production or
distribution process of goods and services. However, since input V A T can be offset against
output V A T, tax is neutral for businesses. In Spain, the general V A T rate is 21%, although
reduced rates apply to certain products.
Other taxes
Among others, different local taxes can be applied; e.g., business activities tax, tax on real
property, tax on the increase in value of urban land, and tax on construction, installations and
works.
OVERVIEW OF LA WS AND REGULATIONS IN MALAYSIA
This section sets out a summary of material laws and regulations related to our
manufacturing business in Malaysia.
Laws and Regulations Governing Our Business
Industrial Co-ordination Act 1975
The Industrial Co-ordination Act 1975 (Act 156 of the Laws of Malaysia) (“ ICA”)
requires manufacturing companies engaged in any manufacturing activity to obtain a
manufacturing licence issued by the Ministry of International Trade and Industry (“ MITI ”)
before engaging in any form of manufacturing activities. Any person who fails to comply with
this requirement is guilty of an offence and is liable on conviction to a fine not exceeding
RM2,000 or to a term of imprisonment not exceeding 6 months and to a further fine not
exceeding RM1,000 for every day during which such default continues.
The manufacturing licence issued by MITI does not have an expiry date, and is subject
to revocation at the discretion of MITI if the licencee (i) fails to comply with any condition
imposed in the licence; (ii) is no longer engaged in the manufacturing activity in respect of
which the manufacturing licence is issued; or (iii) has made a false statement in its application
for the manufacturing licence.
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Customs Act 1967
The Customs Act 1967 (Act 235 of the Laws of Malaysia) regulates customs laws in
Malaysia. It establishes procedures for valuation, classification and declaration of goods and
provides for the imposition of customs duties on any goods imported into or exported from
Malaysia.
For any good that is imported or exported, the importer or exporter shall make a
declaration to the Royal Malaysian Customs Department (“ RMCD ”) of the shipment and give
a full and true account of, amongst others, the number and description of packages, of the
description, weight, measure or quantity, and value of all such goods, unless otherwise
exempted from the declaration requirement.
Any person who makes incorrect declarations or fails to make a declaration commits an
offence and shall, on conviction, be liable to a fine not exceeding RM500,000 or to
imprisonment for a term not exceeding 7 years or to both. Further, engaging in smuggling or
unauthorized import or export may attract a fine between a minimum of 10 times the customs
duty or RM50,000 (whichever is greater) to a maximum of 20 times the customs duty or
RM500,000 (whichever is greater) or to imprisonment for a term not exceeding 5 years or to
both.
Goods listed under the Schedules to the Customs (Prohibition of Imports) Order 2023
(“CPIO ”) would require an import licence to be imported into Malaysia, unless absolutely
prohibited or imported into specified free zones or duty-island (for certain goods). Under the
CPIO, importation of motor vehicles and certain motor vehicle components into Malaysia will
generally require an import licence, otherwise known as an Approved Permit, issued by MITI.
Further, the import of certain motor vehicles and motor vehicle components may also need to
conform to the Malaysian Standard or other standards approved by the relevant Malaysian
authorities and in the manner provided ( e.g. , SIRIM Berhad and Road Transport Department).
As for exports, under the Customs (Prohibition of Export) Order 2023, there is generally
no export licence required to export motor vehicles and parts and accessories thereof falling
under Chapter 87 of the Customs Duties Order 2022. However, Malaysia imposes a unilateral
trade embargo against importation of Israel origin goods and on exports to Israel.
Guidelines on Foreign Participation in Distributive Trade Services issued by the Ministry of
Domestic Trade and Costs of Living (“MDTCL”) (“MDTCL Guidelines”)
Under the MDTCL Guidelines and while not a legal requirement, a majority foreign-
owned company which intends to engage in distributive trade activities in Malaysia is
encouraged and recommended to obtain the approval from the MDTCL (“ MDTCL
Approval ”). “Distributive trade” is defined to mean trade which comprises all linkage
activities that channel goods and services from the supply chains to intermediaries for the
purpose of resale or to the final buyers.
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The MDTCL Guidelines have no force of law and there are no legal sanctions or penalties
for non-compliance with the MDTCL Guidelines. Non-compliance with the MDTCL
Guidelines is instead enforced by way of administrative measures. For instance, the Expatriate
Services Division of the Immigration Department Malaysia requires a majority foreign-owned
distributive trade company to submit a copy of the MDTCL Approval as a supporting document
in its application for employment pass for its expatriates, and a local authority may refuse to
issue or renew a business premise licence to/of a company in breach of the MDTCL Approval
requirement.
Local Government Act 1976 and By-Laws
Local authorities are established under the Local Government Act 1976 (Act 171 of the
Laws of Malaysia) (“ LGA”) and the respective state ordinances and by-laws. The LGA
empowers every local authority to grant any licence or permit for any trade, occupation or
premises and such licence shall be subject to such conditions and restrictions as the local
authority may prescribe.
Our Group carries on businesses in Federal Territory of Kuala Lumpur (“ KL”) and the
city of Shah Alam, Malaysia and are therefore required to comply with the following by-laws:
In respect of Group members carrying on businesses in the Federal Territory of Kuala Lumpur ,
Malaysia:
The LGA governs the Licensing of Trades, Businesses and Industries (Federal Territory
of Kuala Lumpur) By-laws 2016 (“ KL By-Laws ”). The KL By-Laws regulates the licensing in
relation to trading of businesses and industrial matters carried out in KL.
Section 3 of the KL By-Laws states that any person may use any premise for operating
any business activity when a business premise licence has been issued pertaining to the said
premise under the KL By-Laws.
Section 38 of the KL By-Laws further states that any person who contravenes any
provisions of the KL By-Laws commits an offence and shall, on conviction be liable to a fine
not exceeding RM2,000 or imprisonment for a term not exceeding 1 year or to both and in the
case of a continuing offence, to a fine not exceeding RM200 for each day during which such
offence is continued after conviction.
In respect of Group members carrying on businesses in Shah Alam, Malaysia:
The LGA governs the Licensing of Trades, Businesses and Industries (Shah Alam City
Council) By-Laws 2007 (“ Shah Alam By-Laws ”). The Shah Alam By-Laws regulates the
licensing in relation to trading of businesses and industrial matters carried out in Shah Alam.
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Section 3 of the Shah Alam By-Laws states that no person shall operate any activity of
trade, business and industry or use any place or premise in the local area of the Council for any
activity of trade, business and industry without a licence issued by the Shah Alam City Council.
Section 47 of the Shah Alam By-Laws further states that any person who contravenes any
provisions of these Shah Alam By-Laws commits an offence and shall, on conviction be liable
to a fine not exceeding RM200 or to imprisonment for a term not exceeding 1 year or to both
and in the case of continuing offence to a fine not exceeding RM200 for each day during which
such offence is continued after conviction.
The LGA also governs the Advertisement (Shah Alam City Council) By-Laws 2007
(“Advertising By-Laws ”). The Advertising By-Laws govern the form and substance of
advertisements exhibited by businesses.
Section 7 of the Advertising By-Laws states that no person shall exhibit any
advertisement without a licence issued by the Shah Alam City Council.
Section 37 of the Advertising By-Laws further states that any person who contravenes any
provisions of these Shah Alam By-Laws commits an offence and shall, on conviction be liable
to a fine not exceeding RM200 or to imprisonment for a term not exceeding 1 year or to both
and in the case of continuing offence to a fine not exceeding RM200 for each day during which
such offence is continued after conviction.
Street, Drainage and Building Act 1974
The Street, Drainage, and Building Act 1974 (Act 133 of the Laws of Malaysia)
(“SDBA ”) provides a comprehensive framework for the construction, maintenance, and
regulation of streets, drainage systems, and buildings throughout Malaysia. It empowers local
authorities to enforce building control, ensure proper urban planning, and maintain public
safety.
A Certificate of Completion and Compliance is a statutory requirement under the SDBA
to certify that a building has been completed and is safe for occupation. Any person who
occupies or permits to be occupied any building or any part thereof without a certificate of
completion and compliance will be liable on conviction to a fine not exceeding RM 250,000
and/or imprisonment for a term not exceeding 10 years. A person is regarded as an occupier
under the SDBA if he is in actual occupation of the land or building in concern, or having the
charge, management or control thereof either on his own account or as agent of another person,
but does not include a lodger. In addition, the local authority may serve an order for the
alteration or demolishment of works done without a certificate of completion and compliance.
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Fire Services Act 1988
Section 28 (1) of the Fire Service Act 1988 (Act 34 of the Laws of Malaysia) (“ FSA”)
provides that every designated premise requires a fire certificate. Section 33 of the FSA further
states that where there is no fire certificate in force in respect of any designated premises the
owner of the premises shall be guilty of an offence which shall, on conviction, be liable to a
fine not exceeding RM50,000 or to imprisonment for a term not exceeding 5 years or to both.
Consumer Protection Act 1999 and Sale of Goods Act 1957
The supply of goods and services in Malaysia are primarily governed by 2 legislations,
i.e., the Consumer Protection Act 1999 (“ CPA”) and the Sale of Goods Act 1957 (“ SOGA ”).
The CPA generally applies in respect of all goods and services that are offered or supplied
to one or more consumers in trade including any trade transaction conducted through electronic
means. The SOGA generally applies to sale of goods in Peninsular Malaysia.
Both CPA and SOGA set out certain rights, warranties and conditions in favour of
consumers. For example, unfair contract terms, unfair practice/misleading and deceptive
conduct, implied guarantees as to title, correspondence with description, quality or fitness,
reasonable care and skill and rights of redress of consumers against suppliers. In the event such
issues occur, the consumer is entitled to make a claim against the seller including but not
limited to the manufacturers to the Tribunal for Consumer Claims.
The seller and including but not limited to manufacturer can be fined up to a sum of
RM250,000 and for a second or subsequent offence, a fine not exceeding RM500,000.
Taxation
Income Tax Act 1967
The Income Tax Act 1967 (Act 53 of the Laws of Malaysia) (“ ITA”) regulates the
imposition of income tax in Malaysia.
Corporate Income Tax
Pursuant to Paragraph 2 of Schedule 1 of the ITA, a company shall be charged for a year
of assessment on the chargeable income at the rate of 24%. In Malaysia, companies are
required under Section 77A(1) of the ITA to submit an annual tax return in the prescribed form
within 7 months following the close of their accounting period to the Inland Revenue Board
of Malaysia.
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Any person who makes default in furnishing a return in accordance with Section 77A(1)
shall, if he does so without reasonable excuse, be guilty of an offence and upon conviction, be
liable to a fine not less than RM200 and not more than RM20,000 or to imprisonment for a term
not exceeding 6 months or to both.
Withholding Tax
Under the ITA, withholding tax applies to certain payments made to foreign parties,
including interest, royalties and service fees. The withholding tax is generally 10% for
royalties and for certain service fees, and 15% for interest, although these rates may vary
depending on the type of payment and the provisions of any applicable double tax treaties.
Any failure to deduct or remit the required withholding tax will result in a 10% increase
on the amount of the withholding tax failed to be paid.
Dividends
There is no income tax on dividends received by a Malaysian company. However,
Malaysian-sourced dividends received by individual shareholders (both residents and
non-residents), either through direct shareholder or a nominee, in excess of RM100,000
annually will generally be subject to income tax at the rate of 2% effective 1 January 2025,
unless specifically exempted.
Sales Tax Act 2018
The Sales Tax Act 2018 (Act 806 of the Laws of Malaysia) provides for the charging,
levying and collecting of sales tax.
Section 8 of the Sales Tax Act 2018 provides that sales tax shall be imposed on the
manufacture of taxable goods in Malaysia by a registered manufacturer and importation of
taxable goods into Malaysia. From an import perspective, depending on the tariff classification
of the goods imported, motor vehicles and their parts and component could attract sales tax.
Companies who manufacture taxable goods are required to register for sales tax if their
total sales value exceeds RM 500,000 within a 12-month period. Sales tax is levied at the rate
of 5% or 10% or a specified rate, depending on the classification of the goods under the Sales
Tax (Rates of Tax) Order 2018. Sales tax exemptions may be granted by way of a statutory
order to exempt (i) any goods or class of goods from sales tax; or (ii) any persons or class of
persons from the payment of sales tax.
Non-compliance with the registration and tax payment obligations may result in fines and
imprisonment.
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Service Tax Act 2018
The Service Tax Act 2018 (Act 807 of the Laws of Malaysia) provides for the charging,
levying and collecting of service tax.
Section 7 of the Service Tax Act 2018 provides that service tax shall be imposed on any
taxable service provided in Malaysia by a registered person in carrying on its business or any
imported taxable service. Service tax rate is generally imposed at 8% except for selected
services (e.g., food and beverage services, telecommunications services, parking place
services, and logistics services, which remain subject to a service tax rate of 6%).
Any person who provides any taxable service and exceeds the prescribed thresholds under
the First Schedule to the Service Tax Regulations 2018 is liable to be registered. For example,
any person who provides management services or maintenance services, where its total value
of taxable service exceeds RM 500,000 within a 12-month period, is liable to register under the
Service Tax Act 2018.
Failure to register and account for service tax may result in fines and imprisonment.
Customs Duties
Import/export duties
Under the Customs Duties Order 2022, import duties may apply on motor vehicle, motor
vehicle components or raw materials imported into Malaysia, subject to the HS Code of the
particular good imported into Malaysia. Certain goods may qualify for preferential duty rates
under the applicable Free Trade Agreements between Malaysia and the exporting country(ies).
Conversely, there are generally no export duties on the export of motor vehicles and parts
and accessories thereof out of Malaysia falling under Chapter 87 of the Customs Duties Order
2022. Goods can only be released from customs control after the duty and/or sales tax is paid
in full, unless otherwise allowed by the RMCD.
Duty and tax exemption facilities
Malaysia has duty and tax suspension facilities such as free zones and Licenced
Manufacturing Warehouse (LMW) facilities. Under these facilities, exported-oriented
manufacturers may enjoy import duty, excise duty and sales tax suspension on imported inputs.
Furthermore, businesses operating under a bonded warehouse facility (public or private) can
also store imported goods without immediate payment of duties and taxes, subject to specified
conditions. Specific sales tax and import duty exemptions can also be negotiated as part of a
tax incentive application or applied for separately to the Ministry of Finance.
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Notably, in the electrical vehicle (“ EV”) segment, completely built up (CBU) EVs are
granted full import and excise duty exemption until 31 December 2025. Meanwhile, the import
of components for locally assembled EVs are fully exempted from import duty until 31
December 2027. Locally assembled EVs would also enjoy a full exemption of excise duty and
sales tax exemption until 31 December 2027.
Excise Act 1976
The Excise Act 1976 (Act 176 of the Laws of Malaysia) (“ EXA”) regulates the imposition
of excise duties in Malaysia. Excise duties are levied on certain goods manufactured or
imported into Malaysia, including certain motor vehicles under 4-digit HS headings 87.03 and
87.11. Under the EXA, a licence is required from the RMCD to manufacture and warehouse
dutiable goods in Malaysia.
Under Section 71 of the EXA, making incorrect statements or failing to declare dutiable
goods is an offence, which upon conviction, may result in a fine not exceeding RM500,000 or
to imprisonment for a term not exceeding 7 years or to both. Additionally, Section 74 of the
EXA provides that failure to pay excise duty or manufacture dutiable goods without a licence
may attract a fine between 10 to 20 times the customs duty or RM50,000 to RM500,000
(whichever is greater) or to imprisonment for a term not exceeding 5 years or to both.
Strategic Trade Act 2010
The Strategic Trade Act 2010 (Act 708 of the Laws of Malaysia) (“ STA”) regulates the
export, transshipment, transit and brokering of strategic items (i.e., military and dual-use
items). Under Section 9 of the STA, no person is permitted to export, tranship or bring in transit
strategic items, without first obtaining the necessary permit. Furthermore, no person is
permitted to export, tranship or bring in transit strategic items or unlisted items to a prohibited
end-user. Passenger motor vehicles generally do not fall within the meaning of strategic goods,
but parts and components could potentially be caught depending on their technical
specifications.
Failure to comply with the STA is a serious offence. Upon conviction, an individual may
be punished with death, imprisonment or fine whereas a body corporate could be punished with
a fine of up to RM20,000,000.
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OVERVIEW
Our history can be traced back to 1997, when Anhui Auto Parts Co., Ltd.* ( τᏏӛԓཧ
ʮ̡), the predecessor of our Company, was established. On March 24, 2008, our
Company was converted into a joint stock limited company, and the company name was
changed to “Chery Automobile Co., Ltd. (ʮ̡)”.
We are a passenger vehicle company headquartered in Wuhu, China. Our business covers
designing, developing, manufacturing and selling a diverse and expanding portfolio of
passenger vehicles, including ICE vehicles and NEVs, to cater to the distinct and evolving
needs and preferences of customers in both the domestic and overseas markets. In addition, we
design, develop and manufacture engines, transmission systems and chassis, which are
primarily used in our passenger vehicles.
MILESTONES
The table below sets forth our major business development milestones since our
establishment in 1997 and up to the Latest Practicable Date:
Y ear Event
1997 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We commenced construction of “Engine Plant No. 1”, marking the
beginning of our Group’s development
1999 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the production of our first self-developed engine
We completed the production of our first sedan, No. 000001 “Fulwin”,
marking the breakthrough of our independent sedan manufacturing from
scratch
2001 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our first batch of “Fulwin” sedans entered the international market in
batches, achieving a breakthrough in our export of complete vehicles to
overseas markets
2003 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the production of our first self-developed NEV
2004 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the production of our first self-developed transmission
2005 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our SUV Tiggo was officially launched
ACTECO as the first proprietary automobile engine brand in the PRC
was born
2006 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our first batch of engines were exported overseas
2007 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our cumulative sales exceeded one million vehicles, making us the first
Chinese domestic brand passenger vehicle company to achieve sales of
over one million vehicles
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Y ear Event
2008 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We won the “National Science and Technology Progress First Prize ( ਷
ኪආӉɓഃᆤ)” established by the State Council; we were awarded
as the one of first batch of “Innovative Enterprises” by the Ministry of
Science and Technology of the PRC, the State-owned Assets
Supervision and Administration Commission of the State Council, and
the All-China Federation of Trade Unions
2010 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the production of our self-developed continuously
variable transmission (CVT)
2013 /H1118/H1118/H1118/H1118/H1118/H1118/H1118The continuously variable transmission technology (CVT technology)
won the first prize of the 2013 “China Automotive Industry Science &
Technology Award (ኪҦஔᆤ)”
2014 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We completed the production of our first vehicle in our first overseas
plant in Brazil
2016 /H1118/H1118/H1118/H1118/H1118/H1118/H1118We were listed in the National Patent Operation Pilot Enterprises of
Automobile Manufacturing Industry by the China National Intellectual
Property Administration
2018 /H1118/H1118/H1118/H1118/H1118/H1118/H1118JETOUR X70 as its first model was launched officially
2019 /H1118/H1118/H1118/H1118/H1118/H1118/H1118The third-generation ACTECO 1.6 TGDI engine was granted the “China
Top Ten” award (“ ʕ਷ːɤԳ”೯ਗዚ)
EXEED TXL as its first model was launched officially
2020 /H1118/H1118/H1118/H1118/H1118/H1118/H1118The new energy project “Key technologies and equipment for short-
process R&D and manufacturing of aluminum-based lightweight new
energy passenger vehicles (೯Ⴁிᗫ
ᒟҦஔʿༀ௪)” was awarded the first prize of the 2020 “China
Automotive Industry Science and Technology Progress Award ( ʕ਷ӛ
ҦආӉᆤ)”
2021 /H1118/H1118/H1118/H1118/H1118/H1118/H1118“CHERY POWER ( ㆕ᘄਗɢ)”, the ICE and hybrid powertrain solution
was officially released
We completed the production of our full-function hybrid configuration
DHT (dedicated hybrid transmission)
2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118The “RX 2025” forward-looking technology strategy was officially
released
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Y ear Event
2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our NEV new strategy was officially released. We launched the iCAR
and LUXEED brands, created the high-end NEV series EXLANTIX
under EXEED, and launched NEV series Fulwin and Shan Hai under the
CHERY and JETOUR brands, respectively
2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118Our cumulative sales exceeded 13 million vehicles, ranking No. 1 in
exports by Chinese domestic brand passenger vehicle companies for 22
consecutive years
We completed the production of the first EBRO S700 vehicle at the
European production base we built in cooperation with EV MOTORS, a
Spanish established automaker
OUR MAJOR SUBSIDIARIES
We carried out our business through 150 subsidiaries as at the end of the Track Record
Period. Set out below are the principal business activities and place and date of establishment
of our major subsidiaries:
Name
Place of
Establishment
Date of
Establishment Shareholding
Principal Business
Activities
Chery New Energy /H1118/H1118/H1118PRC April 22,
2010
48.20% Manufacturing
and sales of
passenger
vehicles
Chery Sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC August 14,
2000
100% Sales of
passenger
vehicles
Acteco /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC September 29,
2005
100% Manufacturing
and sales of
automotive
parts and
components
Chery Technology /H1118/H1118/H1118PRC November 21,
2001
100% Manufacturing
and sales of
automotive
parts and
components
Jetour Sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118PRC April 28,
2017
100% Sales of
passenger
vehicles
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Name
Place of
Establishment
Date of
Establishment Shareholding
Principal Business
Activities
Soueast Motor /H1118/H1118/H1118/H1118/H1118/H1118PRC May 21, 1992 70% Manufacturing
and sales of
passenger
vehicles
iCAR Technology /H1118/H1118/H1118/H1118PRC November 18,
2015
100%
owned by
Chery New
Energy
Sales of
passenger
vehicles
Chery Auto Parts
Procurement /H1118/H1118/H1118/H1118/H1118/H1118
PRC September 29,
2005
60% by our
Company
and 40%
by Chery
Sales
Supply Chain
Management
Chery Russia /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Russia December 5,
2005
100% Sales of
passenger
vehicles
CORPORATE DEVELOPMENTS
Establishment of our Company
On January 8, 1997, Wuhu Finance Bureau and Wuhu Construction Corporation (wholly
owned by Wuhu Economic and Technological Development Zone Management Committee*
(ึ)) jointly established Anhui Auto Parts Co., Ltd.* ( τᏏӛԓ
ʮ̡), the predecessor of our Company, with a registered capital of
RMB1,680,000,000. The capital contributions subscribed for by Wuhu Finance Bureau and
Wuhu Construction Corporation accounted for 89.29% and 10.71% of the then registered
capital of our Company, respectively.
Introduction of Wuhu Investment Holding in 2000
In December 2000, Wuhu Investment Holding became our largest Shareholder through the
gratuitous equity transfer by Wuhu Finance Bureau and capital increase, holding 45.72% of the
then registered capital of our Company. The shareholding of Wuhu Construction Corporation
in our Company increased to 10.87% through the capital increase. The other Shareholders
include Anhui Credit Financing Guaranty Group Co., Ltd.* (ʮ
̡)( “ Anhui Credit Guaranty ”, formerly known as Anhui Innovation Investment Co., Ltd.*
(ʮ̡)), Anhui Provincial Investment Group Holding Co., Ltd.* (޲
ʮ̡)( “ Anhui Investment Holding ”, formerly known as Anhui Provincial
Investment Group Co., Ltd.* (ப΂ʮ̡)) and an independent
Shareholder, holding 27.11%, 14.87% and 1.43% of the then registered capital of our Company,
respectively. For details of Wuhu Investment Holding, please refer to the section headed
“Relationship with our Single Largest Shareholder” in this prospectus.
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Establishment of Management and Employee Stock Ownership Platform in 2004
In December 2004, Ruichuang was set up as our Company’s equity incentive platform for
the management and key scientific and technological personnel. Pursuant to two equity transfer
agreements dated December 31, 2004, all the then existing Shareholders (including Wuhu
Investment Holding) agreed to transfer a total of 16.17% equity interest of our Company to
Ruichuang in proportion to their shareholdings in our Company, among which the transfer of
8.083% equity interest was at nil consideration and the transfer of 8.083% equity interest was
at a total consideration of RMB120,339,485.93, which was determined based on a 50%
discount to the appraised net asset value of our Company as at September 30, 2004. Upon
completion of the above transfers, Ruichuang held 16.17% equity interest of our Company. For
details of Ruichuang, please refer to “— Management and Employee Stock Ownership
Platforms”.
Conversion into a joint stock company and capital increase in 2008
On March 24, 2008, our Company was converted into a joint stock limited company, and
the company name was changed to “Chery Automobile Co., Ltd. (ʮ̡)”.
Upon completion of the conversion, the registered capital of our Company was
RMB3,200,000,000, which was divided into 3,200,000,000 Shares with a nominal value of
RMB1.00 each.
Establishment of Chery Holding by injecting our Shares in 2010
In October 2010, Wuhu Investment Holding and Ruichuang jointly established Chery
Holding by injecting an aggregate of 32.13% equity interest of our Company and certain
amount of cash. At the time of establishment of Chery Holding, Wuhu Investment Holding and
Ruichuang held 52% and 48% equity interest in Chery Holding, respectively. Meanwhile,
Chery Holding became our largest Shareholder and the direct shareholdings of Wuhu
Investment Holding and Ruichuang in our Company decreased to 9.68% and 9.50%,
respectively.
Introduction of Qingdao Wudaokou and Luxshare from 2019 to 2022
In December 2019, our Company and Chery Holding introduced Qingdao Wudaokou New
Energy Automobile Industry Fund (Limited Partnership)* (Ά
ุ(Υྫ)) (“ Qingdao Wudaokou ”) through the capital increase and/or equity transfer.
After the completion of the aforesaid transactions, the total issued share capital of our
Company increased from RMB4,456,900,000 to RMB5,469,831,633. Qingdao Wudaokou
directly held 46.77% equity interest in Chery Holding, and directly and indirectly held a total
of 33.71% equity interest in our Company. For the sake of completeness, in order to realize
capital gains from its investment, Qingdao Wudaokou divested part of its investment and its
direct shareholding in our Company and Chery Holding decreased to 1.96% and 4.96%,
respectively, after the transfers to Luxshare, Qingdao Xincheng Haishun New Energy
Automobile Partnership (Limited Partnership)* (㒥༐ऎනอঐ๕ӛԓΥྫΆุ(Υ
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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ྫ)) (“ Qingdao Xincheng ”) and Wuhu Kinsman Enterprise Management Partnership (Limited
Partnership)* (౶ਟΆุ၍ଣΥྫΆุ(Υྫ)) (“ Wuhu Kinsman ”, formerly known
as Wuhu Ruiboan Enterprise Management Limited Partnership* ( ጾಳ๿௹τΆุ၍ଣΥྫΆ
ุ(Υྫ)) in May 2022. For details of the aforesaid transactions, please refer to “—
Pre-IPO Investments”.
Businesses Combination from 2022 to 2024
As part of our Group’s strategy to integrate resources, (i) from June 2022 to January 2024,
our Company acquired certain business and equity interests from Chery Holding, including
JETOUR-related assets and business, 51% equity interest of Chery Technology (principally
engaged in manufacturing and sales of automotive parts and components), 51% equity interest
of Acteco (principally engaged in the production of powertrain), and 100% equity interest of
Rejoin (Anhui) Supply Chain Technology Co., Ltd.* ( ๿ᗼ(τᏏ)ʮ̡)
(principally engaged in the supply chain management). The aforesaid acquisitions were
business combinations under common control and the financial statements of the targets were
consolidated into the financial statements of the Group from the beginning of the Track Record
Period, and therefore do not constitute acquisitions of material subsidiary or business as
required to be disclosed under Rule 4.05A of the Listing Rules; (ii) in February 2024, our
Company acquired 100% equity interest in Fuzhou Qingkou Holding Co., Ltd.* (ɹછ
ʮ̡)( “ Fuzhou Qingkou ”) from an Independent Third Party. Fuzhou Qingkou is a
limited liability company established in the PRC on August 23, 2023 for the purpose of holding
70% equity interest in Soueast Motor which is principally engaged in the production and sales
of passenger vehicles. The financial statements of Fuzhou Qingkou were consolidated into the
financial statements of the Group upon completion of the acquisition on February 18, 2024.
Our Directors have confirmed that none of the applicable percentage ratios as defined under the
Listing Rules in respect of the acquisition of Fuzhou Qingkou exceeds 25%. Accordingly, the
relevant pre-acquisition financial information of Fuzhou Qingkou is not required to be
disclosed pursuant to Rule 4.05A of the Listing Rules. For details, please refer to Note 40 to
the section headed “Appendix I — Accountants’ Report”.
Establishment of Management and Employee Stock Ownership Platforms in 2024
On March 30, 2024, for the purpose of employee equity incentives, our Company
repurchased all of our Shares directly held by Ruichuang, representing a total of 6.74% equity
interest of our Company, at nil consideration whereby the tax arising from such repurchase was
borne by our Company. Our Company further transferred an equivalent number of such
repurchased Shares to Hengrui and Zhenrui, the employee stock ownership platforms of our
Company. Each of Hengrui and Zhenrui subscribed for 3.37% equity interest of our Company
at a consideration of RMB626,595,500, representing an award price of RMB3.4 per Share. For
details of Hengrui and Zhenrui, please refer to “— Management and Employee Stock
Ownership Platforms”.
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Equity Transfer by Chery Holding in January 2025
Prior to the Equity Transfer, Chery Holding had been our controlling Shareholder since
its establishment in 2010, and had become a diversified group covering encompass passenger
vehicles (conducted by us), commercial vehicles, financial investment, and trade in services.
After rounds of introduction of investors, there were ten shareholders of Chery Holding
immediately before the Equity Transfer, and other than Ruichuang, all of the shareholders of
Chery Holding also directly held our Shares.
To meet the business needs of the shareholders of Chery Holding and to enhance the
efficiency of decision-making, a restructuring was carried out to remove Chery Holding from
the shareholding structure of our Company, such that all of our Shares then held by Chery
Holding, representing 42.32% equity interest of our Company, would be transferred to the
shareholders of Chery Holding on a pro rata basis. The Equity Transfer was completed on
January 20, 2025, and upon completion of the Equity Transfer, (i) Chery Holding no longer
held any of our Shares, and (ii) the shareholders of Chery Holding held our Shares directly.
The table below sets out the shareholding structure of our Company and Chery Holding
immediately before and after the Equity Transfer:
Shareholder(s)
Shareholding immediately
before the Equity Transfer (%)
Shareholding in
our Company
immediately
after the Equity
Transfer and
prior to the
Listing (%) (A x
42.32%+B)
Shareholding in
our Company
immediately
upon Listing
(assuming the
Over-allotment
Option is not
exercised) (%)
Chery Holding*
(A)
Our Company
(B)
Chery Holding’s Shareholders
Wuhu Investment Holding /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829.47 8.70 21.17 20.08
Ruichuang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827.20 – 11.51 10.92
Luxshare /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821.16 7.87 16.83 15.96
Qingdao Wudaokou /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.28 1.96 4.20 3.98
Ningbo Meishan Bonded Port Area Wending
Investment Co., Ltd.* (೼ಥਜਪཻҳ
ʮ̡)( “ Ningbo Wending ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.97 1.48 3.15 2.99
Qingdao Xincheng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.56 1.32 2.83 2.68
Zhuhai Shangshun Management and Consultancy
Partnership (Limited Partnership)* (න၍ଣ
ፔ༔ΥྫΆุ(Υྫ)) (“ Zhuhai Shangshun ”) 2.81 1.05 2.24 2.12
Qingdao Urban Investment International
Development Group Co., Ltd.* (ҳ਷ყ೯
ʮ̡)( “ Qingdao Urban Investment ”) 2.61 0.97 2.08 1.97
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Shareholder(s)
Shareholding immediately
before the Equity Transfer (%)
Shareholding in
our Company
immediately
after the Equity
Transfer and
prior to the
Listing (%) (A x
42.32%+B)
Shareholding in
our Company
immediately
upon Listing
(assuming the
Over-allotment
Option is not
exercised) (%)
Chery Holding*
(A)
Our Company
(B)
Hefei Gotion High-tech Power Energy Co., Ltd.*
(ʮ̡)( “ Gotion
High-tech ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.08 0.78 1.66 1.57 (2)
Qingdao Huoyan Ruixiang No. 1 Industrial
Investment Partnership (Limited Partnership)*
(˦଻๿ୂɓ໮ପุҳ༟ΥྫΆุ(Υྫ))
(“Qingdao Huoyan ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.85 0.69 1.47 1.40
Our other Shareholders without holding any shares in Chery Holding
Chery Holding
(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 42.32 – –
Anhui Credit Guaranty /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 9.97 9.97 9.46
Anhui Investment Holding /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 5.20 5.20 4.93
Changshu Port Development Construction Co., Ltd.*
(ʮ̡)( “ Changshu Port ”) – 3.57 3.57 3.38
Hengrui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3.37 3.37 3.20
Zhenrui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3.37 3.37 3.20
Dalian Automobile Industry Investment Co., Ltd.*
(ʮ̡)( “ Dalian
Automobile ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1.83 1.83 1.73
Changshu Economic Development Automotive
Technology Co., Ltd.* (ʮ
̡)( “ Changshu Development ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1.83 1.83 1.73
Wuhu Construction Corporation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1.56 1.56 1.47
Kaifeng City Operation and Investment Group Co.,
Ltd.* (ʮ̡)( “ Kaifeng
Investment ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1.33 1.33 1.27
Kaifeng Transportation Construction (Group) Co.,
Ltd.* (ண(ණྠ)ʮ̡)( “ Kaifeng
Transportation ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.49 0.49 0.47
Y ancheng Zhiyuan Qirui Investment Partnership
(Limited Partnership)* (Ⴣຩ๿ҳ༟ΥྫΆ
ุ)( “ Y ancheng Qirui ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.19 0.19 0.18
Guiyang Economic and Technological Development
Zone Tongsheng Y oushi Equity Investment
Management Center (Limited Partnership)* ( ൮ජ
ᛆҳ༟၍ଣʕː(ࠢ
Υྫ)) (“ Guiyang Tongsheng ”) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 0.17 0.17 0.16
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100% 100% 100% 94.84%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notes:
(1) For the avoidance of doubt, following the Equity Transfer, Chery Holding continues as a diversified group
covering commercial vehicles, financial investment, and trade in services. The shareholders of Chery Holding
continue to hold shares in Chery Holding. Wuhu Investment Holding confirms that as at the Latest Practicable
Date, it did not have any interest in a business which competes with, or is likely to compete with, our principal
business, which would otherwise require disclosure to be made under Rule 8.10 of the Listing Rules. For
details, see the section headed “Relationship with Our Single Largest Shareholder” in this prospectus.
(2) The percentage stated herein does not take into account any Offer Shares to be subscribed for by Gotion HK
(as defined under the section headed “Cornerstone Investor”) as a cornerstone investor under the cornerstone
investment agreement. Gotion HK, a wholly-owned subsidiary of Gotion High-tech Co., Ltd. (΅
ʮ̡), entered into a cornerstone investor agreement with our Company, pursuant to which Gotion HK has
agreed to, subject to certain conditions, subscribe at the Offer Price for such number of Offer Shares (rounded
down to the nearest whole board lot of 100 H Shares) that may be purchased for an amount of US$29.00
million. The total number of Offer Shares to be subscribed for by Gotion HK would be 7,346,300 H Shares,
representing approximately 0.13% of our total issued share capital immediately upon Listing (assuming the
Over-allotment Option is not exercised). For details, see the section headed “Cornerstone Investors” in this
prospectus.
Save as disclosed above, our Company also conducted several rounds of Pre-IPO
Investments. For details, please refer to “— Pre-IPO Investments”.
As at the Latest Practicable Date, we have a total of 22 Shareholders with a dispersed
shareholding structure including certain state-owned enterprises. As advised by our PRC Legal
Adviser, pursuant to the Supervision and Administration Measures for the Trading of
State-owned Assets of Enterprises (جour Company is not a
state-owned enterprise, a state-controlled enterprise (Άุ) or a state-actually-
controlled enterprise ( ਷ϞྼყછՓΆุ) as defined therein.
PRC REGULATORY REQUIREMENT
Our PRC Legal Adviser has confirmed that we have legally and properly completed,
settled, and obtained the requisite legal approvals or governmental confirmation and completed
requisite governmental registrations with relevant Administration Department for Market
Regulation in the PRC with respect to all the aforesaid establishment, conversion,
subscriptions, transfers and the changes of our shareholdings (including the Pre-IPO
Investments).
COMPLIANCE WITH RULE 8.05(1)(C) OF THE LISTING RULES
Rule 8.05(1)(c) of the Listing Rules requires a listing applicant to demonstrate ownership
continuity and control for at least the most recent audited financial year.
Since the establishment of Chery Holding in 2010 and prior to the Equity Transfer, it had
remained as the controlling shareholder of our Company holding more than 30% equity interest
of our Company. As set out in the paragraphs “— Equity Transfer by Chery Holding in January
2025” above, upon completion of the Equity Transfer, Chery Holding no longer directly held
any equity interest of our Company with all Chery Holding’s shareholders directly holding the
equity interest of our Company in proportion to their respective shareholdings in Chery
Holding.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notwithstanding the shareholding changes as a result of the Equity Transfer, our
Company is of the view that it satisfies the ownership continuity and control requirement under
Rule 8.05(1)(c) of the Listing Rules based on the following grounds:
(1) the purpose of the Equity Transfer by Chery Holding was to flatten the shareholding
structure of our Company to (a) enhance the liquidity of the shareholders’ equity
interest, (b) balance the interest of all Shareholders in our Company’s future
financing activities and facilitate our Company’s capital market operations, and (c)
enable a clearer and more transparent ownership structure of our Company;
(2) there has been no material change in the interests of the ultimate Shareholders on a
see-through basis since the completion of the Equity Transfer. Before the Equity
Transfer, the three largest shareholders of Chery Holding were Wuhu Investment
Holding, Ruichuang (one of the Management and Employee Stock Ownership
Platforms) and Luxshare, holding 29.47%, 27.20% and 21.16% equity interest of
Chery Holding. Following the completion of the Equity Transfer, Wuhu Investment
Holding, the Management and Employee Stock Ownership Platforms, and Luxshare
remain as the three largest Shareholders, holding 21.17%, 18.25% and 16.83%
equity interest of our Company, respectively. Thus, none of the Shareholders has
gained or lost control in our Company, or changed their ranking or shareholding
percentage of our Company either preceding or following the Equity Transfer;
(3) Chery Holding has no controlling shareholder and there is no single shareholder who
can control the composition of a majority of the board of directors or over the
decision-making of such board. Despite that Chery Holding falls within the
definition of “controlling shareholder” by virtue of the fact that it was entitled to
exercise or control the exercise of 42.32% of the voting power at general meetings
of our Company, (i) each of the shareholders of Chery Holding exercised their
judgement, decision-making and voting power independently at the general
meetings of Chery Holding concerning our Company’s business based on their
respective direct communications with the senior management members of our
Company. There had been no acting-in-concert or other voting arrangements among
the shareholders of Chery Holding, or any contractual obligations or obligations
under the articles of association to be subject to the instruction of any of the
shareholders of Chery Holding; (ii) there is no single shareholder of Chery Holding
who can control the composition of a majority of the board of directors or has the
control over the decision-making of the board of directors of Chery Holding. There
had been no special agreement or arrangement among the directors of Chery
Holding with respect to the exercise of voting rights. In addition, as Chery Holding
is a diversified group with business across different industries, its shareholders
should not be presumed as a group of controlling shareholders. As such, the Equity
Transfer would have no impact on the shareholders’ control over our Company; and
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(4) Our Board comprises 15 members, including two executive Directors, seven
non-executive Directors and six independent non-executive Directors. Both of the
two executive Directors were recommended by the Management and Employee
Stock Ownership Platforms. The Equity Transfer does not result in any changes in
our senior management members (including our executive Directors).
Joint Sponsors’ views
Based on the relevant documents, information, representations and confirmations
provided by our Company, no material matter has come to the attention of the Joint Sponsors
to reasonably doubt our Company’s view that we satisfy the ownership continuity and control
requirement under Rule 8.05(1)(c) of the Listing Rules.
MANAGEMENT AND EMPLOYEE STOCK OWNERSHIP PLATFORMS
In recognition of the contributions of, among others, our management and employees and
to incentivize them to further promote our development, Ruichuang, Hengrui and Zhenrui were
established in the PRC as our management and employee stock ownership platforms.
Ruichuang
Ruichuang was a limited liability company established in the PRC on December 30, 2004
and converted into a joint stock limited company in 2008, holding 11.51% equity interest of
our Company as at the Latest Practicable Date.
Ruichuang is the stock ownership platform mainly for the management of Chery Holding
and our Company. Save for Chairman Yin, who holds more than 30% of the shares in
Ruichuang, there is no other shareholder, directly or indirectly (through their respective
associate(s)), holding 5% or more of the shares in Ruichuang.
Hengrui and Zhenrui
Each of Hengrui and Zhenrui is a limited partnership established in the PRC on February
26, 2024, each holding 3.37% equity interest of our Company as at the Latest Practicable Date.
Hengrui and Zhenrui are the employee stock ownership platforms of our Company, with
their incentive participants mainly being mid-level employees. Their general partner is Wuhu
Y ongrui Enterprise Management Consultation Co., Ltd.* (ʮ̡)
(“Y ongrui”), which is owned as to 52%, 16%, 16% and 16% by Chairman Yin, Mr. Zhang
Guozhong (׀our executive Director and executive vice president), Dr. Gao Xinhua ( ৷
อശ) and Mr. Zhang Guibing ( ੵ൮ж) (both being our executive vice presidents), respectively.
There is no limited partner, directly or indirectly (through their respective associate(s)),
holding 30% or more partnership interest in Hengrui or Zhenrui.
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On March 29, 2024, Hengrui and Zhenrui entered into a voting agreement (the “ Original
Voting Agreement ”) with Chery Holding upon request of the lending banks in order to apply
for bank loans to pay for the consideration of the subscription for our Shares (for details of the
subscription, please refer to “— Corporate Developments — Establishment of Management
and Employee Stock Ownership Platforms in 2024”). Pursuant to the Original V oting
Agreement, Hengrui and Zhenrui shall align and reach a consensus with Chery Holding before
making any proposals and voting at our Company’s board meetings and general meetings; and
in the event that a consensus cannot be reached, the opinion of Chery Holding shall prevail.
The Original V oting Agreement did not impose any corresponding obligations on Chery
Holding and its shareholders other than mainly binding Hengrui and Zhenrui to act in concert
with Chery Holding. Given the Original V oting Agreement is an arrangement between our then
Shareholders, the entering into of the Original V oting Agreement is not subject to the corporate
process and internal control of our Company. Along with Chery Holding’s cessation of holding
any of our Shares as a result of the Equity Transfer, the Original V oting Agreement was
terminated on January 20, 2025. On February 17, 2025, Hengrui, Zhenrui and Ruichuang
entered into a new voting agreement (the “ New Voting Agreement ”) with a term commencing
from the execution date of the agreement until 36 months after the Listing Date. Pursuant to
the New V oting Agreement, the parties shall align and reach a consensus with each other before
making any proposals and voting at our Company’s board meetings and general meetings; and
in the event that a consensus cannot be reached, the opinion of Ruichuang shall prevail.
As at the Latest Practicable Date, all of our Shares held by the three Management and
Employee Stock Ownership Platforms have been granted to the participants and have been
vested.
PRE-IPO INVESTMENTS
1. Principal terms of the Pre-IPO Investments
Our Company has completed several rounds of Pre-IPO Investments through capital
increases and equity transfers. The following table summarizes the principal terms of the
Pre-IPO Investments in our Company:
Investor(s)
Amount of
registered capital
or number of
Shares acquired/
subscribed for (as
the case may be)
Amount of
consideration paid Cost per Share
Discount to
the Offer Price (1) Settlement date
Capital Increase Agreement dated December 27, 2007
Shanghai Tonghua
V enture Capital
Centre (Limited
Partnership)* ( ɪऎ
Νശਗɢ௴ุҳ༟ʕ
ː(Υྫ))
(“Tonghua
Venture”)
(2) /H1118/H1118/H1118/H1118/H1118
RMB61,473,684 RMB113,050,104.88 RMB1.84 93.10% December 27, 2007
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Investor(s)
Amount of
registered capital
or number of
Shares acquired/
subscribed for (as
the case may be)
Amount of
consideration paid Cost per Share
Discount to
the Offer Price (1) Settlement date
Shanghai Hushan
Investment Center
(Limited
Partnership)* ( ɪऎ
ಳʆҳ༟ʕː(Υ
ྫ)) (“ Hushan
Investment ”)
(3) /H1118/H1118/H1118
RMB61,473,684 RMB113,050,104.88 RMB1.84 93.10% December 27, 2007
(Note: the considerations were determined based on the appraised net asset value of our Company as at December 31, 2006 of
RMB3,537,449,400)
Share Subscription and Transfer Agreement dated March 23, 2009
Bohai Industrial
Investment Fund
Management Co.,
Ltd* ( ಲऎପุҳ༟
ʮ̡)
(“Bohai Industrial
Investment ”)
(4) /H1118/H1118/H1118
Subscription:
141,169,993 Shares
Shares Transfer:
25,490,007 Shares
RMB423,509,979
RMB76,470,021
RMB3.00 88.76% March 30, 2009
Tianjin CDH Equity
Investment Fund I
(Limited
Partnership)*
(ᛆҳ༟ɓ
ږ(Υྫ))
(“CDH I ”)
(4) /H1118/H1118/H1118/H1118/H1118
Subscription:
88,093,599 Shares
Shares Transfer:
15,906,401 Shares
RMB264,280,798
RMB47,719,202
RMB3.00 88.76% March 30, 2009
China Huarong Asset
Management Co.,
Ltd.* ( ʕ਷ശፄ༟ପ
ʮ̡)
(“China
Huarong ”)
(4) /H1118/H1118/H1118/H1118
Subscription:
70,728,996 Shares
Shares Transfer:
12,771,004 Shares
RMB212,186,988
RMB38,313,013
RMB3.00 88.76% March 30, 2009
Beijing Zhongke
Fangshan V enture
Capital Fund Co.,
Ltd.* (ג߅
ࠢ
ப΂ʮ̡)( “ Beijing
Zhongke ”)
(4) /H1118/H1118/H1118/H1118
Subscription:
56,474,774 Shares
Shares Transfer:
10,197,226 Shares
RMB169,424,321
RMB30,591,679
RMB3.00 88.76% March 30, 2009
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Investor(s)
Amount of
registered capital
or number of
Shares acquired/
subscribed for (as
the case may be)
Amount of
consideration paid Cost per Share
Discount to
the Offer Price (1) Settlement date
Zhangjiagang Zhongke
Huixin V enture
Capital Co., Ltd.*
(ි㒥௴ุ
ப΂ʮ̡)
(“Zhongke
Huixin ”)
(4) /H1118/H1118/H1118/H1118/H1118
Subscription:
28,237,387 Shares
Shares Transfer:
5,098,613 Shares
RMB84,712,161
RMB15,295,839
RMB3.00 88.76% March 30, 2009
Shanghai Kebao Equity
Investment Co.,
Ltd.* (ᛆ
ʮ̡)
(“Shanghai
Kebao ”)
(4) /H1118/H1118/H1118/H1118/H1118/H1118
Subscription:
28,237,387 Shares
Shares Transfer:
5,098,613 Shares
RMB84,712,161
RMB15,295,839
RMB3.00 88.76% March 30, 2009
Jiangxi Zhongjia
Investment Co.,
Ltd.* ( ϪГʕྗҳ༟
ʮ̡)
(“Zhongjia
Investment ”)
(4) /H1118/H1118/H1118
Subscription:
28,237,387 Shares
Shares Transfer:
5,098,613 Shares
RMB84,712,161
RMB15,295,839
RMB3.00 88.76% March 30, 2009
Tianjin CDH Y uanbo
Equity Investment
Fund (Limited
Partnership)*
(ᛆҳ
ږ(Υྫ))
(“CDH Yuanbo ”)
(4) /H1118
Subscription:
24,844,089 Shares
Shares Transfer:
4,485,911 Shares
RMB74,532,267
RMB13,457,733
RMB3.00 88.76% March 30, 2009
Rongde Asset
Management Co.,
Ltd.* ( ፄᅃ༟ପ၍ଣ
ʮ̡)
(“Rongde ”)
(4) /H1118/H1118/H1118/H1118
Subscription:
13,976,388 Shares
Shares Transfer:
2,523,612 Shares
RMB41,929,165
RMB7,570,835
RMB3.00 88.76% March 30, 2009
(Note: the considerations were determined based on the appraised net asset value of our Company as at June 30, 2008 of
RMB2.3600 per Share)
Share Subscription Agreement dated August 26, 2009
Dalian
Automobile /H1118/H1118/H1118/H1118/H1118/H1118
100,000,000 Shares RMB1,300,000,000 RMB13.00 51.28% September 14,
2009
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Investor(s)
Amount of
registered capital
or number of
Shares acquired/
subscribed for (as
the case may be)
Amount of
consideration paid Cost per Share
Discount to
the Offer Price (1) Settlement date
Share Subscription Agreement dated November 6, 2009
Kaifeng Investment
(5)
/H1118100,000,000 Shares RMB1,300,000,000 RMB13.00 51.28% December 28, 2009
Share Subscription Agreements dated May 26, 2010, December 30, 2011 and December 27, 2012 and Share Transfer Agreement
dated December 31, 2012
Changshu Port (6) /H1118/H1118/H1118/H1118295,000,000 Shares RMB5,900,000,000 RMB20.00 25.05% December 26, 2013
(Note: the considerations above were determined having taken into account various factors, including their industrial investment
cooperation, and the historical operating performance, the industry ranking, the timing of investments and the business
prospects of our Company)
Capital Increase Agreement dated February 2, 2016
CIB Chery Changshu
Automobile R&D
Fund (Limited
Partnership)* ( ጳุ
޼
ږ(Υྫ))
(“CIB Fund ”)
(7) /H1118/H1118/H1118
336,900,000 Shares RMB1,550,000,000 RMB4.60 82.76% February 4, 2016
(Note: the consideration was determined based on the appraised net asset value of our Company as at December 31, 2014 of
RMB4.5631 per Share)
Capital Increase Agreement dated December 3, 2019
Qingdao Wudaokou (8) /H1118 1,012,931,633
Shares
RMB6,863,217,664 RMB6.78 74.59% December 13, 2019
(Note: the consideration was determined based on the appraised net asset value of our Company as at December 31, 2018 of
RMB6.7287 per Share)
Notes:
(1) The discount to the Offer Price is calculated based on the assumption that the Offer Price is HK$29.25 per H
Share (being the mid-point of the indicative Offer Price range of HK$27.75 to HK$30.75).
(2) Tonghua V enture is no longer our Shareholder. On August 10, 2012, Tonghua V enture allocated 4,554,795
Shares, 4,554,795 Shares and 1,301,370 Shares to its limited partners, Mr. Sun Xiang (ജ), Mr. Zhang Wei
(ੵਃ) and Mr. Wang Ting (࣎being Independent Third Parties, in proportion to their partnership interest
in Tonghua V enture in consideration of such limited partners’ divestment in Tonghua V enture.
Tonghua Holding Co., Ltd.* (ʮ̡)( “ Tonghua Holding ”) owed Chery Sales the principal and
interest of a loan under an entrustment loan agreement in July 2018, and Chery Holding the investment
principal and returns under an investment partnership agreement in March 2016 and the interest of a loan under
a loan agreement in February 2018 (the “ Debts ”). Tonghua V enture pledged, among others, a total of
69,589,040 Shares as collateral to secure the repayment of the Debts in the amount of approximately RMB416
million. Due to Tonghua Holding’s failure to repay the Debts, Chery Sales and Chery Holding applied for
enforcement, and on August 22, 2022, the Intermediate People’s Court of Wuhu ruled that Tonghua V enture
shall allocate 35,407,771 Shares and 34,181,269 Shares to Chery Holding and Chery Sales to settle the Debts.
On December 31, 2022, Chery Sales transferred 34,181,269 Shares to Chery Holding at a consideration of
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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RMB5.9784 per Share, because it is not allowed to hold any Shares as a wholly-owned subsidiary of our
Company. The consideration was determined based on the amount of debt Tonghua V enture owed to Chery
Sales and fully settled on January 15, 2023.
On March 26, 2024, due to changes in their own investment arrangements, Mr. Sun, Mr. Zhang and Mr. Wang
transferred 4,554,795 Shares, 4,554,795 Shares and 1,301,370 Shares to Y ancheng Qirui at a consideration of
RMB9.3239 per Share, which was determined after arm’s length negotiations with reference to the historical
financial performance and business prospects of our Company and fully settled on March 30, 2024. Following
the completion of the transfers, Mr. Sun, Mr. Zhang and Mr. Wang are no longer our Shareholders.
(3) Hushan Investment is no longer our Shareholder. On June 23, 2009, Hushan Investment divested its investment
in our Company by transfer of 80,000,000 Shares to Ruichuang at a consideration of RMB3.00 per Share.
(4) Each of Bohai Industrial Investment, CDH I, China Huarong, Beijing Zhongke, Zhongke Huixin, Shanghai
Kebao, Zhongjia Investment, CDH Y uanbo and Rongde (collectively, the “ 2009 Investors ”) is no longer our
Shareholder. The 2009 Investors made investments in our Company through share subscription and share
transfer from Ruichuang in 2009, and divested their investments in our Company by transfer of their Shares
to Chery Holding from 2011 to 2017. Among them, (i) Beijing Zhongke, Zhongke Huixin, Shanghai Kebao and
Zhongjia Investment transferred 166,680,000 Shares to Chery Holding at a consideration of RMB3.8568 per
Share in December 2011; (ii) China Huarong transferred 83,500,000 Shares to Chery Holding at a
consideration of RMB4.0749 per Share in October 2012; (iii) Bohai Industrial Investment transferred
166,660,000 Shares to Chery Holding at a consideration of RMB4.1001 per Share in November 2012; (iv)
CDH I and CDH Y uanbo transferred 44,443,334 Shares to Chery Holding at a consideration of RMB4.1333 per
Share in December 2012, and transferred the remaining 88,886,666 Shares to Chery Holding at a consideration
of RMB5.00 per Share in January 2017; and (v) Rongde transferred 16,500,000 Shares to Chery Holding at
a consideration of RMB4.2403 per Share in April 2013. The aforesaid considerations were determined based
on the investment amount plus interest.
New Horizon Growth (Tianjin) Equity Investment Partnership (Limited Partnership)* (ڗ(ݵ)ᛆ
Υྫ(Υྫ)) (“ New Horizon ”, formerly known as New Tianyu Growth (Tianjin) Equity
Investment Partnership (Limited Partnership)* (ڗ(ݵ)Υྫ(Υྫ)) is no longer
our Shareholder. On May 12, 2009, New Horizon made an investment in our Company through share transfer
from Ruichuang of 27,500,000 Shares at a consideration of RMB3.00 per Share, and divested its investment
in our Company by transfer of 9,300,000 Shares to Guiyang Tongsheng at a consideration of RMB6.20 per
Share in October 2010 and transfer of the remaining 18,200,000 Shares to Chery Holding at a consideration
of RMB4.1622 per Share in April 2013.
(5) On September 13, 2024, due to internal arrangements, Kaifeng Investment transferred 27,000,000 Shares to
Kaifeng Transportation at a consideration of RMB13.00 per Share. The consideration was determined based
on the investment cost and fully settled on September 14, 2024.
(6) On May 31, 2023, due to internal arrangements, Changshu Port established Changshu Development and made
a capital contribution of 100,000,000 Shares (with a book value of RMB2,000,000,000). The consideration was
determined based on the investment cost and was fully settled on July 3, 2023.
(7) CIB Fund is no longer our Shareholder. The general partner of CIB Fund, holding 0.0004% partnership interest
in CIB Fund, was Shanghai Xingsheng Equity Investment Management Co., Ltd.* (ᛆҳ༟၍ଣϞ
ʮ̡), which is ultimately owned as to 90% by Industrial Bank Co., Ltd. (ʮ̡) (the A
shares of which are listed on the Shanghai Stock Exchange under stock code 601166) and 10% by COSCO
SHIPPING Development Co., Ltd. (ʮ̡) (dually listed on the Shanghai Stock
Exchange (stock code: 601866) and the Stock Exchange (stock code: 2866)). In August 2022, due to changes
in their own investment arrangements, CIB Fund divested its investment in our Company by transfer of
336,900,000 Shares to Chery Holding at a consideration of RMB4.3218 per Share. The consideration was
determined based on the book value of net assets of our Company as at December 31, 2021 of RMB4.3218 per
Share and was fully settled on August 31, 2022.
(8) On February 11, 2022, in order to realize capital gains from its investment, Qingdao Wudaokou transferred
430,522,152 Shares, 262,441,165 Shares and 212,603,532 Shares to Luxshare, Qingdao Xincheng and Wuhu
Kinsman at a consideration of RMB8.4144 per Share, which was determined based on the investment amount
plus interest and fully settled on November 7, 2022.
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On March 27, 2024, due to changes in its own investment arrangements, Qingdao Xincheng allocated
57,215,218 Shares, 53,150,883 Shares, 41,457,689 Shares and 38,268,636 Shares to Zhuhai Shangshun,
Qingdao Urban Investment, Qingdao Huoyan and Wuhu Kinsman in proportion to their partnership interest in
Qingdao Xincheng (i.e. total capital commitments of RMB4,439,135,770.80) in consideration of such limited
partners’ divestment in Qingdao Xincheng. On November 8, 2024, the Shares allocated to Wuhu Kinsman and
Qingdao Huoyan were amended to 42,037,517 Shares and 37,688,808 Shares based on their respective paid-up
capital.
Wuhu Kinsman is no longer our Shareholder. Due to changes in its own investment arrangements, (i) on
November 29, 2022, Wuhu Kinsman transferred 80,677,727 Shares to Ningbo Wending at a consideration of
RMB8.9324 per Share, which was determined with reference to the investment amount plus interest and fully
settled on December 9, 2022; (ii) on March 30, 2024, Wuhu Kinsman allocated 42,393,104 Shares to Gotion
High-tech in proportion to its partnership interest in Wuhu Kinsman in consideration of its divestment in Wuhu
Kinsman; (iii) on March 30, 2024, Wuhu Kinsman transferred the remaining 127,801,337 Shares to Chery
Holding at a consideration of RMB8.93 per Share, which was determined with reference to the investment
amount plus interest and fully settled on March 30, 2024; and (iv) on November 9, 2024, Wuhu Kinsman
transferred to Chery Holding the additional 3,768,881 Shares allocated by Qingdao Xincheng at a
consideration of RMB10.75 per Share, which was determined with reference to the investment amount plus
interest and fully settled on November 10, 2024.
2. Use of proceeds
We utilized the proceeds from the Pre-IPO Investments for investment in research and
development, and production expansion. As at the Latest Practicable Date, the net proceeds
from the Pre-IPO Investments had been fully utilized.
3. Strategic benefits
At the time of the Pre-IPO Investments, our Directors were of the view that our Group
could benefit from the additional funds provided by the Pre-IPO Investments in our Group,
insights for industry, advice on business expansion and strategic direction, upstream and
downstream resources that the Pre-IPO Investors brought to our Company, and the knowledge
and experience of the Pre-IPO Investors. Their investments also demonstrated their confidence
in our Group’s operations and served as an endorsement of our Group’s performance, strengths
and prospects.
4. Information about the Pre-IPO Investors
(1) Luxshare
Luxshare is the holding vehicle of the family members of Ms. Wang Laichun (݆)
our non-executive Director). Each of Ms. Wang Laichun (݆s sister, Ms. Wang Laijiao
(ˮԸᄮ) and Ms. Wang Laichun (݆s brother, Mr. Wang Laixi ( ˮԸః), holds 50%
equity interest of Luxshare.
(2) Qingdao Wudaokou
Qingdao Wudaokou is a limited partnership established in the PRC on August 22, 2019,
principally engaged in equity investment. The general partner of Qingdao Wudaokou is
Qingdao Xingrui Zhicheng New Energy V ehicle Industry Co., Ltd.* (อঐ๕ӛԓ
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 219 ---
ʮ̡)( “ Qingdao Xingrui ”), holding 0.99% partnership interest in Qingdao
Wudaokou. Qingdao Xingrui is owned as to 51% and 49% by Beijing Water Wood Equity
Investment Center (Limited Partnership)* (ᛆҳ༟ʕː(Υྫ)) (“ Beijing
Water Wood ”) and Qingdao Chengxin Equity Investment Co., Ltd.* (ࠢ
ʮ̡)( “ Qingdao Chengxin ”). The general partner holding 0.33% partnership interest in
Beijing Water Wood is owned as to 99% by Mr. Mao Jian ( ˣ਄), an Independent Third Party,
and the limited partner holding 98.67% partnership interest in Beijing Water Wood is Mr. Mao
Jian ( ˣ਄). Qingdao Chengxin is ultimately owned as to 46% and 54% by the State-owned
Assets Supervision and Administration Commission of Qingdao Municipal People’s
Government (“ Qingdao SASAC ”) and the State-owned Assets Operation Service Center of
Jimo District, Qingdao City* (ਕʕː)( “ Jimo SAOSC ”),
respectively.
The limited partners of Qingdao Wudaokou include Jinan Jiading Investment Partnership
(Limited Partnership)* (Գཻҳ༟ΥྫΆุ(Υྫ)) (“ Jinan Jiading ”) and Jinan
Changying Jinan Investment Partnership (Limited Partnership)* (τҳ༟ΥྫΆุ
(Υྫ)) (“ Jinan Changying ”), each holding 49.51% partnership interest in Qingdao
Wudaokou. Each of the general partner and the limited partner of Jinan Jiading is ultimately
owned as to 46% and 54% by Qingdao SASAC and Jimo SAOSC. The general partner of Jinan
Changying holding 0.01% partnership interest is ultimately controlled as to 37.64% and 35%
by Mr. Ba Zhen ( ˋቤ) (an Independent Third Party) and Jimo SAOSC. The limited partner of
Jinan Changying, holding 99.99% partnership interest in Jinan Changying is wholly owned by
Jimo SAOSC.
(3) Changshu Port
Changshu Port is a limited liability company established in the PRC on August 13, 2007,
principally engaged in port operations. It is wholly owned by Changshu Economic and
Technological Development Zone Management Committee* (ࡰ
ึ).
(4) Ningbo Wending
Ningbo Wending is a limited liability company established in the PRC on April 6, 2017,
principally engaged in industrial investment, investment management and consultation. It is
wholly owned by Contemporary Amperex Technology Co., Limited (΅
ʮ̡), dully listed on the Shenzhen Stock Exchange (stock code: 300750) and the Stock
Exchange (stock code: 3750).
(5) Qingdao Xincheng
Qingdao Xincheng is a limited partnership established in the PRC on February 11, 2022,
principally engaged in equity investment. The general partner of Qingdao Xincheng is Qingdao
Xincheng Haishun Enterprise Management Co., Ltd.* (ʮ̡)
(“Xincheng Haishun ”), holding 0.0059% partnership interest in Qingdao Xincheng. Xincheng
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Haishun is owned as to 52.83% by Zhuhai Houjiang Consultation Service Co., Ltd.* (ێ
ப΂ʮ̡), which is in turn owned as to 60% by Mr. Xie Y ongyuan ( ᑽ͑ʩ)
and 40% by Mr. Jiang Bo (ت۴both being Independent Third Parties), 35.00% by Qingdao
Chengxin, which is in turn owned as to 46% by Qingdao SASAC and 54% by Jimo SAOSC,
and 12.17% by Qingdao Jimo Innovation Investment Development Co., Ltd.* (уኈ௴౽
ʮ̡), which is in turn wholly owned by Jimo SAOSC.
The limited partners of Qingdao Xincheng include Qingdao Urban Investment (wholly
owned by Qingdao SASAC) and Qingdao Jimo Technology Investment Holding Co., Ltd.* (ڡ
ʮ̡) (wholly owned by Jimo SAOSC), holding 66.11% and 21.64%
partnership interest in Qingdao Xincheng. There is no other limited partner holding 30% or
more partnership interest in Qingdao Xincheng.
(6) Zhuhai Shangshun
Zhuhai Shangshun is a limited partnership established in the PRC on March 11, 2024,
principally engaged in equity investment. The general partner of Zhuhai Shangshun is Tibet
Jinkun Enterprise Management Co., Ltd.* (ʮ̡)( “ Tibet Jinkun ”),
holding 0.0006% partnership interest in Zhuhai Shangshun. Tibet Jinkun is owned as to 34%,
33.30% and 32.70% by Mr. Niu Kuiguang (Έ), Mr. Li Jianguang (Έ) and Mr. Wang
Jingbo (تall being Independent Third Parties. There is no limited partner ultimately
holding 30% or more partnership interest in Zhuhai Shangshun.
(7) Qingdao Urban Investment
Qingdao Urban Investment is a limited liability company established in the PRC on July
21, 2016, principally engaged in equity investment. It is wholly owned by Qingdao SASAC.
(8) Dalian Automobile
Dalian Automobile is a limited liability company established in the PRC on August 18,
2009, principally engaged in investment holding. It is wholly owned by the State-owned Assets
Supervision and Administration Bureau of the People’s Government of Jinpu New Area, Dalian
City.
(9) Changshu Development
Changshu Development is a limited liability company established in the PRC on June 8,
2023, principally engaged in technology promotion and application services. It is wholly
owned by Changshu Municipal Finance Bureau (the State-owned Assets Supervision and
Administration Office of Changshu Municipal Government).
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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(10) Gotion High-tech
Gotion High-tech is a limited liability company established in the PRC on May 9, 2006,
principally engaged in lithium iron phosphate materials and battery cells, ternary materials and
battery cells, power battery packs, energy storage battery packs and battery management
systems, etc. It is wholly owned by Gotion High-tech Co., Ltd. (ʮ̡), the
A shares of which are listed on the Shenzhen Stock Exchange under stock code 002074.
(11) Qingdao Huoyan
Qingdao Huoyan is a limited partnership established in the PRC on January 16, 2024,
principally engaged in equity investment. The general partner of Qingdao Huoyan is Shanghai
Huoyan Beiai Private Fund Management Co., Ltd.* (ʮ̡)
(“Huoyan Beiai ”), holding 11.52% partnership interest in Qingdao Huoyan. Huoyan Beiai is
ultimately owned as to 51%, 24.99% and 24.01% by Mr. Wang Ailong ( ˮฌᎲ), Mr. Zhang
Y aokun ( ੵᘴտ) and Mr. Sun Xiaoping (ʃ̻) (all being Independent Third Parties),
respectively.
The limited partners of Qingdao Huoyan include Huada Automotive Technology Co., Ltd.
(ʮ̡), the A shares of which are listed on the Shanghai Stock Exchange
under stock code 603358, holding 30.51% partnership interest in Qingdao Huoyan. There is no
other limited partner holding 30% or more partnership interest in Qingdao Huoyan.
(12) Kaifeng Investment
Kaifeng Investment is a limited liability company established in the PRC on February 19,
2009, principally engaged in equity investment. It is owned as to 85% and 15% by the
State-owned Assets Supervision and Administration Commission of Kaifeng Municipal
People’s Government and Kaifeng Municipal Urban and Rural Integration Demonstration Zone
Management Committee* (ึ), respectively.
(13) Kaifeng Transportation
Kaifeng Transportation is a limited liability company established in the PRC on June 3,
2014, principally engaged in integrated construction, toll road operation and management, and
transportation industry investment. It is wholly owned by Kaifeng Municipal Finance Bureau*
(҅).
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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(14) Yancheng Qirui
Y ancheng Qirui is a limited partnership established in the PRC on March 14, 2024,
principally engaged in equity investment. The general partner of Y ancheng Qirui is CMS
Zhiyuan Capital Co., Ltd.* (ʮ̡), a wholly-owned subsidiary of China
Merchants Securities Co., Ltd. (ʮ̡) (dually listed on the Shanghai Stock
Exchange (stock code: 600999) and the Stock Exchange (stock code: 06099)), holding 0.103%
partnership interest in Y ancheng Qirui. There is no limited partner ultimately holding 30% or
more partnership interest in Y ancheng Qirui.
(15) Guiyang Tongsheng
Guiyang Tongsheng is a limited partnership established in the PRC on September 19,
2010, principally engaged in equity investment. The general partner of Guiyang Tongsheng is
Mr. Guo Jingjun (ࠏan Independent Third Party, holding 10% partnership interest in
Guiyang Tongsheng. The limited partner of Guiyang Tongsheng is Mr. Wang Jiwen (˖),
an Independent Third Party, holding 90% partnership interest in Guiyang Tongsheng.
To the best knowledge of our Directors, save for Luxshare, other Pre-IPO investors are
Independent Third Parties.
5. Special rights of the Pre-IPO Investors
Certain Pre-IPO Investors had been granted certain special rights relating to our
Company, including but not limited to director nomination right and other nomination right,
veto right, transfer restrictions, information right, right of first refusal, and exclusivity right
and no more favourable terms. The special rights will be terminated at the time of Listing as
agreed by our Company and the Pre-IPO Investors in accordance with the guidance set out in
Chapter 4.2 of the Guide for New Listing Applicants. On April 3, 2025, in order to maintain
the stability of our management team, the existing Shareholders entered into a shareholders’
agreement, pursuant to which they agree to vote for the two director candidates nominated by
Ruichuang in the event of election of Directors at the general meetings of our Company after
the Listing, so as to ensure Ruichuang’s board seats. The abovementioned shareholders’
agreement is not subject to the guidance set out in Chapter 4.2 of the Guide for New Listing
Applicants.
6. Public float
Upon completion of the Global Offering (assuming the Over-allotment Option is not
exercised) and the conversion of Domestic Unlisted Shares into H Shares, 2,015,999,074
Domestic Unlisted Shares will be converted into H Shares and listed on the Stock Exchange,
while the remaining 3,453,832,559 Unlisted Shares (comprising 920,426,548 Foreign Unlisted
Shares and 2,533,406,011 Domestic Unlisted Shares) held by our Shareholders as at the Latest
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 223 ---
Practicable Date will not be considered as a part of the public float as those Shares are Unlisted
Shares which will not be converted into H Shares and listed on the Stock Exchange following
the completion of the Global Offering.
Among the 2,015,999,074 Domestic Unlisted Shares to be converted into H Shares,
972,078,624 H Shares held by certain of our Shareholders will be counted towards the public
float. Set out below is the details of the conversion of Domestic Unlisted Shares into H Shares:
Shareholder
As at the Latest Practicable Date
Upon completion of the Global Offering and the
conversion of Domestic Unlisted Shares (assuming
the Over-allotment Option is not exercised)
Number of
Unlisted Shares
as at the Latest
Practicable Date
Approximate
percentage of the
Unlisted Shares
in the total share
capital of our
Company
Number of
Domestic
Unlisted Shares
to be converted
into H Shares
Approximate
percentage of
the converted
H Shares in the
total share
capital of our
Company
The
converted
H Shares
whether to
count
towards the
public float
or not
Wuhu Investment Holding /H1118/H11181,157,771,424 21.17 218,793,265 3.79 No
Luxshare /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118920,426,548 16.83 – – –
Ruichuang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118629,670,207 11.51 209,890,069 3.64 No
Anhui Credit Guaranty /H1118/H1118/H1118545,513,600 9.97 272,756,800 4.73 No
Anhui Investment Holding /H1118 284,224,000 5.20 142,112,000 2.46 No
Qingdao Wudaokou /H1118/H1118/H1118/H1118/H1118229,538,473 4.20 136,359,488 2.36 Y es
Changshu Port /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118195,000,000 3.57 – – –
Hengrui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118184,292,800 3.37 92,146,400 1.60 No
Zhenrui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118184,292,800 3.37 92,146,400 1.60 No
Ningbo Wending /H1118/H1118/H1118/H1118/H1118/H1118/H1118172,483,393 3.15 172,483,393 2.99 Y es
Qingdao Xincheng /H1118/H1118/H1118/H1118/H1118/H1118154,676,594 2.83 154,676,594 2.68 Y es
Zhuhai Shangshun /H1118/H1118/H1118/H1118/H1118/H1118122,322,174 2.24 122,322,174 2.12 Y es
Qingdao Urban Investment /H1118 113,632,908 2.08 113,632,908 1.97 Y es
Dalian Automobile /H1118/H1118/H1118/H1118/H1118/H1118100,000,000 1.83 100,000,000 1.73 Y es
Changshu Development /H1118/H1118/H1118100,000,000 1.83 – – –
Gotion High-tech /H1118/H1118/H1118/H1118/H1118/H1118/H111890,634,090 1.66 45,317,045 0.79 Y es
Wuhu Construction
Corporation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
85,065,600 1.56 16,075,516 0.28 No
Qingdao Huoyan /H1118/H1118/H1118/H1118/H1118/H1118/H111880,576,062 1.47 80,576,062 1.40 Y es
Kaifeng Investment /H1118/H1118/H1118/H1118/H111873,000,000 1.33 – – –
Kaifeng Transportation /H1118/H1118/H1118 27,000,000 0.49 27,000,000 0.47 Y es
Y ancheng Qirui /H1118/H1118/H1118/H1118/H1118/H1118/H111810,410,960 0.19 10,410,960 0.18 Y es
Guiyang Tongsheng /H1118/H1118/H1118/H1118/H11189,300,000 0.17 9,300,000 0.16 Y es
Save for the Offer Shares to be subscribed by Huangshan Construction Investment,
Jinghui Ruiying and Hefei Jianhui, the Offer Shares to be subscribed by all other Cornerstone
Investors will be counted towards the public float of our Company under Rule 8.08 of the
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Listing Rules (as amended and replaced by Rule 19A.13A(1)). To the best knowledge of our
Directors, upon completion of the Global Offering and the conversion of Domestic Unlisted
Shares into H Shares, assuming the Over-allotment Option is not exercised and 271,558,200 H
Shares to be issued under the Global Offering will be held in public hands, a total of
1,243,636,824 H Shares, representing approximately 21.56% of the total share capital of our
Company will be counted towards the public float, which is higher than the prescribed
percentage of H Shares required to be held in public hands of 10% with the expected market
value of HK$4,500 million under Rule 8.08(1) (as amended and replaced by Rule 19A.13A) of
the Listing Rules based on a minimum Offer Price of HK$27.75 per H Share. Therefore, our
Company will be able to meet the minimum public float requirements under Rule 8.08 (as
amended and replaced by Rule 19A.13A) of the Listing Rules.
7. Lock-up period
Pursuant to the PRC Company Law, within the 12 months following the Listing Date, no
existing Shareholders (including the Pre-IPO Investors) may dispose of any Shares held by
them. In addition, each of Wuhu Investment Holding, Ruichuang, Hengrui, and Zhenrui has
undertaken not to transfer any Shares held by it within five years from the Listing Date, nor
shall the Company repurchase any such Shares during this period.
8. Free float
Rule 19A.13C of the Listing Rules provides that, where a new applicant is a PRC issuer
with no other listed shares at the time of listing, this will normally mean that the portion of H
shares for which listing is sought that are held by the public and not subject to any disposal
restrictions (whether under contract, the Listing Rules, applicable laws or otherwise), at the
time of listing, must: (a) represent at least 10% of the total number of issued shares in the class
to which H shares belong at the time of listing (excluding treasury shares), with an expected
market value at the time of listing of not less than HK$50 million; or (b) have an expected
market value at the time of listing of not less than HK$600 million.
Our Company will satisfy the free float requirement under Rule 8.08A (as amended and
replaced by Rule 19A.13C) of the Listing Rules.
9. Confirmation of the Joint Sponsors
On the basis that (i) the considerations for the Pre-IPO Investments were irrevocably
settled more than 28 clear days before the date of first submission of the Listing application
to the Stock Exchange; and (ii) the special rights granted to the Pre-IPO Investors would be
terminated upon Listing as disclosed in “Special rights of the Pre-IPO Investors” above, the
Joint Sponsors confirm that the Pre-IPO Investments are in compliance with Chapter 4.2 of the
Guide for New Listing Applicants.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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MAJOR ACQUISITIONS, DISPOSALS AND MERGERS
Throughout the Track Record Period and up to the Latest Practicable Date, we did not
conduct any acquisitions, disposals or mergers that we consider to be material to us.
SHAREHOLDING STRUCTURE OF OUR COMPANY
Shareholding Structure Immediately Prior to the Global Offering
Our Company
Wuhu Investment
Holding(1)
Management and
Employee Stock
Ownership Platforms(2)
Luxshare(3) Anhui Credit
Guaranty(4)
Anhui Investment
Holding(5)
15 other existing
Shareholders(3)
21.17% 18.25% 16.83% 9.97% 5.20% 28.58%
Chery
Auto Parts
Procurement
Chery Sales Chery New
Energy(6)
Chery
Technology Jetour Sales Soueast Motor(7) Acteco Chery Russia Other
subsidiaries(8)
60% 100% 48.20% 100% 100% 70%
40%
iCAR
Technology
100%
100% 100%
Notes:
(1) Wuhu Investment Holding is owned as to 95.59% by Wuhu SASAC and as to 4.41% by Anhui Provincial
Department of Finance.
(2) For details, see “— Management and Employee Stock Ownership Platforms”.
(3) For details of Luxshare, the other Shareholders and their shareholdings upon Listing, see “— Information
about the Pre-IPO Investors” and “— Corporate Developments”.
(4) Anhui Credit Guaranty is wholly owned by the People’s Government of Anhui Province.
(5) Anhui Investment Holding is wholly owned by Anhui SASAC.
(6) Chery New Energy is owned as to 48.20% and 13.16% by our Company and Shijiazhuang State-owned Capital
Investment and Operation Group Co., Ltd.* (ப΂ʮ̡), a wholly-owned
subsidiary of the State-owned Assets Supervision and Administration Commission of Shijiazhuang Municipal
People’s Government, respectively. The other shareholders of Chery New Energy include certain Shareholders,
namely Wuhu Investment Holding, Ruichuang, Luxshare, Anhui Credit Guaranty, Changshu Port, Anhui
Investment Holding, Qingdao Wudaokou, Ningbo Wending, Qingdao Xincheng, Zhuhai Shangshun, Qingdao
Urban Investment, Qingdao Huoyan, Wuhu Construction Corporation and Gotion High-tech, each holding less
than 10% equity interest in Chery New Energy.
(7) Soueast Motor is ultimately owned as to 70%, 22.02%, 6.32% and 1.66% by our Company, the State-owned
Assets Supervision and Administration Commission of Fujian Provincial People’s Government, the State-
owned Assets Service Center of Minhou County* (ਕʕː) and an Independent Third Party.
(8) As at the end of the Track Record Period, our other subsidiaries include 107 subsidiaries established in the
PRC, and 34 subsidiaries established overseas.
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Shareholding Structure Immediately Following the Completion of the Global Offering
(Assuming the Over-allotment Option is Not Exercised)
Our Company
Wuhu Investment
Holding(1)
Management and
Employee Stock
Ownership Platforms(2)
Luxshare(3) Anhui Credit
Guaranty(4)
Anhui Investment
Holding(5)
15 other existing
Shareholders(3)
20.08% 17.31% 15.96% 9.46% 4.93% 27.11%
Chery Sales Chery New
Energy(6)
Chery
Technology Jetour Sales Soueast Motor(7) Acteco Chery Russia Other
subsidiaries(8)
100% 48.20% 100% 100% 70%
iCAR
Technology
100%
100% 100%
Chery
Auto Parts
Procurement
60%
40%
Other
Shareholders(9)
5.16%
Notes (1)-(8): See the respective notes under “— Shareholding Structure Immediately Prior to the Global Offering”.
(9) Including 25,838,800 Shares subscribed by cornerstone investors which are ultimately controlled by
the stated-owned enterprises from Anhui Province. See “Cornerstone Investors — the Cornerstone
Placing” for details.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 227 ---
OVERVIEW
Who We Are
We are a passenger vehicle company headquartered in Wuhu, China. We design, develop,
manufacture and sell a diverse and expanding portfolio of passenger vehicles, including
internal combustion engine (ICE) vehicles and new energy vehicles (NEVs), to cater to the
distinct and evolving needs and preferences of customers in both the domestic and overseas
markets.
Since our founding in 1997, with a commitment to leading industrial innovation and
engaging in the global market, we offer high quality passenger vehicles to users worldwide. We
are the second largest Chinese domestic brand passenger vehicle company, and the 11th largest
passenger vehicle company globally, in terms of global sales volume of passenger vehicles in
2024, according to Frost & Sullivan.
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The following chart highlights our business achievements:
2,295,000+
2024 Global Sales Volume (1)
No. 2
Chinese Domestic Brand Passenger
Vehicle Company (2)
No. 1 Exporter for
22 consecutive years since 2003
Among Chinese Domestic Brand
Passenger Vehicle Companies
(4)
11th Largest
Passenger Vehicle Company Globally (5)
Sales to
100+
Countries and Regions (3)
13,000,000+
Cumulative Global Sales Volume (3)
No. 1 Among Global Top 20 Passenger Vehicle Companies
49.4%: 2024 YoY Growth (6)
Only Global Top 20 Passenger Vehicle Company
With 25.0%+ YoY Growth for each NEV Sales, ICE vehicle Sales,
Domestic Sales and Overseas Sales
(6)
RMB269,897 million &
65.4% YoY Growth (7)
2024 Revenue
RMB14,334 million &
37.2% YoY growth (7)
2024 Net Profit265%+
NEV Sales
YoY Growth
(6)
29%+
ICE vehicle Sales
YoY Growth
(6)
55%+
Domestic Sales
YoY Growth
(6)
35%+
Overseas Sales
YoY Growth
(6)
Size Global Coverage Leadership
Rapid Development Financial Performance
Notes:
(1) For the year ended December 31, 2024.
(2) In terms of sales volume in 2024 (excluding sales volumes of brands acquired from overseas by Chinese
companies for the purpose of comparison of sales volume of Chinese domestic brands only), according to Frost
& Sullivan (hereinafter the same).
(3) As of the Latest Practicable Date.
(4) In terms of export volume of Chinese domestic brands from 2003 to 2024 (excluding export volume of brands
acquired from overseas by Chinese companies for the purpose of comparison of export volume of Chinese
domestic brands only), according to the same source (hereinafter the same).
(5) In terms of sales volume of the global top 20 passenger vehicle companies in 2024, according to the same
source.
(6) In terms of sales volume from 2023 to 2024.
(7) From 2023 to 2024.
BUSINESS
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Our Business and Sales Performance
According to Frost & Sullivan, we are the only passenger vehicle company among the
global top 20 to achieve a sales volume increase over 25.0% for both NEVs and ICE vehicles
and in both China and overseas markets in 2024, compared to 2023. Our sales volume of
passenger vehicles increased by 49.4% in 2024, compared to 2023, the largest growth among
the top global 20 passenger vehicle companies, according to the same source. We continually
roll out models that enjoy popularity in the market. There were eight models, each achieving
an average monthly sales of over 10,000 units in 2024. We have to date achieved success in
China and overseas markets.
 Domestic Market . Both of our business scale and sales revenue grew rapidly with
increasing market share, fueled by industry-leading technologies, a diversified
product portfolio, strong brand equity and an extensive sales and distribution
network. In 2024, our sales volume of passenger vehicles in China increased by
56.0%, while the sales volume of NEVs increased by 277.3%, compared to 2023. In
2024, we ranked first among the top 10 Chinese passenger vehicle companies in
terms of sales volume growth of both ICE vehicles and NEVs in China, according
to Frost & Sullivan. With products featuring high performance and safety, and
technological innovation capabilities driven by cutting-edge intelligentization, we
believe we can continue to drive sales growth going forward.
 Overseas Market . We exported our first vehicle in 2001. Through the 24 years
thereafter, we sold over 13 million passenger vehicles globally to more than 100
countries and regions as of the Latest Practicable Date. Leveraging first-mover
advantage, we achieved success in overseas markets with a diverse brand portfolio,
multi-tier sales networks, a robust supply chain, localized R&D capabilities and a
stellar reputation among consumers. All these factors made our passenger vehicles
popular in overseas markets and empowered a strong growth of business amidst
downturn of the global ICE vehicle market. We are the No. 1 exporter among
Chinese domestic brand passenger vehicle companies in terms of export volume of
passenger vehicles for 22 consecutive years since 2003, according to Frost &
Sullivan. In addition, we are a leader in many major passenger vehicles markets. For
example, we ranked first among Chinese domestic brand passenger vehicle
companies in Europe, South America, and Middle East and North Africa, and second
in North America and Asia (excluding China) in terms of sales volume in 2024,
respectively, according to the same source.
(1)
Note:
1 Rankings exclude sales volume of brands acquired from overseas by Chinese companies to compare sales
volume of Chinese domestic brands only in the relevant local markets (hereinafter the same).
BUSINESS
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--- page 230 ---
Our Brands and Products
Market Segment
Mid- to high-end
Premium
Mass market Value
propositions
Comfortable
(τඅ)
Enterprising
(ආ՟)
Harnessing
(ቷය)
Inspiring
(ˏჯ)
Exciting
(Րዧ)
The diagram above illustrates our five major brands, namely CHERY , JETOUR, EXEED,
iCAR and LUXEED and their respective value propositions. Each of these major brands
presents a distinct positioning, modality style and aesthetic experience to satisfy the needs of
target customers and capture the significant growth potentials across market segments.
CHERY — Mass market brand
As our signature brand, CHERY is positioned as a first-rated car brand of safety, comfort
and quality for the mass market and family use. CHERY was the first Chinese domestic
passenger vehicle brand to achieve an accumulated sales of one million units, according to
Frost & Sullivan. We sold more than 10 million units of CHERY brand vehicles as of the Latest
Practicable Date.
 The CHERY brand consists of core product series of Tiggo, Arrizo and Fulwin, as
well as OMODA and JAECOO, which mainly target overseas markets. Major
models include Tiggo 8, Tiggo 7, Tiggo 5x, Arrizo 8, OMODA 5 and Fulwin T9,
with each of the first five models achieving an average monthly sales volume of over
10,000 units in 2024 and Fulwin T9 recording a robust sales during the same year.
In particular, Tiggo 8 ranked No. 1 and No. 3 in the global and China markets,
respectively, among ICE vehicle models of Chinese domestic brand passenger
vehicles companies by sales volume of ICE vehicles in 2024, according to Frost &
Sullivan.
BUSINESS
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 We sold 813.1 thousand units, 1,141.2 thousand units and 1,523.3 thousand units of
CHERY brand vehicles, respectively, in 2022, 2023 and 2024, representing a CAGR
of 36.9%. We sold 358.7 thousand units of CHERY brand vehicles in the three
months ended March 31, 2025.
JETOUR — Brand for off-road travel
JETOUR targets customers who are passionate about family travel and outdoor leisure. In
January 2024, JETOUR brand vehicles quickly achieved an accumulated sales of one million
units since their launch in 2018.
 In 2024, the sales volume of JETOUR X70 ranked No. 4 among all B-class SUV
models globally, according to Frost & Sullivan.
 We sold 164.7 thousand units, 285.3 thousand units and 533.7 thousand units of
JETOUR brand vehicles, respectively, in 2022, 2023 and 2024, representing a
CAGR of 80.0%. We sold 148.0 thousand units of JETOUR brand vehicles in the
three months ended March 31, 2025.
EXEED — Tech-luxury vehicle brand
EXEED targets customers who value performance and elegance, and provides them with
a smooth and sophisticated travel experience.
 EXLANTIX ET (range-extended electric vehicle (REEV) version), a major model of
the EXEED brand, is equipped with our REEV powertrain, the first of this kind in
China that obtained technical validation by China Automotive Technology and
Research Center (CA TARC) as “Premium Drive — High-Quality Range Extender”,
according to Frost & Sullivan.
 In 2022, 2023 and 2024, we sold 47.1 thousand units, 109.5 thousand units and
135.8 thousand units of EXEED brand vehicles, respectively, representing a CAGR
of 69.7%. In 2024, the export volume of EXEED brand vehicles ranked No. 1 among
high-end Chinese domestic brands, according to the same source. We sold 22.0
thousand units of EXEED brand vehicles in the three months ended March 31, 2025.
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iCAR — Brand for young generation
iCAR, targeting Generation Z customers who are keen on technology and value freedom,
is designed to bring in contemporary and smart travel experience.
 In 2024, iCAR 03 ranked fifth in terms of sales volume of A-class pure electric
SUVs in China, according to Frost & Sullivan. Launched in December 2024, iCAR
V23 ranked seventh in terms of sales volume of pure electric SUVs in China in
January 2025, according to the same source.
 In 2024, the sales volume of iCAR brand vehicles amounted to 64.5 thousand units,
ranking fourth among Chinese domestic brand A-class pure electric SUVs,
according to Frost & Sullivan. Since the pre-sale release in late 2023 of iCAR 03,
the first model under iCAR, we sold around 1,000 units of iCAR brand vehicles in
2023. In the three months ended March 31, 2025, we sold 18.4 thousand units of
iCAR brands vehicles.
LUXEED — Brand for superior and intelligent NEVs
LUXEED, targeting customers who pursue intelligence, performance and innovation, is
designed to provide them with a transformative and smart driving experience.
 As of the Latest Practicable Date, we launched two models under the LUXEED
brand, namely S7, a smart sedan, and R7, a smart coupe SUV . In terms of sales
volume in China in January 2025, R7 ranked No. 1 among all mid- to large-sized
pure electric SUV models, according to Frost & Sullivan.
 In 2024 and the three months ended March 31, 2025, we sold 38.5 thousand units
and 33.0 thousand units of LUXEED brand vehicles.
Our ESG Initiatives
Adhering to the philosophy of “In somewhere, For somewhere,” we are committed to
providing green products to users worldwide and contributing to the sustainable development
of the society.
 Sustainable Development . We implement full value-chain carbon reduction
management. In 2024, renewable energy constituted 17% of our total energy
consumption, which increased by 9.4 percentage points compared to 2023. In the
same year, renewable electricity accounted for approximately 30% of our total
electricity usage, increased by 15.3 percentage points compared to 2023.
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 Green Operations . We have received national “Green Factory” certifications for our
five production plants in China. In 2024, we launched 10 new models, nine of which
were NEV models, to continuously increase the proportion of NEVs in our product
portfolio.
Our ESG initiatives have won numerous accolades. We were named in the 2024 Fortune
China ESG Impact List by Fortune China, and recognized as a Green Supply Chain
Management Enterprise by the MIIT and Excellent Sustainable Development Practice Case by
the China Automotive Industry Association in 2024.
OUR COMPETITIVE STRENGTHS
We believe the following competitive strengths contribute to our success:
Diversified products and brand portfolio to maximize brand equity
We believe product strength is the key of brand equity. After years of industrial
accumulation, we have developed comprehensive systemization capability and deep
technological expertise, laying a strong foundation for building product strength. We offer safe,
reliable and superior mobility experience to users worldwide, underpinned by continuous
technological innovations and improvement of product quality and service standards. Our
products enjoy a high recognition and trust in China and globally, making our brand image
deeply ingrained among customers. We enjoy a leading position in terms of product satisfaction
among Chinese domestic brand passenger vehicle companies. The CHERY brand ranked No.
1 among Chinese domestic passenger vehicle brands for the two consecutive years in the 2023
and 2024 China Initial Quality Study, and ranked No. 1 among Chinese domestic passenger
vehicle brands in the 2024 China Automotive Performance, Execution and Layout Study, and
2024 China Sales Satisfaction Index by J.D. Power, a global consumer insights and market
research firm. Moreover, many of our popular models have won prestigious awards at the
China Auto Gala. In 2023, Tiggo 9 and EXLANTIX ES were awarded Best SUV of the Y ear
and Best Sedan of the Y ear, respectively. In 2024, EXLANTIX ET, Fulwin T9 and iCAR V23
were named as Car of the Y ear, Best Performance Car and Best Design Car of the Y ear,
respectively. We were the second largest Chinese domestic brand passenger vehicle company
and the 11th largest passenger vehicle company globally in terms of sales volume in 2024,
according to Frost & Sullivan. Moreover, we achieved the highest sales growth among the
global top 20 passenger vehicle companies in 2024, compared to 2023, according to the same
source.
With our five major brands’ distinct market positioning and features, we integrate market
insights and diverse customer needs into the product definition, design and development
processes. This approach enables us to launch popular models to drive sales growth and capture
significant growth potentials across market segments. In 2024, there were eight models with an
average monthly sales of over 10,000 units, namely Tiggo 8, Tiggo 7, JETOUR Traveler, Tiggo
5X, JETOUR X70, Arrizo 8, OMODA 5 and LUXEED R7, covering both sedan and SUV
models. In particular, both Tiggo 8 and Tiggo 7 recorded an average monthly sales of over
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20,000 units during the same year. In September 2024, we launched LUXEED R7, a smart
coupe SUV , which was well received in the market immediately after launch. R7 deliveries
over 15,000 units in December 2024, making it the best-selling model in the same month in
China among Chinese domestic brand pure electric SUVs priced over RMB250,000, according
to Frost & Sullivan. R7 ranked No. 1 among all mid- to large-sized pure electric SUVs in China
in terms of sales volume in January 2025, according to the same source.
We proactively embrace the opportunities brought by the transition to new energy in the
global automotive industry. Leveraging our strong technology research and product
development capabilities, we swiftly launched high-end NEV brands and models, further
improving our brand equity. Since 2023, we successfully launched iCAR and LUXEED, on top
of EXEED, a high-end product series under EXLANTIX, and Fulwin and Shan Hai, two NEV
product series under the CHERY and the JETOUR brand, respectively. These brands and
product series cover A-class to C-class models with powertrain types including battery electric
vehicles (BEVs), plug-in hybrid electric vehicle (PHEVs) and REEVs, directing our NEV
portfolio into the high-end market segment. Our NEV models targeting the high-end market
segment have quickly captured market mindshare. Our NEV sales increased by 267.4% in 2024
compared to 2023, ranking No. 1 among the top 20 passenger vehicle companies globally,
according to Frost & Sullivan.
Leveraging our expanding brand portfolio and technologically advanced, high
performance product series, we continue to broaden our product lineup and are able to achieve
higher product prices amid intensifying competition in the passenger vehicle industry. The
average selling price of our passenger vehicles increased steadily, up by 33.5% from 2022 to
2024. For the same periods, the average selling price of our passenger vehicles in the domestic
and overseas markets increased by 37.0% and 19.4%, respectively, and the average selling
price of CHERY and JETOUR brand vehicles increased by 30.9% and 39.5%, respectively.
Comprehensive technological expertise underpinned by robust R&D capabilities to
achieve future technological breakthrough
We uphold the development philosophy of “Building the Enterprise through Technology.”
Technological innovations are at the core of our business growth. Leveraging our multi-tier,
comprehensive R&D system, industry-leading technologies in vehicle architecture, powertrain
and intelligentization, and frontier research, we can swiftly develop and launch industry-
leading products that meet diverse customer needs across China and overseas markets.
Comprehensive R&D System and Robust R&D Capabilities. Our multi-tier,
comprehensive R&D system consists of (i) Kaiyang collaborative research initiative ( කජ௴
ᑌΥ᜗), aimed at fostering cutting-edge innovations and promoting the
commercialization of scientific breakthroughs along the industry value chain, (ii) Stellar Lab
(܃our R&D platform for core technologies and (iii) our R&D centers located in
China, Europe, South America, North America and Southeast Asia. Our R&D system
encompasses foundational and interdisciplinary research, core technologies and innovative
functions, and vehicles mass-production. This comprehensive R&D system is the backbone of
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our technology development strategies across three stages from mass production to product
development and further to exploratory study and continuously drives technological
innovations. We have received numerous awards and accolades in respect of our technologies
and products. For example, we won the First Prize and Second Prize of National Science and
Technology Progress Award and the First Prize of the China Automotive Industry Science and
Technology Progress Award. We also participated in multiple national key research and
development programs. As of March 31, 2025, we had more than 14,400 R&D professionals,
accounting for over 50% of our non-manufacturing employees. We had obtained over 13,900
patents, including more than 4,400 invention patents, as of March 31, 2025.
V ehicle Platforms with High Compatibility and Adaptability. Our primary vehicle
platforms, namely T1X, T2X and E0X, feature high compatibility and adaptability. We are
committed to developing and manufacturing a chassis with high safety, spacious interior
design, low energy consumption, enabling a comfortable mobility experience. Developed on
our vehicle safety development system that meets international standards, our 16 models
obtained a total of 25 five-star safety certifications both domestically and internationally,
placing us at the forefront in the industry, according to Frost & Sullivan. Our EXLANTIX ES
is one of the first models in China to receive the NESTA six-dimensional electric safety
certification from CA TARC. Our vehicle platforms cover models with different positioning,
sizes and power types. In addition, leveraging a platform-based development system, we utilize
standard automotive parts and components across different models developed by the same
platform to achieve economies of scale and cost-effectiveness, thereby reducing R&D
investment and shortening the development cycle. For example, according to Frost & Sullivan,
over 80% of our automobile components and parts are interchangeable in models with the same
powertrain type developed by the same vehicle platform, leading the industry practice.
Moreover, the development cycle for new models based on our T1X, T2X and E0X platforms
can be as short as 18 months. Our multiple vehicle bodies and chassis were awarded the “China
Top Ten” by CA TARC. Moreover, our intelligent chassis of EXLANTIX ET won two
prestigious awards, namely China’s Top 10 Chassis 2024 and Best Intelligent Award. In
addition, we have licensed our proprietary vehicle architecture technologies to overseas
original equipment manufacturers (OEMs), exemplifying how our proprietary cutting-edge
technologies empower renowned overseas OEMs.
Industry-leading Proprietary Powertrain. Adhering to our technological strategy of
“Dual Strategy of ICE vehicles and NEVs,” we have achieved technological synergies between
ICE vehicle and NEV models. We produced China’s first self-develop proprietary ICE engine
for passenger vehicle in 1999, according to Frost & Sullivan. Our state-of-the-art ACTECO 1.6
TGDI engine and ACTECO 2.0 TGDI engine are among the most advanced in the world,
according to the same source. Our in-house developed Chery Power 8-speed automatic
transmission was the first proprietary 8A T transmission with full intellectual property rights in
China, according to Frost & Sullivan. Our eight types of fuel engines have been acclaimed as
“China Top Ten” by Automobile and Sports, a magazine hosted by the China Automotive News.
Our deep expertise in ICE technologies accumulated over the years enable us to swiftly achieve
a technological breakthrough in respect of hybrid powertrains for NEVs. Our high-performance
hybrid engine boasts industry-leading thermal efficiency, according to Frost & Sullivan. Our
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REEV engine can achieve an oil-to-electricity conversion efficiency of 3.7 kWh/L, ranking
among the best in the industry, according to the same source. Our hybrid DHT’s maximum
mechanical efficiency in pure electric mode is among one of the highest globally, according to
Frost & Sullivan. Our hybrid engines and hybrid DHT have been awarded “China Top Ten” by
Automobile and Sports due to their cutting-edge performance.
V ehicle Intelligence Solutions with High Adoption Rate. To promote intelligence
technologies for NEVs to the next level and accelerate the adoption of intelligence solutions
for ICE vehicles, we are committed to providing cost-effective intelligence solutions to users
of both ICE vehicles and NEVs so that they can enjoy an intelligent mobility experience
empowered by driving assistance and intelligent cockpit technologies. Benefiting from our
multi-modal, multi-network communication management platform, our intelligent cockpit with
in-cabin mobile communications are eligible to be deployed in nearly 30 countries and regions.
Leveraging our in-house development on middleware, application layer and domain-specific
large AI models, we can offer intelligent cockpit system and applications featuring smooth
connectivity, personalized intelligence and comprehensive functions across China and overseas
markets. Moreover, we offer varied levels of driving assistance systems on our vehicles,
making us one of the leading Chinese domestic brand passenger vehicle companies in respect
of driving assistance technologies, according to Frost & Sullivan. We endeavor to promote
“technology equality” and provide users worldwide with superior driving assistance solutions
that are highly cost-effective. In 2023, the percentage of our passenger vehicles equipped with
our driving assistant system that features the provision of both steering and brake/acceleration
support to the driver was 43.8%, as compared with the global average of 31.0%, according to
Frost & Sullivan. In 2024, our percentage rose further to 49.6% as compared with the global
average of 35.6%, according to the same source.
Most globalized Chinese passenger vehicle company endeavoring to expand overseas
markets
We have long been committed to building a world-class global passenger vehicle
company. We were one of the first Chinese domestic brand passenger vehicle companies to
venture abroad with international sales of passenger vehicles, knock down (KD) kits and
engines, according to Frost & Sullivan. Over the past two decades, we have grown from a
vehicle manufacturer and exporter to a company capable of leveraging technology, brand and
management to build overseas presence, and become a global automaker that contributes
locally and benefits worldwide. We partnered with EV MOTORS, an established Spanish
automaker, to operate production facilities in Barcelona, making us the first Chinese domestic
brand company to manufacture passenger vehicles in Europe. The Barcelona plant rolled out
the first EBRO S700 car in December 2024. Due to our successful globalization strategy, we
have been honored five times successively as the Top 20 China Enterprises with Best Overseas
Corporate Image by China Foreign Languages Publishing Administration. We ranked No. 1 in
the automotive category of the 2024 Top 50 China Global Brand by Google and Kantar. We
believe we have become a prominent benchmark of Chinese automotive brands going global.
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With our globalization strategy, we have established a R&D, production and sales
network globally, which allows us to capitalize on significant growth opportunities in overseas
markets. As of the Latest Practicable Date, we had established research institutes in Germany,
Spain, Brazil, Mexico and Malaysia, to carry out R&D in the European, South American, North
American and Southeast Asian markets, respectively. With R&D resources on a global scale,
we are equipped with R&D capabilities that combine localized development with advanced
research. Through direct investment and collaboration with local partners, we have expanded
production capacities in overseas markets including Asia, Europe, Africa and South America
to provide efficient production and delivery support for overseas market expansion. Moreover,
we have established an effective and extensive overseas sales network with first-mover
advantages in overseas markets. As of December 31, 2024, we had 1,075 overseas dealers, one
of the most among Chinese domestic brand passenger vehicle companies, according to Frost &
Sullivan.
With our deep expertise in localized product development, we can provide customized
products and services that meet customer needs and preferences as well as regulatory
requirements in local markets. Our platform-based manufacturing capabilities, combined with
global-scale operations, fueled our rapid expansion in overseas markets characterized by
diverse consumer groups, various driving conditions and regulatory requirements. Since our
inception, we have sold over 13 million passenger vehicles globally to more than 100 countries
and regions. During the Track Record Period, we expanded our business and sales from
emerging markets to major passenger vehicle markets. We ranked No. 1 among Chinese
domestic brand passenger vehicle companies in terms of export volume of passenger vehicles
for 22 consecutive years since 2003, according to Frost & Sullivan. In 2024, we ranked first
among Chinese domestic brand passenger vehicle companies in Europe, South America, and
Middle East and North Africa, and second in North America and Asia (excluding China) in
terms of sales volume of passenger vehicles, respectively, according to Frost & Sullivan. Our
revenue generated from sales in overseas markets accounted for 37.4% of our total revenue in
2024.
Collaborative industry ecosystem to drive upstream advancement along the value chain
Leveraging our extensive industry expertise and deep insights into the automotive
mobility technology trend, we implement the development philosophy of “Keep Core
Technology In-house and Ensure Controllable Supply Chain.” We are committed to proprietary
development and innovations in vehicle technologies, powertrains, intelligent technologies and
core systems and components, which we believe is key to enable us to accumulate core
technology know-how. At the same time, we adopt a collaborative innovation model with
ecosystem partners across the industry value chain to leverage the technological accumulation
and comparative advantages of industry partners in the global automotive and technology
industry. Through equity investment and strategic partnership, we collaborate extensively with
business partners to build an industrial ecosystem with a controllable full-stack supply chain.
To date, we have invested in automotive chassis and body molds companies. With respect to
vehicle intelligence and powertrain, we entered into strategic partnerships with global industry
leaders to achieve supply chain efficiency, high product quality and joint technological
innovations.
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We believe the collaborative industry ecosystem can provide us with a safe, flexible and
efficient supply chain, which enables us to build a high quality, efficient and cost effective
vehicle development system and supports our multi-brand strategies and diversified product
portfolio in China and overseas markets. It also allows us to achieve technological and product
innovations in a highly competitive market. In addition, the collaboration with industrial
ecosystem partners strengthens our full-stack technology capabilities, fostering upstream
advancement along the industry value chain. For example, we cooperated with a world leading
supplier of parts and components for NEVs to develop industry-leading hybrid transmission
motor controllers, which features a compact design that can significantly enhance the motor
controller performance. In addition, we collaborated with a leading global powertrain system
company to develop a dual motor distributed drive system. As of the Latest Practicable Date,
we completed prototype development with ongoing vehicle testing. Moreover, through close
collaboration with industry leaders, we shortened the development cycle of our driving
assistance solutions, reduced development costs, and quickly built our capabilities of driving
assistance technologies.
Capable management team and efficient organization contributing to corporate success
We have an outstanding and visionary management team. Our founder and chairman, Mr.
Yin Tongyue, with over 40 years of experience in the automobile industry, has been awarded
numerous accolades, including Distinguished Figure in the Chinese Automotive Industry,
China’s Top Ten Innovators, China Brand Figures, Leaders in Overseas Expansion, National
Science and Technology Progress Award (Second Class), the China Machinery Industry
Science and Technology Award, and the Outstanding Figure in China’s Automotive Industry
Award for 30 Y ears of Reform and Opening Up and the Ho Leung Ho Lee Foundation Science
and Technology Innovation Award. Our core management team has extensive experience with
an average of 20 years in the automotive industry, navigating industry development cycles and
our corporate development stages with deep market insights and keen global perspective.
Under their leadership, we have seized strategic market development opportunities to navigate
through market cycles and thrive in a highly competitive industry.
We implement a scientific and efficient organizational management approach. For our
users, we have established various forms of Amoeba autonomous business units within our
Company, focusing on different business segments and user groups, to conduct refined
autonomous management and operational optimization of all business processes, ensuring that
each business process accurately meets user needs and operates efficiently. Internally, we are
committed to implementing a digital transformation strategy. We carry out digital
transformation across the value chain, including marketing, R&D, logistics, manufacturing,
quality, service and operations, through unified data security and foundational support services.
We adhere to a people-oriented corporate culture, placing great importance on the value
of individuals and endeavoring to achieve mutual growth for both employees and the
organization. We have established market-based incentive and training system. We have
continuously expanded our equity incentive program to provide ample support and care for
employees, significantly enhance motivation for innovation and attract and retain the best
talent in the industry.
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OUR STRATEGIES
We are committed to becoming an innovation-driven, globally trusted player in the
intelligent mobility ecosystem. To achieve this goal, we intend to steadfastly implement the
following strategies, continuously enhance corporate value, actively fulfill environmental and
social responsibilities and strengthen our brand awareness globally:
Further expand product lineup and sharpen brand positioning to enhance our brand
equity
Our five major brands constitute a complementary brand portfolio. With distinct
positioning and features, each brand targets different market segments with an expanding
product lineup to meet diverse customer needs. Going forward, we plan to further expand our
product portfolio. In particular, (i) based on customer perceptions and brand positioning, we
plan to develop and roll out new models that address unmet needs across market segments and
launch best-selling products with a distinct brand identity for each model; (ii) we plan to
develop localized products by incorporating and considering cultural difference, customer
preferences, climate environments, infrastructure conditions across different countries and
regions to enhance our brand awareness and product competitiveness globally; and (iii) we plan
to further improve product and service quality by enhancing the level of manufacturing
intelligence, implementing more stringent quality control systems and standards and
continuously optimizing and upgrading the after-sales service system, with an aim to improve
customer satisfaction and brand loyalty and make our five brands hallmarks resided in the
hearts of users worldwide.
Continue to invest in R&D on next-generation technologies to strengthen our
competencies
Adhering to the technology development strategy across three stages from mass
production to product development and further to exploratory study, we plan to continue to
invest in R&D, strengthen our technological advantages and accelerate cutting-edge
innovations through: (i) developing ICE powertrain technology with higher thermal efficiency,
lower energy consumption and higher performance to maintain our technological barrier of ICE
vehicles; (ii) advancing new energy technologies, including optimizing the technologies of
battery, electric motor and electronic control, electrical/electronic architecture (E/E
architecture) and intelligence chassis to develop NEVs with high performance, high energy
efficiency and superior mobility experience; (iii) enhancing the competence of our driving
assistance technologies, intelligent cockpit and their respective large AI models to further drive
intelligentization of passenger vehicles; (iv) vigorously promoting the development of
cutting-edge technologies by increasing investment in frontier areas such as new materials,
green energy and next-generation batteries, aiming to promote green and low-carbon footprint.
We intend to increase investment in artificial intelligence to drive digitalization and data
industrialization, and facilitate business model innovations alongside building a high-tech
ecosystem. We also intend to develop eco-products, such as in-car drones and humanoid to
expand our presence across the technological value chain.
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Continue to enhance vehicle electrification and intelligentization to embrace global
mobility transformation
We proactively embrace the transformation brought by electrification and
intelligentization in the automotive industry and strive to become an innovation-driven,
globally trusted player in the intelligent mobility ecosystem.
To drive continuous advancement in electrification, we plan to (i) expand our NEV
product portfolio and explore NEVs with next-generation energy type by launching new NEV
models in both China and overseas markets, covering multiple powertrain types, such as BEVs,
PHEVs and REEVs, based on customer needs and preferences as well as regulatory
requirements of target markets globally. We are committed to promoting NEV adoption
domestically and accelerating NEV adoption abroad to provide global users with green
mobility products that best meet their needs; and (ii) continue to invest in R&D in new energy
technologies, including upgrading key auto parts such as electric motor, engines, transmissions
for PHEVs, REEVs and BEVs to drive our hybrid technologies to the next level. Moreover, we
expect to achieve mass production of in-house developed high performance batteries and
accelerate the R&D and commercialization of next-generation battery technologies.
With respect to driving assistance technologies, we plan to advance “technology equality”
by offering driving assistance solutions with high cost-effectiveness to NEV and ICE vehicle
users worldwide taking advantage of the high adoption rate on our vehicles globally so that
more users can enjoy the convenience and safety brought by driving assistance technologies.
Moreover, by collaboration with leading industry partners of driving assistance solutions
providers, we plan to further invest in R&D on driving assistance technologies to accelerate
commercialization of advanced driving assistance solutions and solidify our driving assistance
technologies leadership among Chinese domestic brand passenger vehicle companies. With
respect to intelligent cockpit, we plan to continue to develop both hardware and software
in-house or in collaboration with industry partners, expand the coverage of our intelligent
cockpit, optimize the interactive experience of the vehicle intelligence system and enhance the
application of large AI models across mobility scenarios, thereby creating a personalized,
human-like intelligent cockpit experience for users.
Expand our international footprints with globalization strategy to solidify overseas
market leadership
We intend to steadfastly implement the globalization strategy to solidify our overseas
market leadership by (i) further expanding our global sales and service network, including
entering into right-hand drive markets and the European market and actively exploring market
opportunities in the North America, Japan, South Korea and other markets with high entry
barrier to continuously expand our overseas outreach and global market share; (ii) enhancing
our R&D capabilities in technologically advanced regions such as Europe and North America,
attract local talents and strengthen collaboration with local research institutions to carry out
joint R&D and sharing of cutting-edge technologies and incorporate industry-leading
technologies into our products to enhance product competence; (iii) continuing to identify
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suitable jurisdictions globally to build production facilities to expand our global manufacturing
capacity, and enhance supply chain localization and resiliency; and (iv) adopting an adaptable
sales strategy and develop products that meet local customer needs in consideration of the
market trends, the penetration of new energy infrastructure and local regulatory requirements,
enhancing our product competitiveness and adaptability.
OUR BUSINESS
We are a passenger vehicle company headquartered in Wuhu, China. We design, develop,
manufacture and sell a diverse and expanding portfolio of passenger vehicles, including ICE
vehicles and NEVs, to cater to the distinct and evolving needs and preferences of customers
in both the domestic and overseas markets. In addition, we design, develop and manufacture
engines, transmission systems and chassis, which are primarily used in our passenger vehicles.
We take pride in our technological prowess. With our technological breakthroughs and
innovations, including industry-leading vehicle platforms, state-of-the-art fuel and hybrid
engine and transmission systems, E/E architecture, driving assistance technologies and
intelligent cockpit system, we provide users worldwide with a superior mobility experience
featuring high performance, comprehensive safety and superior comfort and intelligence. See
“— Our Technological Prowess.”
During the Track Record Period, we generated a majority of revenue from the sales of
passenger vehicles and automotive parts and components. In addition, we also manufacture and
sell KD kits, the revenue of which are included in the sales of passenger vehicles. The
following table sets forth our revenue breakdown by product type for the periods indicated:
For the year ended December 31,
For the three months ended
March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(unaudited)
Passenger vehicles (1)(2)
ICE vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,258 75.9 143,316 87.8 187,891 69.6 45,951 83.7 42,974 63.0
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,253 13.2 7,912 4.9 58,931 21.9 4,596 8.4 18,665 27.3
– PHEVs and REEVs /H1118/H11181,301 1.4 2,727 1.7 35,314 13.1 2,584 4.7 10,709 15.6
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,952 11.8 5,185 3.2 23,617 8.8 2,012 3.7 7,956 11.7
Automotive parts and
components (3) /H1118/H1118/H1118/H1118/H1118/H11188,675 9.4 8,904 5.5 15,864 5.9 2,936 5.3 5,743 8.4
Others (4) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,432 1.5 3,073 1.8 7,211 2.6 1,427 2.6 841 1.3
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 100.0 163,205 100.0 269,897 100.0 54,910 100.0 68,223 100.0
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Notes:
1. Including sales of (1) passenger vehicles in the domestic and overseas markets; and (2) KD kits to be
assembled and sold as passenger vehicles. See “— Sales and Marketing — Other Sales Channels” and “—
Manufacturing — Overseas Production Facilities.” The revenue generated from the sales of KD kits accounted
for less than 10.0% of the total revenue in each period during the Track Record Period.
2. All of our passenger vehicles including KD kits are categorized into our five major brands.
3. Mainly including sales of (1) engines, transmissions and other automotive parts and components; and (2) spare
parts and components in connection with our after-sales services.
4. Including automotive business-related procurement, production, technology development and other supporting
services.
We have achieved significant scale, growth and profitability. Our revenue increased from
RMB92,618 million in 2022 to RMB163,205 million in 2023 and further to RMB269,897
million in 2024, representing a CAGR of 70.7%. Our profit for the year increased from
RMB5,806 million in 2022 to RMB10,444 million in 2023 and further to RMB14,334 million
in 2024, representing a CAGR of 57.1%. Our revenue and net profit increased by 24.2% and
90.9%, from RMB54,910 million and RMB2,476 million in the three months ended March 31,
2024 to RMB68,223 million and RMB4,726 million in the three months ended March 31, 2025,
respectively.
2024 was a momentous year for us. According to Frost & Sullivan, we are the only
passenger vehicle company among the global top 20 to achieve a sale volume increase over
25.0% for both NEVs and ICE vehicles and in both China and overseas markets in 2024,
compared to 2023. In 2024, our sales volume of passenger vehicles in China and overseas
markets increased by 56.0% and 37.4%, respectively, compared to 2023. The sales volume of
our NEVs and ICE vehicles increased by 267.4% and 29.2%, respectively, compared to 2023.
The gross margin from the sales of our vehicles under each of the three major brands, namely
CHERY , JETOUR and EXEED, was higher than 10% in 2024. The gross margin from the sales
of our EXEED vehicles decreased throughout the Track Record Period as a result of (i)
intensifying competition in overseas markets and (ii) increased sales which had lower gross
margin in domestic markets. We recorded gross profit from the sales of our iCAR vehicles in
2024 and we incurred gross loss from the sales of LUXEED vehicles in 2024 as we were still
in the process of ramping up sales volumes.
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We ranked No. 1 among Chinese brand passenger vehicle companies in terms of export
volume of passenger vehicles for 22 years consecutively since 2003, according to Frost &
Sullivan. As of the Latest Practicable Date, we sold over 13 million passenger vehicles globally
to more than 100 countries and regions. The gross margin from the sales generated in both PRC
and overseas markets was higher than 10% in 2024. The gross margin from the sales in
overseas markets decreased throughout the Track Record Period as a result of (i) intensifying
competition in overseas markets; and (ii) increase of recycling fees on the imported vehicles
in Russia since the fourth quarter of 2024. The following table sets forth the revenue
breakdown of our passenger vehicles by geographical region for the periods indicated:
For the year ended December 31,
For the three months ended
March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(unaudited)
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,359 64.7 76,695 50.7 148,954 60.3 30,901 61.1 36,971 60.0
Other countries and
regions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,152 35.3 74,533 49.3 97,868 39.7 19,646 38.9 24,668 40.0
– Asia (excluding the
PRC) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,048 7.3 18,341 12.1 29,449 11.9 5,844 11.6 10,382 16.8
– Europe (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,964 16.9 42,289 28.0 51,297 20.8 10,103 20.0 10,420 16.9
– Americas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,545 10.4 12,427 8.2 13,268 5.4 2,918 5.8 2,394 3.9
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558 0.7 482 0.3 2,170 0.9 578 1.1 805 1.3
– Oceania and others /H1118/H1118/H1118 37 0.0 994 0.7 1,684 0.7 203 0.4 667 1.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0 246,822 100.0 50,547 100.0 61,639 100.0
Notes:
1. Including Hong Kong, Macau and Taiwan.
2. In 2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our revenue from sales of
passenger vehicles in Russia represented 14.6%, 26.8%, 18.6%, 18.4% and 10.9% of our revenue from sales
of passenger vehicles, respectively.
We expect to further increase sales of our ICE vehicles and NEVs with different models
and versions under our five major brands in the future. See “— Our Strategies — Further
expand product lineup and sharpen brand positioning to enhance our brand equity” and “— Our
Products — Pipeline of Future V ehicle Models.”
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OUR BRAND PORTFOLIO
We design, develop, manufacture and sell passenger vehicles under five major brands
namely, CHERY , JETOUR, EXEED, iCAR and LUXEED.
CHERY — Mass market brand
 As our signature brand, CHERY is positioned as a first-rated car brand of safety, comfort
and quality for mass market and family use. The CHERY brand consists of key product
series of Tiggo, Arrizo and Fulwin, as well as OMODA and JAECOO mainly targeting
overseas markets. The CHERY brand covers sedans and SUVs with ICE, PHEV and BEV
versions.
JETOUR — Brand for off-road travel
 JETOUR targets customers who are passionate about family travel and outdoor leisure.
The JETOUR brand include ICE vehicles and PHEVs.
EXEED — Tech-luxury vehicle brand
 EXEED targets customers who value performance and elegance, and provides them with
a smooth and sophisticated travel experience. EXEED brand comprises product series of
EXEED and EXLANTIX, covering sedans and SUVs with multiple powertrain options
including ICE, PHEV , REEV and BEV versions.
iCAR — Brand for young generation
 iCAR, targeting Generation Z customers who are keen on technology and value freedom,
is designed to bring in contemporary and smart travel experiences. iCAR currently offers
two models, iCAR 03 and iCAR V23, and focuses on pure electric SUV models.
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LUXEED — Brand for superior and intelligent NEVs
 LUXEED, targeting customers who pursue intelligence, performance and innovation, is
designed to provide them with a transformative and smart driving experience. LUXEED
offers two models, namely S7, a smart sedan, and R7, a smart coupe SUV with both BEV
and REEV versions.
OUR PRODUCTS
Passenger Vehicles
During the Track Record Period, we sold passenger vehicles mainly in two product
categories, namely sedans and SUVs, with multiple powertrain options targeting mass market,
mid- to high-end and premium segments, to cater to the distinct and evolving needs and
preferences of customers. The following table illustrates the market positioning, product
category, powertrain option and manufacturer’s suggested retail price (MSRP) range of major
product series available for sale under our five major brands as of the Latest Practicable Date:
Market
positioning (1)
Product
category Powertrain
MSRP range in
the PRC (3)
(RMB)
CHERY
– Tiggo series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mass market and
mid- to high-
end
SUV ICE/PHEV 57,900-203,900
– Arrizo series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mass market and
mid- to high-
end
Sedan ICE 59,900-148,900
– Fulwin series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end Sedan/SUV PHEV 99,900-229,900
– OMODA and JAECOO /H1118/H1118 —
(2) SUV ICE/PHEV/
BEV
— (2)
JETOUR
– JETOUR series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV ICE 93,900-191,900
– Shan Hai series /H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV PHEV 123,900-234,900
EXEED
– EXEED series /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV ICE/PHEV 109,900-233,900
– EXLANTIX series /H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Sedan/SUV REEV/BEV 152,800-319,800
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Market
positioning (1)
Product
category Powertrain
MSRP range in
the PRC (3)
(RMB)
iCAR
– iCAR 03 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV BEV 109,800-169,800
– iCAR V23 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end SUV BEV 99,800-149,800
LUXEED
–S 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Sedan BEV 229,800-329,800
–R 7 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid- to high-end
and premium
Coupe SUV REEV/BEV 249,800-339,800
Note:
1. According to Frost & Sullivan, China’s passenger vehicle market can be categorized into mainly three
market segments primarily in terms of selling prices, namely (i) mass market segment (below
RMB80,000), (ii) mid- to high-end segment (RMB80,000-RMB300,000) and (iii) premium segment
(above RMB300,000).
2. OMODA & JAECOO mainly target overseas markets with a mid- to high-end positioning.
3. We routinely published MSRPs on our websites. The retail selling prices of our vehicles vary in different
markets.
CHERY
CHERY , our signature brand, is positioned as a first-rated car brand of safety, comfort and
quality for mass market and family use. The CHERY brand consists of core product series of
Tiggo, Arrizo and Fulwin, as well as OMODA and JAECOO mainly targeting overseas markets.
The best-selling product series, Tiggo and Arrizo, are well-suited for everyday driving, making
them popular choices for families looking for cost-effective yet stylish options. Moreover, the
CHERY brand also has product series focusing on compact and mini electric vehicles such as
Little Ant and QQ Ice Cream.
Tiggo
Tiggo, a core product series of CHERY brand’s line-up, offers affordable, reliable and
stylish SUVs that emphasize modern design, advanced technology, and practicality, making it
a popular choice for families and young customers.
We manufacture and sell five major models under Tiggo series, namely Tiggo 9, Tiggo 8,
Tiggo 7, Tiggo 5x and Tiggo 3x, with different versions and editions.
 Tiggo 9, the latest model launched in 2023, combines cutting-edge technology and
powerful performance. Tiggo 9 is equipped with the latest continuously damping
control (CDC) magnetic suspension system and intelligent all-wheel drive (AWD)
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system, offering a stable and comfort riding experience. Moreover, the ICE version
of Tiggo 9 is available with a 2.0TGDI engine and a 8A T transmission, facilitating
high efficient engine operation and low fuel consumption. The PHEV version of
Tiggo 9 is equipped with a 1.5TGDI hybrid engine and a DHT transmission,
delivering a high acceleration from zero to 100km/h in 8.8 seconds and a maximum
China light-duty vehicle test cycle (CLTC) driving range up to 106 km.
 Tiggo 8 and Tiggo 7 feature high performance, high safety and cost-effectiveness.
Both vehicles are available with ACTECO 1.6TGDI engine, a “China Top Ten”
award-winning engine, with maximum power of 145 kw and maximum torque of 290
Nm. Both vehicles are equipped with six air bags and built with high intensity steels,
greatly enhancing vehicle safety. Tiggo 7 achieved a five-star C-NCAP safety rating
for occupant protection in 2017 and Tiggo 8 achieved a five-star C-NCAP safety
rating for occupant protection, pedestrian protection and active safety in 2019.
Tiggo 7 and Tiggo 8 were our best-selling models during the Track Record Period. Tiggo
7 was the best-selling passenger vehicle model among Chinese domestic brand passenger
vehicles in terms of export volume of passenger vehicles in 2024, according to Frost &
Sullivan. Tiggo 8 ranked No. 1 and No. 3 in the global and China markets, respectively, among
ICE vehicle models of Chinese domestic brand passenger vehicles companies by sales volume
of ICE vehicles, in 2024, according to the same source.
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The following table sets forth details of the major models under the Tiggo product series as of the Latest Practicable Date:
Model Tiggo 9 Tiggo 8 Tiggo 7 Tiggo 5x Tiggo 3x
Initial launch year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182023 2018 2016 2017 2016
Product category /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid-size SUV Mid-size SUV Compact SUV Subcompact SUV Subcompact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Tiggo 9 offers two
powertrain options:
ICE vehicle and PHEV
versions. The ICE
version is available
with a 2.0TGDI engine
and with 7DCT or 8A T
transmission. The
PHEV version is
available with a
1.5TGDI hybrid engine
and with a 3DHT
transmission.
Tiggo 8 offers two
powertrain options:
ICE vehicle and PHEV
versions. The ICE
version is available
with 1.6TGDI and
2.0TGDI engine
options and with 7DCT
or 8A T transmission.
The PHEV version is
available with
1.5TGDI hybrid engine
and with a DHT
transmission.
Tiggo 7 offers two
powertrain options:
ICE vehicle and PHEV
versions. The ICE
version is available
with options of (i) a
1.5L turbocharged
engine with a CVT
transmission or (ii) a
1.6TGDI engine with a
7DCT transmission.
The PHEV version is
available with
1.5TGDI hybrid engine
and with a DHT
transmission.
Tiggo 5x is an ICE
vehicle available with
a 1.5L naturally
aspirated engine and
with MT or CVT
transmission.
Tiggo 3x is an ICE
vehicle, available with
a 1.5L naturally
aspirated engine and
with a 9CVT
transmission.
Driving Assistance System /H1118/H1118/H1118/H1118Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
N/A N/A
Intelligent Cockpit System /H1118/H1118/H1118/H1118Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
N/A
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB152,900 to
RMB203,900 in the
PRC
RMB109,900 to
RMB164,900 in the
PRC
RMB74,900 to
RMB142,900 in the
PRC
RMB62,900 to
RMB83,900
in the PRC
RMB57,900 in the PRC
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Arrizo
Arrizo product series are sedans targeting mass and mid- to high-end market segments.
We manufacture and sell two major models under Arrizo series, namely Arrizo 8 and Arrizo 5,
in different versions and editions. Arrizo targets customers who seek cost-effective vehicles
offering comfort and safe driving experience.
The following table sets forth details of the major models under the Arrizo product series
as of the Latest Practicable Date:
Model Arrizo 8 Arrizo 5
Initial launch year /H1118/H1118/H1118/H11182022 2016
Product category /H1118/H1118/H1118/H1118Compact sedan Compact sedan
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Arrizo 8 is an ICE vehicle
available with 1.6 TGDI
and 2.0TGDI engine
options and with 7DCT or
8A T transmission.
Arrizo 5 is an ICE vehicle
available with a 1.5L
DVVT engine and with
MT or CVT transmission.
Driving Assistance
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with driving
assistance system.
N/A
Intelligent Cockpit
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with Lion OS
system.
N/A
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB99,900 to RMB148,900
in the PRC
RMB59,900 to RMB69,900
in the PRC
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Fulwin
Fulwin product series, launched in 2024, focus on hybrid SUVs and Sedans. We manufacture and sell four major models under Fulwin series,
namely T10, T9, T8 and A8L, respectively, in different versions and editions. The following table sets forth details of the major models under the
Fulwin product series as of the Latest Practicable Date:
Model T10 T9 T8 A8L
Initial launch year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182024 2024 2025 2024
Product category /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid-size SUV Mid-size SUV Mid-size SUV Compact sedan
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118T10 is an PHEV available
with a 1.5TGDI hybrid
engine and with a 3DHT
transmission.
T9 is an PHEV available with
a 1.5TGDI
hybrid engine and with a
DHT or 3DHT
transmission.
T8 is an PHEV available with
a 1.5TGDI
hybrid engine and with a
DHT transmission.
A8L is an PHEV available
with a 1.5TGDI hybrid
engine and with a DHT
transmission.
Driving Assistance System /H1118/H1118/H1118/H1118/H1118Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Intelligent Cockpit System /H1118/H1118/H1118/H1118/H1118Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB189,900 to RMB229,900
in the PRC
RMB132,900 to RMB183,900
in the PRC
RMB99,900 to RMB146,900
in the PRC
RMB109,900 to RMB149,900
in the PRC
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OMODA and JAECOO
OMODA and JAECOO mainly focus on SUVs in different versions and editions,
primarily targeting the overseas markets.
The following table sets forth details of the major models under the OMODA and
JAECOO brands as of the Latest Practicable Date:
Model OMODA 5 JAECOO 7
Initial launch year /H1118/H1118/H11182022 2023
Product category /H1118/H1118/H1118/H1118Compact SUV Compact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118OMODA 5 offers two
powertrain options: ICE
vehicle and BEV
versions. The ICE version
is available with a 1.5L
DVVT engine and with
9CVT transmission.
JAECOO 7 offers two
powertrain options: ICE
vehicle and PHEV
versions. The ICE version
is available with a
1.6TGDI engine and with
a 7DCT transmission. The
PHEV version is available
with 1.5TGDI hybrid
engine and with a DHT
transmission.
Driving Assistance
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with driving
assistance system
Available with driving
assistance system
Intelligent Cockpit
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with Lion OS
system.
Available with Lion OS
system.
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JETOUR
JETOUR brand targets customers who are passionate about family travel and outdoor leisure. JETOUR offers ICE and hybrid SUVs in different
versions and editions. In 2024, the sales volume of JETOUR X70 ranked No. 4 among all B-class SUV models globally, according to Frost &
Sullivan.
The following table sets forth details of the major ICE models under the JETOUR series as of the Latest Practicable Date:
Model Traveler X90 X70 Dashing
Initial launch year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182023 2019 2018 2022
Product category /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Compact SUV Mid-size SUV Mid-size SUV Compact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Traveler is an ICE vehicle
available with the options of
(i) a 2.0TGDI engine with
7DCT or 8A T transmission
and (ii) a 1.5TGDI engine
with a 7DCT transmission.
X90 is an ICE vehicle available
with 1.6TGDI and 2.0TGDI
engine options and with
7DCT or 6MT transmission.
X70 is an ICE vehicle available
with 1.5TGDI and 1.5L
turbocharged engine options
and with 7DCT or 6DCT
transmission.
Dashing is an ICE vehicle
available with the options of
a 1.5TGDI engine with a
7DCT transmission and (ii) a
1.5L turbocharged engine
with a 6DCT transmission.
Driving Assistance System /H1118/H1118/H1118/H1118/H1118/H1118Available with driving
assistance solution.
Available with driving
assistance solution.
Available with driving
assistance solution.
Available with driving
assistance solution.
Intelligent Cockpit System
(1) /H1118/H1118/H1118/H1118/H1118Available with TOUR OS
system.
Available with TOUR OS
system.
Available with TOUR OS
system.
Available with TOUR OS
system.
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB139,900 to RMB191,900
in the PRC
RMB105,900 to RMB169,900
in the PRC
RMB102,900 to RMB137,900
in the PRC
RMB93,900 to RMB127,900 in
the PRC
Note:
1. TOUR OS was co-developed with a third-party intelligent cockpit solution provider.
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The following table sets forth details of the major models under the Shan Hai series, JETOUR’s NEV product lineup, as of the Latest Practicable
Date:
Model Shan Hai T2 Shan Hai T1 Shan Hai L9 Shan Hai L7 Shan Hai L6
Initial launch year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182024 2024 2023 2024 2024
Product category /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Compact SUVs Compact SUV Mid-size SUV Mid-size SUV Compact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Shan Hai T2 is an
PHEV available with
a 1.5TGDI hybrid
engine and with a
3DHT transmission.
Shan Hai T1 is an
PHEV available with
a 1.5TGDI hybrid
engine and with a
DHT transmission.
Shan Hai L9 is an
PHEV available with
a 1.5TGDI hybrid
engine and with a
2DHT transmission.
Shan Hai L7 is an
PHEV available with
a 1.5TGDI hybrid
engine and with a
2DHT transmission.
Shan Hai L6 is an
PHEV available with
a 1.5TGDI hybrid
engine and with a
DHT transmission.
Driving Assistance System /H1118/H1118/H1118Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Intelligent Cockpit System
(1) /H1118Available with TOUR
OS system.
Available with TOUR
OS system.
Available with TOUR
OS system.
Available with TOUR
OS system.
Available with TOUR
OS system.
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB179,900 to
RMB234,900
in the PRC
RMB154,800 to
RMB174,800
in the PRC
RMB164,900 to
RMB183,900
in the PRC
RMB129,800 to
RMB159,800
in the PRC
RMB123,900 to
RMB144,900
in the PRC
Note:
1. TOUR OS was co-developed with a third-party intelligent cockpit solution provider.
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EXEED
Launched in 2018, the EXEED brand is positioned as a preferred tech-luxury vehicle. EXEED aims to provide high-quality vehicles with a
smooth and sophisticated travel experience to customers who value performance and elegance. We manufacture and sell EXEED brand vehicles
under two product series, namely, EXEED series and EXLANTIX series.
EXEED Series
EXEED series focuses on SUVs with both ICE and PHEV versions. As of the Latest Practicable Date, there were four models under EXEED
series, namely VX, RX, TXL and LX in different versions and editions.
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The following table sets forth the details of EXEED series as of the Latest Practicable Date:
Model VX RX TXL LX
Initial launch year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182021 2023 2019 2019
Product category /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Mid-size SUV Mid-size SUV Mid-size SUV Compact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118VX offers two powertrain
options: ICE vehicle and
PHEV versions. The ICE
vehicle is available with a
2.0TGDI engine and with
a 8A T transmission. The
PHEV version is available
with a 1.5TGDI hybrid
engine and with a 3DHT
transmission.
RX offers two powertrain
options: ICE vehicle and
PHEV versions. The ICE
vehicle version is
available with a 2.0TGDI
engine and with 7DCT or
8A T transmission. The
PHEV version is available
with a 1.5TGDI hybrid
engine and with a 3DHT
transmission.
TXL is an ICE vehicle
available with 1.6TGDI
and 2.0TGDI engine
options and with 7DCT or
8A T transmission.
LX offers two powertrain
options: ICE vehicle and
PHEV versions. The ICE
vehicle is available with a
1.5TGDI engine. The
PHEV version is available
with a 1.5TGDI hybrid
engine and with a 3DHT
transmission.
Driving Assistance System /H1118/H1118/H1118/H1118Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Available with driving
assistance system.
Intelligent Cockpit System /H1118/H1118/H1118/H1118Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
Available with Lion OS
system.
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB189,900 to
RMB233,900 in the PRC
RMB149,800 to
RMB219,900 in the PRC
RMB129,900 to
RMB169,900 in the PRC
RMB109,900 to
RMB149,800 in the PRC
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EXLANTIX Series
EXLANTIX series focuses on SUVs and sedans covering REEV and BEV . We offer two
models under our EXLANTIX product series, namely EXLANTIX ET and EXLANTIX ES, in
different versions and editions. EXLANTIX ET (REEV version), as a major model of the
EXEED brand, is equipped with our REEV powertrain, the first of this kind in China that
obtained technical validation by CA TARC as “Premium Drive — High-Quality Range
Extender”, according to Frost & Sullivan.
The following table sets forth the details of EXLANTIX series as of the Latest Practicable
Date:
Model EXLANTIX ET EXLANTIX ES
Initial launch year /H1118/H1118/H1118/H11182024 2023
Product category /H1118/H1118/H1118/H1118/H1118Mid- to large-sized SUV Mid- to large-sized sedan
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118REEV and BEV versions REEV and BEV versions
CLTC range (km) /H1118/H1118/H1118/H1118Available with CLTC range
of up to 200 km or 240
km for REEV version
Available with CLTC range
of up to 540 km, 625 km,
655 km and 760 km for
BEV version
Available with CLTC range
of up to 255 km for
REEV version
Available with CLTC range
of up to 705 km or
710 km for BEV version
0-100 km/h
acceleration (s) /H1118/H1118/H1118/H1118/H1118
4.8s for REEV
3.8s for BEV
4.6s for REEV
3.7s for BEV
Driving Assistance
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with driving
assistance system.
Available with driving
assistance system.
Intelligent Cockpit
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with Lion OS
system.
Available with Lion OS
system.
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB189,800 to
RMB319,800 in the PRC
RMB152,800 to
RMB269,800 in the PRC
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iCAR
iCAR, targeting Generation Z customers who are keen on technology and value freedom,
is designed to bring in contemporary and smart travel experiences. iCAR is an electric play
brand. We currently manufacture and sell two models under the iCAR brand, namely, iCAR 03
and iCAR V23, in different versions and editions.
iCAR combines a stylish and personalized design with safety standards and reliable
performance. iCAR offers a wide range of customizable configurations, to appeal to young
customers. For example, customers are able to choose the color, touchscreen, headlights or
certain interior features of iCAR V23 as well as customize the vehicle roof with a modification
limit of 200kg. Moreover, the rear wheels of iCAR V23 are equipped with a five-arm
independent suspension, enhancing control over wheel movement and delivering improved
stability and more comfortable ride. Over 70% of the car body is made with high strength steel
and the chassis is tuned to drive effortlessly in all kinds of terrain with six driving modes,
offering comfortable driving experience with safety assured.
The following table sets forth the details of the iCAR brand vehicles as of the Latest
Practicable Date:
Model iCAR 03 iCAR V23
Initial launch year /H1118/H11182024 2024
Product category /H1118/H1118/H1118Compact SUV Compact SUV
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118BEV BEV
CLTC range (km) /H1118/H1118/H1118Available with CLTC range
of up to 401 km, 472 km
or 501 km
Available with CLTC range
of up to 301 km, 401 km
or 501km
0-100 km/h
acceleration (s) /H1118/H1118/H1118
10.5s for two-wheel
drive version
6.5s for four-wheel
drive version
11s for two-wheel
drive version
7.5s for four-wheel
drive version
Driving Assistance
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with driving
assistance system
Available with driving
assistance system
Intelligent Cockpit
System
(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
iCAR OS iCAR OS
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118/H1118RMB109,800 to
RMB169,800 in the PRC
RMB99,800 to RMB149,800
in the PRC
Note:
1. iCAR OS was co-developed with a third-party intelligent cockpit solution provider.
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LUXEED
LUXEED, targeting customers who pursue intelligence, performance and innovation, is
designed to provide them with a transformative and smart driving experience. LUXEED
focuses on mid- to large-sized electric sedan and SUV . We currently manufacture and sell two
models under LUXEED, namely, S7 and R7. S7 is an electric vehicle currently offering four
editions and R7 offers two powertrain options: a BEV and a REEV , with three and two editions,
respectively.
R7, the latest model, features long driving range, high level of safety and advanced
driving assistance system and cockpit. Built with 800V “Giant Whale” high voltage battery
platform, R7 boasts a maximum CLTC driving range of up 802 kilometers and supports a
recharge up to 200 km within five minutes, significantly alleviating the range anxiety of NEV
users. Moreover, R7 is equipped with omni-directional collision avoidance system (CAS3.0),
Qiankun advanced driving system and HarmonyOS intelligent cockpit system, delivering a safe
and advanced driving experience.
The follows table sets forth the details of R7 and S7 as of the Latest Practicable Date:
Model R7 S7
Initial launch year /H1118/H11182024 2023
Product category /H1118/H1118/H1118Mid- to large-sized coupe
SUV
Mid- to large-sized sedan
Powertrain /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118BEV and REEV BEV
CLTC range /H1118/H1118/H1118/H1118/H1118/H1118/H1118Available with CLTC range
of up to 802 km for single
motor RWD version
Available with CLTC range
of up to 855 km for single
motor RWD version
Available with CLTC range
of up to 736 km for dual
motor AWD version
Available with CLTC range
of up to 785 km for dual
motor AWD version
0-100 km/h
acceleration /H1118/H1118/H1118/H1118/H1118
7.4s for single motor RWD
version
3.9s for dual motor AWD
version
5.6s for single motor RWD
version
3.3s for dual motor AWD
version
Driving Assistance
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Available with driving
assistance solution
Available with driving
assistance solution
Intelligent Cockpit
System /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
HarmonyOS system HarmonyOS system
MSRP Range /H1118/H1118/H1118/H1118/H1118/H1118RMB249,800 to
RMB339,800 in the PRC
RMB229,800 to
RMB329,800 in the PRC
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We collaborate with Huawei Device Co., Ltd. (ʮ̡), Huawei Technologies
Co., Ltd. (ʮ̡) and their respective affiliates in respect of LUXEED S7 and R7.
We are primarily involved in product development, supply chain management, manufacturing,
quality assurance and after-sales services. Huawei Device Co., Ltd. (ʮ̡)
primarily provides us with services in relation to product definition, marketing and
management consulting. Moreover, we procure driving assistance systems, intelligent cockpit
systems and other related auto parts and components from Huawei Technologies Co., Ltd. ( ശ
ʮ̡) and its affiliates.
Pipeline of Future Vehicle Models
We will continue to launch new models to expand our product portfolio to meet diverse
customer needs and penetrate further into mid- to high-end and premium market segments. In
2025, we plan to launch more than 60 new models and versions of passenger vehicles, covering
sedans and SUVs with ICE, PHEV , REEV and BEV versions. See “— Our Strategies — Further
expand product lineup and sharpen brand positioning to enhance our brand equity.”
Automotive Parts and Components
In addition to sales of passenger vehicles, we sell (i) engines, transmissions and
automotive parts and components primarily to third-party vehicle manufacturers and (ii) spare
parts and components in support of our after-sales services. In 2022, 2023 and 2024 and the
three months ended March 31, 2024 and March 31, 2025, our revenue derived from sales of
automotive parts and components was RMB8,675 million, RMB8,904 million, RMB15,864
million, RMB2,936 million and RMB5,743 million, respectively, accounting for 9.4%, 5.5%,
5.9%, 5.3% and 8.4% of our total revenue for the same periods, respectively.
OUR TECHNOLOGICAL PROWESS
Technological prowess lies at the core of our vehicle development and witnesses our
success to date. Through years, we have built a full-range technology stack including (i) Chery
Power, our powertrain systems; (ii) Mars Architecture, our vehicle development platform; (iii)
Lion Intelligent Cockpit, our intelligent cockpit system; and (iv) Our driving assistance
systems.
Chery Power — Our Powertrain Systems
Chery Power covers four core technologies, namely engine, transmission, electric drive,
and battery safety system. We are a frontrunner in the development and manufacturing of
engine and transmission systems in China automotive industry, according to Frost & Sullivan.
With industry-leading ICE and hybrid powertrain technologies, our powertrains are designed
to deliver driving experience in terms of energy efficiency, longest possible range and
acceleration. As of the Latest Practicable Date, our eight types of fuel engines and our hybrid
engines and hybrid DHT have been acclaimed as “China Top Ten” by Automobile and Sports,
a magazine hosted by the China Automotive News.
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ICE Powertrain
ICE powertrain primarily consists of engine and transmission. We developed in-house and
manufactured ACTECO 1.6 and 2.0 TGDI engines. Compared to traditional naturally aspirated
engine with the same engine displacement, TGDI engine delivers higher power and fuel
efficiency and lower emission. Our 1.6TGDI and 2.0TGDI engines were awarded “China’s Top
Ten Engines” by Auto & Sports magazine in 2019 and 2021, respectively. In 2023, we
developed and manufactured an advanced ACTECO 1.5TGDI engine. All three engine models
feature a smart thermal management system, with the 1.5TGDI engine achieving a maximum
thermal efficiency of 40%, which is higher than the industry average of around 35% by Chinese
brand passenger vehicles powered by ICE, according to Frost & Sullivan. Moreover, we have
performed over 30,000 hours of bench testing on each of the three engines, ensuring their
compliance with regulatory requirements in major passenger vehicle markets in terms of
emission, safety and performance.
The following table sets forth certain technical features and configurations of ACTECO
1.6TGDI, 2.0TGDI and 1.5TGDI engines, respectively.
Configuration
ACTECO 1.6TGDI
engine
ACTECO 2.0TGDI
engine
ACTECO 1.5TGDI
engine
Engine displacement (L) /H1118/H11181.598 1.998 1.499
Compression ratio /H1118/H1118/H1118/H1118/H1118/H1118/H11189.9:1 10.2:1 11.6:1
Maximum net power/Speed
(kW/rpm) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
140/5500 180/5500 125/5500
Maximum net torque/Speed
(Nm/rpm) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
275/2000–4000 375/1750–4000 270/2000–3500
Maximum thermal
efficiency /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
37% 38% 40%
Weight (kg) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118125 137 /H11349108
Emission standards /H1118/H1118/H1118/H1118/H1118/H1118CN6b (China VI,
Phase 6), EU6D
and EU6E
CN6b (China VI,
Phase 6) and EU6D
CN6b (China VI,
Phase 6), EU6D
and EU6E
In addition to our proprietary fuel engines, we developed the Chery 8A T transmission,
which is the first proprietary automatic transmission developed in-house with full intellectual
property rights in China, according to Frost & Sullivan. 8A T is primarily paired with our
ACTECO 1.6TGDI and 2.0TGDI engines. 8A T features RA VIGNEAUX-style planetary gear
system, which is known for its compact and spacing-saving design. With a speed ratio range
of 7.8 and eight forward gears, 8A T transmission ensures efficient engine operation and low
fuel consumption.
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PHEV and REEV powertrain
A PHEV has both internal combust engine and electric motors, which can be powered by
gasoline and batteries, or be plugged into external power source through a charging cable. By
comparison, an REEV is purely driven by its electric motor, and its energy source comes from
both its battery pack and range extension system. A PHEV powertrain primarily consists of
engine, transmission, motor, and battery and a REEV powertrain mainly consists of engine,
motor, generator and battery. Supported by hybrid engine, dedicated hybrid transmission,
battery system and electric drive system, our dedicated hybrid powertrain systems empower
our PHEVs and REEVs, achieving high efficiency, long driving range and better performance
whiling maintaining high safety standards.
Hybrid Engine
In 2023, we developed in-house and manufactured ACTECO 1.5TGDI hybrid engine
for PHEVs. ACTECO 1.5TGDI hybrid engine is also our hybrid engine for REEVs, the
first REEV engine in China certified as “Premium Drive — High-Quality Range
Extender” by CA TARC. It has a high efficiency of energy conversion during combustion
with a high compression ratio of 14.5:1. Leveraging an intelligent thermal management
system and low friction technology, our ACTECO 1.5TGDI hybrid engine can achieve a
maximum thermal efficiency of 44.5%, which is higher than the industry average of
around 40% by Chinese brand passenger vehicles powered by hybrid engine, according
to Frost & Sullivan.
The following table sets forth certain technical features of the configuration of the
ACTECO 1.5TGDI hybrid engine.
Configuration ACTECO 1.5TGDI hybrid engine
Engine displacement (L) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.498
Compression ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814.5:1
Maximum net power/Speed (kW/rpm) /H1118105/5200
Maximum net torque/Speed (Nm/rpm) /H1118215/2500
Maximum thermal efficiency /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111844.5%
Weight (kg) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118106
Emission standards /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118CN6b and Euro 7
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Dedicated Hybrid Transmission
We developed in-house two models of dedicated hybrid transmissions, namely
DHT165 and DHT150. DHT165 is a 3-speed transmission with a dual electric motor drive
that enables the engine and motor to operate efficiently. With a maximum output power
of 165kW and maximum output of torque of 4,000Nm, DHT165 allows the vehicle to
accelerate from 0 to 100 kilometers per hour in 4.3 seconds. DHT150 is an E-CVT that
uses an electronic control system to regulate the engagement of the electromagnetic
clutch, ensuring a smooth transmission process. An E-CVT combines an electronic motor
and generator, automatically adjusting the power distribution between the engine, electric
motor and generator based on the vehicle’s driving conditions. DHT150 boasts a
maximum mechanical efficiency of up to 98.5% in pure electric mode, reducing noise and
fuel consumption to improve driving range and enhancing ride comfort.
The following table sets forth certain technical features and configurations of
DHT165 and DHT150, respectively:
Configuration DHT165 DHT150
Electric Motor 1 /H1118/H1118/H1118/H1118Peak Power (kW) 75 150
Peak torque (Nm) 170 310
Electric Motor 2 /H1118/H1118/H1118/H1118Peak Power (kW) 90 N/A
Peak torque (Nm) 220 N/A
Generator /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Peak Power (kW) N/A 100
Peak torque (Nm) N/A 120
Peak transmission efficiency /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111897.6% 98.5%
Weight (kg) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118122 (including MCU) 121 (including MCU)
Protector Battery Safety System
We design and develop in-house the Protector battery safety system to enhance
power performance and driving range of our vehicles. We procure battery cells from
top-tier suppliers, and pack them into battery modules using our proprietary packing
techniques. We require such battery cells to be waterproof, anti-collision and fire resistant
and to satisfy various national and international testing and inspection standards. With our
uniquely designed battery pack structure, we seal battery cells and high-performance
materials into modules to prevent batteries from overheating and integrate the modules
with highly efficient thermal management components and durable battery cases. Such a
structure reduces vibration of the battery system to the minimum level, enhances safety
in the event of a collision, and achieves high-standard water- and dust-resistance
performance.
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Moreover, our Protector battery safety system is connected to our self-developed big
data cloud platform, which enables us to monitor the status of battery pack, such as
temperature, voltage, current and power output. Such a system accurately calculates the
remaining battery energy, and the accuracy of such calculation is essential to the safety
and lifetime of the battery, as well as to our customers’ driving experience.
Electric Drive System
The electric drive system uses battery as power source to drive a vehicle, and mainly
consists of an electric motor, a motor control unit and a fixed gear transmission. Our
self-developed AEH240 electric-drive system features 7-functions integrated with 800V
high-voltage. The following table sets forth certain technical features of ACTECO
AEH240:
Configuration ACTECO AEH240
Integration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Electric Motors/MCU/reducer/OBC/
DCDC/PDU/DAC
Efficiency /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111891.1% (CLTC conditions measured)
Power Density (kW/kg) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.297
Cooling Method /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118MCU: water cooling/
Electric Motor: oil cooling
Peak Power (kW) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118240
Wheel End Peak Torque (Nm) /H1118/H1118/H1118/H1118/H1118/H1118/H11184,800
Maximum Output Speed (rpm) /H1118/H1118/H1118/H1118/H1118/H1118/H11181,490
Mars Architecture — Our Vehicle Development Platform
Mars Architecture, mainly consisting of two core technologies — the vehicle platform
and the E/E architecture, is our platform for the design, development and engineering of our
vehicles. With modularized hardware and cross-platform software, Mars Architecture enables
us to achieve cost effectiveness in R&D, reduce development risks, and accelerate the launch
of new and reliable products, for models across different platforms.
V ehicle Platforms
During the Track Record Period, we mainly designed and developed vehicles on three
vehicle platforms, namely T1X, T2X and E0X. These vehicle platforms are designed to be
adaptable and scalable for future models and features.
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T1X platform is our first self-developed platform, with Tiggo 7 as its first mass
production model in 2016. T1X platform is used to develop ICE vehicles, PHEVs and BEVs.
It is also used to develop A0 to A+ class vehicles with mechanical four-wheel drive system and
electric four-wheel drive system. In addition, Tiggo 3x and Tiggo 5x were developed on T1X
platform.
T2X platform is used to develop ICE vehicles, PHEVs and BEVs with high performance,
covering A+ to C class sedans and SUVs with mechanical or electric four-wheel drive system.
The system offers continuously damping control (CDC) magnetic suspension system, which
utilizes magnetic dampers to adjust the damping forces. Moreover, T2X platform is used to
develop vehicles with intelligent all-wheel drive (AWD) system. Such system adjusts the
distribution of powers between the front and rear wheels automatically in response to real-time
driving and road conditions to achieve stability. Developed on T2X platform with CDC
magnetic suspension system and AWD system, our vehicles deliver smoothy and comfortable
riding experience for our users. Tiggo 9, Fulwin T9 and T10 and EXEED RX and VX were
developed on T2X platform.
E0X platform is used to develop REEVs and BEVs with high performance, high
intelligence and safe driving, covering B to C+ class sedans and SUVs with spacious interiors.
The platform can be framed with our proprietary E/E architecture, to support advanced driving
assistance solutions. E0X platform seamlessly integrates proactive safety solutions with
driving assistance functions, including AEB, LKA, ACC and forward collision warning. See
“— Our Technological Prowess — Our Driving Assistance System.” Moreover, E0X platform
offers advanced technological solutions such as 800V high-voltage architecture, battery safety
system, and a steel-aluminum composite body structure, featuring high level of safety. Our
EXLANTIX ET and ES and LUXEED S7 and R7 were developed based on E0X platform.
E/E Architecture
The E/E architecture connects the electronic component systems and controls various
vehicle functions. We design the E/E architecture to enable seamless integration between
software and hardware and facilitate technology innovations of our vehicles. Our E/E
architecture is compatible with ICE vehicles, PHEVs, REEVs and BEVs. Our latest version
features high-bandwidth Ethernet-enabled data communication with multi-service interface,
which supports in-car communication and data, driving assistance system and intelligent
cockpit. See “— Our Technological Prowess — Lion Intelligent Cockpit” and “— Our
Technological Prowess — Our Driving Assistance System.”
Moreover, our E/E architecture allows us to upgrade our vehicles through flexible and
efficient firmware and software over-the-air (OTA) updates. We deliver regular OTA updates
throughout the entire vehicle lifecycle, from enhancement of the central control screen
interface, operation menu and in-vehicle infotainment system, to major upgrades of the driving
assistance system. We proactively and regularly seek feedback from our users, and deliver OTA
upgrades responding to their feedback in a timely manner.
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Lion Intelligent Cockpit
Lion OS, our intelligent cockpit system, is designed to enhance the in-cabin experience
for both drivers and passengers by providing a safer and more comfortable driving environment
and intelligent in-cabin functions. Lion OS is tailored to match individual user preferences
leveraging our proprietary operating system and application software. Moreover, with modular
design, Lion OS is compatible with our vehicle models with minimal re-configuration.
Highlights of key functions are set out below:
 AI Voice Assistant. Our intelligent in-car assistant, with continuous voice
recognition capabilities, can control most of the in-car functions.
 Customized Interactive Functions. Lion OS is able to customize in-car settings,
such as rear-view mirrors, seat position, air conditioning and driving mode, based on
user’s preferences.
 Navigation System. We developed an in-house navigation system and integrated it
into our assistance driving system to achieve better user experience.
 Interactive Entertainment. We offer a number of interactive entertainment
functions catering to users across different age groups, such as music, video games,
and in-cabin KTV .
 Vehicle Remote Control. We offer various remote control capabilities, such as car
locking and unlocking, turning on and off air conditioning, opening and closing the
trunk and seat heating.
We can continue to update Lion OS, with new features and applications through OTA
updates. In the future, we will leverage large AI models into our intelligent cockpit system to
refine the features and functionalities and enhance user experience.
Our Driving Assistance System
We provide driving assistance system for our passenger vehicles. Our vehicles models
that are equipped with our driving assistance system can meet the active safety regulations in
both China and EU and are rated five-stars or excellence by various evaluation programs or
systems including ENCAP , ANCAP , CNCAP , IVISTA and C-ICAP , adapting well to different
road conditions and complex scenarios in both China and overseas markets.
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Our driving assistance system primarily provide the following driving assistance
functions:
 Adaptive cruise control (ACC) . ACC controls the longitudinal movement of the
vehicle to ensure driving safety, and also supports the recognition and tracking of
dozens of vehicle types, including unconventional ones, providing a smooth
vehicle-following experience.
 Lane Keep Assist (LKA) . LKA continuously monitors the vehicle’s position
relative to the lane markings and controls the lateral movement of the vehicle, either
continuously or when necessary to ensure the vehicle stays within its lane.
 Autonomous Emergency Braking (AEB) . AEB activates an alarm or initiates
braking automatically when the driver brakes too late, applies insufficient braking
force, or fails to brake at all.
 Intelligent Speed Adaptation (ISA) . ISA helps drivers comply with traffic
regulations and enhances road safety by providing speed limit alerts or taking
control of the vehicle. It utilizes technologies such as GPS and cameras to recognize
traffic signs, including speed limits and stop signs. The system alerts drivers through
visual cues (e.g., dashboard or HUD displays), auditory signals (e.g., warning
sounds), or tactile feedback (e.g., steering wheel vibrations). In certain situations, it
can also activate automatic speed limit control or adjust to dynamic speed limit
changes.
 Parking Assist (PA) . PA uses the vehicle’s own sensors to monitor the relative
distance, speed and angle between the vehicle and surrounding obstacles. PA
controls the vehicle’s acceleration, deceleration and navigation, to park into or out
of designated parking space. Moreover, PA has a parking memory function
accommodating route length of up to one km.
 Blind Spot Detection (BSD) . BSD monitors vehicles, motorcycles, bicycles,
pedestrians, and other objects within the blind spots on both sides of the
automobiles. It alerts the driver to ensure safe lane changes and reduces the risk of
collisions during lane transitions.
 Traffic Jam Assist (TJA) . TJA manages the vehicle’s lateral movement in
low-speed, congested traffic scenarios. It provides automated follow-up driving and
assistance on congested roads, reducing the driver’s workload and enhancing
comfort during traffic jams.
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 Driver Monitoring System (DMS) . DMS monitors the driver’s state during driving
and alerts them to stay focused, helping to prevent safety risks caused by fatigue or
distracted driving.
 Lane Change Control (LCC) . LCC allows the vehicle to initiate lane changes using
the turn signal stalk. It also assists the vehicle to stay centered in its current lane and
ensures the vehicle maintain a consistent following distance in lanes or curves with
clear markings. LCC can operate in its basic function even without the assistance of
navigation maps.
Our driving assistance system enhances driving experiences in the following scenarios,
including (i) activating NOA at zero-speed at roadside; (ii) navigating on internal roads; (iii)
U-turning in narrow spaces; (iv) passing through barrier gate lift; (v) changing lanes and
avoiding obstacles; (vi) passing through roundabouts in the city; and (vii) point to point driving
and memory driving assistance.
OUR GLOBAL PRESENCE
We started from China with a global vision and have successfully achieved prominent
global presence. We were one of the first Chinese domestic brand passenger vehicle companies
to venture abroad with international sales of passenger vehicles, KD kits and engines,
according to Frost & Sullivan. Over the past two decades, we have grown from a vehicle
manufacturer and exporter company exporting vehicles to a company capable of leveraging
technology, brand and management to build overseas presence, and become a global automaker
that contributes locally and benefits worldwide. We have achieved significant business growth
in the overseas markets during the Track Record Period. In 2022, 2023, 2024 and the three
months ended March 31, 2024 and 2025, our revenue from sales of passenger vehicles in
overseas markets amounted to RMB29,152 million, RMB74,533 million, RMB97,868 million,
RMB19,646 million and RMB24,668 million, respectively, representing 35.3%, 49.3%, 39.7%,
38.9% and 40.0%, respectively, of our revenue of passenger vehicles during the same periods.
Sales
We have built an extensive network of dealerships in the overseas markets over the years.
As of March 31, 2025, we had 1,092 overseas dealers with 2,958 overseas dealership outlets
in Asia (excluding China), Europe, Africa, Oceania and the Americas. See “— Sales and
Marketing — Dealership — Overseas Dealership.” We adopt a multi-brand strategy for
overseas markets. In emerging markets, we typically introduce and market our own brand of
vehicles with of high product quality and localized designs and quickly capture market share.
In mature markets, we formed joint ventures with established automobile OEMs in the local
markets and leveraged their well-known brand to tap into the local markets, laying the
foundation for the penetration of our own vehicle brands in the future.
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Our passenger vehicles have gained popularity in the overseas markets. The overseas
sales volume of OMODA vehicles increased by 35.5% in 2024 compared to 2023. Tiggo 7 was
the best-selling passenger vehicle among the Chinese domestic brand passenger vehicles in
terms of export volume of passenger vehicles in 2024, according to Frost & Sullivan.
Moreover, EXEED brand vehicles achieved growth in both sales volume and selling price in
the Middle East market in 2024 compared to 2023. According to Frost & Sullivan, EXEED
brand vehicles ranked No. 1 among high-end Chinese domestic brands in terms of export
volume. In addition, JETOUR Traveler and JETOUR X70 are popular vehicles for off-road
travel in overseas markets, with JETOUR Traveler having been sold to over 50 countries and
regions as of the Latest Practicable Date.
Production
We have established a network of overseas production facilities through our own
subsidiary or partnership with local OEMs. As of the Latest Practicable Date, we had one
production base owned by our subsidiary in Malaysia and one production base owned by the
joint venture with EV MOTORS, an established Spanish automaker, in Barcelona. In addition,
we also contract with overseas OEMs located in overseas jurisdictions including Indonesia,
Brazil and Uzbekistan to manufacture passenger vehicles and for sales in local markets. See
“— Manufacturing — Overseas Production Facilities.” In particular, our joint venture with EV
MOTORS rolled out the first EBRO S700 car in December 2024, making us the first Chinese
domestic brand passenger vehicle company to manufacture passenger vehicles in Europe. Our
production plant in Malaysia focuses on production of right-hand drive vehicles. With overseas
production capabilities, we can achieve mass production and swift delivery to capitalize the
significant growth opportunities of the overseas markets.
R&D
We have established research institutes in Germany, Spain, Brazil, Mexico and Malaysia,
to carry out R&D activities in the European, South American, North American and Southeast
Asian markets, respectively. We have strong capabilities of product localization and adaptative
development. We tailor passenger vehicles to meet the needs and preferences of a diverse
customer base in overseas markets. Our R&D efforts ensure the compliance with local
regulations and focus on product adaptation, which enables us to provide customized products
and services for local markets. For example, we have established a global adaptability
development and inspection system covering seven dimensions including temperature,
humidity, fuel quality, corrosion, sunlight, precipitation and sand. We conducted vehicle tests
in Brazil, Saudi Arabia, Malaysia and Eastern Europe under challenging conditions such as
cold, heat, high altitude and high humidity to meet all-weather test standards in various
regions. With over 30,000 hours of engine bench test and 5,000,000 km of vehicle test, we
believe we can translate different usage scenarios and conditions into vehicle development and
engineering requirements to develop and manufacture passenger vehicles with global
standards, achieving a globalized product definition and vehicle development.
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SALES AND MARKETING
Our Sales Network
We sell our passenger vehicles under the CHERY , JETOUR, EXEED and iCAR brands
primarily through a network of dealerships in China and overseas markets. Moreover, OMODA
and JAECOO are dedicated brands mainly targeting overseas markets. For the sales and
distribution of the LUXEED brand vehicles, see “— Sales and Marketing — Other Sales
Channels.” We establish a seller-buyer relationship with our dealers. Our dealers do not have
the right to return any unsold passenger vehicles to us except for defects. The outlets of our
dealers are strategically located in the major cities of China and overseas countries and regions
for marketing and sales of our vehicles. We have established an extensive network of
dealerships globally over the years. As of March 31, 2025, we had 3,663 dealership outlets
covering over 310 cities in the PRC and 2,958 overseas dealership outlets in Asia (excluding
China), Europe, Africa, Oceania and the Americas.
The following table sets forth our sales channels and their respective revenue contribution
with respect to our passenger vehicles for the periods indicated:
For the year ended December 31,
For the three months ended
March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(unaudited)
Dealership (1) /H1118/H1118/H1118/H111869,734 84.5 128,809 85.2 216,222 87.6 40,642 80.4 56,133 91.1
Others (2) /H1118/H1118/H1118/H1118/H1118/H111812,777 15.5 22,419 14.8 30,600 12.4 9,905 19.6 5,506 8.9
Total /H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0 246,822 100.0 50,547 100.0 61,639 100.0
Notes:
(1) Including the revenue generated from the sales of the passenger vehicle under LUXEED brand.
(2) See “— Sales and Marketing — Other Sales Channels.”
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Dealership
China Dealership
In line with industry norm, we primarily sell our passenger vehicles under the CHERY ,
JETOUR, EXEED and iCAR brands through a network of dealerships to effectively cover the
China market. Sales and marketing activities are carried out separately under the CHERY ,
JETOUR, EXEED and iCAR brands. We allow candidates to apply for new dealerships and
dealership outlets through an open application process. We consider a number of criteria in
selecting dealers, including financial condition, operational scale and location of the proposed
dealership outlet, transportation conditions, management capabilities, reputation and
creditworthiness. To grant a license, we require the candidate to submit an application. Upon
reviewing, we invite the candidate for an interview and pay a visit to the venue of the potential
dealership outlet for an on-site inspection. We make a final decision based on the results of the
on-site inspection, formal proposal and qualifications of the candidate.
Once a new dealer is selected, the dealer places a security deposit and enters into a letter
of intent with us. We provide guidelines for the set-up of the new dealership outlet, including
standard internal and external decoration, the display of our logos and vehicles, and time frame
for the construction and launch of the new dealership outlet, as well as staffing and trainings.
We arrange our own staff to monitor the work onsite. In addition, we will provide the new
dealer with our proprietary information system, which is to be installed in the dealership outlet
to track sales and inventories and collect relevant financial and operation data. A new
dealership outlet must pass our inspection and obtain our formal authorization before it can
commence operation. We usually enter into a dealership agreement with each of our dealers.
The following table sets forth the movement of our dealers for the passenger vehicles
under the CHERY , JETOUR, EXEED and iCAR brands in the PRC for the periods indicated:
As of/Y ear ended December 31,
As of/Three
months ended
March 31,
2022 2023 2024 2025
At the beginning of the
period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,556 2,312 2,528 3,480
Addition of new dealers /H1118/H1118/H11181,174 988 1,361 401
Termination of existing
dealers (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118418 772 409 224
Net increase/(decrease) in
the number of dealers /H1118/H1118/H1118 756 216 952 177
At the end of the period /H1118/H1118/H11182,312 2,528 3,480 3,657
Note:
1. The termination of dealers in 2023 was comparatively higher than the counterparts in 2022 and 2024,
primarily due to the gradual phase-out of our certain BEV models that are no longer our strategic focus
going forward.
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The following table sets forth the movement of the dealership outlets operated by our
dealers for the CHERY , JETOUR, EXEED and iCAR brands in China for the periods indicated:
As of/Y ear ended December 31,
As of/Three
months ended
March 31,
2022 2023 2024 2025
At the beginning of the
period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,556 2,813 2,673 3,486
Opening of new dealership
outlets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,858 992 1,361 401
Closure of dealership
outlets (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118601 1,132 548 224
Net increase/(decrease) in
the number dealership
outlets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,257 (140) 813 177
At the end of the period /H1118/H1118/H11182,813 2,673 3,486 3,663
Note:
1. The closure of dealership outlets in 2023 was comparatively higher than the counterparts in 2022 and
2024, primarily due to the gradual phase-out of our certain BEV models that are no longer our strategic
focus going forward.
We typically enter into dealership agreement with our dealers. The following table sets
forth a summary of the key commercial terms and arrangements that we typically enter into
with our dealers:
Terms: one to five years, which is automatically renewable
upon expiration or is renewable by written
agreement of the parties.
Pricing and Payment: We issue market-guided price, which is subject to
adjustment based on market conditions. We settle
with our dealers with bank transfer or bank
acceptance bill.
Sales target: We set sales target on month, quarter or annual basis
with our dealers specifying the sales volume by
different models as agreed in their agreement. The
achievement of the sales target by our dealers is a
key performance indicator and the basis for the
sales initiatives and rebates programs.
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Sub-dealers: Dealers are allowed to appoint sub-dealers.
Inventory: We and dealers agree on the designated vehicle
models and quantities and maintaining reasonable
inventory levels.
Return of products: Return are only available with quality issues
pursuant to applicable laws and regulations.
Termination: Upon occurrence of certain customary termination
events: for example, the dealer (i) becomes
insolvent or enters into liquidation; (ii) is revoked
business license; (iii) is in suspension of business;
(iv) undermines our interests and images; or (v) is in
material breach of our management policy, we may
unilaterally terminate the distributorship agreement.
Overseas Dealership
In addition to domestic market, we have also built an extensive network of dealerships in
overseas markets. Over the years, we have established overseas subsidiaries in markets with
significant market potential and returns. In these overseas markets, we have developed a
network of local dealers through our overseas subsidiaries. For the jurisdictions where we do
not have overseas subsidiaries, we generally appoint a general agent which is also our dealer
to market and sell our passenger vehicles to customers within the designated jurisdiction. In
addition to those standard dealer responsibilities, such as dealership management and customer
engagement, the general agent is also responsible for establishing a distribution and sales
network within such designated jurisdiction with its local resources. Moreover, different from
other dealers, for some of our general agents, we usually include a minimum purchase
requirement clause in the distributorship agreement, which is in essence an adjustable sales
target for our general agent to incentivize their sales and demonstrate their commitments to
market and sell the passenger vehicles within the respective designated jurisdictions.
Leveraging the distribution and sales networks established by the general agents, we are able
to tap into new markets efficiently. As of March 31, 2025, we partnered with 1,092 overseas
dealers globally. In selecting our overseas dealers, we generally adopt the similar approach in
selecting dealers and dealership outlets in our home market. For the selection of the general
agent, we consider a range of factors including the industry experience, financial strength and
regional or national sales networks and capabilities.
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The following table sets for the movement of our overseas dealers for the periods
indicated.
As of/Y ear ended December 31,
As of/Three
months ended
March 31,
2022 2023 2024 2025
At the beginning of the
period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118252 327 741 1,075
Addition of new overseas
dealers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118112 469 432 19
Termination of existing
overseas dealers (1) /H1118/H1118/H1118/H1118/H111837 55 98 2
Net increase/(decrease) in
the number of overseas
dealers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111875 414 334 17
At the end of the period /H1118/H1118/H1118 327 741 1,075 1,092
Note:
(1) During the Track Record Period, the termination of overseas dealers was primarily because (i) we did
not renew distribution agreements with certain dealers upon expiry or upon mutual agreement when they
failed to perform to the satisfaction of the Group; and (ii) certain dealers discontinued their passenger
vehicle dealership business due to their own commercial considerations.
The following table sets forth the movement of the overseas dealership outlets operated
by our dealers for the periods indicated:
As of/Y ear ended December 31,
As of/Three
months ended
March 31,
2022 2023 2024 2025
At the beginning of the
period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118905 1,088 1,997 2,799
Opening of new overseas
dealership outlets /H1118/H1118/H1118/H1118/H1118/H1118/H1118243 1,032 1,041 174
Closure of overseas
dealership outlets /H1118/H1118/H1118/H1118/H1118/H1118/H111860 123 212 15
Net increase/(decrease) in
the number overseas
dealership outlets /H1118/H1118/H1118/H1118/H1118/H1118/H1118183 909 802 159
At the end of the period /H1118/H1118/H11181,088 1,997 2,799 2,958
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The following table sets forth a summary of the key commercial terms and arrangements
that we typically enter into with our overseas dealers:
Terms: one to five years, which is automatically renewable
upon expiration or is renewable by written
agreement of the parties.
Pricing and Payment: We provide a guidance price list, which is subject to
change from time to time at our sole discretion by a
prior written notice. We settle with our overseas
dealers with bank transfer or bank acceptance bill.
Sales targets: We set sales target or minimum purchase
requirements with our overseas dealers, usually
opting for minimum purchase requirements with
some of our general agents. The minimum purchase
requirement is not a mandatory purchase
commitment but an adjustable sales target. The
minimum purchase requirement gives the Company
an initiative to first negotiate if the general agent
does not meet the agreed sales target and an option
to terminate the distribution agreement if such
negotiation fails. The Company will first approach
such general agent to discuss and evaluate the
reasons. As the next step, both parties will re-
negotiate the minimum purchase amount with
reference to the sales target in the following year
and the achieved sales in the past years as well as
taking into account the then market condition,
competition, and capabilities of the dealers. It is an
industry norm to set sales target or equivalent
minimum purchase requirement to incentivize and
manage dealers effectively, according to Frost &
Sullivan. The achievement of the sales target by our
overseas dealers is a key performance indicator and
the basis for the sales initiatives and rebates
programs.
Inventory: We and dealers agree on the designated vehicle
models and quantities and maintaining reasonable
inventory levels by dealers.
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Sub-dealers: Dealers who are representative of general agents
can appoint sub-dealers in their countries or
regions.
Product return: Return only available for products with quality
issues pursuant to applicable laws and regulations.
Termination: Upon occurrence of certain customary termination
events: for example, the dealer (i) becomes
insolvent or entering into liquidation; (ii) is revoked
business license; (iii) is in suspension of business;
(iv) undermines our interests and images; or (v) is in
material breach of our management policy, we may
unilaterally terminate the distributorship agreement.
During the Track Record Period and up to the Latest Practicable Date, we did not have
any material dispute with our dealers in China and overseas markets. To the knowledge of our
Directors, all of our dealers during the Track Record Period and up to the Latest Practicable
Date were Independent Third Parties.
Dealership Management
We have established a robust dealership management system to manage our dealership
networks, offering a consistent brand image and customer experience. Set forth below are key
aspects of our dealer management policies and measures:
 Minimize cannibalization : To minimize the risk of cannibalization among dealers,
we adopt the following measures: (i) managing the number of regional dealers for
each geographical region; (ii) clearly delineating the geographic coverage of our
dealers and explicitly prohibiting them from selling our vehicles outside their
designated geographical regions, and delegating our dealers to manage their
respective sub-dealers to avoid cannibalization. Our dealers are required to ensure
their sub-dealers operate within their designated geographical regions; and (iii)
managing the pricing policy and provide market-guided price for our vehicles sold
domestically and overseas.
 Management of auto dealers in China and overseas markets . We have a variety
of measures to monitor and inspect our dealers. We require dealers to connect to our
dealership management system, so that we are able to monitor their sales and
operation activities closely. In addition, we may conduct on-site inspections of our
dealership outlets to monitor business operations including sales performance,
inventory level, service quality, sales and marketing efforts and compliance with our
policies and guidelines. Based on the our inspection results, we identify those
dealers with unsatisfactory or unusual performance. Such dealers are required to
address and rectify all the issues identified in a specified time or we will terminate
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the dealership otherwise. We have direct contract with our general agents, which
may further distribute our vehicles to their sub-dealers. Our dealers are permitted to
develop sub-dealers within their designated territories, subject to our oversight and
control. We do not have contractual relationship with the sub-dealers. We primarily
regulate and monitor the sales activities of sub-dealers through our dealers. Our
dealers track the sales and inventory level of their respective sub-dealers and report
the same to us on a regular basis and we will adjust the sales to our dealers
accordingly to avoid the risk of accumulation of significant inventory at the
sub-dealers. Moreover, our dealers conduct annual inspection or evaluation to
ensure that the sub-dealers are in compliance with relevant laws and regulations and
our management policies. We are not responsible for sales misconduct by the
sub-dealers, should any occur.
 Sales and inventory management . To reduce channel stuffing risks, we manage our
dealers to ensure that they would maintain a reasonable inventory level. We monitor
and record the sales of our vehicles and the inventory levels of our dealers primarily
through our real-time dealership management system or conduct inventory checks
on a regular basis. Through this system, we are able to monitor our dealers
throughout vehicle sales process from ordering, invoicing, delivery, to after sales.
For some of our overseas dealers who do not have access to our dealership
management system, we manage them by monitoring orders and inventory level on
a monthly basis through our local staff. Moreover, in China, we can further monitor
the actual demands of our vehicles through the vehicle registration system, enabling
us to have better understanding as to the inventory turnover of our dealers.
Moreover, we do not allow returns of vehicles except for product defects.
 Internal control policies and measures on dealers . We have implemented internal
control polices and measures on the conduct of our dealers, which include (i)
requiring our dealers to timely and effectively communicate and deal with
consumers on inquiries received by us through multiple communication channels,
particularly in the case of delivery urgency; (ii) setting out clearly in the vehicle
delivery confirmation form that upon delivery, the certificate of conformity must
also be delivered; (iii) incorporating customer feedback into our evaluation on
dealers as part of its dealers satisfactory management; (iv) imposing penalties on our
dealers as part of the sales operations evaluation system, if any misconduct was
found, such as malicious competition, misleading pricing, financial
misrepresentation, and improper handling of deposits; and (v) establishing a dealer
integrity scoring system to evaluate dealers every two months across six dimensions,
including market conduct, financial integrity, integrity verification and
accountability, integrity in compliance, integrity in customer management, and
employee integrity.
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 Compliance management . We require our dealers to strictly comply with relevant
laws and regulations, as well as our management policies, in their sales practices. If
any of our distributors fails to comply with the relevant laws and regulations, or our
management policies, we may reserve the right to unilaterally terminate our
distributorship agreement with them.
LUXEED corporate distributor
We sell the LUXEED brand vehicles to an exclusive corporate distributor, which is
principally engaged in the sales of NEVs in the PRC, and further sells the LUXEED brand
vehicles to end customers in China. We have entered into the general distributorship agreement
with this distributor, the terms of which are not different from those in our typical dealership
agreements in material aspects. During the Track Record Period and up to the Latest
Practicable Date, we did not have any material dispute with this distributor. To the knowledge
of our Directors, this distributor is an Independent Third Party.
The following table sets forth a summary of the salient terms and arrangements that we
entered into with the corporate distributor:
Terms: The term of the general distributorship agreement is five
years and is renewable upon mutual agreement upon
expiry.
Pricing and payment: We agree with the general distributor on the purchase
price of vehicles, which is subject to change from time to
time upon mutual agreement. We settle with the
distributor with bank transfer.
Inventory: The general distributor shall maintain certain vehicle
inventory. It procures vehicles from us based on the
purchase orders from end customers and market
forecasts.
Product return: We typically do not allow the general distributor to return
products to us once the vehicles have been accepted by
the general distributor.
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Renewal and termination: During the term of the general distributorship agreement,
unless either party notifies the other party in writing of its
intention not to continue the cooperation at least three
months prior to the expiration of the distributorship
agreement, a new agreement shall be entered into upon
expiry. To ensure continuity of cooperation, the term of
the general distributorship agreement shall be
automatically extended for three months. If renewal is
not completed within such three-month period, the
general distributorship agreement shall terminate.
During the term of the general distributorship agreement,
either party can terminate the agreement if the other party
breaches any terms in material respects and fails to
correct such breaches after 90 days upon the correction
request from the non-breaching party.
Other Sales Channels
Passenger V ehicles
During the Track Record Period, we also sold passenger vehicles under the CHERY ,
JETOUR, EXEED and iCAR brands to individual and corporate customers and trading
companies.
KD Kits
During the Track Record Period, we primarily sold KD kits to (i) overseas OEMs and
overseas joint ventures for assembling to passenger vehicles in their respective overseas
production facilities and for sale under our brands such as Chery, OMODA and JAECOO and
EXEED or under the brands of overseas joint ventures and overseas OEMs such as EBRO; and
(ii) trading companies in China which would on-sell the KD kits to its customers.
We also engage overseas contract manufacturers to assemble our KD kits to passenger
vehicles for sales in overseas markets. We pay services fees to such overseas contract
manufacturers in respect of the assembly service. During the Track Record Period, the
assembly services fees to the overseas contract manufacturers amounted to nil, RMB40
million, RMB779 million and RMB928 million, accounting for nil, 0.03%, 0.33% and 1.55%
of our cost of sales for each of the same periods, respectively. Overseas OEMs and overseas
joint ventures are our customers that purchased KD kits from us whereas the overseas contract
manufacturers are suppliers that provide assembly services to us. See “— Manufacturing —
Overseas Production Facilities.”
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Pricing
Our pricing policy varies among different countries and regions, considering factors such
as market maturity, penetration rate, purchasing power, competition landscape and product
costs. We provide market-guided prices to our dealers for their reference. We usually review
our pricing model at the different development stages of a vehicle model, in particular, the
beginning of the development, the completion of the development and prior to the formal
launch. In addition, we will review and adjust the market-guided price from time to time and
taking into prevailing market conditions.
Marketing
We increase our brand presence through traditional marketing campaigns, the network of
dealerships, and online promotion on social media platforms. Our offline marketing and brand
building activities include participating in the organizing new model launch events, seminars,
trade shows and exhibitions to showcases and obtain users’ feedback for our products. For
example, we attend Guangzhou International Auto Exhibition every year, demonstrating our
latest concept vehicles and cutting-edge technologies to our users and potential customers.
In addition, for our vehicles sold under the CHERY , JETOUR, EXEED and iCAR brands,
we rely on our dealers to carry out sales and marketing activities separately for each of those
brands. Our dealers make annual marketing budgets and plans to promote our product, thus
increasing brand penetration in the PRC, and expanding our network of dealerships. We review
and provide feedback on our dealers’ marketing plans, and they will carry out marketing
campaigns accordingly. From time to time, we also invite our dealers to participate in our own
marketing campaigns.
We are committed to increasing our brand exposure through creating content on major
social media platforms. We promote our brand history and newly launched models and editions
of our vehicles through popular social media platform including Douyin, Kuaishou and
Rednote. Our marketing content also includes live streaming test drives of the new models and
editions of our vehicles. Leveraging the data driven functions of such platforms, we are able
to accurately target our end-customers. Our online marketing achieved a great success,
allowing us to accumulate a large number of followers on our social media platform. This
reflect our ability to reach and impact a broad audience, and the potential to monetize on brand
awareness and user interaction.
We believe that the optimization of our marketing channels through dealership network,
in conjunction with high quality content through social media, which enables us to achieve
continued brand exposure and attract potential customers effectively.
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CUSTOMERS
During the Track Record Period, we sold our passenger vehicles primarily through dealers
in domestic and overseas markets. In addition, we also sold to overseas OEMs, overseas joint
ventures and trading companies during the same periods. We have a broad base of customers
and we do not believe that we have material concentration risks. The revenue generated from
our five largest customers in each period during the Track Record Period amounted to
RMB16,035 million, RMB23,799 million, RMB41,698 million and RMB12,989 million
accounted for 17.3%, 14.6%, 15.4% and 19.0% of our total revenue in 2022, 2023 and 2024
and the three months ended March 31, 2025, respectively. We typically settle with our five
largest customers with bank transfer or bank acceptance bills. The following table sets forth the
details of our five largest customers for each period during the Track Record Period:
For the year ended December 31, 2022
Customer Background Products purchased from us
Approximate
years of business
relationship
Customer A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in manufacturing
and sale of automobiles
and auto parts
Passenger vehicles,
auto parts and
components
6
Customer B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
9
Customer C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
11
Customer D /H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
19
Customer E /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
3
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For the year ended December 31, 2023
Customer Background Products purchased from us
Approximate
years of
relationship
Customer A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in manufacturing
and sale of automobiles
and auto parts
Passenger vehicles,
auto parts and
components
6
Customer B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
9
Customer C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
11
Chery Holding /H1118/H1118/H1118A company that is primarily
engaged in production and
R&D of automobiles and
auto parts and investment
Passenger vehicles,
auto parts and
components
15
Customer F /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
7
For the year ended December 31, 2024
Customer Background Products purchased from us
Approximate
years of
relationship
Customer A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in manufacture
and sale of automobiles
and auto parts
Passenger vehicles,
auto parts and
components
6
Customer G /H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
2
Customer B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
9
Customer C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
11
Chery Holding /H1118/H1118/H1118A company that is primarily
engaged in production and
R&D of automobiles and
auto parts and investment
Passenger vehicles,
auto parts and
components
15
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For the three months ended March 31, 2025
Customer Background Products purchased from us
Approximate
years of
relationship
Customer G /H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
2
Customer A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in manufacture
and sale of automobiles
and auto parts
Passenger vehicles,
auto parts and
components
6
Customer H /H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
4
Customer C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
11
Customer I /H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in sale of
automobiles and auto parts
Passenger vehicles,
auto parts and
components
2
During each year/period of the Track Record Period and up to the Latest Practicable Date,
none of our Directors or their respective close associates or any of our shareholders, to the
knowledge of our Directors, owned more than 5% of our issued shares, had any interest in any
of our five largest customers (except for Chery Holding). During the Track Record Period, we
did not have any material disputes with, nor did we receive any material complaints from, our
customers.
SUPPLIERS
We procure a wide variety of raw materials mainly including steel products, seats, tires,
battery cells and electronic components for our passenger vehicles. We also engage overseas
contract manufacturers to assemble our KD kits to passenger vehicles for sales in overseas
markets. A localized and stable supply chain is a key focus in production of vehicles. We select
suppliers very carefully, taking into account their price, quality, production capacity, financial
conditions, delivery scheme, business scale and reputation. During the Track Record Period
and up to the Latest Practicable Date, we did not experience quality issue with our suppliers
that materially affect our operations nor did we experience any material disruption in the
manufacture of our vehicles due to supply shortage of any major components. We have a broad
base of suppliers and we do not believe that we have material concentration risks.
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In 2022, 2023 and 2024 and the three months ended March 31, 2025, purchases of raw
materials from our five largest suppliers in each period during the Track Record Period
amounted to RMB12,096 million, RMB20,503 million, RMB28,672 million and RMB8,903
million, respectively, accounting for 15.8%, 16.9%, 14.4% and 17.1% of our total purchases of
raw materials for each of the same periods. We typically settle payments with our five largest
suppliers with bank transfer or bank acceptance bills. The following table sets forth the details
of our five largest suppliers for each period during the Track Record Period:
For the year ended December 31, 2022
Supplier Background
Products/services offered
to us
Approximate
years of business
relationship
Chery Holding /H1118/H1118/H1118A company that is primarily
engaged in production and
R&D of automobiles and
automobile parts and
investment
Auto parts and
components
15
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in automobile
manufacturing supply
chain business
KD kits and Auto parts 4
Supplier B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
auto parts and components
Automobile transmission 27
Supplier C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile transmission
Automobile transmission 9
Supplier D /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile safety system
and components
Automobile brake
system, steering
system and suspension
system
19
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For the year ended December 31, 2023
Supplier Background
Products/services offered
to us
Approximate
years of business
relationship
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in automobile
manufacturing supply
chain business
KD kits and auto parts 4
Supplier B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
auto parts and components
Automobile transmission 27
Chery Holding /H1118/H1118/H1118A company that is primarily
engaged in production and
R&D of automobiles and
automobile parts and
investment
Auto parts and
components
15
Supplier C /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile transmission
Automobile transmission 9
Supplier D /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile safety system
and components
Automobile brake
system, steering
system and suspension
system
19
For the year ended December 31, 2024
Supplier Background
Products/services offered
to us
Approximate
years of business
relationship
Supplier B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
auto parts and components
Automobile transmission 27
Supplier E /H1118/H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in the R&D,
production and sales of
batteries
Power battery 5
Supplier D /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile safety system
and components
Automobile brake
system, steering
system and suspension
system
19
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Supplier Background
Products/services offered
to us
Approximate
years of business
relationship
Supplier F /H1118/H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile parts and
components
Engine parts and
components
5
Supplier A /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in automobile
manufacturing supply
chain business
KD kits and Auto parts 4
For the three months ended March 31, 2025
Supplier Background
Products/services offered
to us
Approximate
years of business
relationship
Supplier E /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in the R&D,
production and sales of
batteries
Power battery 5
Supplier B /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
auto parts and components
Automobile transmission 27
Supplier G /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in manufacturing
of communication system
equipment
Driving assistance
systems, intelligent
cockpit system and
other related auto
parts and components
3
Supplier H /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile
OEM 2
Supplier D /H1118/H1118/H1118/H1118/H1118/H1118A company that is primarily
engaged in production of
automobile safety system
and components
Automobile brake
system, steering
system and suspension
system
19
During each year/period of the Track Record Period and up to the Latest Practicable Date,
none of our Directors or their respective close associates or any of our shareholders, to the
knowledge of our Directors, owned more than 5% of our issued shares, had any interest in any
of our five largest suppliers (except for Chery Holding).
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OVERLAPPING CUSTOMER AND SUPPLIER
Supplier A is one of our five largest suppliers in 2022, 2023 and 2024 and a supplier of
our Company in the three months ended March 31, 2025. Meanwhile, supplier A was also a
customer of our Company in each period during the Track Record Period. Supplier A is a
company engaging in automobile manufacturing supply chain business in China. Save for the
purchases and sales transactions, we do not have any other past or present relationships
(including, without limitation, financing, family, employment, trust or otherwise) with Supplier
A, its respective substantial shareholders, directors or senior management, or any of its
respective associates. We primarily sold automotive parts and components to Supplier A and
primarily procured KD kits from it. For manufacturing the KD kits sold to us, Supplier A used
some of our automotive parts and components sold to it as raw materials and procured other
raw materials from third party suppliers. In 2022, 2023 and 2024 and the three months ended
March 31, 2025, our sales to Supplier A amounted to RMB1,577 million, RMB2,133 million,
RMB3,959 million and RMB989 million, respectively, accounting for 1.7%, 1.3%, 1.5%, and
1.4% of our total revenue for the same periods, respectively. In 2022, 2023 and 2024 and the
three months ended March 31, 2025, our purchases from Supplier A amounted to RMB2,529
million, RMB5,976 million, RMB4,107 million and RMB603 million, accounting for 3.3%,
4.9%, 2.1%, and 1.2% of our total purchases of raw materials for the same periods.
Chery Holding was one of five largest suppliers in 2022 and 2023 and a supplier of our
Company in 2024 and the three months ended March 31, 2025. Meanwhile, Chery Holding was
also one of our five largest customers in each period during the Track Record Period. For the
relationship between our Company and Chery Holding, as well as the shareholding structure
of our Company and Chery Holding, see “History, Development and Corporate Structure —
Corporate Developments.” In each period during the Track Record Period, (i) our purchases of
products from Chery Holding, primarily including battery pack, amounted to RMB3,124
million, RMB3,415 million, RMB2,426 million and RMB858 million in 2022, 2023 and 2024
and the three months ended March 31, 2025, respectively, accounting for 4.1%, 2.8%, 1.2%,
and 1.7% of our total purchase of raw materials amounts in the same periods, respectively; and
(ii) our sales to Chery Holding, primarily including passenger vehicles, engines, transmissions,
chassis and other key parts, amounted to RMB1,339 million, RMB2,111 million, RMB3,018
million and RMB120 million in 2022, 2023 and 2024 and the three months ended March 31,
2025, respectively, accounting for 1.4%, 1.3%, 1.1%, and 0.2% of our total revenue in the same
periods, respectively.
The negotiations of the terms of our sales to and purchases from each of Supplier A and
Chery Holding were conducted on an individual basis and the sales and purchases were not
inter-conditional upon each other. Moreover, the major terms of transactions with each of
Supplier A and Chery Holding were similar to those with our other customers and suppliers and
were in line with normal commercial terms. Save as disclosed above, to the best of our
knowledge, none of our five largest customers/suppliers in each period during the Track Record
Period was a supplier/customer of us.
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LOGISTICS AND INVENTORY MANAGEMENT
Logistics and Warehouse
We have our warehouses in Wuhu, Ordos, Dalian, Qingdao and Kaifeng primarily for
storage of automobile components and parts and raw materials. Raw materials and automobile
components are delivered to us directly by suppliers or through third-party transportation
service providers. To the extent possible, we have prioritized partnering with suppliers with
operations in close proximity to our warehouses to minimize logistics costs. We engage
third-party logistics service providers for the delivery of our passenger vehicles from our
production facilities to our dealership outlets.
Inventory Management
Our inventory primarily includes finished and semi-finished passenger vehicles,
automotive parts and components. Our inventory turnover days were 43.5 days, 58.4 days, 52.6
days and 56.3 days in 2022, 2023 and 2024 and the three months ended March 31, 2025,
respectively. We implement strict inventory control policies to monitor our inventory levels at
our production facilities and warehouses, and maintain a relatively low level of inventory as
we generally adopt a make-to-order approach.
RESEARCH AND DEVELOPMENT
Our technological prowess is empowered by our strong and comprehensive R&D
capabilities. We have strategically focused our R&D efforts on the design and development of
high quality passenger vehicles to deliver superior and intelligent mobility experience for our
users. Over the years, we have achieved significant success in developing of diversified and
expanding passenger vehicle portfolio as well as state-of-the-art vehicle technologies in
electrification and intelligentization. See “— Our Technological Prowess” and “— Intellectual
Property”.
As of March 31, 2025, we established three R&D centers in Wuhu, Hefei and Shanghai
in China, and five overseas R&D centers in Germany, Spain, Brazil, Mexico and Malaysia. As
of the same date, we had over 14,400 R&D professionals, among which approximately 23%
possess a master’s degree or above. In 2022, 2023 and 2024 and the three months ended March
31, 2025, our R&D expenditure amounted to RMB4,128 million, RMB6,849 million,
RMB10,544 million and RMB2,761 million, respectively.
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R&D System
Strong R&D capabilities in vehicle architecture, fuel and electric powertrains, and vehicle
intelligentization are our core competence. We have built a multi-level R&D system, consisting
of Kaiyang collaborative research initiative (ᑌΥ᜗), aimed at fostering cutting-
edge innovations and promoting the commercialization of scientific breakthroughs across the
industry value chain, Stellar Lab (܃our R&D platform for core technologies, our
global R&D centers and state-of-the-art manufacturing facilities to cover foundational and
interdisciplinary research, core technologies and features innovations, and mass-production of
new models and solutions. Adhering to the technology development strategies across three
stages from mass production to product development and further to exploratory study, we are
also carrying out R&D in forward-looking technologies to further strengthen our technology
advantages and accelerate the cutting-edge innovations.
R&D Collaboration
As part of our R&D efforts, we collaborated with renowned industry leaders and top
academic institutions to co-develop key vehicle parts. For example, we have collaborated with
a leading global powertrain system company to develop the next-generation high-efficiency
hybrid engine with a thermal efficiency of 48.0%, highlighting superior efficiency and long
driving range. We also worked with the same company on a dual motor distributed drive system
and have completed prototype development with ongoing vehicle testing. Moreover, we
collaborated with a top university in China to on a R&D project on solid battery to explore the
limits and patterns of energy density in solid-state lithium batteries. We also collaborated with
a world leading supplier of parts and components for NEVs to develop industry-leading hybrid
transmission motor controllers, which feature a compact design that significantly enhances the
motor controller’s performance. Through close collaboration with multiple industry-leading
companies, we have shortened the development cycle of our driving assistance solutions,
reduced development costs, and quickly built our capabilities of driving assistance solutions.
MANUFACTURING
We have established a network of production facilities in China and overseas to
manufacture passenger vehicles and KD kits. As of the Latest Practicable Date, we had 10
production facilities in China, which are located in Wuhu, Ordos, Dalian, Qingdao, Kaifeng,
Dezhou and Shijiazhuang, respectively. As of the same date, we had one production base
owned by our subsidiary in Malaysia and one production base owned by the joint venture we
established with EV MOTORS, an established Spanish automaker. We also contracted with
overseas OEMs to manufacture passenger vehicles and for sales in the local markets. See “—
Manufacturing — Overseas Production Facilities.”
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Domestic Production Facilities
The following table sets forth the designed annual production capacity, production
volume of passenger vehicles (including KD kits) and the utilization rate of our production
bases in the PRC during the Track Record Period:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2025
Designed
production
capacity (1)
Actual
production
Volume(2)
Utilization
Rate (3)
Designed
production
capacity (1)
Actual
production
Volume(2)
Utilization
rate (3)
Designed
production
capacity (1)
Actual
production
Volume(2)
Utilization
rate (3)
Designed
production
capacity (1)
Actual
production
Volume(2)
Utilization
rate (3)
(Units’000)
(Units/
Set’000) (%) (Units’000)
(Units/
Set’000) (%) (Units’000)
(Units/
Set’000) (%) (Units’000)
(Units/
Set’000) (%)
Passenger V ehicles /H1118 1,018 1,150 113.0 1,198 1,622 135.4 1,498 2,411 161.0 368 585 158.9
Notes:
1. The designed production capacity of the relevant year/period is calculated (i) based on the bottleneck
production capacity at the painting and assembly stages and (ii) assuming the production lines operate 17
working hours per day (including the necessary time for shift changes and breaks) and 250 days per year.
According to Frost & Sullivan, the bottleneck production capacity is the key basis for calculating the designed
production capacity in the automotive industry.
2. Including (i) passenger vehicles and (ii) KD kits.
3. The utilization rate is calculated by dividing the actual production volume by the designed production capacity
for the period indicated.
4. The utilization rate exceeded 100.0% for the periods indicated mainly because (i) certain production lines at
our major production bases operated 24 working hours per day (including the necessary time for shift changes
and breaks) or more than 250 days per year due to the high demand of our products; and (ii) the designed
production capacity for the periods indicated does not include a separate production capacity of KD kits as the
production process for manufacturing KD kits is different from those for the whole passenger vehicles whereby
the KD kits may not go through all the stages for producing the passenger vehicles.
5. The production cycle of passenger vehicles is approximately 2.5 days including all the stages in the production
process. See “— Manufacturing — Our Production Process.” The production cycle of KD kits varies depending
on the type of KD kits and is generally less than 2.5 days.
Overseas Production Facilities
We adopt a two-pronged approach to build up our overseas production network. For the
markets where there are OEMs with manufacturing capabilities, we (i) enter into contracted
manufacturing arrangements with overseas contract manufacturers, such as those in Indonesia
and Uzbekistan as our OEM service providers, for assembling our KD kits into passenger
vehicles and sales in local markets, (ii) sell KD kits to (a) joint ventures formed with OEMs
in Spain, Brazil, Thailand and Vietnam and (b) overseas OEMs as our customers, such as
Kazakhstan and Brazil, for their own assembling to and sales of passenger vehicles in local
markets. During the Track Record Period, the sales volumes of passenger vehicles that were
assembled by our overseas contract manufacturers accounted for nil, 0.5%, 1.3% and 3.9% of
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our total sales volume of passenger vehicles for the same periods, respectively. For the
overseas markets where we believe it suitable to build our production bases to be operated by
our overseas subsidiaries, we would establish our own production base, such is the case with
our production base in Malaysia. As of the Latest Practicable Date, the production bases of our
joint ventures in Thailand and Vietnam were under plan. We also plan to expand the production
capacity at our production base in Malaysia.
During Track Record Period, we primarily adopted a “knock-down” model for overseas
production. We manufacture KD kits in China. Overseas OEMs, overseas joint ventures and
overseas contract manufacturers assemble the KD kits to finished passenger vehicles for sales
in local markets under our brands or the brands of our overseas joint ventures and overseas
OEMs, mainly through local dealerships. Our KD kits are primarily in the form of completely
knocked down (CKD), semi knocked down (SKD) and direct knocked down (DKD) depending
on the requirements of our customers, such as the local law and regulations on automotive
industry, tax and tariff implications and overall costs. CKD refers to completely knocked down
parts and components primarily comprising welded body components, powertrain and other
components including interior and exterior decoration, automotive electronics and chassis.
SKD refers to semi knocked down parts and components primarily comprising vehicle body,
powertrain and other components including interior and exterior decoration, automotive
electronics. DKD refers to direct knocked down parts and components, which is a more
pre-assembled form than SKD. DKD comprises a vehicle body with interior and exterior
decorations and pre-installed electric system, powertrain, suspension and tires.
We supervise the assembly and inspection process at overseas joint ventures or OEMs by
deploying our local staff to production bases. Our staff provides technical assistance to support
the assembly and inspection process. We are responsible for the product quality of KD kits we
sold to our joint venture customers and OEM customers pursuant to the relevant agreement.
Our joint venture customers and OEM customers are responsible for vehicle manufacturing and
product quality of the whole vehicles.
We believe the knock-down model enables us to quickly enter into new markets and
establish a strong market presence while catering to customer needs and preferences and
adapting to local laws and regulations. Third-party logistics service providers are engaged for
the delivery of all finished goods from overseas production facilities to local dealership outlets.
Our Production Process
Our production process of passenger vehicles is designed to promote high standards of
quality and facilitate a rapid production ramp-up to satisfy customers’ needs. The following
chart illustrates the principal steps in the production of our passenger vehicles:
Preparation Stamping Welding Painting Assembly Final
Inspection
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 Preparation . We process and assemble automobile parts and components into a
complete chassis and powertrain. We also prepare upholstery components, such as
seats, interior sideboards and lights and air-conditioning equipment, and other
components, such as batteries and headlights, for final assembly.
 Stamping . Steel and aluminum plates are stamped onto vehicle body parts.
 Welding . Welding is a process whereby the vehicle bodies are formed by welding
together the relevant vehicle body parts and other stamped parts and components
procured from our suppliers. We use welding robots to automate the welding of
joints and adopt laser welding on the vehicle roof for enhanced body stiffness,
thereby improving vehicle safety.
 Painting . Painting involves mid-electrophoresis painting, layer painting and surface
coating to protect against corrosion. The painting process is fully automated and
computer-controlled.
 Assembly . At this stage, the chassis, wheels, electric drive systems, lights, and
braking systems are assembled to the vehicle body. We have equipped our assembly
lines with fully automated quality control and inspection systems.
 Final Inspection . Final inspection involves road tests and production inspection,
including the examination of exhaust emission, steering, braking, engine,
transmission and electrical appliances. It will also involve an inspection of the
vehicle’s interior and its exterior.
Set forth below are examples of our production lines of our production bases in China:
Stamping Welding
Painting Assembly
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The quality control procedure is implemented in each stage of our manufacturing process
to ensure that our vehicles are in compliance with our quality control standards. See “—
Quality Control, Warranty and After-sale Services and Product Recall — Quality Control.”
QUALITY CONTROL, W ARRANTY AND AFTER-SALE SERVICES AND PRODUCT
RECALL
Quality Control
We are committed to maintaining high product quality of our passenger vehicles. We have
implemented an effective quality management system based on internationally recognized
standard for quality management system ISO9001 and internationally accepted automotive
industry quality management standard IA TF16949 to cover the full lifecycle of a vehicle, from
research and development, procurement, production, sales and marketing to aftersales services.
Our systematic quality control measures are benchmarked against good practices in the
automotive industry.
R&D
In the research and development process, we develop our products in accordance with the
requirements of relevant laws and regulations and industry practices. We conduct a series of
rigorous testing and validation processes on prototype products to ensure product quality while
controlling production costs. Our new models are tested under a variety of environmental
conditions to meet the diverse needs of our users globally.
Manufacturing
In the manufacturing process, we implement strict quality control measures and apply
advanced quality testing equipment and tools to ensure each of our vehicles meets high quality
standards. We have invested substantial resources to the automation of production to ensure the
comprehensive quality management system. Moreover, our production facilities have stringent
system to monitor the key process of production, ensuring the delivery of consistent products
to our users. Once any product defect has been identified, our quality control department will
conduct analysis on the quality or technical issue, formulate rectification plans, and implement
corrective and preventive measures accordingly. We have formulated our evaluation standards
and our quality evaluation department is responsible for reviewing and evaluating our product
quality and production processes. We conduct regular internal audits and management
evaluations to ensure that our quality control system is proper, effective and adequate.
Supply Chain
For our supply chain management, we have comprehensive policies and detailed
procedures in place to ensure the quality of the components and raw materials we purchase
from suppliers. We have established a system to identify and manage qualified suppliers, and
we require all procurement to be made through qualified suppliers. When selecting and
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evaluating qualified suppliers, we conduct due diligence and consider a number of factors,
including, but not limited to, their reputations, credentials, experience, service or product
availability, price and delivery time. For those parts and components customized for our
vehicles, we require suppliers to develop, test and produce in accordance with our project plan
and quality control standards. Our suppliers are expected to follow our requirements for
product labeling and packaging identification to ensure traceability.
After-sales Services
We have implemented quality control measures on the after-sales services and product
repairs to ensure high customer satisfaction. We take a proactive approach whereby we notify
users timely once we spot any defects of our vehicles through our internal tracing system, and
offer free maintenance services. Moreover, our customer service department will follow up the
users for any feedback our users may have and ensure that any issues are resolved in a timely
manner.
Our strict quality control have earned us widespread market recognition and industry
honors. The CHERY brand ranked No. 1 Chinese passenger vehicle brand for the two
consecutive years in the 2023 and 2024 China Initial Quality Study and ranked No. 1 among
Chinese passenger vehicle brands in the 2024 China Automotive Performance, Execution and
Layout Study and 2024 China Sales Satisfaction Index by J.D. Power, a global consumer
insights and market research firm.
Warranty and After-sales Services
We are customer-centered and attach great emphasis on customer satisfaction. Our
products also feature a comprehensive package of after-sales services. We are committed to
providing high-quality and pleasant digital after-sales service.
Our users may seek free repair and maintenance services, including replacement of parts
and components due to quality defects, during the warranty period. Users are entitled to
services from any of our dealership outlets, regardless of their purchase location. According to
the Regulations on the Responsibility for Repair, Replacement and Return of Household
Automobile Products () and the industry
practice, we offer “Three Guarantee Policy” (i.e. guaranteed repair, guaranteed replacement
and guaranteed return) for our passenger vehicles for a period of two years or within a mileage
of 50,000 kilometers following the sales, whichever is earlier. Additionally, for most of our
passenger vehicles, we offer a warranty covering the whole vehicle for a period of no less than
three years or within a mileage of 60,000 kilometers following sales, whichever is earlier. We
provide in-warranty repair services through dealership outlets, and reimburse the dealers for
in-warranty repairs conducted. Out-of-warranty repair services are provided by our dealers on
a fee-basis, which includes replacement of parts due to wear and tear or repair of damage
resulting from collisions or other accidents.
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We have established a holistic system to handle the complaints from users, including 400
hotline, customer service hotline, car owner clubs and corporate emails. Once we receive a
complaint from our user, we will notify our designated dealers’ sales personnel and require
them to contact the user within one hour. We require our designated dealers’ sales personnel
to report and update the status until the issue is resolved and closed.
In 2022, 2023 and 2024 and the three months ended March 31, 2025, we had product
warranty provisions in the amount of RMB2,858 million, RMB5,213 million, RMB7,477
million and RMB2,046 million, respectively.
Product Recall
Automotive recalls have long been a critical aspect of our industry, serving as a reminder
that even well-engineered vehicles may occasionally require intervention to ensure public
safety. As consumer expectations have grown and technologies advanced, so too have the
standards for safety and the strategies employed to address recall issues. We are subject to the
Regulations on the Administration of Recall of Defective Automobile Products ( ॹ௘ӛԓପ
), Regulations on the Administration of Recall of Defective Automobile
Products () and Regulations on the Administration of
Recall of Motor V ehicle Emissions () in the PRC and other recall
regulations and requirements in other jurisdictions where we sell our passenger vehicles.
During the Track Record Period, we initiated 12 recalls of approximately 307,900
passenger vehicles in China and overseas markets as part of our quality control measure
intended to correct defects that may jeopardize performance or safety of our vehicles. The
product recalls were primarily due to automotive components and software issues such as those
related transmission oil cooler line, air conditioning system, radiator core and software for
integrated braking system. Our suppliers borne the liabilities for seven of the 12 recalls because
the relevant auto components and software issues were attributable to the suppliers’
manufacturing process control and software management. We borne the liabilities for five
recalls because the auto components issues were attributable to our manufacturing process
control. We paid RMB23.3 million to the users and dealers in respect of the product recalls,
which was negligible compared to our total revenues combined during the Track Record
Period. We recalled all the passenger vehicles in question to replace the relevant auto parts and
returned the repaired vehicles to the users. There were not any cases where the entire vehicle
is scrapped after being recalled. The recalls had no any material and adverse impact on the
Group’s results of operations and financial conditions during the Track Record Period.
In respect of the quality control and product safety, we enhanced the quality control
standards in the production process and upgraded our automated manufacturing equipment to
minimize the product defect during the production. We established a management system
covering full product cycle of auto parts and components from procurement, production,
delivery and after-sales. We also implemented a comprehensive after-sales systems and
protocols to handle urgent matters, such as customer complaints and product recalls, in a
responsive matter.
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INTELLECTUAL PROPERTY
We regard our proprietary domain names, copyrights, trademarks, trade secrets, and other
intellectual property, critical to our business operations and fundamental to our success and
competitiveness, and we devote significant time and resources to the development and
protection. We rely on a combination of patents, copyrights, trademarks, trade secret laws, and
restrictions on disclosure to protect our intellectual property. As of March 31, 2025, we had
over 13,900 registered patents and over 7,100 patent applications, over 7,300 trademarks, over
140 registered software copyrights.
For detailed information about our material intellectual property, see “Appendix VI —
Statutory and General Information — B. Further Information about Our Business —
2. Intellectual Property Rights.”
During the Track Record Period and up until the Latest Practicable Date, we were not
involved in any legal proceedings in relation to infringement of any intellectual property rights
which would have any material adverse impacts on our business, financial condition and results
of operations. See “Risk Factors — Risks Relating to Our Business and Industry — We may
need to defend ourselves against claims for intellectual property infringement, which may be
time-consuming and would cause us to incur substantial costs” and “Risk Factors — Risks
Relating to Our Business and Industry — We may not be able to prevent others from
unauthorized use of our intellectual properties, which could harm our business and competitive
position.”
SEASONALITY
Our passenger vehicles sales generally decline over January and February, particularly
around the Chinese New Y ear, and gradually pick up over spring and summer. Passenger
vehicles sales generally culminate in the last quarter of a calendar year, which is traditionally
an important sales season for the automotive industry, mainly due to nationwide auto shows
and increasing vehicle purchases near year end.
IMPACT OF COVID-19
The outbreak of COVID-19 has affected the Chinese and global economy. During the
COVID-19 outbreak in 2022, we had not experienced material disruptions in our production.
Our headquarter in Wuhu was temporarily closed for a short period of time, yet without any
material disruptions to our business operations. Our Directors confirmed that, during the Track
Record Period and up to the Latest Practicable Date, the COVID-19 outbreak did not materially
and adversely impact on our business, results of operations and financial condition nor caused
material disruption to our supply chain. Our revenue increased from RMB92,618 million in
2022 to RMB163,205 million in 2023 and further to RMB269,897 million in 2024,
representing a CAGR of 70.7%. Our revenue increased by 24.2%, from RMB54,910 million in
the three months ended March 31, 2024 to RMB68,223 million in the three months ended
March 31, 2025.
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DATA PRIV ACY AND PROTECTION
Overview
We are committed to complying with data privacy laws and protecting the security of
customer data. In the course of our business, we mainly collect and store data relating to the
usage of the driving assistance solutions and the intelligent cockpit systems, as well as data
collected through our sales and services channels. Such data primarily includes, among others,
name, ID number, address, phone number, driving license information and payment
information. In addition, we also collect or cooperate with qualified partners to collect data of
our passenger vehicles, including, among others, vehicle condition, location information,
assisted driving information, maintenance status, as well as information of the intelligent
cockpit system, information relating to AI voice assistant. Such information is collected with
prior consent from our customers in accordance with applicable laws and regulations. Our data
usage and privacy policies, which is provided to every customer, describes our data practices.
Specifically, we undertake to manage and use the data collected from customers in accordance
with applicable laws and make reasonable efforts to prevent the unauthorized use, loss, or leak
of customer data and will not disclose sensitive customer data to any third party without
customers’ approval except under legal requirement or certain circumstances in accordance
with applicable laws and regulations. We implement access control and account authority
control, and strictly limit and monitor employee access to customer data. We provide data
privacy training to our employees and require them to report any data security breach. Our
business partners may have access to the data collected within the scope of their service. We
take various measures to protect such data, such as entering into separate confidentiality
agreements with our business partners, adopting encrypted data storage and transformation and
de-sensitive and de-identify personal information.
We pay close attention to risk management relating to our IT system, as storage and
protection of personal and corporate data and related information is critical to us. We
de-sensitize customer data by removing personally identifiable information, when such
information is not relevant to our business. To ensure data security, we have adopted rigorous
encrypted algorithm to store sensitive data and strictly execute a data accessing and
transmitting policy to ensure the confidentiality of our data. We have also developed strict
internal control and data accessing mechanisms and detailed approval and operation procedures
regarding data storage and processing. We have established a set of internal protocols on data
security and privacy protection, which set forth detailed, stringent requirements in relation to
the use, disclosure and protection of data and personal information. Among other things, such
internal protocols provide limited authorization to our employees holding specific positions at
specific levels to access and process corporate data on a need-to-know basis, who shall use
such data only for the purposes of performing their work assignment.
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For driving assistance services offering, we provide a series of functions such as voice
recognition, driving monitoring system (DMS), occupancy monitoring system (OMS) and
vehicle control and collects intelligent driving related data and location information upon
obtaining consents from end customers. The details of format, the point in time and frequency
of consent are as follow:
 Voice recognition data : i) format: end customers’ consent is obtained via a pop-up
window when the vehicle is activated. ii) point in time: data collection begins after
customers click “consent” on the pop-up. iii) frequency: we continuously collect
data after the consent pop-up is clicked, until the vehicle is powered off or the
customer withdraws consent.
 Vehicle control related data (such as vehicle location information) : i) format:
customers actively click on vehicle control functions (namely keyless entry, vehicle
locating and map display) in the Apps to give consent to the collection of necessary
vehicle location information. ii) point in time: data collection begins after the
customers click on the vehicle control functions in the Apps. iii) frequency: vehicle
location information is collected each time the customer clicks on the vehicle
control function in the Apps.
Data Storage and Cross-border Transfer
All data collected or generated during the Group’s ordinary course of business in China
is stored in mainland China. Specifically, data related to production and R&D is stored in
domestic local data center computer rooms located at manufacturing bases in mainland China.
Data related to marketing and other business activities is stored in domestic public cloud
servers located in mainland China. The Group does not transfer any personal information or
important data collected or generated during its ordinary course of business in China to
locations outside mainland China, and therefore does not trigger the prior approval
requirements for cross-border data transfer under the relevant PRC laws and regulations.
As confirmed by our legal adviser as to PRC data compliance law, during the Track
Record Period and up to the Latest Practicable Date, we had been in compliance with
applicable PRC laws and regulations with respect to cyber security, data security and personal
information protection in all material aspects.
Internal Control and Data Accessing Mechanisms
We have established strict internal control and data accessing mechanisms regarding data
storage and process, covering data security management, cybersecurity management and
personnel management:
 Data security management : we have formulated the uniform data security
management specifications to clarify the requirements for full life-cycle data
security management. Under this mechanism, i) a prior approval is needed for the
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access of customer data after verifying the purposes of data accessing, and ii)
protection measures would be taken if any suspectable attempt which failed to prove
true and genuine purposes of data accessing was detected. Data usage activities are
recorded through logs and subject to regular audits, and abnormal operations such
as bulk data export or download will be monitored and alarmed. Upon receiving
such alarms, immediate emergency measures will be promptly implemented. In
addition, access to classified data is subject to identity authentication, such as
multi-factor authentication and secondary authorization, to prevent unauthorized
access.
 Cybersecurity management : we have formulated the uniform cybersecurity
management specifications, under which the network configuration of our
information systems is uniformly planned by the digital intelligence center and
implemented in accordance with relevant standards, and therefore no unauthorized
modifications are permitted. Based on the unified system account and authority
management specifications, access application control is implemented under the
principles of default prohibition and minimal authorization, with access control
policies set to prohibit all unauthorized access and the opening of high-risk ports. To
reinforce our cybersecurity management, network access requests are examined and
verified, before granting access and allocating corresponding network resources.
 Personnel management : we conduct annual trainings for employees on
cybersecurity and data security through various means. Meanwhile, personnel
security control is implemented through background check, signing of
confidentiality clauses or responsibility letter. Upon employee departure,
information system accounts are promptly deactivated to prevent data security risks.
COMPETITION
The global and China passenger vehicle markets are highly competitive, driven by key
factors including (i) development of products that can meet diverse and evolving customer
needs; (ii) technological innovations in electrification and intelligentization; (iii) strong brand
equity; (iv) efficient production capabilities with robust and localized supply chain; and (v) an
extensive and locally adapted sales network and after-sales services. The competition in the
NEV market is increasingly intensified in both domestic and overseas markets. In the China
market, as the penetration rate of NEVs continues to rise, both traditional OEMs and emerging
NEV brands accelerate the speed of product launches. Competition is also intense in respect of
retail price, product design, intelligent cockpit, driving assistance systems, battery
performance, and charging efficiency. Meanwhile, competition is escalating in overseas
markets. Traditional overseas OEMs are leveraging their established brand recognition, global
supply chain systems, and manufacturing expertise to build up their NEV product portfolio
whereas Chinese domestic brand passenger vehicle companies are rapidly gaining market
shares by optimizing production process to minimize costs and catering to rapid responses to
market demands and customer preference. In response to such intense competition in the PRC,
China Association of Automobile Manufacturers (CAAM) and MIIT have issued related
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initiatives, urging for strict adherence to the fair competition principles and implementing
strong measures to curb unfair pricing practices within the automotive industry. The
competition in the NEV market is no longer solely based on technological superiority or price
competitiveness, but increasingly on the overall capabilities including operational efficiency,
global expansion and brand building. We primarily compete with global passenger vehicle
companies and Chinese domestic brand passenger vehicle companies in both domestic and
overseas markets. In the future, we may also face competition from new entrants both in China
and globally that will increase the level of competition.
We are the second largest Chinese domestic brand passenger vehicle company and the
11th largest passenger vehicle company globally by sales volume in 2024, according to Frost
& Sullivan. We are the only one among the global top 20 passenger vehicle companies to
achieve over 25.0% sales volume increases of both NEVs and ICE vehicles and in both China
and overseas markets in 2024 compared to 2023, according to the same source. See “Industry
Overview — Competitive Landscape of Global Passenger V ehicle Market” for details.
Leveraging our cutting-edge technologies, strong R&D and manufacturing capabilities and an
extensive sales and distribution network, we believe we can capitalize the market growth
opportunities of global and China passenger vehicle markets. In response to the related
initiatives issued by CAAM and MIIT, firstly, we will sustain our commitment to our
technological innovation. In particular, we will continue to heavily invest in the research and
development of core automobile technologies while accelerating the adopting of vehicle
electrification and intelligentization. Through these efforts, we aim to deliver better driving
experience to our users and foster healthier and more rational competition across the industry.
Secondly, we ranked No. 1 among Chinese brand passenger vehicle companies in terms of
export volume of passenger vehicles for 22 years consecutively since 2003, according to Frost
& Sullivan. In 2024, our sales volume of passenger vehicles in overseas markets increased by
37.4% compared to 2023. With our success and strong growth potential in the overseas
markets, we will not compete on price in the China market but instead continue to differentiate
ourselves through technological and product innovations in the China and overseas markets.
EMPLOYEES
As of March 31, 2025, we had 54,408 full-time employees based in the PRC and 1,712
full-time employees based outside the PRC.
The following table shows the numbers and percentages of our full-time employees by
function as of March 31, 2025:
Function/department
Number of
employees
% of total
employees
Production /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,011 51.7
Research and Development /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,461 25.8
Sales and Marketing /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,318 11.2
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Function/department
Number of
employees
% of total
employees
Procurement /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118955 1.7
Administration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,214 7.5
Finance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,161 2.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111856,120 100.0
We believe that our employees are valuable assets that contribute to the success of our
Group. We recruit our employees based on a number of factors such as their industry
experience in the passenger vehicle industry, their educational background, and our vacancy
needs. We generally pay our employees a fixed salary and other allowances based on their
respective positions and responsibilities. We also entered into individual employment contracts
with our employees covering matters such as wages, employee benefits, employment scope and
grounds for termination. We provide mandatory social insurance for our employees as required
by PRC social insurance regulations, such as pension insurance, unemployment insurance,
work injury insurance, medical insurance and maternity insurance.
Our employees would undergo training to enhance their technical skills, knowledge of
industry quality standards, occupational health and safety standards and applicable laws and
regulations. We believe that we have maintained good working relationships with our
employees. During the Track Record Period and up to the Latest Practicable Date, we did not
experience any major labor disputes, work stoppages or labor strikes that led to disruptions in
our Group’s operations.
INSURANCE
We consider our insurance coverage adequate and in accordance with the commercial
practices in the industries in which we operate. We primarily maintain property insurance,
machinery breakdown insurance, domestic cargo transportation insurance, import and export
cargo insurance and export product liability insurance, which we believe is in line with those
of other companies in the same industry of similar size in China. We also maintain life
insurance for our employees. We do not maintain business interruption insurance or key-man
insurance. Our management evaluate the adequacy of our insurance coverage from time to time
and purchase additional insurance policies as needed. See “Risk Factors — Risks Relating to
Our Business and Industry — Our insurance coverage may not be sufficient to cover all the
losses associated with our business operations.”
PROPERTIES
Owned Properties
As of March 31, 2025, our Company and major subsidiaries in the PRC owned the land
use rights of 35 parcels of land with an aggregate site area of approximately 5,136,000 sq.m.,
and 151 properties with an aggregate GFA of approximately 2,040,000 sq.m. We use these
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properties as premises for production facilities, offices, research centers and other ancillary
purposes. See “History, Development and Corporate Structure — Our Major Subsidiaries” for
details of our major subsidiaries in China.
As of March 31, 2025, we owned one property with a total GFA of approximately 18,673
sq.m. in Malaysia. We use this property as premises for production facilities.
As of the Latest Practicable Date, we and our major subsidiaries had not obtained the
building ownership certificates of certain properties with a gross floor area of approximately
2,000 square meters (accounting for less than 0.2% of the aggregate gross floor area of our
owned properties). These properties are located in Wuhu, which we primarily use for ancillary
purposes, such as sewage treatment station and guardhouses, and for staff accommodations.
Our Directors are of the view that the defects of such properties would not materially and
adversely affect our business operations, primarily because we have obtained a confirmation
letter from the relevant competent authority indicating that such defect does not constitute a
material non-compliance of relevant laws and regulation and we had not been imposed with
any administrative penalties. As advised by our PRC Legal Advisor, that the risk that the
relevant competent government authority may require us to demolish or relocate from or cease
to use such buildings or may impose any administrative penalties on us is relatively low.
As of the Latest Practicable Date, we and our major subsidiaries were in the process of
obtaining the building ownership certificates of two properties with an aggregate gross floor
area of approximately 32,975.1 square meters. Such properties are located in Fujian Province
and currently used as offices and for residential purposes. Our Directors are of the view that
the defects of such buildings would not materially and adversely affect our business operations,
primarily because we have obtained confirmation letters from the relevant competent
authorities indicating that such defect does not constitute a material non-compliance of
relevant laws and regulations and we had not been imposed with any administrative penalties.
Our Directors are of the view that our business operations do not materially rely on these
properties and the defects of such owned buildings would not materially and adversely affect
our business. As advised by our PRC Legal Advisor, there is no material legal impediment for
us to apply and obtain the building ownership certificates. See “Risk Factors — There are
defects in our titles of, or rights to use, certain properties.”
As of March 31, 2025, we did not have any single property with a book value accounting
for 15% or more of our total assets. According to Chapter 5 of the Hong Kong Listing Rules
and section 6(2) of the Companies Ordinance (Exemption of Companies and Prospectuses from
Compliance with Provisions) Notice, this prospectus is exempt from the requirements of
section 342(1)(b) of the Companies (Winding up and Miscellaneous Provisions) Ordinance to
include all interests in land or buildings in a valuation report as described under paragraph
34(2) of the Third Schedule to the Companies (Winding up and Miscellaneous Provisions)
Ordinance.
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Leased Properties
As of March 31, 2025, our Company and our major subsidiaries in the PRC leased 11
properties, from Independent Third Parties, with an aggregated GFA of approximately
1,284,000 sq.m., which are primarily used as production facilities and for ancillary purposes.
As of March 31, 2025, the landlord of four of our leased properties in China had not
provided us with valid title certificates. These leased properties were used for the primary
purpose of warehousing and workshops. Our Directors are of the view that the defects of such
properties would not materially and adversely affect our business operations, primarily because
our business operation does not materially rely on these leased properties. As advised by our
PRC Legal Adviser, the defects of such leased buildings would not materially and adversely
affect our business operations and financial performance.
Pursuant to the applicable PRC laws and regulations, property lease contracts must be
registered with the local branch of the Ministry of Housing and Urban Development of the
PRC. As of the Latest Practicable Date, we had not yet completed the registration of property
lease contracts we entered into in the PRC. As advised by our PRC Legal Adviser, failure to
complete the lease registration will not affect the validity of the lease agreements according to
PRC law, but we may have a maximum penalty of RMB10,000 imposed on us for each
non-registered lease if we fail to complete the registration of any of our future lease agreements
after we are requested to do so by the competent PRC government authorities. As of the Latest
Practicable Date, we had not been ordered to make corrections by the competent local
counterpart of Ministry of Housing and Urban Development. See “Risk Factors — Risks
Relating to Our Business and Industry — We may face penalties for the non-registration of our
lease agreements in China.”
As of March 31, 2025, we also leased properties in jurisdictions outside the PRC. Such
properties are primarily used as office buildings, warehousing and staff accommodation.
INTRA-GROUP TRANSACTIONS
The Organization for Economic Cooperation and Development (the “ OECD ”), an
international organization of international cooperation, promulgated the transfer pricing
guidelines for multinational enterprises and tax administrations (the “ OECD Transfer Pricing
Guidelines ”). According to the OECD Transfer Pricing Guidelines, our intra-Group
transactions should be on an arm’s-length basis.
We conducted business operations primarily through our Company and our PRC and
overseas subsidiaries with the following material intra-group transactions during the Track
Record Period (the “ Intra-Group Transactions ”): (i) our certain subsidiaries that are engaged
in passenger vehicle manufacturing in China (the “ Passenger Vehicle Manufacturers ”)
procured auto parts and components from our certain subsidiaries that are engaged in auto parts
manufacturing in China (the “ Auto Parts Manufacturers ”); and (ii) the Passenger V ehicle
Manufacturers sold passenger vehicles and/or KD kits to our certain PRC subsidiaries that are
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engaged in sales of passenger vehicles and/or KD kits (the “ Domestic Sales Companies ”) and
overseas subsidiaries that are engaged in sales of passenger vehicles and/or assembly of
purchased KD kits into passenger vehicles for further sales in local market (the “ Overseas
Sales Companies ”) located in jurisdictions such as Russia, Mexico, Italy, Indonesia and
Malaysia.
The diagram below sets forth the business and logistic flow of the Intra-Group
Transactions within the Group during the Track Record Period:
Auto Parts
Manufacturers
(PRC)
Auto parts &
components Passenger Vehicle
Manufacturers
(PRC)
Passenger
Vehicles/
KD Kits
Domestic Sales
Companies
(PRC)
Overseas Sales
Companies
(Overseas)
During the Track Record Period, the Group mainly applied the following transfer pricing
methods in respect of the Intra-Group Transactions:
(i) When Passenger V ehicle Manufacturers procured auto parts and components from
Auto Parts Manufacturers, the parties to the transaction mainly determined the
transfer pricing of parts and components through the comparable uncontrolled prices
reflected in centralized bidding processes, or by ensuring that the Auto Parts
Manufacturers obtained a full cost markup profit level in line with the arm’s length
principle when the market prices were unavailable;
(ii) When Passenger V ehicle Manufacturers sold passenger vehicles to Domestic Sales
Companies for sales in Chinese domestic market, the transaction parties mainly
determined the transfer pricing of the passenger vehicles through the profit split
method according to the contributions made in specific model of passenger vehicle
by the Passenger V ehicle Manufacturers and the Domestic Sales Companies;
(iii) When Passenger V ehicle Manufacturers sold passenger vehicles to Domestic Sales
Companies for export or to Overseas Sales Companies for sales in overseas local
markets, the transaction parties usually determined the transfer pricing of passenger
vehicles by ensuring that Domestic Sales Companies or Overseas Sales Companies
retained the operating profit level in line with the arm’s length principle based on
the functions performed and risks assumed by Domestic Sales Companies and
Overseas Sales Companies; and
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(iv) When Passenger V ehicle Manufacturers sold KD kits to Overseas Sales Companies
for further assembly in local market, the transaction parties usually determined the
transfer pricing of KD kits by ensuring that Overseas Sales Companies retained the
full cost mark-up profit level in line with the arm’s length principle based on the
functions performed and risks assumed by Overseas Sales Companies.
In accordance with the applicable tax laws and regulations of the relevant tax
jurisdictions, intra-group transactions must comply with the arm’s length principle. We have
engaged a transfer pricing advisor, Ernst & Y oung (China) Advisory Limited (the “ Transfer
Pricing Advisor ”) to review and assess the Group’s transfer pricing arrangements. The
Transfer Pricing Advisor reviewed the Intra-Group Transactions, interviewed the management
of the Group, conducted industry analysis and comparability analysis and evaluated whether
the price or profit level of the Intra-Group Transactions met the price and profit level required
by the arm’s length principle under appropriate transfer pricing methods. The review and
analysis conducted by the Transfer Pricing Advisor is mainly based on the OECD Transfer
Pricing Guidelines and the requirements of relevant PRC transfer pricing laws and regulations.
The Transfer Pricing Advisor selected the following assessment methodologies based on
the nature and characteristics of the Intra-Group Transactions: (i) Comparable Uncontrolled
Price (“ CUP”) method or Transaction Net Margin Method (“ TNMM ”) was applied for the
procurement of auto parts and components by the Passenger V ehicle Manufacturers from Auto
Parts Manufacturers; (ii) profit split method or TNMM was applied for the sales of passenger
vehicles from the Passenger V ehicle Manufacturers to the Domestic Sales Companies for
passenger vehicles sold in Chinese domestic market; (iii) TNMM was applied to evaluate the
transfer pricing of sales of passenger vehicles from Passenger V ehicle Manufacturers to
Domestic Sales Companies for export sales of passenger vehicles and to Overseas Sales
Companies; and (iv) TNMM was applied to the KD kits sold by the Passenger V ehicle
Manufacturers to Overseas Sales Companies. TNMM compares the net profit margin of the
Intra-Group Transactions with the net profit margin achieved by comparable transactions
between independent third parties. CUP method compares the prices charged under the
Intra-Group Transactions with the prices of comparable transactions between independent third
parties. The profit split method allocates the transfer pricing price or profit according to the
value contribution made by the participants involved in the Intra-Group Transactions.
Based on the above analysis, the Transfer Pricing Advisor is of the view that (i) the
weighted average price and/or profit level of the Intra-Group Transactions conducted by the
Group during the Track Record Period is within the range of the respective arm’s length price
and/or profit margin; (ii) the Group’s transfer pricing arrangements meet the requirements of
the arm’s length principle; and (iii) there is no material transfer pricing risk identified on the
Intra-Group Transactions of the Group during the Track Record Period.
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LEGAL PROCEEDINGS AND COMPLIANCE
Legal Proceedings
We may from time to time be subject to various legal or administrative claims
proceedings arising from the ordinary course of business. Litigation or any other legal or
administrative proceeding, regardless of the outcome, is likely to result in substantial cost and
diversion of our resources, including our management’s time and attention. See “Risk Factors
— Risks Relating to Our Business and Industry — We may from time to time be subject to
claims, disputes, lawsuits and other legal and administrative proceedings.”
During the Track Record Period and up to the Latest Practicable Date, there were no legal
proceedings pending or threatened against us or our Directors that could, individually or in the
aggregate, have a material adverse effect on our business, financial condition and results of
operations.
Legal Compliance
During the Track Record Period and up to the Latest Practicable Date, we had not been
and were not involved in any material non-compliance incidents that would have a material
adverse effect on our business, financial condition and results of operations.
LICENSES, APPROV AL AND PERMITS
During the Track Record Period and up to the Latest Practicable Date, we have obtained
all licenses, approvals and permits that are material and necessary for our business operations
in jurisdictions where we operate, and such licenses, approvals and permits are valid and
subsisting.
The following table sets forth details of our material licenses and permits:
Project Permit (1) Manufacturer Access Permit (1)
License/Permit Holder
Issuing
Authority Grant Date
Issuing
Authority Grant Date
V ehicle Production
Qualification
(዆ԓ͛ପ༟ሯ) /H1118/H1118/H1118
Our Company Anhui Provincial
Development
and Reform
Commission
November 10,
2006
NDRC September 10,
2004
Our Company Anhui Provincial
Development
and Reform
Commission
October 16,
2023
MIIT February 04,
2024
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Project Permit (1) Manufacturer Access Permit (1)
License/Permit Holder
Issuing
Authority Grant Date
Issuing
Authority Grant Date
Our Company Anhui Provincial
Development
and Reform
Commission
August 13,
2024
MIIT December 30,
2024
Dalian Branch of
our Company
Department of
Equipment
Industry of
MIIT
September 27,
2009
MIIT November 05,
2012
Ordos Branch of
our Company
Department of
Equipment
Industry of
MIIT
November 20,
2012
MIIT June 24, 2013
Qingdao Branch
of our
Company
Qingdao
Municipal
Development
and Reform
Commission
February 8,
2021
MIIT July 17, 2023
Henan Branch of
our Company
Henan Provincial
Development
and Reform
Commission
May 14, 2024 MIIT October 18,
2024
Chery New
Energy
NDRC October 25,
2016
MIIT September 05,
2018
Shijiazhuang
Branch of
Chery New
Energy
Hebei Provincial
Development
and Reform
Commission
January 8,
2019
MIIT September 13,
2023
Qihe Branch of
Chery New
Energy
Shandong
Provincial
Development
and Reform
Commission
July 9, 2018 MIIT July 20, 2020
Note:
1. There is no expiry date for the project permit and manufacturer access permit, respectively.
BUSINESS
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A W ARDS AND RECOGNITION
During the Track Record Period and up to the Latest Practicable Date, we received awards
and recognition in respect of our products, technologies and innovations, significant ones of
which are set forth below:
Y ear Award/Recognition Awarding Institution/Authority
2022 /H1118/H1118/H1118/H1118/H1118Gold Medal of the 47th International
Convention on Quality Control
Circles
the 47th International Convention on
Quality Control Circles (ICQCC)
2023 /H1118/H1118/H1118/H1118/H11182023 Forbes China ESG Innovators Forbes China ESG Innovation Awards
Organizing Committee
2023 /H1118/H1118/H1118/H1118/H1118Green Supply Chain Management
Enterprise
MIIT
2023 /H1118/H1118/H1118/H1118/H1118First Prize of the 28th National
Enterprise Management
Modernization Innovation
Achievements
China Enterprise Confederation,
China Entrepreneurs Association
2023 /H1118/H1118/H1118/H1118/H1118Ranked No. 1 among Chinese
passenger vehicle brand in the 2023
China Initial Quality Study (IQS)
J.D. Power
2023 /H1118/H1118/H1118/H1118/H1118China Top 10 Engine and Hybrid
System Award
Automobile and Sport
2024 /H1118/H1118/H1118/H1118/H11182024 Fortune China ESG Impact List Fortune China
2024 /H1118/H1118/H1118/H1118/H1118National Enterprise Culture Best
Practice Enterprise
China Enterprise Confederation,
China Entrepreneurs Association
2024 /H1118/H1118/H1118/H1118/H1118Excellent Sustainable Development
Practice Case
China Association of Automobile
Manufacturers
2024 /H1118/H1118/H1118/H1118/H1118Quality Technology Award – Second
Prize
China Association of Quality
2024 /H1118/H1118/H1118/H1118/H1118Ranked 187th in the list of China’s
500 Most V aluable Brands in 2024
World Brand Lab
BUSINESS
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Y ear Award/Recognition Awarding Institution/Authority
2024 /H1118/H1118/H1118/H1118/H1118Ranked No. 1 among Chinese
passenger vehicle brands in the
2024 China Sales Satisfaction Index
(SSI)
J.D. Power
2024 /H1118/H1118/H1118/H1118/H1118Ranked No. 1 among Chinese
passenger vehicle brands in the
2024 China Automotive
Performance, Execution and Layout
(APEAL) Study
J.D. Power
2024 /H1118/H1118/H1118/H1118/H1118Ranked No. 1 among Chinese
passenger vehicle brands in the
2024 China Initial Quality Study
(IQS)
J.D. Power
2024 /H1118/H1118/H1118/H1118/H1118Ranked No. 1 in the automotive
category of the 2024 Top 50 China
Global Brand
Google and Kantar
2025 /H1118/H1118/H1118/H1118/H11182025 Fortune China ESG Impact List Fortune China
2025 /H1118/H1118/H1118/H1118/H1118T9 under Fulwin series ranked No. 1
among PHEVs in the 2025 China
NEV-IQS
J.D. Power
BUSINESS ACTIVITIES IN REGIONS SUBJECT TO INTERNATIONAL SANCTIONS
Certain countries or organizations, including the U.S., the EU, the United Kingdom, the
United Nations and Australia, maintain economic sanctions and trade restrictions targeting
certain industries or sectors within certain regions subject to International Sanctions. In
general, there are two types of International Sanctions: (i) primary sanctions, which are
triggered when transactions involve a nexus to the sanctions-administering jurisdiction; and
(ii) secondary sanctions, which can be enforced without a nexus to the sanction-administering
jurisdiction, when certain transactions involve certain sanctioned regions, activities, entities
and/or sectors.
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U.S. sanctions
Primary sanctions
Primary U.S. sanctions can be triggered when a transaction involves a U.S. nexus, which
is generally where the transaction involves a U.S. person or entity, U.S. items or the transaction
is denominated in U.S. dollars. During the Track Record Period, we had sales of Chinese-origin
passenger vehicle and auto parts to non-sanctioned customers located in the Balkans (Serbia),
Belarus, Cuba, Democratic Republic of the Congo, Egypt, Ethiopia, Hong Kong, Iran, Iraq,
Lebanon, Libya, Myanmar, Nicaragua, Russia, Somalia, Tunisia, Turkey, Ukraine (excluding
the Crimea/so-called Luhansk People’s Republic and so-called Donetsk People’s Republic
regions/Kherson/Zaporizhzhia regions), V enezuela and Y emen (“ Relevant Regions ”). Among
the Relevant Regions, Iran and Cuba are Comprehensively Sanctioned Countries in the U.S.
sanctions regime and are subject to broad-based territorial sanctions. The revenue generated
from our sales to Iran and Cuba represented less than 0.5% of our total revenue for each of the
period during the Track Record Period. The revenue generated from our sales to Russia were
represented approximately 13.4%, 25.5%, 17.7% and 10.7% of our total revenue for the period
during the Track Record Period, respectively. There is no outstanding commitment that the
Group has yet to fulfill in relation to its transactions with Iran and Cuba as at the Latest
Practicable Date. The U.S. sanctions programs against Iran and Cuba prohibit U.S. persons
from dealing with such Comprehensively Sanctioned Countries and their governments as well
as persons or entities in such countries or territories; transactions with Iran and Cuba involving
other U.S. nexus (including transactions denominated in U.S. dollars) are also prohibited under
the said regimes, regardless if a U.S. person is involved. In contrast, the other Relevant
Regions are subject to a more limited set of sanctions targeting certain sanctioned entities
and/or sectors in the countries or territories.
To mitigate sanctions risks, the Group had ceased its sales with Iran and Cuba as of
December 31, 2024. As advised by our International Sanctions Legal Advisers, during the
Track Record Period the Group’s activities in the Relevant Regions did not represent a Primary
Sanctioned Activity or a violation of the U.S. primary sanctions, on the following bases:– (i)
save for the transactions with Iran and Cuba, we had no transactions with other
Comprehensively Sanctioned Countries; and for our transactions with Iran and Cuba, they only
involved sales of Chinese-origin passenger vehicle and auto parts for maintenance
denominated RMB or EUR, therefore no U.S. nexus was involved in the transactions and U.S.
primary sanction was not triggered; and (ii) for the transactions with other Relevant Regions
(i.e. non-Comprehensively Sanctioned Countries), our customers in such countries or
territories were not Sanctioned Targets and therefore the transactions did not represent a
violation of the U.S. primary sanctions.
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Secondary sanctions
U.S. secondary sanctions can apply extra-territorially and without a U.S. nexus. The
United States has through executive orders provided grounds for agencies, including OFAC, to
designate entities viewed to be “operating in” certain sectors in sanctioned countries or
territories, including the Relevant Regions. There is a risk that OFAC may consider us as
operating in the “transportation” sector of Russia by virtue of our sales of automobiles to
Russia and our subsidiaries in Russia, hence there could be exposure to secondary sanctions
enforcement risk. However, OFAC through FAQs explained that a sector determination made
pursuant to EO 14024 does not automatically impose sanctions on all persons who operate or
have operated in the sector, only persons designated pursuant to EO 14024 for being viewed
to operate or viewed to have operated in the certain designated sector are subject to sanctions.
In OFAC FAQ 1151, OFAC provided guidance the facts and circumstances attributable to
whether OFAC would designate under EO 14024 include the totality when determining whether
a transaction or transactions are “significant”, including: “(a) the size, number, and frequency
of the transaction(s); (b) the nature of the transaction(s); (c) the level of awareness of
management and whether the transactions are part of a pattern of conduct; (d) the nexus of the
transaction(s) to persons sanctioned pursuant to EO 14024, or to persons operating in Russia’s
military-industrial base; (e) whether the transaction(s) involve deceptive practices; (f) the
impact of the transaction(s) on U.S. national security objectives; and (g) such other relevant
factors that OFAC deems relevant.”
Taking into account of the guidance provided by OFAC, when assessing the totality of our
Russia sales, our International Sanctions Legal Advisers took into consideration the following
factors provided by us, including:
(i) our products (i.e. vehicles or aftermarket parts for maintenance) are not listed on the
Russia Critical Items Determination issued pursuant to subsection 11(a)(ii) of EO
14024 (a list that OFAC identified certain items that support Russia’s military-
industrial base) nor the Common High Priority List issued by the Bureau of Industry
and Security on February 23, 2024 (a list that BIS listed 50 common high priority
items to highlight for industry that these items pose a heightened risk of being
diverted illegally to Russia because of their importance to Russia’s war efforts);
(ii) we did not sell vehicles or parts subject to the EAR to Russia;
(iii) Our sales to Russia were denominated in Russian Rubbles and were processed
through non-sanctioned banks;
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(iv) we did not engage in transactions, business or financial dealings that directly or
indirectly involve or benefit any Sanctioned Targets (including those subject to
sanctions restrictions because of sanctions ownership), SDNs, “military end-users”
or “military end-use” such as the national armed services (army, navy, marine, air
force, or coast guard), the national guard and national police, government
intelligence or reconnaissance organizations, intelligence or reconnaissance
organization of the armed services, or national guard, or any person or entity whose
actions or functions are intended to support military or military-intelligence
end-uses (as defined in Part 744 of the EAR);
(v) we had not been designated as a Sanctioned Target as of the Latest Practicable Date;
and
(vi) to demonstrate our compliance efforts, we will downscale our operation and sales in
Russia to mitigate sanctions risks, including downscaling our presence and sales in
Russia.
Our International Sanctions Legal Advisor also took into account to the recent
enforcement trends when assessing our secondary sanctions risks, including that (i) as of the
Latest Practicable Date, no Chinese vehicle manufacturer had been designated under the EO
14024 secondary sanctions authority for selling automobiles in Russia; and (ii) during the
Track Record Period, other major non-Russian labels had also been selling to Russia, and as
of the Latest Practicable Date no SDN designation had been made against any non-Russian
companies for such activity.
These factors demonstrated that (i) we did not supply any products subject to U.S. export
controls to Russia; (ii) our products sold to Russia are not identified by OFAC or BIS as
products critical or of high priority for the Russia military effort; (iii) we did not engage in
transactions, business or financial dealings with persons sanctioned pursuant to EO 14024, or
to persons operating in Russia’s military-industrial base; (iv) recent enforcement actions do not
indicate that secondary sanctions against non-Russian companies for selling vehicle to Russia
are an immediate enforcement priority. While our scope of business involves transportation in
a broad sense, it remains for the Treasury to designate and determine whether the Group indeed
“operates in the Russian transportation sector.” We are currently not designated under EO
14024. The fact that our business involves transportation does not mean that EO 14024
automatically imposes sanctions on us. In addition, we are further demonstrating our sanctions
and export controls compliance efforts by downsizing our operations and sales in Russia. Based
on the aforementioned, as advised by our International Sanctions Legal Advisers, we believe
the risk of secondary sanctions risk is fairly low for the Group’s operation in general and in
relation to our sales to Russia.
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UN, EU, UK and Australia
As further advised by our International Sanctions Legal Advisers, our business dealings
in the Relevant Regions did not implicate restrictive measures adopted by the UN, the EU, the
U.K., and Australia because our customers in the Relevant Regions were not sanctioned under
any sanctions regimes administered by the UN, the EU, the U.K. and Australia. For a summary
of the sanctions regimes imposed by these countries, see “Regulatory Overview — Sanctions
Laws and Regulations.”
Risk Exposure and Internal Controls
To mitigate our sanctions risks, we had ceased our transactions with Iran and Cuba as of
December 31, 2024 and are downscaling our activities with Russia. In March 2025, we begun
to downsize our Russian operations and in April, we entered into agreements to dispose a
portion of our local assets and distribution channels. In particular, on April 28, 2025, Chery
Russia, a wholly-owned subsidiary of us, entered into agreements with three companies, each
of which is primarily engaged in the business related to the sale of passenger vehicles and an
Independent Third Party. Pursuant to the agreements, we agreed to transfer (i) our inventories
primarily involving passenger vehicles under the brands and product series of CHERY , EXEED
and OMODA and JAECOO and (ii) associated warranty obligations and local distribution
networks for these brands and product series. The disposal was completed by July 31, 2025.
Moreover, as of the Latest Practicable Date, we were contemplating the business plan with
regards to the disposal of inventories primarily involving Jetour passenger vehicles and
associated warranty obligations and local distribution networks. It is expected that we will
gradually reduce existing brands and distribution channels in Russia by 2027. While we are
striving to increase our existing market share in overseas markets, we are also actively
expanding into other overseas markets to minimize the impact of the downsizing of our Russian
operations on our results of operations and financial performance. During the Track Record
Period, we primarily sold our passenger vehicles in Russia through a network of local dealers.
Our subsidiaries in Russia are responsible for sales, marketing and managing our local
dealerships. We primarily sold passengers vehicles under the brands and product series of
CHERY , JETOUR, EXEED and OMODA and JAECOO in Russia. As of December 31, 2022,
2023 and 2024 and March 31, 2025, we had 130, 342, 372 and 372 dealers and 141, 564, 682
and 687 dealership outlets, respectively, in Russia. In selecting our dealers and dealership
outlets in Russia, we generally adopt the similar approach in selecting those in our home
market. Our inventory in Russia includes whole passenger vehicles and automotive parts and
components. We implement an inventory management policy on the acceptance, storage,
accounting, disposal and custom clearance to ensure the safety and integrity of inventory, thus
improving the operational efficiency. We inspect incoming inventory of passenger vehicles for
both quantity and quality and request for return or replace of non-confirming items. We store
our passenger vehicles in accordance with their vehicle identification number and shipment
plan and automative parts and components by categories. We carry out on-site inspections and
reconcile inventory accounts on a monthly basis and report any discrepancies to the finance
department. Through the inventory management process, we promptly identify obsolete stock
and compile lists for internal review, allowing the management to decide whether to discount,
BUSINESS
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sell off, scrap, or dispose of these items. Moreover, we also make necessary arrangement with
third-party warehouse and logistics services providers in respect of customs clearance for
imported goods. The revenue generated from our sales to Russia as a percentage of the total
revenue of our Company decreased from 25.5% in 2023 to 17.7% in 2024 and further to 10.7%
in the three months ended March 31, 2025 and is expected to downscale the sales of passenger
vehicles in Russia as a percentage of total revenue contribution to be negligible in 2027. The
Directors confirm that the scaling down of our Russian business (including the
abovementioned disposal) would unlikely to have any material adverse impact on the Group’s
business operations and financial performance with the following basis: firstly, as a Chinese
domestic brand passenger vehicles company with global operations, the Company is well
positioned to capture the potential growth opportunities in the PRC and overseas markets
capitalizing its well established R&D centers, production and sales network worldwide. With
the continuous growth of sales in both the PRC and overseas markets, the revenue of the
Company generated from the sales to Russia as a percentage of the total revenue of the
Company decreased from 25.5% in 2023 to 17.7% in 2024 and further to 10.7% in the three
months ended March 31, 2025; secondly, since the Company does not have production
facilities in Russia, its operational and sales cost would decrease accordingly with the
downsizing business operations in Russia; and thirdly, vehicles manufactured in the PRC under
current production capacity can be flexibly allocated to the demand in the non-Russian
markets. We will closely monitor the geopolitical changes and may adjust our business strategy
in Russia in the future in response to changes in the international regulatory environment,
including sanctions and export controls programs. In addition, we have appointed an internal
control consultant to review the effectiveness of our internal control measures related to our
major business processes, including our measures in managing economic sanction risks. After
the review of the internal control consultant, we have formulated corresponding enhanced
internal control and risk management measures in February 2025, which will be
comprehensively implemented before Listing.
 we will set up and maintain a separate bank account upon the Listing, which will be
designated for the sole purpose of the deposit and deployment of the proceeds from
the Global Offering or any other funds raised through the Stock Exchange;
 our finance department will review, approve, process and monitor the use of
proceeds from the Global Offering, as well as any other funds raised through the
Stock Exchange, to ensure that such funds will not be used to finance or facilitate,
directly or indirectly, activities or business (such as R&D of passenger vehicles and
advanced technologies, establishing of production facilities and marketing of
passenger vehicles) with, or for the benefit of, Russia, Belarus, the Comprehensively
Sanctioned Countries or Sanctioned Targets, and it will report to the Directors on the
use of proceeds on a semi-annual basis;
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 to further enhance our existing internal risk management functions, our legal
department is responsible for controlling and monitoring our exposure to sanctions
risks and our implementation of the related internal control procedures. Our legal
department will hold a meeting biannually to control and monitor our exposure to
sanctions risks and to review our procedures implemented over sanctions screening;
 we will evaluate the sanctions risks prior to determining whether we should embark
on any business opportunities in regions subject to International Sanctions or
Sanctioned Targets. According to our internal control procedures, our legal
department needs to review and approve all relevant business transaction
documentation from customers or potential customers, suppliers and vendors from
regions subject to restrictions under International Sanctions or who are Sanctioned
Targets. In particular, as of Latest Practicable Date, we had implemented the
screening process to identify if the potential transaction counterparty of the Group
is a person or entity on the various lists of restricted parties or located in sanctioned
regions maintained by the U.S., the EU, the UN, the U.K. or Australia. Our legal
department will provide such lists of restricted parties and regions under
International Sanctions to our Directors, senior management and other relevant
personnel, who will in turn disseminate such information internally. The
transactions that fail the internal review will not be proceed. We have engaged an
external vendor to introduce an advanced information technology system, which
enables automatic and active monitoring to be integrated into all business-related
units and will perform real-time screening on entities and counterparties in proposed
and ongoing transactions against the dynamically updated lists of Sanctioned
Targets. The system was launched in June 2025. The advanced information
technology system will also perform ongoing monitoring of the Group’s existing
entities and counter parties by crosschecking these names against the lists of
Sanctioned Targets on a regular basis. At the same time, our legal department
should quarterly review the existing customers and suppliers lists to ensure that the
Group does not engage in transactions with countries, regions, entities or individuals
on the sanction lists. If any potential sanctions risk or suspicious transaction is
identified, we may seek advice from reputable external legal counsel with necessary
expertise and experience in International Sanctions matters;
 The Group will adopt policy before the Listing with respect to self-reporting of
sanctions risks, including consultation with its sanctions legal advisers and timely
reporting to the relevant government authority upon identification of any confirmed
sanctions violations;
 we will include a compliance clause in contracts with the Group’s customers and
suppliers or request a separate certification from the customers and suppliers,
requesting them to undertake (i) to comply with all sanctions imposed by the U.S.,
the EU, the UN, the U.K. and other economic sanctions applicable to them and us;
(ii) not to take any action, including the sale, distribution or delivery of our products
BUSINESS
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which could cause them or us to violate any applicable sanctions; and/or (iii) not to
take any action, including the sale, distribution or delivery of any products to our
Group which could cause them or us to violate any applicable sanctions;
 our Directors will continuously monitor the use of proceeds from the Global
Offering, as well as any other funds raised through the Stock Exchange, to ensure
that such funds will not be used to finance or facilitate, directly or indirectly,
activities or business with, or for the benefit of, Russia, Belarus, the
Comprehensively Sanctioned Countries or Sanctioned Targets;
 our legal department and internal audit department will review our internal control
policies and procedures with respect to sanctions matters as part of the biannual
meeting. Our legal department will provide the latest list of regions and restricted
suppliers and customers subject to International Sanctions to our Directors, senior
management and other relevant personnel, who will in turn disseminate such
information internally. As and when our legal department considers necessary, we
will retain external legal counsel with necessary expertise and experience in
sanctions matters for recommendations and advice;
 if necessary, we will engage external legal counsel to provide compliance training
relating to the International Sanctions to our Directors, our senior management and
other relevant personnel to assist them in evaluating the potential sanctions risks in
our daily operations, in particular, to perform screening procedures in respect of
counterparties to our Group’s business to ensure none of them are Sanctioned
Targets; and
 our audit team will conduct internal audit on a semi-annual basis, monitoring the
implementation of sanction-related internal control policies and procedures and
requesting corrective action for any identified non-compliance.
Our Directors confirm that we do not have any present intention to undertake any business
involving directly or indirectly the Comprehensively Sanctioned Countries. We will not
knowingly or intentionally conduct any business with any Sanctioned Targets, or any business
in any Comprehensively Sanctioned Countries that will cause us to violate International
Sanctions, and we will not use the proceeds from the Global Offering or any other funds raised
through the Stock Exchange to finance or facilitate, directly or indirectly, activities or business
involving, or for the benefit of, parties with ties to Russia, Belarus, the Comprehensively
Sanctioned Countries or Sanctioned Targets. Our Directors will continuously monitor the use
of proceeds from the Global Offering, as well as any other funds raised through the Stock
Exchange, to ensure that such funds will not be used to finance or facilitate, directly or
indirectly, activities or business with, or for the benefit of, parties with ties to Russia, Belarus,
the Comprehensively Sanctioned Countries or Sanctioned Targets. Our internal control
consultant has reviewed the enhanced internal control and risk management measures and is of
the view that such measures are adequate and effective.
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Given the scope of the Global Offering and the expected use of proceeds from the Global
Offering as set out in “Future Plans and Use of Proceeds”, our International Sanctions Legal
Advisers are of the view that the sanctions risk exposure to the Joint Sponsors, future investors
and future public shareholders and persons who might, directly or indirectly, be involved in
permitting the listing, trading, clearing and settlement of the Shares, including the Stock
Exchange and its related group companies is low.
IMPACT OF U.S. AND EU TARIFF REGULATIONS AND U.S. RESTRICTIONS ON
SEMICONDUCTOR EXPORTS
The current tension in international trade and rising political tension, may affect our
business operations and results of operation as this could potentially affect the demand of our
customers for passenger vehicles. In early 2025, the U.S. government issued multiple executive
orders implementing additional tariffs on imports from various jurisdictions, including
additional tariffs amounting to an aggregate of 145% on imports from the PRC that took effect
on April 10, 2025 (the IEEPA tariffs), and the proclamation invoking Section 232 of the Trade
Expansion Act of 1962 that imposed a 25% tariff on imported automobiles with effect from
April 3, 2025 (Section 232 tariffs). On May 12, 2025, the PRC government and U.S.
government issued a joint announcement acknowledging that both parties will take actions to
build a sustainable and long-term trade relationship. In particular, the U.S. government took
actions to reduce the IEEPA tariff rate to 30% on imports from the PRC on a temporary basis
for an initial period of 90 days from May 14, 2025, which was extended for another 90 days
on August 12, 2025. Nevertheless, other potential duties could be imposed depending on the
changing international trade environment. We did not generate any revenue from sales of
passenger vehicles to the U.S in each period during the Track Record Period. In addition, on
October 29, 2024, the EU members voted to adopt provisional countervailing duties of up to
35.3% on imports of Chinese-made EVs which entered into effect on October 30, 2024. The
specific duty rate is dependent of the Chinese EV manufacturers. The revenue from our exports
of passenger vehicles to EU accounted for less than 3.8% of our total revenue in each period
during the Track Record Period.
Our Directors do not expect that the tariffs imposed by the U.S. and EU regarding Chinese
imports or NEVs would result in a material adverse impact on the business operations and
financial performance of our Group given that (i) we did not export passenger vehicles directly
to the U.S. in each period during the Track Record Period and as of the Latest Practicable Date,
we did not have specific plans to export passenger vehicles directly to the U.S. and (ii) the sales
of our passenger vehicles to the EU markets is relative small compared to other overseas
markets in each period during the Track Record Period and we plan to further advance
localized manufacturing and assembly and expand our overseas production network in EU
markets, thereby reducing tariff risks. However, the U.S. and EU tariffs and trade policies are
subject to constant changes, influenced by evolving geopolitical dynamics, economic priorities
and regulatory agenda, and such policies may be amended, expanded, or replaced with short
or no advance notice. We cannot assure you that we will not be subject to stricter tariff rules
or trade restrictions in the future and we may be subject to risks relating to tariff changes. See
“Risk Factors — Risks relating to our Business and Industry — Changes in international trade
policies, geopolitics and trade protection measures, export control and economic or trade
sanctions may affect our business, financial condition and results of operations.”
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Moreover, on October 7, 2022, the U.S. Department of Commerce, the U.S. Bureau of
Industry and Security (“ BIS”) published rules that introduce new restrictions related to
semiconductors, semiconductor manufacturing, supercomputers, and advanced computing
items and end uses in Mainland China, Hong Kong or Macau. BIS’ rules on advanced
computing and semiconductor manufacturing were implemented in two key areas. First, these
rules impose restrictive export controls on certain advanced computing semiconductor chips
and software, transactions for supercomputer end-uses, and transactions involving certain
entities on the Entity List. Second, these rules impose new controls on certain semiconductor
manufacturing items and on transactions for certain integrated circuit (IC) end uses. We
purchased automotive chips that can generally be exported without a license (a type of products
that are generally consist of low-technology consumer goods and do not require a license to
export in most situations) from the U.S. for use in our passenger vehicles. As advised by our
International Sanctions Legal Advisers, such purchases are not currently affected by U.S.
export control laws in any material respect. Based on the conclusion reached by the
International Sanctions Legal Advisers, the Directors are of the view that the continued
tightening of U.S. restrictions on semiconductor exports would not have a material adverse
impact on the business operations and financial performance of our Group. However, as the
Entity List and other U.S. export control laws and regulations continue to expand and evolve,
we cannot assure you that we will not be subject to stricter U.S. export control laws and
regulations in the future and we may be subject to risks relating to such changes. See “Risk
Factors — Risks relating to our Business and Industry — Changes in international trade
policies, geopolitics and trade protection measures, export control and economic or trade
sanctions may affect our business, financial condition and results of operations.”
ENVIRONMENT, SOCIAL AND GOVERNANCE MATTERS
Corporate Governance
We are committed to fostering sustainable practices, promoting social responsibility, and
maintaining strong governance standards, reflecting our dedication to Environmental, Social,
and Governance (“ ESG”) principles. We established an ESG policies (“ ESG Policy ”) in
accordance with the standards of Appendix C2 to the Listing Rules, which outlined, among
others, (i) the appropriate risk governance on ESG matters; (ii) ESG strategy formation
procedures; (iii) management and monitoring of ESG risk (including climate-related risks); and
(iv) the identification of key performance indicators and the relevant measurements and a
multi-level sustainable development governance structure from top to bottom, consisting of the
governance layer, management layer, executive supervision layer, and execution layer.
The Board has the overall responsibility for our ESG matters including evaluating and
determining our ESG-related risks, and establishing, adopting and reviewing the ESG visions,
policy and target of our Group. The Board of Directors has established the Strategy and
Sustainability Committee, consisting of Mr. Yin Tongyue, Ms. Wang Laichun, Mr. Wang
Jinhua, Mr. Zhang Guozhong, Mr. Yin Xiangling, Mr. Lai Ni Hium, Frank and Mr. Y e Shengji,
to lead the ESG vision and goals, ESG risks and opportunities, ESG strategy, system building,
information disclosure and other management matters, and to make suggestions on ESG-related
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work to the Board of Directors in a unified manner, ensuring that the ESG governance
functions are fully performed. For details of the information and working experience of core
members of the Strategy and Sustainability Committee, see “Directors, Supervisors and Senior
Management.”
We identify potential material ESG issues that may affect our Group’s business or
stakeholders such as customers, suppliers, dealers and employees, based on the corporate
strategies of our Group and characteristic of the industry, as well as developments in national
policies and applicable regulatory requirements, industry standards, capital markets and peer
ESG concerns. We assess the materiality of ESG issues using two-dimensional metrics of
“materiality to stakeholders” and “materiality to our business development” by taking into
account the feedback received from stakeholders and research results.
Climate-related risk and opportunities
We have attached great importance to the impact brought by climate change on our
financial operations and sustainable development. With reference to the list of climate related
risks recommended by the Task Force on Climate-related Financial Disclosures, we identified
physical risk and transition risk as our key climate-related risks. Physical risk refers to the risk
related to the frequent extreme weather events such as rainstorms and typhoons which may
disturb our normal operation and cause our economic losses. Transition risk refers to medium
and long-term financial risk related to the shift towards a lower-carbon economy, for example,
changes in climate-related policies and regulations, technological changes, or a change in
market sentiment. As such, the operating costs caused by climate-related policies and
regulations in sustainable practice requirements may be increased.
We also believe that climate change may bring about opportunities to our business
operations and financial positions. For example, regulators promulgate policies to build a
market-based mechanism for the coordinated development between energy conservation and
NEVs, and in response, we have accelerated technological innovation in NEVs and improved
the performance of ICE vehicles to reduce carbon emission.
Environmental protection
We are committed to practicing environmental protection and promoting sustainability to
fulfil our social responsibilities as a global corporate citizen. We have formulated numerous
environmental management policies and measures to avoid and reduce the risks and impacts of
our operations on the environment. As of March 31, 2025, five of our production bases had
been rated as national-level “green factories.” In 2023, were awarded “Green Supply Chain
Management Enterprise” by MIIT.
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We have set the following specific ESG-related targets:
Strategy theme Reduction Targets by 2026
Greenhouse Gas Emission Reduction /H1118/H1118/H1118/H11185% reduction in average vehicle lifecycle
emissions
Electricity Consumption Reduction /H1118/H1118/H1118/H1118/H1118/H11185% reduction in electricity consumption
per vehicle
Water Consumption Reduction /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185% reduction in water consumption per
vehicle
Wastes Discharge /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182% reduction in hazardous waste emission
intensity per vehicle
To achieve the reduction targets, we have adopted the measures set forth below. See “—
Environment, Social and Governance Matters — Emissions” and “— Environment, Social and
Governance Matters — Use of Resources”.
Emissions
Wastes Discharge
We strictly adhere to the requirements of waste management in our operation and
production. We have established various wastes management measures, such as “Solid Waste
Pollution Prevention and Control Management Measures”, “Hazardous Waste Management
Measures” and “Hazardous Waste Storage Safety Management Measures”, which are designed
to reduce resource consumption and negative impact on environment.
For household wastes and non-hazardous solid wastes, we conduct classification
collection and engage third-party organizations for recycling or transport them to designated
waste treatment plants for processing, promoting the recycling and reuse of wastes.
We use low-temperature drying technology to treat sludge from the sewage treatment
plant, achieving a weight reduction of up to 45.0% compared to traditional methods. We place
hazardous wastes in a temporary storage area within our production bases and implement
stringent measures in respect of collection, storage, transportation, and disposal. All hazardous
wastes generated will be entrusted to qualified third-party entities for disposal to prevent any
pollution into the environment.
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Air Emission
We have established measures such as “Air Pollution Prevention and Control Measures”
to manage exhaust emissions. We advocate green production whereby we implement a
comprehensive exhaust emissions management procedures covering the source, process, and
end-of-pipe treatment. Moreover, we use NEVs as our daily factory trailers or business-use
vehicles to reduce green gas emissions.
Wastewater
We have established measures such as the “Water Pollution Prevention and Control
Measures” to strictly implement various wastewater discharge standards set by regulatory
agencies and industry requirements. Our measures include standardizing wastewater treatment
processes, continuously upgrading wastewater treatment facilities and technologies, and
ensuring the treatment of industrial and domestic wastewater in compliance with applicable
discharge standards. We have an automatic monitoring system whereby we are able to monitor
pollutant discharge indicators at various discharge points for prevention of any pollution into
the environment.
Use of Resources
Energy Consumption
We establish the management system measures with high standards and our measures
include “Energy Management Manual” and “Energy Utilization Management Measures.” We
have developed a comprehensive energy management system that features visual management
of energy processes. It monitors energy consumption data from power and auxiliary equipment,
and optimizes energy-saving plans through data analysis and forecasts, and thus improving
energy management efficiency. As of March 31, 2025, we have passed the energy management
system certification audits for GB/T 23331-2020, ISO 50001:2018, and RB/T119-2015.
Water consumption
We strictly adhere to applicable laws and regulations such as “Water Law of the People’s
Republic of China” and “Law of the People’s Republic of China on the Prevention and Control
of Water Pollution.” The water used in our production operations mainly from municipal water
supplies. To reduce the consumption of fresh water, we implement lean production
management and promote green office practices.
At the same time, we actively engage in the recycling of industrial wastewater. We
implemented specialized technology and equipment to ensure that recycled industrial
wastewater meets reuse standards. Moreover, we utilize greywater treatment and rainwater
collection systems to use recycled water for landscape maintenance, ground washing, and other
similar purposes, maximizing the use of water resources.
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The following is our environmental protection related indicators during the Track Record
Period.
For the year ended December 31,
For the three
months ended
March 31,
Unit 2022 2023 2024 2025
Resource consumption
Energy consumption /H1118MWh 712,359.7 1,172,871.1 1,833,274.7 464,286.0
Freshwater intake /H1118/H1118tonne 2,956,576.0 4,319,252.7 6,121,754.9 1,803,643.0
Greenhouse gas
emission
Scope 1 emission /H1118/H1118tCO2e 78,691.2 139,965.9 202,687.4 93,340.1
Scope 2 emission /H1118/H1118tCO2e 284,538.8 363,502.0 530,395.1 84,892.1
Scope 3 emission /H1118/H1118tCO2e – 57,194.3 97,718.1 26,179.1
Pollutant management
Hazardous waste /H1118/H1118/H1118tonne 8,639.4 12,627.2 20,426.6 5,127.4
Industrial
wastewater /H1118/H1118/H1118/H1118
tonne 979,501.0 1,438,032.7 2,704,701.4 586,483.6
Note:
 Greenhouse gas emissions indicators are calculated with reference to the GHG Protocol issued by the
World Resources Institute and the World Business Council for Sustainable Development. Scope 1
greenhouse gas emissions refer to direct emissions from sources that are owned or controlled by our
Group, whereas scope 2 greenhouse gas emissions refer to energy indirect emissions resulting from the
generation of purchased or acquired electricity or heat within our Group. Scope 3 greenhouse gas
emissions include fuel and energy related activities, employee business trips and employee commuting
but do not include scope 1 and scope 2 green gas emissions.
Social Matters
We promote diversity and equal treatment in recruitment, training, and professional and
personal development of our employees. We regard our employees as the most valuable wealth
and endeavor to build a “Happy Chery” whereby their life dreams and career values can be
realized. We are committed to maintaining work-life balance, fostering a positive working
environment, and providing equal job opportunities for everyone.
We make contribution to various social welfare schemes for our employees. These
schemes include contributions to social insurance and housing provident funds in according to
applicable laws and regulations. In this regard, we make contributions to five categories of
insurance including basic pension insurance, basic medical insurance, work-related injury
insurance, unemployment insurance, and maternity insurance.
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Moreover, our human resources department periodically reviews and updates our social
and employee policies with our legal teams to reflect any significant changes in applicable
labor and safety laws and regulations.
As a corporate citizen, we are devoted to public welfare and charity programs. We
collaborate with international welfare organizations such as UNICEF to fulfil our social
responsibility. We also practice “In somewhere, For somewhere” to create value wherever we
operate worldwide, collectively working towards a better world.
Caring for Children
In 2023, we and UNICEF announced a two-year joint partnership, supporting its global
education programs aimed at providing quality education to the most disadvantaged and
marginalized children. We also support education programs in China, Mexico, South Africa and
Turkey that create healthy and safe learning environments for children and young people,
empowering them with the skills and knowledge they need to thrive in their communities and
beyond. We believe that investing in education is the most cost-effective way to bring children
with disadvantage and marginalized background into a promising future and ultimately benefit
the society as a whole.
Disaster Relief and Assistance
We have been actively provided relief and assistance to people suffered from natural
disasters in China and overseas. When a 6.2-magnitude earthquake occurred in Gansu Province
and Qinghai Province on December 18, 2023, we donated funds through the China Charity
Federation for emergency rescue and disaster relief and post disaster reconstruction. On
February 6, 2023 local time, when a 7.8-magnitude earthquake occurred in southern Turkey, we
responded without any delays. We purchased rescue materials and supplies including
cotton-padded clothes and boots and heaters within less than 30 minutes after the earthquake
and delivered them to the disaster-hit area immediately. We were among the first automakers
in Turkey to deliver the rescue and disaster relief to disaster zone.
Environmental sustainability
In October 2024, we launched a global collaboration program with IUCN for cherishing
the nature. We promised a donation in the amount of US$3.5 million to the program. We plan
to collaborate in the topics focusing on water resources, marine conservation and biodiversity,
to address the challenges we face together in the current environment.
Supplier Management
We have a dedicated ESG management department for supplier management and have put
in place a comprehensive supplier lifecycle management system which includes admission,
designation, performance evaluation to guarantee the standard supplier selection and
procurement. As an advocate for sustainable development, we prefer to procurement of
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energy-saving and eco-friendly products from suppliers with good social and corporate
governance practices. During our selection and procurement process, we strictly comply with
relevant laws, regulations and rules, and require all of suppliers to obtain and maintain
necessary and valid business license, qualifications and certifications, and demonstrate legal
compliance with applicable laws and regulations in relation to environment, product quality,
society and corporate governance. We oppose briberies of any kind and strictly enforce
penalties for suppliers who violate our red lines, in accordance with our management policies.
We expressly requires our suppliers to sign a code of conduct with us and continuously
optimize the code of conduct based on business development and market changes. We
established communication channels with suppliers to continuously enhance the
communication.
Occupational Health and Safety
We place a strong emphasis on occupational safety of our staff. We have established
procedures to ensure that all our staff are provided with a safe and healthy working
environment by setting out a series of work safety rules in the staff manual for our staff to
follow. In addition, we provide new employees with an employee handbook which allows them
to be familiarized with the working environment and enhance their awareness of safety issues.
Throughout the Track Record Period and up to the Latest Practicable Date, we adhered to
occupational health and safety laws and regulations in all material aspects. While we do not
anticipate a significant increase in costs related to compliance with current and future health
and safety laws, changes in requirements may impact our ability to accurately forecast these
costs.
We have an established occupational health and safety management system to monitor
work safety and labour conditions in our production facilities. The system is guided by various
our internal policies including “Regulation of Safety Production Management”, “Equipment
and Facility Safety Management Procedures”, “Emergency Preparedness and Response Control
Procedures”, and “Employee Occupational Health Surveillance Management Operating
Specification”. We carry out routine screening for identifying the potential work safety
accidents. We also carry out routine hazard identification on a daily basis to identify, assess and
manage safety risks in all aspects with the aim to reduce occupational hazards at our
workplace. For positions involving occupational hazards, we keep a health record for our
employees and implement pre-job, on-the-job and post-job health checkups. Moreover, we
continuously to monitor and protect our employees’ safety by implementing measures such as
upgrading production procedures, improving production protection equipment and conducting
drills on a regular basis. We have established similar healthy and safety management system
in our overseas production facilities established by our subsidiary in Malaysia.
During the Track Record Period and as of the Latest Practicable Date, there were no
material accidents or claims for personal or property damage or work safety related incidents
that led to disruptions in our Group’s operations.
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RISK MANAGEMENT AND INTERNAL CONTROL
Our Board of Directors and senior management of the Company shoulder the
responsibility for devising and supervising the execution and efficacy of our internal control
framework. This framework is meticulously structured to guarantee continuous adherence to
pertinent legal and regulatory mandates that govern our business activities and corporate
governance, thereby averting any reoccurrence of compliance failures. Our conviction stands
firm that the existing internal control mechanisms and procedures epitomize adequacy in
scope, feasibility, and operational effectiveness.
In the regular progression of our business activities, we are inherently subject to a
spectrum of risks, encompassing operational, market, and financial risks. Recognizing these
exposures, we hold the conviction that the implementation of robust and adaptable risk
management strategies is essential to our enduring success. It is through this lens that we
approach risk mitigation, ensuring that our operations are safeguarded against potential
adversities, thereby securing our competitive edge and financial stability. For details of such
risks, see “Risk factors — Risks relating to our business and industry.”
For the purpose of effective risk management, we will adopt or have put in place the
following measures:
 Through the cultivation of strong, positive relationships with our established
suppliers and customers, we aim to periodically broaden our customer and supplier
base, thereby mitigating operational risks associated with dependency on a singular
entity;
 In alignment with our Group’s interests and where it proves economically feasible,
we proactively seek to forge diverse agreements that expand our supplier network;
 Our management team is committed to vigilantly observing market trends, including
fluctuations in raw material and components pricing, to consistently benchmark our
procurement expenses against prevailing market rates, ensuring competitive access
to raw materials, parts and components;
 We uphold stringent IT controls to significantly reduce the likelihood of IT system
failures, safeguarding our business continuity and data integrity;
 To attract and retain skilled professionals, we regularly evaluate and adjust our
compensation structures for management and staff, ensuring they remain
competitive and congruent with the Group’s strategic growth;
 Our Directors maintain diligent oversight of our Group’s liquidity and financial
health, prepared to secure financing to support our business activities and expansion
initiatives when deemed necessary and advantageous; and
 We have established an audit committee which is composed of a majority our
independent non-executive Directors to review and supervise our financial reporting
process and internal control system.
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OUR SINGLE LARGEST SHAREHOLDER
As at the Latest Practicable Date, Wuhu Investment Holding held approximately 21.17%
of the issued share capital of our Company. Immediately following completion of the Global
Offering and the conversion of Domestic Unlisted Shares into H Shares (assuming the
Over-allotment Option is not exercised), Wuhu Investment Holding will hold approximately
20.08% of the enlarged issued share capital of our Company, and will continue to be our Single
Largest Shareholder.
DELINEATION OF BUSINESS
Our Principal Business
We are a passenger vehicle company headquartered in Wuhu, China. We design, develop,
manufacture and sell a diverse and expanding portfolio of passenger vehicles, including ICE
vehicles and NEVs, to cater to the distinct and evolving needs and preferences of customers
in both the domestic and overseas markets. Please refer to the section headed “Business” in this
prospectus for details of our business.
Principal Business of our Single Largest Shareholder
Wuhu Investment Holding is an investment holding company incorporated under the laws
of the PRC on February 16, 1998. Apart from the investment in our Group, Wuhu Investment
Holding also controls or invests in companies which engage in, amongst others, investment
management, automotive parts and components, smart devices and integration, engineering and
project management, aviation and aerospace, etc. As at March 31, 2025, the total assets of
Wuhu Investment Holding were approximately RMB115.86 billion. For the year ended
December 31, 2024, the revenue and profits before taxation of Wuhu Investment Holding were
approximately RMB6.98 billion and RMB1.30 billion, respectively. As at the Latest
Practicable Date, Wuhu Investment Holding had more than 100 portfolio investee companies.
Interests in the Investees
Among all investee portfolio companies in which Wuhu Investment Holding holds 10%
or more equity interests, three portfolio investee companies (the “ Investees of Wuhu
Investment Holding ”) engage in automotive parts and components business, namely Anhui
Hongyi Automotive Technology Co., Ltd.* (ʮ̡)( “ Hongyi ”),
Wuhu Motiontec Automotive Technology Co., Ltd.* (ʮ̡)
(“Motiontec ”) and Wuhu Y ongda Tech Co., Ltd.* (ʮ̡)( “ Y ongda”). As at
the Latest Practicable Date, Wuhu Investment Holding held 58.05% equity interest in Hongyi,
42.87% equity interest in Motiontec and 51.00% equity interest in Y ongda.
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We do not consider that the businesses of the Investees of Wuhu Investment Holding
compete or are likely to compete with the business of our Group for the following reasons:
 Different products and target customers. The automotive parts and components of
our Group mainly include (i) engines, transmissions and other automotive parts and
components; and (ii) spare parts and components in connection with our after-sales
services, whereas the automotive parts and components of the Investees of Wuhu
Investment Holding mainly include (i) engine block, cylinder head and frame
housing, (ii) welded parts, stamped part and passive safety parts and (iii) sunroof,
car window regulator, electric sliding door, electric tailgate, controller module,
powder metallurgy parts. The target customers of our Group in respect of automotive
parts and components are primarily other automotive part manufacturers and
after-sales market customers, whereas the target customers of the Investees of Wuhu
Investment Holding are automotive engine assembly companies and vehicle
manufacturers.
 Different geographic regions. Our Group has diversified sales channels with a
broad distribution network offering our automotive parts and components in both the
domestic and overseas markets, whereas the automotive parts and components of the
Investees of Wuhu Investment Holding are primarily sold in Mainland China.
 Different product positioning and business scale. The automotive parts and
components are not main products of our Group. The revenue derived from sales of
automotive parts and components represented 5.5% and 5.9% of our Group’s total
revenue for the years ended December 31, 2023 and 2024, respectively, whereas the
revenue generated from automotive parts and components business represented
approximately 66.35% and 77.16% of the total revenue of Wuhu Investment Holding
for the year ended December 31, 2023 and 2024, respectively.
 Corporate governance. The Investees of Wuhu Investment Holding and our
Company are managed by different management teams. The Directors nominated by
our Single Largest Shareholder (i.e. Mr. Wang Jinhua and Mr. Wang Xiaowei) are
non-executive Directors, and are not involved in our daily operations. Our Company
has adopted and will adopt certain corporate governance measures to manage the
conflicts of interest as set forth in “— Corporate Governance Measures” as below.
No Competing Interests
Save as disclosed above, each of our Single Largest Shareholder and our Directors
confirms that as at the Latest Practicable Date, it/he/she did not have any interest in a business
which competes with, or is likely to compete with, our principal business, whether directly or
indirectly, which would otherwise require disclosure to be made under Rule 8.10 of the Listing
Rules.
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INDEPENDENCE FROM OUR SINGLE LARGEST SHAREHOLDER
Our Directors are satisfied, on the basis of the following reasons, that we are capable of
carrying on our business independently of our Single Largest Shareholder (including any close
associates of such Single Largest Shareholder) after the Listing.
Management Independence
Our business is managed and conducted by our Board and senior management. Currently,
our Board consists of 15 Directors, comprising two executive Directors, seven non-executive
Directors and six independent non-executive Directors, and we also have three Supervisors and
six senior management members (two of which are executive Directors). Each of our Directors,
Supervisors and senior management possesses relevant management, financial or industry-
related experience to contribute to the management of our business. Please refer to the section
headed “Directors, Supervisors and Senior Management” in this prospectus for qualifications
and experience of our Directors, Supervisors and senior management.
Save as disclosed below, none of our Directors, Supervisors or members of senior
management performs a management role in Wuhu Investment Holding.
Name Position with our Company
Positions held within our Single Largest
Shareholder or its close associates
Mr. Wang Jinhua /H1118/H1118/H1118/H1118Non-executive Director Chairman of the board of directors
of Wuhu Investment Holding
Mr. Wang Xiaowei /H1118/H1118/H1118Non-executive Director General manager of Wuhu
Investment Holding
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118Supervisor Deputy general manager of Wuhu
Investment Holding
Our Directors consider that our Board, Supervisors and senior management of our Group
are capable of functioning independently of our Single Largest Shareholder for the following
reasons:
(a) Mr. Wang Jinhua and Mr. Wang Xiaowei are non-executive Directors, and are not
involved in our daily operations. They are responsible for the high-level supervision
on the management and operations of our Group. Mr. Wu Y unfei is the chairperson
of our Supervisory Committee, responsible for chairing the work of the Supervisory
Committee and coordinating Supervisors to supervise the operating and financial
activities of our Group;
(b) Our Group and Wuhu Investment Holding and its close associates are managed by
separate management teams as all of our executive Directors and senior management
team members are independent from Wuhu Investment Holding and/or its close
associates and have adequate relevant experience to ensure the normal operation of
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the day-to-day business and management of our Group. All of our executive
Directors and senior management do not hold any position in Wuhu Investment
Holding or its close associates, and are capable to contribute sufficient time and
efforts to manage the daily operations of our Group. In addition, the management
personnel of our Company have clear reporting lines, and the management team
ultimately reports to the executive Directors, who are responsible for reporting to
our Board. Our Board supervises and monitors the performance of our Company’s
management team generally through (i) regular reports made by our executive
Directors to our Board, (ii) regular meetings and ad hoc meetings of our Board to
consider, deliberate and approve material matters which exceed the delegated
authorities of management team, and (iii) regular updates of operational and
financial data and information that are provided to our Directors;
(c) we have appointed six independent non-executive Directors, comprising more than
one-third of the total members of our Board, who have sufficient knowledge,
experience and competence, so that there is a balanced composition of executive,
non-executive Directors and independent non-executive Directors to ensure the
independence of the Board in making decisions affecting our Company and to
promote the interests of our Company and the Shareholders as a whole. In particular,
the six independent non-executive Directors possess the relevant qualifications and
industry experiences to safeguard the interests of the minority Shareholders of our
Company by, among other things, reviewing and opining on connected transactions
of our Group, including those between our Group and our Single Largest
Shareholder and/or its close associates. Please refer to the section headed
“Directors, Supervisors and Senior Management” in this prospectus for details of the
biographies of the independent non-executive Directors;
(d) each Director is aware of his/her fiduciary duties as a director which require, among
others, that he/she must act for the benefit and in the interest of our Company and
not allow any conflict between his/her duties as a Director and his/her personal
interests;
(e) there is no overlapping senior management personnel who serves at both our Single
Largest Shareholder and us; and
(f) we have adopted other corporate governance measures to manage potential conflicts
of interest, if any, between our Group and our Single Largest Shareholder, which
would enhance our independent management, as detailed in the sub-section headed
“— Corporate Governance Measures” below.
Based on the above, our Directors are of the view that our Group has our own
management team and that we are capable of managing our business independently of our
Single Largest Shareholder and its close associates.
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Operational Independence
We operate our business independently from our Single Largest Shareholder. We have
obtained relevant qualifications and licenses, independent operating premises, domain names
and electronic information systems needed for our businesses.
We have our own organizational structure, with each department having specific areas of
responsibilities. We also maintain a set of comprehensive internal control procedures to
facilitate the effective operation of our business. We have adopted a set of corporate
governance manuals, including but not limited to the terms of reference for general meetings
and terms of reference for Board meetings, both of which are based on relevant applicable
laws, rules and regulations.
Based on the above, our Directors are of the view that our Group operates independently
from the Single Largest Shareholder and its close associates.
Financial Independence
We have adopted our own independent internal control and financial management systems
and we also have an independent accounting and finance department responsible for
discharging relevant financial and treasury function with relevant finance personnel. We make
financial decisions and determine our use of funds according to our own business needs. We
have adequate internal resources and our own credit profile to support our daily operation.
Moreover, our Board has established the Risk Control and Audit Committee to provide
independent oversight to, among others, our accounting and financial reporting processes.
We open and manage our bank accounts independently, and have not shared any bank
account with Wuhu Investment Holding during the Track Record Period and up to the Latest
Practicable Date. We are also capable of obtaining financing from third parties, if necessary,
without reliance on our Single Largest Shareholder. We do not expect to rely on our Single
Largest Shareholder or any of its close associates for financing after the Listing as we expect
that our working capital will be primarily funded by cash generated from our business
operation, and to a lesser extent, external indebtedness.
No loan, guarantee or other forms of financial assistance was provided by, or granted to,
Wuhu Investment Holding or its close associates as at the Latest Practicable Date.
In light of the above, our Directors are of the view that we are able to maintain financial
independence from our Single Largest Shareholder and its close associates.
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CORPORATE GOVERNANCE MEASURES
Our Directors recognise the importance of good corporate governance in protecting our
Shareholders’ interests. Our Company will comply with the provisions of the Corporate
Governance Code in Appendix C1 to the Listing Rules, which set out principles of good
corporate governance in relation to, among other matters, directors, the chairperson and chief
executive officer, board composition, the appointment, re-election and removal of directors,
their responsibilities and remuneration and communications with Shareholders. We have
adopted/will adopt the following corporate governance measures to resolve actual or potential
conflict of interests between our Group and the Single Largest Shareholder:
(a) as part of our preparation for the Global Offering, we have amended our Articles to
comply with the Listing Rules which will become effective upon Listing. In
particular, our Articles provides that, a Director shall abstain from voting on any
resolution approving any contract, transaction or arrangement in which such
Director or any of his/her associates has a material interest nor shall such Director
be counted in the quorum present at the Board meeting. In addition, where a
Shareholders’ meeting is held to consider proposed transactions in which Wuhu
Investment Holding is, under the Listing Rules, required to abstain from voting,
Wuhu Investment Holding shall abstain from voting and such votes shall not be
counted in respect of such transactions;
(b) our Company has established internal control mechanisms to identify connected
transactions. Upon Listing, if our Group enters into connected transactions with
Wuhu Investment Holding and/or any of its associates, our Company will comply
with the applicable requirements under the Listing Rules;
(c) our Board consists of a balanced composition of executive, non-executive and
independent non-executive Directors, with not less than one-third of independent
non-executive Directors to ensure that our Board is able to effectively exercise
independent judgment in its decision-making process and provide independent
advice to our Shareholders. Our independent non-executive Directors, details of
whom are set out in the section headed “Directors, Supervisors and Senior
Management” in this prospectus, individually and collectively possess the requisite
knowledge and experience to perform their roles. They will review whether there is
any conflict of interests between our Group and our Single Largest Shareholder and
provide impartial and professional advice to protect the interest of our minority
Shareholders;
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER
– 320 –


--- page 331 ---
(d) as required by the Listing Rules, our independent non-executive Directors shall
review any continuing connected transactions annually and confirm in our annual
reports that such transactions have been entered into in our ordinary and usual
course of business, are either on normal commercial terms or on terms no less
favorable to us than those available to or from independent third parties and on
terms that are fair and reasonable and in the interests of our Company and our
Shareholders as a whole;
(e) in the event that our independent non-executive Directors are requested to review
any conflict of interests circumstances between our Group, on one hand, and Wuhu
Investment Holding and/or our Directors, on the other hand, Wuhu Investment
Holding and/or our Directors shall provide our independent non-executive Directors
with all necessary information for consideration. Where our independent non-
executive Directors reasonably request the advice of independent professionals,
such as financial advisers, to help them make the judgement, the appointment of
such independent professionals will be made at the expense of our Company; and
(f) we have appointed China International Capital Corporation Hong Kong Securities
Limited as our compliance adviser to provide advice and guidance to us in respect
of compliance with the applicable laws and regulations, as well as the Listing Rules,
including various requirements relating to corporate governance.
RELATIONSHIP WITH OUR SINGLE LARGEST SHAREHOLDER
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--- page 332 ---
Upon Listing, certain transactions between us and our connected persons will constitute
transactions under Chapter 14A of the Listing Rules.
OUR CONNECTED PERSONS
We have entered into certain transactions in the ordinary and normal course of our
business with the following connected persons, which are expected to continue after the Listing
and will constitute continuing connected transactions of our Company:
Name of our connected persons Connected Relationship
Wuhu Investment Holding /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Wuhu Investment Holding is our substantial
shareholder, holding 20.08% of our equity interests
upon completion of the Global Offering (assuming
the Over-allotment Option is not exercised),
constitutes a connected person of our Company under
the Listing Rules.
Luxshare Precision Industry /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118As at the Latest Practicable Date, Luxshare Precision
Industry was owned as to approximately 37.74% by
Luxshare Limited, which was in turn owned by Ms.
Wang Laichun, our non-executive Director, and Mr.
Wang Laisheng, the brother of Ms. Wang Laichun, as
to 50% each. Accordingly, Luxshare Precision
Industry is an associate of Ms. Wang Laichun and
constitutes a connected person of our Company under
the Listing Rules.
SUMMARY OF OUR CONTINUING CONNECTED TRANSACTIONS
Transaction Counterparty
Category of
continuing connected
transaction
Applicable
Listing Rule Waiver sought Historical amount
Proposed annual
caps for the
year ending
December 31
(RMB million) (RMB million)
Procurement
Framework
Agreement with
Luxshare Precision
Industry /H1118/H1118/H1118/H1118/H1118/H1118
Luxshare
Precision
Industry
(for itself
and on
behalf of its
associates)
Non-exempt
continuing
connected
transactions
(subject to
reporting,
annual review
and
announcement
requirements)
Rule 14A.35 Announcement FY2022: 31.72
FY2023: 161.23
FY2024: 2,134.09
3M2025: 513.48
2025: 4,000.00
2026: 6,000.00
2027: 8,000.00
CONTINUING CONNECTED TRANSACTIONS
– 322 –


--- page 333 ---
Transaction Counterparty
Category of
continuing connected
transaction
Applicable
Listing Rule Waiver sought Historical amount
Proposed annual
caps for the
year ending
December 31
(RMB million) (RMB million)
Procurement
Framework
Agreement with
Wuhu Investment
Holding /H1118/H1118/H1118/H1118/H1118/H1118
Wuhu
Investment
Holding
(for itself
and on
behalf of its
associates)
Non-exempt
continuing
connected
transactions
(subject to
reporting,
annual
review and
announcement
requirements)
Rule 14A.35 Announcement FY2022: 1,739.76
FY2023: 2,530.02
FY2024: 3,798.95
3M2025: 952.39
2025: 4,676.00
2026: 5,581.00
2027: 6,438.00
PARTIALLY-EXEMPT CONTINUING CONNECTED TRANSACTIONS
Procurement Framework Agreement with Luxshare Precision Industry
Principal Terms
On September 12, 2025, our Company, for itself and on behalf of its subsidiaries, entered
into a framework agreement (the “ Procurement Framework Agreement with Luxshare
Precision Industry ”) with Luxshare Precision Industry, for itself and on behalf of its
associates, pursuant to which, our Group would procure automotive parts and components from
Luxshare Precision Industry and its associates from time to time.
The initial term of the Procurement Framework Agreement with Luxshare Precision
Industry will commence on the Listing Date and end on December 31, 2027. Both parties or
their respective subsidiaries or associates will enter into separate underlying agreements which
will set out the specific terms and conditions for the procurement of automotive parts and
components according to the principles provided in the Procurement Framework Agreement
with Luxshare Precision Industry.
Historical Amounts
The automotive parts and components procured by our Group from Luxshare Precision
Industry and its associates mainly include wiring harnesses, USB charging modules, wireless
charging, display cables, door handles, cockpit domain controls, smart driving domain
controls, camera modules, etc. For the three years ended December 31, 2024, and the three
months ended March 31, 2025, the historical transaction amounts with respect to the
procurement of automotive parts and components by our Group from Luxshare Precision
Industry and its associates were approximately RMB31.72 million, RMB161.23 million,
RMB2,134.09 million and RMB513.48 million respectively.
CONTINUING CONNECTED TRANSACTIONS
– 323 –


--- page 334 ---
Annual Caps and Basis for Annual Caps
The maximum aggregate annual transaction amounts under the Procurement Framework
Agreement with Luxshare Precision Industry for the three years ending December 31, 2027
shall not exceed the caps set out below:
For the year ending December 31,
2025 2026 2027
(RMB million) (RMB million) (RMB million)
Procurement of automotive parts
and components /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,000.00 6,000.00 8,000.00
In determining the annual caps for the transactions contemplated under the Procurement
Framework Agreement with Luxshare Precision Industry, we have considered, among other
things, the following:
(i) historical amounts of purchase of automotive parts and components by our Group
from Luxshare Precision Industry and its associates during the Track Record Period.
After two years of exploratory collaboration, our Group and Luxshare Precision
Industry and its associates significantly strengthened the cooperation in the year
ended December 31, 2024. The transaction amount for the year ended December 31,
2024 saw an impressive increase, exceeding tenfold. Our Group anticipates that this
positive momentum will persist over the next three years;
(ii) existing orders and contracts between Luxshare Precision Industry and/or its
associates and our Group and the expected orders and contracts in the foreseeable
future;
(iii) most of the automobile parts and components that we procure from Luxshare
Precision Industry and its associates being used for NEVs and models with driving
assistance systems of our Group. Given (a) anticipated significant growth of NEV
market in the next three years with the penetration rate of NEV in China being
48.4% in 2024 and rising significantly to 68.7% in 2027, (b) rapid growth and
business expansion of our Group in the NEV market. We plan to expand our NEV
product portfolio and explore NEVs with next-generation energy type by launching
new NEV models in both China and overseas markets, covering multiple powertrain
types. Moreover, we will continue to invest in R&D in NEV models under each of
our brands, namely CHERY , JETOUR, EXEED, iCAR and LUXEED, respectively
and roll out a variety of PHEVs, REEVs and BEVs with distinct models including
SUVs, sedans and MPVs and market positionings covering mass market segment,
mid- to high-segment and premium segment to further increase our domestic and
overseas market share. For example, we plan to launch more than eight NEV models
in the second half of 2025 covering PHEVs, REEVs and BEVs with a MSRP range
CONTINUING CONNECTED TRANSACTIONS
– 324 –


--- page 335 ---
from RMB100,000 to RMB400,000. The annual sales volume of these models is
targeted to exceed 400,000 units. We intend to use approximately 20% of the net
proceeds from the Global Offering for developing and expanding our NEV
offerings; and (c) expected rising demand from our customers for our NEVs,
accelerated popularisation of automotive intelligence, more products equipped with
our driving assistance systems and expansion of smart driving models, we expect
that the operation and scale of our NEV business will continue to increase in the next
three years, which will further drive up our demand for the automobile parts and
components for the NEVs from Luxshare Precision Industry and its associates. The
types of automotive parts and components that our Group procured from Luxshare
Precision Industry and its associates increased from four to ten from 2023 to 2024.
It is estimated that the types of automotive parts and components that our Group
procures from Luxshare Precision Industry and its associates will increase to more
than 20 by December 31, 2027, such as Augmented Reality/Windshield Head-Up
Display (AR/W-HUD), advanced smart driving domain controls, rear steering
actuators, millimeter-wave radars, etc.; and
(iv) expertise, strong research and development and technology innovation capabilities
of Luxshare Precision Industry and its associates in providing automobile parts and
components for NEVs. Established on May 24, 2004, Luxshare Precision Industry
successfully listed on the ChiNext Board of Shenzhen Stock Exchange on September
15, 2010 (stock code: 002475). It is committed to providing integrated intelligent
solutions, parts, modules and systems for enterprise communication products
(including high-speed interconnect, optical module, heat dissipation module, base
station antenna, base station filter), consumer electronic products (including TWS
wireless headphones, smart wear, wireless charging module, 5G router, VR headsets,
smart speaker), and automobile systems (including automobile wiring harness,
connector, intelligent cabin, intelligent driving) and central gateway, etc. As at
March 31, 2025, the total assets of Luxshare Precision Industry amounted to
RMB238.10 billion. For the year of December 31, 2024, Luxshare Precision
Industry recorded the revenue and profits before taxation of RMB268.79 billion and
RMB16.11 billion, respectively. As Luxshare Precision Industry is a leading
enterprise in the precision manufacturing field, and has continued to expand its
product offerings and market shares in the automotive electronics sector, we expect
that our cooperation with Luxshare Precision Industry and its associates will
continue to diversify and deepen.
CONTINUING CONNECTED TRANSACTIONS
– 325 –


--- page 336 ---
Reason for the Transactions
Our Company believes that the purchase of automobile parts and components from
Luxshare Precision Industry and/or its associates would benefit our Group for the following
reasons:
(i) the purchases from Luxshare Precision Industry and/or its associates will be at
competitive prices not less favorable than those that our Group can obtain from
Independent Third Parties;
(ii) Luxshare Precision Industry is a leading enterprise in the precision manufacturing
field with advanced technology capability to develop and manufacture automobile
parts and components with special specification as requested by our Group from
time to time to cope with its production needs;
(iii) Luxshare Precision Industry and its associates are familiar with our Group’s
specifications, standards and requirements on automobile parts, and the negotiation
time and cost, as well as the delivery time and costs, can be reduced in view of the
existing friendly business cooperation among the parties and the close geographical
location of the respective operations of Luxshare Precision Industry and its
associates and our Group; and
(iv) our Directors consider that it is crucial for our Group to maintain the stability in
supply and quality of the automobile parts for our existing and future production
needs. In view of our product purchasing experience with Luxshare Precision
Industry and its associates, our Directors are of the view that Luxshare Precision
Industry and its associates can effectively fulfill our requirements in supply stability
as well as quality.
Pricing Basis
The amount to be paid by our Group under the Procurement Framework Agreement with
Luxshare Precision Industry shall be in line with normal commercial terms and determined on
arms’ length basis with reference to (i) the specification, model, unit price, type and quality of
the automobile parts and components; (ii) the prevailing market price of comparable products
provided by the Independent Third Parties; and (iii) if no comparable market price, at price
with reference to actual cost or reasonable cost (whichever is lower) incurred plus a profit
margin within the pre-agreed arm’s length range.
CONTINUING CONNECTED TRANSACTIONS
– 326 –


--- page 337 ---
Listing Rules Implications
In respect of the continuing connected transactions as described above, the highest
applicable percentage ratio calculated in respect of the annual caps under the Procurement
Framework Agreement with Luxshare Precision Industry for the purpose of Chapter 14A of the
Listing Rules is expected to be above 0.1% but less than 5%. Accordingly, the continuing
connected transactions under the Procurement Framework Agreement with Luxshare Precision
Industry are exempt from the independent shareholders’ approval requirement under Chapter
14A of the Listing Rules but will be subject to the annual reporting, annual review and
announcement requirements under Chapter 14A of the Listing Rules.
Procurement Framework Agreement with Wuhu Investment Holding
Principal Terms
On September 12, 2025, our Company, for itself and on behalf of its subsidiaries, entered
into a framework agreement (the “ Procurement Framework Agreement with Wuhu
Investment Holding ”) with Wuhu Investment Holding, for itself and on behalf of its
associates, pursuant to which, our Group would procure automotive parts and components from
Wuhu Investment Holding and its associates from time to time.
The initial term of the Procurement Framework Agreement with Wuhu Investment
Holding will commence on the Listing Date and end on December 31, 2027. Both parties or
their respective subsidiaries or associates will enter into separate underlying agreements which
will set out the specific terms and conditions for the procurement of automotive parts and
components according to the principles provided in the Procurement Framework Agreement
with Wuhu Investment Holding.
Historical Amounts
The automotive parts and components procured by our Group from Wuhu Investment
Holding and its associates mainly include stamped parts, dashboard beams, brake/clutch
pedals/seat belts, airbags, sunroofs and glass lifters. For the three years ended December 31,
2024, and the three months ended March 31, 2025 the historical transaction amounts with
respect to the procurement of automotive parts and components by our Group from Wuhu
Investment Holding and its associates were approximately RMB1,739.76 million,
RMB2,530.02 million, RMB3,798.95 million and RMB952.39 million respectively.
CONTINUING CONNECTED TRANSACTIONS
– 327 –


--- page 338 ---
Annual Caps and Basis for Annual Caps
The maximum aggregate annual transaction amounts under the Procurement Framework
Agreement with Wuhu Investment Holding for the three years ending December 31, 2027 shall
not exceed the caps set out below:
For the year ending December 31,
2025 2026 2027
(RMB million) (RMB million) (RMB million)
Procurement of automotive parts
and components /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,676.00 5,581.00 6,438.00
The above proposed annual caps are determined with reference to:
(i) historical amounts of purchase of automotive parts and components by our Group
from Wuhu Investment Holding and its associates during the Track Record Period.
Over the past three years, the historical amounts increased by 45.4% in 2023 and
further increased by 50.2% in 2024. In contrast, the proposed annual caps for the
next three years indicate a steady growth of around 20%;
(ii) existing orders and contracts between Wuhu Investment Holding and/or its
associates and our Group and the expected orders and contracts in the foreseeable
future;
(iii) production capabilities of Wuhu Investment Holding and its associates, the
geographical location of Wuhu Investment Holding and its associates and operation
needs of our Group. For the year ended December 31, 2024, the annual production
capacity of Wuhu Investment Holding and its associates for the main automotive
parts and components they offered was approximately 38 million stamping
operations for the production of stamped automotive parts, over 25 million pieces of
welded automotive parts (including but not limited to dashboard beams and
brake/clutch pedals), over 0.5 million units of airbags and seat belts, approximately
3 million sunroofs and approximately 8 million glass lifters. Such products are
primarily sold in Mainland China, such as Anhui Province, Hunan Province,
Liaoning Province, Zhejiang Province, Shandong Province, Henan Province and
Sichuan Province;
(iv) our Group’s estimated sales volume of passenger vehicles with steady growth by
taking into account, among others, macroeconomic conditions as well as the
development strategies and business expansion plan of our Group. The proposed
annual caps are in line with the estimated increase in the revenue of our Group from
2025 to 2027;
CONTINUING CONNECTED TRANSACTIONS
– 328 –


--- page 339 ---
(v) the prevailing market price of the comparable products; and
(vi) a buffer of approximately 5% to 10% for unexpected demands for the procurement
of automotive parts and components by our Group.
Reason for the Transactions
Our Company believes that the purchase of automobile parts and components from Wuhu
Investment Holding and/or its associates would benefit our Group for the following reasons:
(i) the purchases from Wuhu Investment Holding and/or its associates will be at
competitive prices not less favorable than those that our Group can obtain from
Independent Third Parties;
(ii) Wuhu Investment Holding and/or its associates are familiar with our Group’s
specifications, standards and requirements on automobile parts and components, and
the negotiation time and cost, as well as the delivery time and costs, can be reduced
in view of the existing friendly business cooperation among the parties and the close
geographical location of the respective operations of Wuhu Investment Holding and
its associates and our Group; and
(iii) our Directors consider that it is crucial for our Group to maintain the stability in
supply and quality of the automobile parts for our existing and future production
needs. In view of our product purchasing experience with Wuhu Investment Holding
and its associates, our Directors are of the view the Wuhu Investment Holding and
its associates can effectively fulfill our requirements in supply stability as well as
quality.
Pricing Basis
The amount to be paid by our Group under the Procurement Framework Agreement with
Wuhu Investment Holding shall be in line with normal commercial terms and determined on
arms’ length basis with reference to (i) the specification, model, unit price, type and quality of
the automobile parts and components; (ii) the prevailing market price of comparable products
provided by the Independent Third Parties; and (iii) if no comparable market price, at price
with reference to actual cost or reasonable cost (whichever is lower) incurred plus a profit
margin within the pre-agreed arm’s length range.
CONTINUING CONNECTED TRANSACTIONS
– 329 –


--- page 340 ---
Listing Rules Implications
In respect of the continuing connected transactions as described above, the highest
applicable percentage ratio calculated in respect of the annual caps under the Procurement
Framework Agreement with Wuhu Investment Holding for the purpose of Chapter 14A of the
Listing Rules is expected to be above 0.1% but less than 5%. Accordingly, the continuing
connected transactions under the Procurement Framework Agreement with Wuhu Investment
Holding are exempt from the independent shareholders’ approval requirement under Chapter
14A of the Listing Rules but will be subject to the annual reporting, annual review and
announcement requirements under Chapter 14A of the Listing Rules.
APPLICATION FOR AND CONDITIONS FOR W AIVER
Pursuant to Rule 14A.105 of the Listing Rules, we have applied for, and the Stock
Exchange has granted, a waiver from strict compliance with the announcement requirement
under Chapter 14A of the Listing Rules in respect of the continuing connected transactions
under the Procurement Framework Agreement with Luxshare Precision Industry and the
Procurement Framework Agreement with Wuhu Investment Holding (the “ Procurement
Framework Agreements ”), subject to the condition that the aggregate value of such
continuing connected transactions for the years ending December 31, 2025, 2026 and 2027
shall not exceed relevant annual amounts stated above. See “Waivers from Strict Compliance
with Listing Rules — Continuing Connected Transactions” for details of the waiver.
DIRECTORS’ VIEW
Our Directors, including the independent non-executive Directors, are of the view that all
the continuing connected transactions described above have been and will continue to be
entered into in the ordinary and usual course of our business on normal commercial terms or
better, the terms and proposed annual caps thereof are fair and reasonable and in the interests
of our Company and our Shareholders as a whole.
JOINT SPONSORS’ VIEW
Based on the review of the documentation, information and data provided by our
Company and the participation in the due diligence and discussion with our Company, the Joint
Sponsors are of the view that, as at the Latest Practicable Date, (i) the aforesaid continuing
connected transactions for which the waivers have been sought have been and will be entered
into in the ordinary and usual course of business of our Company, are on normal commercial
terms or better, are fair and reasonable, and are in the interests of the Shareholders as a whole,
and (ii) the proposed annual caps of the continuing connected transactions are fair and
reasonable and in the interests of the Shareholders as a whole.
CONTINUING CONNECTED TRANSACTIONS
– 330 –


--- page 341 ---
INTERNAL CONTROL PROCEDURES ADOPTED BY OUR COMPANY IN RESPECT
OF THE IMPLEMENTATION OF CONTINUING CONNECTED TRANSACTION
FRAMEWORK AGREEMENTS
Our Group adopts the following internal control measures to ensure that the transactions
will be carried out in accordance with the terms of the Procurement Framework Agreements,
including the pricing policies, and in compliance with all the applicable requirements under the
Listing Rules:
 we have adopted a connected transactions management policy for the purpose of
ensuring that connected transactions will be conducted in a fair manner, on normal
commercial terms and in the interests of our Company and our Shareholders as a
whole;
 prior to the execution of the underlying agreements for the procurement of
automotive parts from Luxshare Precision Industry and Wuhu Investment Holding
and/or their respective associates, if quotations from Independent Third Parties are
available, the operation department of the relevant business sector of our Group will
compare the quotations offered by Luxshare Precision Industry and Wuhu
Investment Holding and/or their respective associates with those offered by
Independent Third Parties to ensure that the quotations offered by Luxshare
Precision Industry and Wuhu Investment Holding and/or their respective associates
are no less favourable to our Group than those offered by Independent Third Parties
to our Group. If there are no quotations offer by Independent Third Parties, the
operation department of the relevant business sector and the finance department of
our Group will jointly determine the prices of the proposed transactions based on
reasonable costs plus a reasonable profit to ensure that the prices are fair and
reasonable;
 the finance department of our Group shall (i) regularly examine the pricing of the
transactions under the Procurement Framework Agreements to ensure that those
transactions are conducted in accordance with the pricing terms therein, and
(ii) periodically monitor the transaction amount under the Procurement Framework
Agreements to ensure that our Company complies with all the applicable
requirements under the Listing Rules, including to revise the relevant annual caps
when appropriate;
 the legal department of our Group has reviewed the terms of the Procurement
Framework Agreements and shall in case of any proposed change to the principal
terms of the transactions, ensure that our Company complies with all the applicable
requirements under the Listing Rules, including but not limited to publishing an
announcement; and
 our independent non-executive Directors and auditors will conduct annual review of
the continuing connected transactions under the Procurement Framework
Agreements and provide annual confirmations in accordance with Rules 14A.55 and
14A.56 of the Listing Rules.
CONTINUING CONNECTED TRANSACTIONS
– 331 –


--- page 342 ---
OVERVIEW
The Board of our Company consists of 15 Directors, including two executive Directors,
seven non-executive Directors and six independent non-executive Directors, which is
responsible and has the general authority for the management and operation of our Company.
The Directors are appointed for a term of three years and are eligible for re-election upon
expiry of their term of office.
The Supervisory Committee of our Company consists of three Supervisors, including one
employee representative Supervisor and two non-employee representative Supervisors. The
non-employee representative Supervisors are elected at our general meetings. The employee
representative Supervisor is elected at our staff representative meeting. The Supervisors are
appointed for a term of three years and are eligible for re-election upon expiry of their term
of office.
The senior management of our Company consists of six members and is responsible for
the management of day-to-day operations of our Company.
DIRECTORS
The following table sets out the key information of our Directors as at the Latest
Practicable Date:
Name Age Position
Date of
joining our
Group
Date of
appointment
as Director
Roles and
responsibilities
Mr. Yin Tongyue
(ʙΝᚔ)
62 Chairman,
Executive
Director,
President
January 1997 January 8,
1997
Responsible for the
overall daily
operations and
management of our
Group
Mr. Zhang
Guozhong
(׀)
53 Executive
Director,
Executive
Vice President
July 1997 March 30,
2024
Responsible for the daily
operations and
management of our
Group
Ms. Wang Laichun
(݆)
58 Non-executive
Director
March 2024 March 30,
2024
Responsible for high-
level supervision on
the management and
operations of our
Group
Ms. Li Jing
(ҽ౺)
54 Non-executive
Director
March 2024 March 30,
2024
Responsible for high-
level supervision on
the management and
operations of our
Group
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 332 –


--- page 343 ---
Name Age Position
Date of
joining our
Group
Date of
appointment
as Director
Roles and
responsibilities
Mr. Wang Jinhua
(ശ)
55 Non-executive
Director
April 2022 April 28,
2022
Responsible for high-
level supervision on
the management and
operations of our
Group
Mr. Wang Xiaowei
(ˮѽਃ)
50 Non-executive
Director
February 2025 February 15,
2025
Responsible for high-
level supervision on
the management and
operations of our
Group
Mr. Bao Siyu
(Ⴇ)
50 Non-executive
Director
July 1999 June 21,
2021
Responsible for high-
level supervision on
the management and
operations of our
Group
Mr. Yin Xiangling
(ʙୂჯ)
55 Non-executive
Director
February 2025 February 15,
2025
Responsible for high-
level supervision on
the management and
operations of our
Group
Mr. Hu Jingyuan
(ห๕)
54 Non-executive
Director
September
2022
September 30,
2022
Responsible for high-
level supervision on
the management and
operations of our
Group
Mr. Shang Wenjiang
(ਠ˖Ϫ)
59 Independent
Non-executive
Director
March 2024 March 30,
2024
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
Mr. Y ang Mianzhi
(เಗʘ)
56 Independent
Non-executive
Director
March 2024 March 30,
2024
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 333 –


--- page 344 ---
Name Age Position
Date of
joining our
Group
Date of
appointment
as Director
Roles and
responsibilities
Mr. Y e Shengji
(໢ସਿ)
63 Independent
Non-executive
Director
March 2024 March 30,
2024
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
Mr. Lu Feng
(ࠬ)
69 Independent
Non-executive
Director
March 2024 March 30,
2024
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
Mr. Y ang Shanlin
(؍)
76 Independent
Non-executive
Director
March 2024 March 30,
2024
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
Mr. Lai Ni Hium,
Frank ( ኇϧඪ)
63 Independent
Non-executive
Director
February 2025 February 15,
2025
Responsible for
supervising and
providing independent
opinions and
judgements to the
Board
Note: None of our Directors is related to other Directors, Supervisors or members of senior management.
Executive Directors
Mr. Yin Tongyue ( ʙΝᚔ), aged 62, participated in the preparation of our Company in
October 1996 and has served as an executive Director since the establishment in January 1997,
the chairman of our Board since February 2004, and the president of our Company since
December 2024, who has been fully in charge of the daily operations and management of our
Group. From January 1997 to February 2004, Chairman Yin served as the deputy general
manager of our Company. During the period from February 2004 to April 2017 and from
October 2018 to December 2024, Chairman Yin served as the general manager of our Company.
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Chairman Yin has also served as the chairman and a director of certain subsidiaries of our
Company, including (i) a director of Chery New Energy since April 2010 and the chairman of
the board of directors of Chery New Energy since April 2025, (ii) the chairman and a director
of Wuhu Purui Automobile Investment Co., Ltd.* (ʮ̡) since
December 2014, and (iii) a director of Anhui Kai Y ang Technology Co., Ltd.* (Ҧ
ʮ̡) since August 2024. In addition, Chairman Yin has been the chairman of the board
of directors of Chery Holding since October 2010, and has also served as a director of certain
subsidiaries of Chery Holding, including the chairman and a director of Chery Commercial
V ehicle (Anhui) Co., Ltd. ( փ๿ਠ͜ԓ(τᏏ)ʮ̡) since May 2014, and a director of
Karry New Energy Holding Co., Ltd.* (ʮ̡) since December 2022.
Chairman Yin has served as the chairman of Ruichuang since December 2004, and the
executive director and the general manager of Y ongrui (the general partner of Hengrui and
Zhenrui, our employee stock ownership platforms) since February 2014.
Prior to joining our Group, Chairman Yin worked as a workshop supervisor and the head
of the logistics section at FAW-V olkswagen Automotive Co., Ltd. (ʮ̡).
Chairman Yin obtained a bachelor’s degree in automobile design from Hefei University
of Technology (ʈุɽኪ) in the PRC in July 1984. Chairman Yin was awarded the CCTV
China Economic Person of the Y ear (CCTVᆤ) by China Central Television
in December 2005, the Second Prize of National Science and Technology Progress Award by
the State Council of the People’s Republic of China in December 2008, the Anhui Major
Science and Technology Achievement Award by the People’s Government of Anhui Province
in November 2009, the title of “40 Y ears of Reform and Opening-up · Tribute to Chinese
Automobile Figures” (׳40ϋيby China Central Television in June
2018, the Anhui Outstanding Contribution Talent Award by the People’s Government of Anhui
Province in July 2023, and the “Rao Bin Medal of China Automobile Industry” ( ʕ਷ӛԓʈ
ุᙘⅳᆤ) by China Society of Automotive Engineers in November 2024. In November 2022,
Chairman Yin was awarded the title of senior engineer by the Department of Human Resources
and Social Security of Anhui Province. Chairman Yin was elected as a representative of the
14th National People’s Congress in February 2023.
Mr. Zhang Guozhong (׀)aged 53, joined our Group in July 1997 and has served
as an executive Director since March 2024 and the executive vice president of our Company
since December 2024, responsible for our Group’s daily operations and management. Mr.
Zhang has also served as the chairman and a director of certain subsidiaries of our Company,
including (i) a director of Chery Technology since September 2017, (ii) an executive director
of Chery Sales since July 2019, (iii) a director of Wuhu Lion Automotive Technology Co.,
Ltd.* (ʮ̡) since November 2019, (iv) a director of Rejoin (Anhui)
Supply Chain Technology Co., Ltd.* ( ๿ᗼ(τᏏ)ʮ̡) since April 2021, and
(v) a director of Chery New Energy since May 2024, responsible for overseeing the operations
and management at a high level.
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From July 1997 to December 2024, Mr. Zhang successively served as a technician, a
project manager, a paint workshop director, the factory director of the passenger car company,
the assistant to the general manager, the deputy general manager, the executive deputy general
manager, the general manager of Chery Auto Parts Procurement, the executive director of
procurement of our Company, and the assistant to the general manager, the deputy general
manager and the executive deputy general manager of our Company. From December 2021 to
June 2025, Mr. Zhang served as a director of Chery Holding. In addition, Mr. Zhang has served
as a supervisor in Qoros Automobile Co., Ltd.* (ʮ̡), a company in which our
Company holds a minority interest, since March 2019 and a director of Ruichuang since
November 2020.
Mr. Zhang obtained a bachelor’s degree in chemical engineering and technology from
Hefei University of Technology (ʈุɽኪ) in the PRC in July 1997 and a master’s degree
in vehicle engineering from Hefei University of Technology (ʈุɽኪ) in the PRC in
December 2014. Mr. Zhang was awarded the title of senior engineer by the Department of
Human Resources and Social Security of Anhui Province in January 2018.
Non-executive Directors
Ms. Wang Laichun (݆aged 58, joined our Group in March 2024 and has served
as a non-executive Director since then, responsible for high-level supervision on the
management and operations of our Group.
Ms. Wang has over 30 years of experience in the precision manufacturing industry. Ms.
Wang has served as the chairman and the general manager of Luxshare Precision Industry
(listed on the Shenzhen Stock Exchange, stock code: 002475) since May 2004, responsible for
formulating development strategies and goals. Ms. Wang also serves as the chairman, the vice
chairman, a director and the legal representative of certain subsidiaries of Luxshare Precision
Industry. In 2004, Ms. Wang and Mr. Wang Laisheng founded Luxshare Precision Industry.
In addition, Ms. Wang has served as the chairman of the board and a non-executive
director of Time Interconnect Technology Limited (listed on the Stock Exchange, stock code:
1729) since April 2022, responsible for formulating development strategies and goals.
Ms. Wang obtained her EMBA degree from Tsinghua University ( ૶ശɽኪ) in the PRC
in January 2008. Ms. Wang has served as a member of the 14th National Committee of the
Chinese People’s Political Consultative Conference, a vice chairman of the Chamber of
Commerce for Women Entrepreneurs of the All-China Federation of Industry and Commerce
and a vice chairman of the Guangdong Federation of Industry and Commerce (General
Chamber of Commerce) since January 2023.
Ms. Li Jing ( ҽ౺), aged 54, joined our Group in March 2024 and has served as a
non-executive Director since then, responsible for high-level supervision on the management
and operations of our Group.
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Ms. Li has over 21 years of experience in the precision manufacturing industry. Ms. Li
has served as the general manager of the automotive department of Luxshare Precision Industry
(listed on the Shenzhen Stock Exchange, stock code: 002475) since June 2004, responsible for
the strategic planning and major decision-making of the automotive business. Ms. Li served as
a director of Chery Holding from May 2022 to March 2024, responsible for the strategic
planning and major decision-making.
Ms. Li obtained a bachelor’s degree in automatic control from Dalian University of
Technology ( ɽஹଣʈɽኪ) in the PRC in July 1993.
Mr. Wang Jinhua (ശ), aged 55, joined our Group in April 2022 and has since then
served as a non-executive Director, responsible for high-level supervision on the management
and operations of our Group.
Mr. Wang has over 33 years of experience in management and corporate operations. Mr.
Wang has served as the party secretary and chairman of Wuhu Investment Holding since
November 2021, responsible for formulating overall development strategies and goals. Mr.
Wang also serves as the chairman, a director and the general manager of certain subsidiaries
and minority-owned companies of Wuhu Investment Holding, including a non-executive
director of Chery Holding and Anhui Y ofc Advanced Semiconductor Company Limited* ( τᏏ
ʮ̡) (currently known as Anhui Y ofc Advanced Semiconductor Co.,
Ltd.* (ʮ̡)) since May 2022, a director of EFORT Intelligent
Equipment Co., Ltd. (ʮ̡) (listed on the STAR Market of the
Shanghai Stock Exchange, stock code: 688165) since February 2022, etc., responsible for
high-level supervision on the operations and management.
Mr. Wang worked as a teacher at Eshan Primary School in Fanchang County, Wuhu,
Anhui Province from August 1988 to August 1992, and worked at the county party committee,
county government and various functional departments of Fanchang County, Wuhu, Anhui
Province from August 1992 to February 2019. From February 2019 to November 2021, Mr.
Wang served as the party secretary and director of Wuhu Municipal Bureau of Water
Resources.
Mr. Wang obtained a bachelor’s degree in economics and management from the
Correspondence College of the Party School of the CPC* (Ռબኪ৫) in the PRC
through correspondence courses in December 1996 and obtained an in-service postgraduate
certificate in economics and management from Party School of Anhui Provincial Committee of
CPC (Anhui Academy of Governance) (ࣧ(ኪ৫)) in the PRC in July
2010.
Mr. Wang Xiaowei ( ˮѽਃ), aged 50, joined our Group in February 2025 and has since
then served as a non-executive Director, responsible for high-level supervision on the
management and operations of our Group.
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Mr. Wang has over 18 years of experience in management and business operations. Mr.
Wang has been the chairman of the board of directors of Wuhu Y angtze River Bridge
Investment and Construction Co., Ltd.* (ʮ̡) since December
2020 and the general manager of Wuhu Investment Holding since November 2024. Mr. Wang
served as an investment and financing assistant, the deputy director of the engineering
investment department, the director of the investment department and director of the office of
Wuhu Investment Holding from July 2007 to January 2020; deputy general manager (from
January 2020 to December 2020) and general manager (from December 2020 to September
2023) of Wuhu Y angtze River Bridge Investment and Construction Co., Ltd.* (Ϫɽ዗
ʮ̡); and deputy general manager of Wuhu Investment Holding from October
2020 to October 2024, responsible for overseeing the operations and management.
Mr. Wang obtained a diploma in political history from Wuhu Normal College* ((ࢪ
ࣧcurrently known as Anhui Normal University (ᇍɽኪ)) in the PRC in July
1995, a master’s degree in Marxist philosophy from Anhui Normal University (ᇍɽኪ)
in the PRC in June 2002, and a doctorate degree in economics from the Party School of the
CPC Central Committee (National Academy of Governance) (ࣧ(ኪ৫)) in
the PRC in July 2007.
Mr. Bao Siyu (Ⴇ), aged 50, joined our Group in July 1999 and has served as a
Director since June 2021. Mr. Bao currently is a non-executive Director, responsible for
high-level supervision on the management and operations of our Group.
Mr. Bao has over 26 years of experience in management and corporate operations. Mr.
Bao has served as an executive vice president of Chery Holding since December 2024, the
general manager of Anhui Chery Intelligent Technology Co., Ltd.* (ʮ
̡), a subsidiary of Chery Holding since May 2025, an employee representative director of
Chery Holding since June 2025 and a director of Ruichuang since November 2020. From July
1999 to February 2014, Mr. Bao successively served as the assistant to the head of the
procurement department and the head of the procurement quality section of our Company, the
acting general manager of Wuhu Tianyou Automobile Technology Co., Ltd.* ( ጾಳ˂СӛԓҦ
ʮ̡), a subsidiary of our Company, a deputy general manager of the Chery Auto Parts
Procurement, and the general manager of our Ordos Branch. From February 2014 to January
2024, Mr. Bao successively served as an assistant to the general manager and a deputy general
manager of Chery Holding, and from September 2015 to May 2025, he served as the general
manager of Chery Commercial V ehicle (Anhui) Co., Ltd. ( փ๿ਠ͜ԓ(τᏏ)ʮ̡), a
subsidiary of Chery Holding. From September 2021 to February 2024, he served as the
chairman of Chery New Energy, a subsidiary of our Company, and from September 2015 to
January 2024, he successively served as a deputy general manager and an executive deputy
general manager of our Company. From January 2024 to December 2024, Mr. Bao served as
an executive deputy general manager of Chery Holding.
Mr. Bao obtained a bachelor’s degree in industrial management engineering from Anhui
Polytechnic University ( τᏏʈ೻ɽኪ) in the PRC in July 1999.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Yin Xiangling ( ʙୂჯ), aged 55, joined our Group in February 2025 and has served
as a non-executive Director since then, responsible for high-level supervision on the
management and operations of our Group.
Mr. Yin has over 34 years of experience in finance and financing. He has been the chief
financial officer of Anhui Credit Financing Guaranty Group Co., Ltd.* (ڭ
ʮ̡) since June 2021 and is responsible for the general office affairs of the party
committee, guarantee business and financial management.
From July 1991 to June 2021, Mr. Yin successively served as a chief clerk (secretary of
the party group), the deputy director of the budget office, the deputy director of the budget
division (budget office), the deputy division chief (deputy director) of the budget division
(budget office), the deputy director and the executive deputy director of the government debt
management office (director-level), the director of the government debt management office,
and the level I consultant of the government debt management office of the Department of
Finance of Anhui Province, the PRC.
Mr. Yin obtained a bachelor’s degree in economics from Fudan University ( ూ͇ɽኪ)i n
the PRC through correspondence courses in July 1998 and an in-service postgraduate
certificate in economics from the Party School of the CPC Central Committee (National
Academy of Governance) (ࣧ(ኪ৫)) in the PRC in July 2008.
Mr. Hu Jingyuan (ห๕), aged 54, joined our Group in September 2022 and has since
then served as a non-executive Director, responsible for high-level supervision on the
management and operations of our Group.
Mr. Hu has extensive experience in financing and investment. Mr. Hu has served as the
deputy general manager and a member of the party committee of Anhui Provincial Investment
Group Holding Co., Ltd. (ʮ̡) since November 2020 and July 2021,
respectively, and has served as the chairman of board of directors of Anhui Railway Group Co.,
Ltd. (ʮ̡) since October 2024, responsible for daily operations and
management.
Mr. Hu worked at Anhui Branch of Bank of Communications Co., Ltd. (΅Ϟ
ʮ̡)( “ Bank of Communications ”, dually listed on the Shanghai Stock Exchange (stock
code: 601328) and the Stock Exchange (stock code: 3328)) for a long time, and successively
served as the general manager of Anhui Branch of Bank of Communications, the secretary of
the party committee and president of Huainan Branch of Bank of Communications, etc. Mr. Hu
served as a director and legal representative of the subsidiaries of Anhui Provincial Investment
Group Holding Co., Ltd. (ʮ̡), including the chairman and the legal
representative of Anhui Shen’an Investment Co., Ltd.* (ʮ̡) from August
2021 to January 2024, and a director of Anhui Zhongan Auto Financial Leasing Co., Ltd.* ( τ
ʮ̡) from April 2021 to June 2024, responsible for the overall
operations and management.
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Mr. Hu obtained a college degree in Chinese language from Hefei Union University ( Υ
ᑌΥɽኪ) in the PRC in July 1993, a college degree in accountancy from Anhui V ocational
College (ᔖʈɽኪ) in the PRC in July 1997 and a bachelor’s degree in finance
accounting from Central Radio and Television University ( ʕ̯ᄿᅧཥൖɽኪ) in the PRC in
April 2006. Mr. Hu was certified as an economist by the Ministry of Human Resources and
Social Security of the People’s Republic of China in November 1998.
Independent Non-executive Directors
Mr. Shang Wenjiang ( ਠ˖Ϫ), aged 59, joined our Group in March 2024 and has served
as an independent non-executive Director since then, responsible for supervising and providing
independent opinions and judgements to the Board.
Mr. Shang has over 40 years of experience in law. Mr. Shang has served as the dean of
School of Business and director of the MBA Education Center of China University of Political
Science and Law (ɽኪ) since June 2022, and has served as an independent director
of China Resources New Energy Group Company Limited and Xi’an Eswin Material
Technology Co., Ltd. (ʮ̡) since June 2023.
Mr. Shang served as a lecturer at Zhejiang University ( एϪɽኪ) from 1985 to 1993 and
an associate researcher at the University of International Business and Economics ( ࿁̮຾᏶
ɽኪ) from 1999 to 2001. Mr. Shang successively served as a division director at China
Cinda Asset Management Co., Ltd. (ʮ̡), an assistant to the
mayor of the Banan District People’s Government of Chongqing (on a temporary basis), and
an assistant to the director and deputy director of the Financial Affairs Office of the Chongqing
Municipal People’s Government (concurrently serving as a director of Guotai Junan Securities
Co., Ltd. (ʮ̡) (assigned by Central Huijin Investment Ltd.)) from
March 2001 to March 2011. From April 2011 to October 2014, Mr. Shang served as the deputy
director of the Chongqing Liangjiang New Area Management Committee. From November
2014 to February 2022, he served as the vice president, the chairman of the labor union and
a researcher of Southwest University of Political Science and Law (ɽኪ), and from
February 2022 to June 2022, he served as a professor at China University of Political Science
and Law (ɽኪ).
Mr. Shang obtained a bachelor’s degree in law from East China University of Political
Science and Law (ɽኪ) in the PRC in July 1985, a doctorate degree in civil and
commercial law from China University of Political Science and Law (ɽኪ)i nt h e
PRC in July 1996, and obtained the qualification of researcher of law from Southwest
University of Political Science and Law (ɽኪ) in the PRC in June 2015. Mr. Shang
has served as a member of the 14th National Committee of the Chinese People’s Political
Consultative Conference and a member of its Economic Committee since January 2023.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Y ang Mianzhi ( เಗʘ), aged 56, joined our Group in March 2024 and has served
as an independent non-executive Director since then, responsible for supervising and providing
independent opinions and judgements to the Board.
Mr. Y ang has over 32 years of experience in accounting. Mr. Y ang has been a professor
at the University of Science and Technology Beijing (Ҧɽኪ) since January 2022, a
director of the Accounting Society of China since June 2023, and an independent director of
360 Security Technology Inc. (ʮ̡) (listed on the Shanghai Stock
Exchange, stock code: 601360) since May 2024, responsible for supervising and providing
independent opinions and judgments to the board of directors.
Mr. Y ang served as a professor and vice dean at Anhui University ( τᏏɽኪ) from July
1993 to November 2017, and as a professor and the dean of the School of Economics and
Management at China University of Petroleum (ɽኪ) from December 2017 to
December 2021. Mr. Y ang served as an independent director of Anhui Expressway Company
Limited (ʮ̡) (dually listed on the Shanghai Stock Exchange
(stock code: 600012) and the Stock Exchange (stock code: 995)) from August 2011 to August
2017, an independent director of Guoyuan Securities Company Limited (ʮ
̡) (listed on the Shenzhen Stock Exchange, stock code: 000728) from October 2013 to
January 2020, an independent non-executive director of Anhui Conch Cement Company
Limited (ʮ̡) (dually listed on the Shanghai Stock Exchange (stock
code: 600585) and the Stock Exchange (stock code: 914)) from June 2016 to February 2021,
and an independent director of Beijing Y uanliu Hongyuan Electronic Technology Co., Ltd. ( ̏
ʮ̡) (listed on the Shanghai Stock Exchange, stock code:
603267) from July 2022 to July 2025.
Mr. Y ang obtained a bachelor’s degree in accounting from Anhui University of Finance
and Economics ( τᏏৌ຾ɽኪ) in the PRC in July 1993, a master’s degree in business
administration from Anhui University ( τᏏɽኪ) in the PRC in July 2004, and a doctorate
degree in business administration (financial management) from Renmin University of China
(ʕ਷ɛ͏ɽኪ) in the PRC in June 2008. Mr. Y ang obtained the qualification of professor of
accounting from the University of Science and Technology Beijing (Ҧɽኪ)i n
November 2011.
Mr. Y e Shengji ( ໢ସਿ), aged 63, joined our Group in March 2024 and has served as an
independent non-executive Director since then, responsible for supervising and providing
independent opinions and judgements to the Board.
Mr. Y e has over 40 years of experience in the automotive industry. Mr. Y e has served as
an independent director of Xiamen King Long Motor Group Co., Ltd. (΅
ʮ̡) (listed on the Shanghai Stock Exchange, stock code: 600686) and Beiqi Foton Motor
Co., Ltd. (ʮ̡) (listed on the Shanghai Stock Exchange, stock code:
600166) since September 2020 and November 2022, respectively, responsible for supervising
and providing independent opinions and judgments to the board of directors.
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From July 1985 to March 2009, Mr. Y e successively served as an engineer, a senior
engineer, a professor-level senior engineer, the director of research office of the Institute of
Standardization, the executive deputy general manager of certification center, the chief
engineer and the chief expert of China Automotive Technology and Research Center* ( ʕ਷ӛ
Ӻʕː) (now known as China Automotive Technology and Research Center Co., Ltd.
(ʮ̡)), responsible for research and formulation of standards,
regulations and certification, and research of industrial development and policy. Since March
2009, he has served as the assistant secretary-general and the director of the expert committee,
the deputy secretary-general and management representative, the chief engineer and deputy
secretary-general, and the chief engineer and executive deputy secretary-general of China
Association of Automobile Manufacturers ( ʕ਷ӛԓʈุ՘ึ), responsible for research and
formulation of standards, regulations and certification, new energy vehicles, industrial
strategic development and policies. From April 2015 to June 2024, Mr. Y e served as a vice
president of China Machine Building Quality Management Association. Mr. Y e served as an
independent director of Zhejiang VIE Science and Technology Co., Ltd. (΅Ϟ
ʮ̡) (listed on the Shenzhen Stock Exchange, stock code: 002590) from June 2020 to June
2023.
Mr. Y e obtained a bachelor’s degree in automotive engineering from Hefei University of
Technology (ʈุɽኪ) in the PRC in July 1985 and a college degree in law from the
School of Continuing Education of Beijing Normal University (ᇍɽኪ) through
correspondence course in the PRC in March 1997. Mr. Y e obtained the qualification of a senior
engineer with enhanced remuneration granted by China National Machinery Industry Bureau
(ዚ૛ʈุ҅) in September 2000.
Mr. Lu Feng (ࠬ)aged 69, joined our Group in March 2024 and has served as an
independent non-executive Director since then, responsible for supervising and providing
independent opinions and judgements to the Board.
Mr. Lu has over 43 years of experience in policy research. From February 1982 to August
1991, Mr. Lu successively served as a clerk in the Petitions Office of the General Office of the
CPC Beijing Municipal Committee, a senior clerk in the Research Office of the Finance and
Trade Office of the Beijing Municipal People’s Government, a senior clerk in the Finance and
Trade Bureau of the National Economic Commission, and a senior clerk in the Consumer
Market Department and the Comprehensive Planning Department of the National Planning
Commission. From June 1999 to January 2003, Mr. Lu served as an associate professor at the
School of Public Administration of Tsinghua University ( ૶ശɽኪ). From February 2003 to
April 2019, he served as a professor at the Department of Economics and director of the
Research Institute of Business and Government at School of Government of Peking University
(̏ԯɽኪ).
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In April 2010, Mr. Lu’s paper titled “Unit: A Special Form of Social Organization” ( ఊ
З:ึଡ଼ᔌҖό) won the first “Outstanding Achievement Award in Sociology
(ᆤ)” of the Lu Xueyi Sociology Development Foundation (࢝
ึ). In October 2014, Mr. Lu’s paper titled “Double Surplus, Capacity Gap and
Independent Innovation — Macro and Micro Perspectives on Transformation of the Economic
Development Mode” ( “ࢨ”eঐɢॹɹၾІ˴௴อ——҃ᝈձฆᝈ
ൖ௉) won the fifth Zhang Peigang Outstanding Achievement Award in Development
Economics (ᆤ). In February 2018, Mr. Lu’s book titled “Light
Change: An Enterprise and Its Industrial History” ( Έᜊ:ΆุʿՉʈุ̦) won the
“Enterprise Reform and Development Research Award (Ӻᆤ)” at the
seventh Jiang Yiwei Enterprise Reform and Development Academic Fund (ၾ
ᆤ).
Mr. Lu obtained a bachelor’s degree in philosophy from the Department of Political
Science of the Minzu University of China ( ʕ̯͏ૄኪ৫) in the PRC in September 1982 and
a doctorate degree in political science from Columbia University in the United States in
December 1998. Mr. Lu obtained the professor qualification from Peking University ( ̏ԯɽ
ኪ) in the PRC in August 2002.
Mr. Y ang Shanlin (؍)aged 76, joined our Group in March 2024 and has served as
an independent non-executive Director since then, responsible for supervising and providing
independent opinions and judgements to the Board.
Mr. Y ang has over 30 years of experience in computer and its applications. Mr. Y ang has
been a professor at Hefei University of Technology (ʈุɽኪ) since December 1994, a
co-chairman of Chinese Academy of Management since November 2015, and the director of
the Academic Committee of Hefei University of Technology (ʈุɽኪ) since January
2019. Prior to this, Mr. Y ang served as the dean of the School of Management at Hefei
University of Technology (ʈุɽኪ) from January 1994 to June 2002, and as the vice
president of Hefei University of Technology (ʈุɽኪ) from June 1996 to June 2006,
responsible for overseeing the scientific research and the graduate school.
Mr. Y ang was awarded the second prize of the National Science and Technology Progress
Award by the State Council of the People’s Republic of China in December 2006, the
Outstanding Teacher Award of Higher Education Institutions by the Ministry of Education of
the People’s Republic of China in September 2008, the second prize of the National Science
and Technology Progress Award by the State Council of the People’s Republic of China in
December 2008, and the National Teaching Achievement Award by the Ministry of Education
of the People’s Republic of China in September 2009. From March 2018 to March 2023, Mr.
Y ang served as a representative of the 13th National People’s Congress.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Y ang obtained a bachelor’s degree in electronic computer and its applications from
Hefei University of Technology (ʈุɽኪ) in the PRC in July 1982 and a master’s degree
in computer applications from Hefei University of Technology (ʈุɽኪ) in the PRC in
February 1985. Mr. Y ang obtained the professor qualification from Hefei University of
Technology (ʈุɽኪ) in December 1994.
Mr. Lai Ni Hium, Frank ( ኇϧඪ), aged 63, joined our Group in February 2025 and has
served as an independent non-executive Director since then, responsible for supervising and
providing independent opinions and judgements to the Board.
Mr. Lai has over 37 years of experience in financial management. Mr. Lai served as an
executive director (responsible for finance and operations) and the chief executive officer of
China Resources Gas Group Limited (listed on the Stock Exchange, stock code: 1193, formerly
known as Logic International Holdings Limited), the chief financial officer of Nam Cheong
Limited (listed on the Singapore Stock Exchange, stock code: 1MZ, formerly known as Eagle
Brand Holdings Limited), an executive director, chief financial officer, company secretary and
non-executive director of China Resources Microelectronics Limited (formerly listed on the
Stock Exchange, stock code: 597) from May 2000 to June 2009, an executive director, the chief
financial officer and company secretary, a non-executive director of China Resources Beer
(Holdings) Company Limited (listed on the Stock Exchange, stock code: 291) and an executive
director and chief financial officer of China Resources Enterprise, Limited from June 2009 to
July 2023, the chief executive officer of Dah Chong Hong Holdings Limited, a subsidiary of
CITIC Limited (listed on the Stock Exchange, stock code: 267), which is principally engaged
in automobile and consumer goods distribution, from June 2016 to December 2024, and the
chairman of board of directors and a director of Jonjee HI-TECH Industrial and Commercial
Holding Co., Ltd. (৷อҦஔྼุ(ණྠ)ʮ̡) (listed on the Shanghai Stock
Exchange, stock code: 600872) since July 2025.
Mr. Lai obtained a bachelor’s degree in commerce from the University of Western
Australia, Perth in Australia in April 1982 and a master’s degree in business and management
from the Western Australia Curtin University of Technology in Austria in August 1988. Mr. Lai
was qualified as a Certified Practising Accountant accredited by CPA Australia in 1987, and is
a member of the Hong Kong Institute of Certified Public Accountants and a fellow member of
CPA Australia.
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SUPERVISORS
The following table sets out the key information of our Supervisors as at the Latest
Practicable Date:
Name Age Position
Date of
joining our
Group
Date of
appointment
as Supervisor
Roles and
responsibilities
Mr. Wu Y unfei
(࠭)
43 Chairman of the
Supervisory
Committee
and non-
employee
representative
Supervisor
November
2021
November 16,
2021
Responsible for chairing
the work of the
Supervisory
Committee and
coordinating
Supervisors to
supervise the
operating and financial
activities of our Group
Mr. Xu Hui
(ฯ)
57 Non-employee
representative
Supervisor
June 2006 March 30,
2024
Responsible for the
supervision on the
operating and financial
activities of our Group
Mr. Cai Changfeng
(ቜ)
40 Employee
representative
Supervisor
July 2006 March 30,
2024
Responsible for the
supervision on the
operating and financial
activities of our Group
Note: None of our Supervisors is related to other Directors, Supervisors or members of senior management.
Mr. Wu Yunfei (࠭)aged 43, joined our Group in November 2021 and has served
as a Supervisor since then, responsible for chairing the work of the Supervisory Committee and
coordinating Supervisors to supervise the operating and financial activities of our Group. Mr.
Wu also served as a director of certain subsidiaries of our Company, including (i) a director of
Anhui Ruizhi Drive Technology Co., Ltd.* (ʮ̡) since September
2016; (ii) a director of Chery New Energy since November 2023, and is responsible for the
management or supervision of its operations.
Mr. Wu has over 21 years of experience in investment management and corporate
management and operations. Mr. Wu joined Wuhu Investment Holding in July 2004 and served
as a staff member of the investment management department, a staff member of the asset
operations department, the deputy director of the investment management department, and the
director of the investment management department of the company. Mr. Wu has served as a
member of the party committee and deputy general manager of Wuhu Investment Holding since
June 2022, and as the chairman, a director and the general manager of certain subsidiaries and
minority-owned companies of Wuhu Investment Holding, responsible for management or
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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supervision on their operations, including: (i) a director of Anhui Changjiang Equity Exchange
Co., Ltd.* (ʮ̡) from April 2012 to June 2024, (ii) a director of
EFORT Intelligent Equipment Co., Ltd. (ʮ̡) (listed on the
Shanghai Stock Exchange, stock code: 688165) since June 2019, (iii) the general manager
(from July 2022 to December 2024) and the chairman (since July 2022) of Wuhu Y uanda
V enture Capital Co., Ltd.* (ʮ̡) and (iv) a director of Wuhu Token
Sciences Co., Ltd. (ʮ̡) (listed on the Shenzhen Stock Exchange,
stock code: 300088) since May 2023, etc.
Mr. Wu obtained a bachelor’s degree in business administration from Hubei University of
Economics ( ಳ̏຾᏶ኪ৫) in the PRC in June 2004.
Mr. Xu Hui (ฯ), aged 57, joined our Group in June 2006 and has served as a
Supervisor since March 2024, responsible for the supervision on the operations and financial
activities of our Group. Mr. Xu has served as a director and supervisor of certain subsidiaries
of our Company, including: (i) a supervisor of Chery New Energy since December 2015, (ii)
the legal representative and the executive director of Anhui Pusi Standard Technology Co.,
Ltd.* (ʮ̡) since November 2017, and (iii) a supervisor of Chery
Technology since January 2014, responsible for management or supervision on the operations.
Mr. Xu has over 25 years of experience in intellectual property and corporate management
and operations. Mr. Xu served as the head of the legal and intellectual property department of
our Company from June 2006 to February 2015. From February 2015 to April 2016, he served
as the assistant to the general manager and secretary to the board of directors of Chery Holding.
Since April 2016, he has served as the deputy general manager and secretary to the board of
directors of Chery Holding, and as the chairman, director, general manager and legal
representative of certain of its subsidiaries, generally responsible for the operations and
management (including serving as chairman and general manager of Ruiyuan International
Resources Investment Co., Ltd.* (ʮ̡) since December 2018, a
non-executive Director of Chery Commercial V ehicle (Anhui) Co., Ltd. ( փ๿ਠ͜ԓ(τᏏ)Ϟ
ʮ̡) since October 2017, and the chairman of the board of directors of Tu Journey Camping
Management Co., Ltd.* (ʮ̡) since February 2024, and as a supervisor
of Ruichuang since June 2008.
Mr. Xu served as the head of Wuhu Anhui Intellectual Property Agency Co., Ltd.* ( ጾಳ
ʮ̡). Since December 2008, Mr. Xu has served concurrently as an
intellectual property expert of Wuhu Intermediate People’s Court. In January 2010, Mr. Xu was
awarded the National Intellectual Property Honorary Certificate by China National Intellectual
Property Administration. Since May 2014, he has served concurrently as an expert of the Anhui
Provincial Intellectual Property Bureau, and since October 2020, he has served concurrently as
an expert of the Wuhu Municipal Supervision for Market Regulation.
Mr. Xu obtained a bachelor’s degree in polymer from Tongji University ( Ν᏶ɽኪ)i nt h e
PRC in July 1991 and was awarded the title of associate researcher by the Anhui Provincial
Natural Science Research Series Senior Position Evaluation Committee in December 2002.
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Mr. Cai Changfeng (ቜ), aged 40, joined our Group in July 2006 and has been the
deputy director of the finance center since August 2023 and a Supervisor since March 2024,
responsible for the supervision on the operations and financial activities of our Group. Mr. Cai
has also served as a director of certain subsidiaries of our Company, including (i) a director of
Wuhu Purui Automobile Investment Co., Ltd.* (ʮ̡) since March
2007, (ii) a director of each of Chery Russia and its subsidiary, OMODA Cars Rus LLC since
May 2018, (iii) a director of O&J (Hong Kong) Automobile Investment Co., Ltd. since August
2023, and (iv) a director of EXEED Cars Rus LLC since August 2023, responsible for
management on the operations.
Mr. Cai has over 19 years of experience in finance as well as corporate management and
operations. Mr. Cai was the cost administrator, budget administrator and accountant of our
Company from July 2006 to May 2011, the accountant-in-charge and section chief of the
finance department of Chery Holding from June 2011 to December 2014, and the section chief
of the finance department of our Company’s International Region, senior chief accountant of
the business & finance department, and senior manager of the business & finance department
from January 2015 to July 2023, dispatched executive vice president of finance of Chery Jaguar
Land Rover Automotive Co., Ltd. (ʮ̡), responsible for its financial
management. Mr. Cai has also served as a director and a supervisor of certain companies in
which our Company holds a non-controlling interest, including a director of Chery (Qingdao)
International Trading Co., Ltd.* ( փ๿(ࢥڡ)ʮ̡) since May 2020, a director of
Chery Overseas Industrial Investment Co., Ltd.* (ʮ̡) since
September 2021, a director of Wuhu Ruirong International Trading Co., Ltd.* ( ጾಳ๿ፄ਷ყ
ʮ̡) since November 2021, and a supervisor of Chery Jaguar Land Rover
Automotive Co., Ltd. (ʮ̡) and Chery Jaguar Land Rover Auto Sales
Co., Ltd.* (ʮ̡), respectively, since July 2023, responsible for
management or supervision on the operations.
Mr. Cai obtained a bachelor’s degree in financial management from Hubei University of
Automotive Technology ( ಳ̏ӛԓʈุኪ৫) in the PRC in June 2006 and was granted the
qualification as a certified public accountant in August 2016 by the Chinese Institute of
Certified Public Accountants.
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SENIOR MANAGEMENT
The following table sets out the key information of the senior management as at the Latest
Practicable Date:
Name Age Position
Date of joining our
Group
Date of
appointment as
senior management
Roles and
responsibilities
Mr. Yin
Tongyue
(ʙΝᚔ)
62 Chairman and
President
January 1997 January 8, 1997 Overall responsible for
the daily operations
and management of
our Group
Mr. Zhang
Guozhong
(׀)
53 Executive Vice
President
July 1997 April 9, 2016 Responsible for
chairing the daily
work of our Group
Dr. Gao Xinhua
(৷อശ)
53 Executive Vice
President,
President of
General
Research and
Development
Institute of
Automobile
Engineering
Technology
June 1997 May 1, 2015 Responsible for the
supervision on our
Group’s
technological
development
Mr. Zhang
Guibing
(ੵ൮ж)
48 Executive Vice
President,
General
Manager of
International
Business
Division
July 1999 November 21, 2020 Responsible for our
Group’s
international
business outside the
China market
Mr. Qi Shilong
(ગɻᎲ)
45 Executive Vice
President,
Secretary to
the Board
July 2003 May 20, 2021 Responsible for the
supervision on our
Group’s financial
and supply chain
operations and
management
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Name Age Position
Date of joining our
Group
Date of
appointment as
senior management
Roles and
responsibilities
Mr. Li
Xueyong
(ҽኪ͜)
42 Executive Vice
President,
General
Manager of
CHERY
Domestic
Business
Group
July 2005 April 7, 2023 Responsible for the
management of
CHERY domestic
business and
JETOUR business
Note: None of our senior management is related to other Directors, Supervisors or members of senior
management.
For the biographical details of Mr. Yin Tongyue ( ʙΝᚔ) and Mr. Zhang Guozhong ( ੵ
׀please refer to the section headed “Directors — Executive Directors” above.
Dr. Gao Xinhua ( ৷อശ), aged 53, joined our Group in June 1997 and has been the
executive vice president of our Company and president of the general research and
development institute of automobile engineering technology of our Company since December
2024 and is responsible for the supervision on our Group’s technology development. Dr. Gao
also serves as the chairman and a director of certain subsidiaries of our Company, including (i)
a director of Chery Technology since February 2018, (ii) the chairman of the board of directors
and a director of Wuhu Lion Automotive Technology Co., Ltd.* (ʮ̡)
since November 2019, (iii) an executive director of Anhui New Energy and Intelligent
Connected V ehicle Industry Research Institute Co., Ltd.* (อঐ๕ձ౽ঐၣᑌӛԓପุ
ʮ̡) since November 2021, (iv) an executive director of Chery Intelligent
Automobile Technology (Hefei) Co., Ltd.* (Ҧ(٭)ʮ̡) since July
2022, (v) an executive director of Dazhuo Quxing Intelligent Technology (Shanghai) Co., Ltd.*
(Ҧ(ɪऎ)ʮ̡) since February 2023, (vi) a director of Acteco since
December 2023, (vii) a director of Anhui Deeiot Energy Technology Co., Ltd.* ( τᏏ੻ఠঐ
ʮ̡) since January 2024, and (viii) a director of Wuhu Purui Automobile
Investment Co., Ltd.* (ʮ̡) since December 2024, responsible for
managing the operations.
Dr. Gao has over 28 years of experience in the automobile industry. From July 1997 to
December 2024, Dr. Gao served as the head of the vehicle section of the product department,
the assistant to the director of the product department, the assistant to the director of the
research institute, the vice director of the research institute, the deputy director of the product
development center, the assistant to the general manager, the deputy general manager, the
general manager of the marketing company, the executive director of the product development
management center, the general manager and executive deputy general manager of the general
research and development institute of automobile engineering technology of our Company,
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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responsible for engineering design and product development. Since September 2010, Dr. Gao
has concurrently served as a professor and a master’s degree tutor at Hefei University of
Technology (ʈุɽኪ), a visiting professor at Shanghai University of Engineering
Science from September 2021 to September 2023, and a member of the Technical Committee
of China Automotive Technology and Research Center from July 2020 to June 2022.
Dr. Gao was awarded the title of Anhui Provincial Academic and Technical Leader by the
People’s Government of Anhui Province in May 2013, the title of the seventh batch of Anhui
Provincial Strategic Emerging Industry Technical Leader jointly by the Organization
Department of the CPC Committee of Anhui Province, Department of Human Resources and
Social Security of Anhui Province, Anhui Development and Reform Commission, and
Department of Science and Technology of Anhui Province in September 2018, and was
awarded the title of Y oung and Middle-aged Expert with Outstanding Contributions by the
National Ten Million Talents Project in July 2020.
Dr. Gao received a bachelor’s degree in mechanical design and manufacturing from Hefei
University of Technology (ʈุɽኪ) in the PRC in July 1994, a master’s degree in
mechanical engineering from Hefei University of Technology (ʈุɽኪ) in the PRC in
December 1997, and a doctorate degree in vehicle engineering from Hefei University of
Technology (ʈุɽኪ) in the PRC in June 2016. Dr. Gao was awarded the title of senior
engineer in December 2009 by the Department of Human Resources and Social Security of
Anhui Province.
Mr. Zhang Guibing ( ੵ൮ж), aged 48, joined our Group in July 1999, and has been the
executive vice president and general manager of the international business division of our
Company since December 2024 and is responsible for the integrated management of our
Group’s international business outside the PRC market. Mr. Zhang also serves as a director and
chairman of certain subsidiaries of our Company, including (i) a director of Chery Russia since
May 2018, (ii) the chairman of Anhui Xingtu Automobile Co., Ltd.* (ʮ̡)
since December 2021, and (iii) a director of Anhui Mojia Zhichuang Robot Technology Co.,
Ltd.* (ʮ̡) since January 2025, responsible for managing the
operations.
Mr. Zhang has over 26 years of experience in the automobile industry. He was the head
of the overseas quality section, the manager of the project department, the assistant to general
manager, the deputy general manager, the executive deputy general manager and general
manager of the international business division, deputy general manager of Karry V ehicle
business division, and the assistant to general manager, the deputy general manager and the
executive deputy general manager of our Company from July 1999 to December 2024, in
charge of the sales business in the international market. Mr. Zhang has served as the chairman
of Chery Overseas Industrial Investment Co., Ltd.* (ʮ̡) since
November 2018, responsible for managing the operations.
Mr. Zhang was awarded the title of 2023 Anhui Economic Figure (2023຾᏶ɛ
يby Anhui Broadcasting Corporation in February 2024.
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Mr. Zhang obtained a bachelor’s degree in automobile and tractor from Hefei University
of Technology (ʈุɽኪ) in the PRC in June 1999.
Mr. Qi Shilong ( ગɻᎲ), aged 45, joined our Group in July 2003, has been the secretary
to the Board since July 2023, and has been the executive vice president since January 2025 and
is responsible for the supervision on the finance and supply chain operations and management
of our Group. Mr. Qi also has served as the chairman, director, and supervisor of certain
subsidiaries of our Company, including (i) a director of Ordos Ruishi International Trading
Co., Ltd.* (ʮ̡) since October 2015, (ii) a supervisor of Chery
Sales since July 2019, (iii) a non-executive director of Rejoin (Anhui) Supply Chain
Technology Co., Ltd.* ( ๿ᗼ(τᏏ)ʮ̡) since May 2021, and (iv) the
chairman of the board of directors of Chery Technology since January 2022, and is responsible
for managing or supervising the operations.
Mr. Qi has over 22 years of experience in the automobile industry. From July 2003 to
December 2024, Mr. Qi served as the supervisor and head of the budget section of the finance
department of our Company, the director of the treasury and tax department of the finance
department, the deputy director of the finance department, the assistant to the general manager
and the executive director of the finance department, and the executive director of the
operation and management center and the deputy general manager. Mr. Qi served as a
non-executive director of Rayhoo Motor Dies Co., Ltd. (ʮ̡) (listed
on the Shenzhen Stock Exchange, stock code: 002997) from January 2024 to January 2025. Mr.
Qi has also served as a director of certain companies in which our Company holds a
non-controlling interest, including a non-executive director of Wuhu Chery Capital
Management Co., Ltd.* (ʮ̡) since December 2021, and a non-
executive director of Zhejiang Wanliyang Co., Ltd. (ʮ̡) (listed on the
Shenzhen Stock Exchange, stock code: 002434) since August 2024. In addition, Mr. Qi has
served as a non-executive director of Anhui Guofu Industry Investment Fund Management Co.,
Ltd.* (ʮ̡) since February 2022, a supervisor of Chery
Holding since May 2022, and the chairman of board of directors and a director of Chery Jaguar
Land Rover Automotive Co., Ltd. (ʮ̡) since April 2025.
Mr. Qi obtained a bachelor’s degree in accounting from Anhui University of Technology
(τᏏʈุɽኪ) in the PRC in July 2003 and a master’s degree in business administration from
Tsinghua University ( ૶ശɽኪ) in the PRC in October 2020.
Mr. Li Xueyong ( ҽኪ͜) , aged 42, joined our Group in July 2005 and has been the
executive vice president and general manager of the CHERY domestic business group of our
Company from January 2025, and is responsible for the management of CHERY domestic
business and JETOUR business. Mr. Li has also served as the chairman and the general
manager of certain subsidiaries of our Company, including (i) the general manager of Chery
Sales since November 2022, and (ii) the chairman of Soueast Motor since March 2024,
responsible for managing the operations.
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Mr. Li has over 20 years of experience in the automobile industry. Mr. Li served as a sales
assistant, a department head and a regional manager at Chery Sales, a marketing director of the
Tiggo product line, and an assistant to general manager and the deputy general manager of
Henan Branch from July 2005 to December 2016; the executive deputy general manager of
Chery Commercial V ehicle (Anhui) Co., Ltd. ( փ๿ਠ͜ԓ(τᏏ)ʮ̡), a subsidiary of
Chery Holding, and the executive deputy general manager and the assistant to general manager
of the JETOUR product line from January 2017 to May 2022; the assistant to general manager,
the general manager of the JETOUR business division and the marketing company, the deputy
general manager, the vice president and the general manager of the CHERY domestic business
group of our Company from May 2022 to January 2025.
Mr. Li obtained his bachelor’s degree in automation from Beihua University ( ̏ശɽኪ)
in the PRC in July 2005.
Save as disclosed in this section, none of our Directors, Supervisors and senior
management held directorships in any public companies the securities of which are listed on
any securities market in Hong Kong or overseas in the three years immediately preceding the
Latest Practicable Date.
As at the Latest Practicable Date, save as disclosed in this section, there were no other
matters relating to the appointment of our Directors or Supervisors that need to be brought to
the attention of the Shareholders and there was no other information relating to our Directors
or Supervisors that is required to be disclosed pursuant to Rule 13.51(2) of the Listing Rules.
Please refer to “Statutory and General Information — C. Further Information about
Directors, Supervisors, Chief Executive and Substantial Shareholders” in Appendix VI to this
prospectus for the interests of our Directors, Supervisors and chief executive in our Shares
within the meaning of Part XV of the SFO.
CONFIRMATION FROM OUR DIRECTORS
Rule 3.09D of the Listing Rules
Each Director confirms that he/she (i) has obtained legal advice pursuant to Rule 3.09D
of the Listing Rules on February 10, 2025 and (ii) is aware of his/her responsibilities as a
director of the listed issuer under the Listing Rules.
Rule 3.13 of the Listing Rules
Each of the independent non-executive Directors has confirmed that (i) he/she is
independent for each of the factors set out in Rules 3.13(1) to (8) of the Listing Rules; (ii) as
at the Latest Practicable Date, he/she did not have any past or present financial or other
interests in the business of our Company or its subsidiaries, nor was he/she connected in any
way with any of the core connected persons of our Company under the Listing Rules; and (iii)
there were no other factors which may affect his/her independence at the time of his/her
appointment.
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Disclosure under Rule 8.10(2) of the Listing Rules
As at the Latest Practicable Date, none of our Directors was interested in any business
which competes directly or indirectly with our business pursuant to Rule 8.10(2) of the Listing
Rules.
Resigned Directors and Supervisors
During the Track Record Period and up to the Latest Practicable Date, certain former
Directors and Supervisors resigned as a Director or Supervisor on voluntary and amicable basis
due to work arrangements, details of which were set out as follows:
Name Appointment date Resignation date
Resigned Directors, being non-executive Directors
Mr. Xia Feng (ࢤࢀDecember 2019 April 2022
Mr. Y u Zhijun (ࠏJune 2021 April 2022
Mr. Cui Mingshou (ྪ) June 2021 April 2022
Mr. Huang Linmu (ӕ) June 2021 September 2022
Mr. Wang Zhaoyuan ( ˮ̜Ⴣ) June 2021 June 2023
Mr. Xing Hui ( Ԝฯ) November 2021 January 2025
Mr. Li Bin ( ҽⅳ) April 2022 May 2023
Mr. Huang Zuchao ( රख़൴) December 2019 April 2022
April 2022 May 2023
Mr. Yi Lei (ᆾ) May 2023 March 2024
Ms. Liu Ling ( ᄎ୥) May 2023 March 2024
Mr. Wang Laisheng ( ˮԸ௷) May 2022 May 2024
Mr. Wang Zhaohui ( ˮಃฯ) June 2023 January 2025
Resigned Director, being independent non-executive Director
Ms. Shi Qin ( ͩೞ) March 2024 January 2025
Resigned Supervisors
Ms. Li Qingxiang (࠰June 2021 April 2022
Mr. Zhang Jinsong (ؒۊDecember 2021 March 2024
Mr. Hong Gaoming (׼April 2022 March 2024
Note: Among the resigned Directors, all non-executive Directors were nominated by our Shareholders. Among
the resigned Supervisors, Ms. Li Qingxiang (࠰was nominated by our Shareholder. For details, see
note 8 to the Accountant’s Report in Appendix I.
To the best of the knowledge and belief of our Directors, there were no disputes or
disagreements between our Company and each of the resigned Directors and Supervisors as
mentioned above, and there are no matters that need to be brought to the attention of the Stock
Exchange and potential investors in Hong Kong.
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Our Joint Company Secretaries
Ms. Zhan Ni ( ༗֋) has been appointed as our joint company secretary.
Ms. Zhan, aged 41, joined our Group in August 2024 and has since then been the assistant
to the president and head of the office of the Board, responsible for the Board affairs.
Ms. Zhan has over 13 years of experience in finance and treasury. Ms. Zhan served as a
researcher of the Ministry of Finance of the People’s Republic of China from August 2012 to
December 2020, in charge of financial budget; a consultant of the Local Financial Supervisory
Authority of Anhui Province from December 2020 to September 2022, in charge of government
fund management; and a deputy general manager of Hefei Ruicheng Private Equity Fund
Management Co. Ltd.* (ʮ̡) from October 2022 to August 2024,
in charge of equity fund raising and investment.
Ms. Zhan obtained a bachelor’s degree in finance from Nanjing University (ԯɽኪ)i n
the PRC in June 2005 and a master’s degree in business administration from Tsinghua
University ( ૶ശɽኪ) in the PRC in June 2012.
Ms. Yu Wing Sze ( Я൘་), aged 42, is one of the joint company secretaries of our
Company. She is a manager of the listing services division at TMF Hong Kong Limited, a
company providing corporate accounting and corporate secretarial services in Hong Kong. She
has over 15 years of experience in company secretarial profession and has been serving as the
company secretary of several listed companies in Hong Kong.
Ms. Y u is an associate member of both The Hong Kong Chartered Governance Institute
and The Chartered Governance Institute (formerly known as the Institute of Chartered
Secretaries and Administrators) in the United Kingdom.
Ms. Y u obtained a bachelor’s degree in business administration from the Chinese
University of Hong Kong in Hong Kong in December 2005.
The Special Committees of The Board
We have established three special committees of the Board, namely the Risk Control and
Audit Committee, the Nomination and Remuneration Committee and the Strategy and
Sustainability Committee.
The Risk Control and Audit Committee
The Risk Control and Audit Committee comprises seven Directors, namely Mr. Lai Ni
Hium, Frank, Mr. Shang Wenjiang, Mr. Y ang Mianzhi, Mr. Y ang Shanlin, Mr. Wang Jinhua, Mr.
Hu Jingyuan and Mr. Bao Siyu. All members of the Risk Control and Audit Committee are our
non-executive and independent non-executive Directors. Mr. Lai Ni Hium, Frank, our
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independent non-executive Director, is the chairman of the Risk Control and Audit Committee.
Mr. Lai Ni Hium, Frank has appropriate accounting or related financial management expertise
as required under Rules 3.10(2) and 3.21 of the Listing Rules.
The primary duties of the Risk Control and Audit Committee include:
(i) proposing the appointment, re-appointment and removal of the external auditor, and
making recommendations to the Board and approving the remuneration and terms of
engagement of the external auditor;
(ii) reviewing and monitoring the independence and objectivity of the external auditor
and the effectiveness of the audit process, discussing the nature, scope, method and
relevant reporting obligation of the audit with the auditor before the audit
commences, formulating and implementing policies on engaging the external
auditors to provide non-audit services;
(iii) monitoring the authenticity, accuracy and completeness of the financial statements
of our Company and our Company’s annual report and accounts, half-year report and
quarterly reports (if any) and reviewing the material opinion on the financial reports
contained in the statement and reports;
(iv) reviewing our Company’s systems of financial control, internal control and risk
management, discussing the risk management system and the internal control system
with the management to ensure that the management has performed its duty to
establish effective risk management and internal control systems;
(v) being responsible for the communication between the internal auditing department
and the external auditor, acting as the key representative between our Company and
the external auditor, and being responsible for monitoring the relationship between
them; and
(vi) other matters authorized by the Board.
The Nomination and Remuneration Committee
The Nomination and Remuneration Committee comprises seven Directors, namely Mr.
Shang Wenjiang, Ms. Li Jing, Mr. Wang Xiaowei, Mr. Zhang Guozhong, Mr. Lu Feng, Mr. Y e
Shengji and Mr. Y ang Mianzhi. All members of the Nomination and Remuneration Committee
are our non-executive Directors and independent non-executive Directors. Mr. Shang
Wenjiang, our independent non-executive Director, is currently the chairman of the
Nomination and Remuneration Committee.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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The primary duties of the Nomination and Remuneration Committee include:
(i) establishing the criteria, procedures and methods for selecting our Directors and
senior management of our Company, and submitting them to our Board for
consideration;
(ii) regularly reviewing the structure, size and composition of our Board and their
relevant qualifications (including skills, knowledge, experience and others) at least
annually, assisting the Board in developing a board skill chart, and advising on any
proposed changes to our Board to complement our Company’s strategy;
(iii) identifying the individuals qualified to serve as our Directors and senior
management, and reviewing and advising on the candidates for our Directors and
senior management;
(iv) assessing the skills, knowledge and experience of our Directors and senior
management comprehensively, and reviewing the independence of the independent
non-executive Directors;
(v) supporting our Company’s periodic evaluation of the performance of the Board;
(vi) reviewing the Board diversity policy, and the measurable objectives that it has set
for implementing the policy and progress on achieving those objectives;
(vii) making recommendations to the Board on the remuneration policy and structure for
all Directors and senior management of our Company and on the establishment of
formal and transparent procedures for developing such remuneration policy;
(viii) determining the specific remuneration packages (including benefits in kind, pension
rights and compensation payments, should including any compensation payable for
loss or termination of their office or appointment) for all executive Directors and
senior management members and making recommendations to the Board on
non-executive Directors’ remuneration packages;
(ix) preparing the management plan for the performance appraisal of the senior
management of our Company, formulating the appraisal program and determining
the appraisal objectives;
(x) examining the performance of duties by Directors and senior management and
conducting annual assessment over their performance;
(xi) studying our Company’s policies and proposals in relation to salary, welfare,
rewards and penalties, making recommendations to the Board and supervising the
implementation of such policies and proposals;
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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(xii) reviewing and/or approving matters relating to the share scheme under Chapter 17
of the Listing Rules; and
(xiii) other matters authorized by the Board.
The Strategy and Sustainability Committee
The Strategy and Sustainability Committee comprises seven Directors, namely Mr. Yin
Tongyue, Ms. Wang Laichun, Mr. Wang Jinhua, Mr. Zhang Guozhong, Mr. Yin Xiangling, Mr.
Lai Ni Hium, Frank and Mr. Y e Shengji. Mr. Yin Tongyue, our executive Director, chairman
of our Board and president of our Company, is currently the chairman of the Strategy and
Sustainability Committee.
The primary duties of the Strategy and Sustainability Committee include:
(i) evaluating and making recommendations on our long-term strategic planning and
other significant matters that may affect our development strategy; and
(ii) other matters authorized by the Board.
Corporate Governance Code
We aim to implement a high standard of corporate governance, which we believe is
crucial to safeguard the interests of our Shareholders. To accomplish this, we expect to comply
with the Corporate Governance Code set out in Appendix C1 of the Listing Rules after the
Listing, save that Chairman Yin, will serve as both the chairman of our Board and president
as discussed below.
Pursuant to code provision C.2.1 set out in Part II of the Corporate Governance Code,
companies listed on the Stock Exchange shall comply with, but may choose to deviate from the
requirement that the responsibilities between the chairman and the chief executive officer
should be separate and should not be performed by the same individual. Chairman Yin
currently performs the chairman of our Board and president. Our Board believes that Chairman
Yin has been operating and managing our Company since its incorporation and is familiar with
the operations of our Group, which is in the best interest of our Group to have both roles
assumed by Chairman Yin after the Listing for the effective management of our Group as well
as for the development of the business of our Group, and that Chairman Yin will provide strong
and consistent leadership to our Group. This arrangement will ensure the effective and efficient
overall strategic planning of our Group as the structure will enable our Company to make and
implement decisions quickly and effectively. In addition, our Company has put in place
appropriate checks and balances through the Board and six independent non-executive
Directors. Our independent non-executive Directors are able to maintain their independence of
character and judgment and are able to express their views without undue restrictions. We will
consult our Board for advice on any major decisions. Accordingly, our Board is of the view that
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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the balance of power and authority of the existing arrangement will not be jeopardized as the
arrangement does not result in an excessive concentration of power in a single individual,
which may adversely affect the interests of minority Shareholders.
Board Diversity
Our Company has adopted a board diversity policy which sets out the approach to achieve
diversity of the Board. Our Company recognizes and embraces the benefits of having a diverse
Board and sees diversity at the Board level, including gender diversity, as an essential element
in maintaining our Company’s competitive advantage and enhancing our ability to attract,
retain and motivate employees from the widest possible pool of available talent. Pursuant to the
board diversity policy, in reviewing and assessing suitable candidates to serve as a director of
our Company, the Nomination and Remuneration Committee will consider a number of aspects,
including but not limited to gender, age, cultural and educational background, professional
qualifications, skills, knowledge, and industry and regional experience. In particular, our Board
currently has two female Directors, and one female member serves in the Nomination and
Remuneration Committee, and will continue to work towards enhancing the gender diversity
of the Board. Our Directors have a balanced mix of knowledge and skills, and we have seven
non-executive Directors and six independent non-executive Directors with different industry
backgrounds. Taking into account our existing business model and specific needs as well as the
different backgrounds of our Directors, the composition of our Board satisfies our board
diversity policy. Pursuant to the board diversity policy, the Nomination and Remuneration
Committee will discuss periodically and when necessary, agree on the measurable objectives
for achieving diversity, including gender diversity, on the Board and recommend them to the
Board for formal adoption.
Compensation of Directors, Supervisors and Senior Management
We offer our executive Directors, Supervisors and senior management, who are also our
Company’s employees, compensation in the form of fees, salaries, bonuses and benefits in kind
(including contributions to pension plans). The remuneration of Directors, Supervisors and
senior management is determined with reference to factors such as the responsibilities, risks
and commitments of the Directors, Supervisors and senior management, the market standards
of the same industry and the operations of our Company. Our independent non-executive
Directors receive compensation with reference to their respective positions and duties,
including being a member or the chairman of Board committees.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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The following table sets forth the aggregate amount of remuneration paid to our
Directors, Supervisors and the five highest paid individuals (including certain Directors) for
each of the three years ended December 31, 2024 and the three months ended March 31, 2025.
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2025
(RMB million) (RMB million) (RMB million) (RMB million)
Directors 5.48 6.69 43.35 13.84
Supervisors 4.89 4.76 9.34 0.59
Five highest paid
individuals 56.19 49.41 164.00 48.03
During the Track Record Period, (i) no emoluments were paid to our Directors,
Supervisors or the five highest paid individuals as an inducement to join or upon joining our
Group, (ii) no emoluments were paid or payable to our Directors, the retiring Directors,
Supervisors, the retiring Supervisors or the five highest paid individuals for their loss of office
as a Director of any member of our Group or of any other office in connection with the
management of the affairs of any member of our Group, and (iii) no Directors and Supervisors
waived or agreed to waive any emoluments except for Mr. Y ang Shanlin (؍.)
Save as disclosed above and in “Financial Information”, “Accountant’s Report” and
“Statutory and General Information”, no other payments have been paid or are payable in
respect of the Track Record Period to our Directors, Supervisors and senior management by our
Group. Under the arrangements currently in force, we estimate the aggregate remuneration,
excluding discretionary bonus, of our Directors and Supervisors for the year ending December
31, 2025 to be approximately RMB54.26 million. The actual amount may differ from this
estimate.
See note 8 and note 9 to the Accountant’s Report in Appendix I for details on
remuneration paid to our Directors, Supervisors and senior management and, on an aggregate
basis, the five highest paid individuals of our Group during the Track Record Period.
See “Statutory and General Information — D. Equity Incentive Schemes” in Appendix VI
to this prospectus for details on the incentive schemes for our Directors, Supervisors and senior
management.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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COMPLIANCE ADVISER
We have appointed China International Capital Corporation Hong Kong Securities
Limited as our compliance adviser pursuant to Rule 3A.19 of the Listing Rules. The
compliance adviser will provide us with guidance and advice as to compliance with the Listing
Rules and other applicable laws, rules, codes and guidelines. Pursuant to Rule 3A.23 of the
Listing Rules, the compliance adviser will advise our Company in certain circumstances
including:
(i) before the publication of any regulatory announcement, circular or financial report;
(ii) where a transaction, which might be a notifiable or connected transaction, is
contemplated, including share issues, the sale or transfer of treasury shares and
share repurchases;
(iii) where we propose to use the proceeds of the Global Offering in a manner different
from that detailed in this prospectus or where the business activities, development
or results of our Group deviate from any forecast, estimate or other information in
this prospectus; and
(iv) where the Stock Exchange makes an inquiry to our Company under Rule 13.10 of
the Listing Rules.
The term of appointment of the compliance adviser shall commence on the Listing Date
and is expected to end on the date on which we comply with Rule 13.46 of the Listing Rules
in respect of our financial results for the first full financial year commencing after the Listing
Date and such appointment may be subject to extension by mutual agreement.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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So far as known to our Directors as at the Latest Practicable Date, immediately following
the completion of the Global Offering and the conversion of Domestic Unlisted Shares into H
Shares (assuming the Over-allotment Option is not exercised), the following persons will have
an interest and/or short position (as applicable) in the Shares or underlying Shares which would
fall to be disclosed to our Company and the Stock Exchange under the provisions of Divisions
2 and 3 of Part XV of the SFO, once the H Shares are listed on the Stock Exchange:
Name of
Shareholder
Nature of
interest
Description of
Shares
As at the Latest
Practicable Date (1)
Immediately following the completion of
the Global Offering and the conversion of Domestic
Unlisted Shares into H Shares (assuming the
Over-allotment Option is not exercised)
Number of
Shares
Approximate
percentage of
interest in our
Company
Number of
Shares
Approximate
percentage of
interest in the
Unlisted Shares/
H Shares (as
appropriate) (1)
Approximate
percentage of
interest in our
Company (1)
Wuhu Investment
Holding /H1118/H1118/H1118/H1118
Beneficial
owner (2)
Unlisted Shares 1,157,771,424 21.17% 938,978,159 27.19% 16.28%
H Shares Nil – 218,793,265 9.46% 3.79%
Chairman Yin /H1118/H1118Interest in
controlled
corporations
(3)
Unlisted Shares 998,255,807 18.25% 604,072,938 17.49% 10.47%
H Shares Nil – 394,182,869 17.04% 6.83%
Ms. Wang
Laijiao /H1118/H1118/H1118/H1118
Interest in
controlled
corporation
(4)
Unlisted Shares 920,426,548 16.83% 920,426,548 26.65% 15.96%
H Shares Nil – Nil – –
Mr. Wang Laixi /H1118Interest in
controlled
corporation
(4)
Unlisted Shares 920,426,548 16.83% 920,426,548 26.65% 15.96%
H Shares Nil – Nil – –
Luxshare
Investment
Limited /H1118/H1118/H1118/H1118
Interest in
controlled
corporation
Unlisted Shares 920,426,548 16.83% 920,426,548 26.65% 15.96%
H Shares Nil – Nil – –
Luxshare
Investment
(HK) Limited /H1118
Beneficial
owner
(4)
Unlisted Shares 920,426,548 16.83% 920,426,548 26.65% 15.96%
H Shares Nil – Nil – –
Ruichuang /H1118/H1118/H1118/H1118Beneficial
owner (3)
Unlisted Shares 629,670,207 11.51% 419,780,138 12.15% 7.28%
H Shares Nil – 209,890,069 9.07% 3.64%
Anhui Credit
Guaranty /H1118/H1118/H1118
Beneficial owner Unlisted Shares 545,513,600 9.97% 272,756,800 7.90% 4.73%
H Shares Nil – 272,756,800 11.79% 4.73%
Wuhu Y ongrui
Enterprise
Management
Consultation
Co., Ltd.* ( ጾ
ಳ͑๿Άุ၍ଣ
ʮ̡)
(“Wuhu
Y ongrui”) /H1118/H1118/H1118
Interest in
controlled
corporations
(3)
Unlisted Shares 368,585,600 6.74% 184,292,800 5.34% 3.20%
H Shares Nil – 184,292,800 7.97% 3.20%
SUBSTANTIAL SHAREHOLDERS
– 361 –


--- page 372 ---
Name of
Shareholder
Nature of
interest
Description of
Shares
As at the Latest
Practicable Date (1)
Immediately following the completion of
the Global Offering and the conversion of Domestic
Unlisted Shares into H Shares (assuming the
Over-allotment Option is not exercised)
Number of
Shares
Approximate
percentage of
interest in our
Company
Number of
Shares
Approximate
percentage of
interest in the
Unlisted Shares/
H Shares (as
appropriate) (1)
Approximate
percentage of
interest in our
Company (1)
Anhui Investment
Holding /H1118/H1118/H1118/H1118
Beneficial owner Unlisted Shares 284,224,000 5.20% 142,112,000 4.11% 2.46%
H Shares Nil – 142,112,000 6.14% 2.46%
Qingdao
Wudaokou /H1118/H1118/H1118
Beneficial
owner (5)
Unlisted Shares 229,538,473 4.20% 93,178,985 2.70% 1.62%
H Shares Nil – 136,359,488 5.89% 2.36%
Ningbo Wending /H1118Beneficial
owner (6)
Unlisted Shares 172,483,393 3.15% Nil – –
H Shares Nil – 172,483,393 7.46% 2.99%
Qingdao
Xincheng /H1118/H1118/H1118
Beneficial
owner (7)
Unlisted Shares 154,676,594 2.83% Nil – –
H Shares Nil – 154,676,594 6.69% 2.68%
Zhuhai
Shangshun /H1118/H1118/H1118
Beneficial
owner (8)
Unlisted Shares 122,322,174 2.24% Nil – –
H Shares Nil – 122,322,174 5.29% 2.12%
Notes:
(1) The calculation is based on the total number of 3,453,832,559 Unlisted Shares and 2,313,396,074 H Shares in
issue upon Listing comprising (i) an aggregate of 2,015,999,074 H Shares to be converted from the Unlisted
Shares and (ii) 297,397,000 H Shares to be issued pursuant to the Global Offering (without taking into account
the H Shares which may be issued upon the exercise of the Over-allotment Option).
(2) Wuhu Investment Holding is owned as to 95.59% by Wuhu SASAC and as to 4.41% by Anhui Provincial
Department of Finance.
(3) As at the Latest Practicable Date, Ruichuang directly held 629,670,207 Domestic Unlisted Shares. Chairman
Yin holds more than 30% of the shares in Ruichuang. Each of Hengrui and Zhenrui directly held 184,292,800
and 184,292,800 Domestic Unlisted Shares, respectively. Wuhu Y ongrui is the general partner of Hengrui and
Zhenrui. Chairman Yin holds more than 30% of the shares in Wuhu Y ongrui. Therefore, Chairman Yin is
deemed to be interested in 998,255,807 Domestic Unlisted Shares held by Ruichuang, Hengrui and Zhenrui for
the purpose of the SFO, and Wuhu Y ongrui is deemed to be interested in 368,585,600 Domestic Unlisted
Shares held by Hengrui and Zhenrui for the purpose of the SFO. For the avoidance of doubt, the above
statistical interests of Chairman Yin are deemed interests for the purpose of the SFO, which does not imply
that Chairman Yin actually owns such interests. At the level of Hengrui and Zhenrui, Chaiman Yin only holds
equity interests as a shareholder of Wuhu Y ongrui, the general partner of Hengrui and Zhenrui, with very low
shareholding percentages in Hengrui and Zhenrui, and the interests actually held by Chairman Yin through
Hengrui and Zhenrui in our Company are negligible. On a see-through basis, Chairman Yin only holds interests
in our Company through Ruichuang, and the percentage of interests actually held by Chairman Yin in our
Company is less than 5%.
(4) As at the Latest Practicable Date, Luxshare Investment (HK) Limited directly held 920,426,548 Foreign
Unlisted Shares. Luxshare Investment (HK) Limited is a wholly-owned subsidiary of Luxshare Investment
Limited. Each of Ms. Wang Laijiao and Mr. Wang Laixi, both being family members of Ms. Wang Laichun (our
non-executive Director), holds 50% of issued share capital of Luxshare Investment Limited. Therefore, each
of Luxshare Investment Limited, Ms. Wang Laijiao and Mr. Wang Laixi is deemed to be interested in
920,426,548 Foreign Unlisted Shares held by Luxshare Investment (HK) Limited for the purpose of the SFO.
SUBSTANTIAL SHAREHOLDERS
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(5) Qingdao Xingrui, Beijing Waterwood, Qingdao Chengxin, Jinan Jiading, Jinan Changying, Mr. Mao Jian and
Mr. Ba Zhen are deemed to be interested in the Shares held by Qingdao Wudaokou for the purpose of the SFO.
For details of Qingdao Wudaokou’s shareholding structure, see “History, Development and Corporate Structure
— Pre-IPO Investments — 4. Information about the Pre-IPO Investors ” in this prospectus.
(6) Contemporary Amperex Technology Co., Limited (ʮ̡), dully listed on the
Shenzhen Stock Exchange (stock code: 300750) and the Stock Exchange (stock code: 3750), is deemed to be
interested in the Shares held by its wholly-owned subsidiary, Ningbo Wending, for the purpose of the SFO.
(7) Xincheng Haishun, Zhuhai Houjiang, Qingdao Chengxin, Qingdao Urban Investment, Mr. Xie Y ongyuan, and
Mr. Jiang Bo are deemed to be interested in the Shares held by Qingdao Xincheng for the purpose of the SFO.
For details of Qingdao Xincheng’s shareholding structure, see “History, Development and Corporate Structure
— Pre-IPO Investments — 4. Information about the Pre-IPO Investors ” in this prospectus.
(8) Tibet Jinkun and Mr, Niu Kuiguang are deemed to be interested in the Shares held by Zhuhai Shangshun for
the purpose of the SFO. For details of Zhuhai Shangshun’s shareholding structure, see “History, Development
and Corporate Structure — Pre-IPO Investments — 4. Information about the Pre-IPO Investors ” in this
prospectus.
(9) All interests are long positions.
For those who are directly and/or indirectly interested in 10% or more of the issued voting
shares of any other members of our Group, see “Statutory and General Information — C.
Further Information about our Directors, Supervisors, Chief Executive and Substantial
Shareholders — 5. Disclosure of Interests of Substantial Shareholders — (b) Interests in our
Company’s subsidiaries” in Appendix VI to this prospectus.
Save as disclosed above and in Appendix VI, our Directors are not aware of any person
who will, immediately following completion of the Global Offering and the conversion of
Domestic Unlisted Shares into H Shares (and the offering of any additional Shares pursuant to
the Over-allotment Option), have an interest or short position in the Shares or underlying
Shares which would be required to be disclosed to our Company and the Stock Exchange under
Divisions 2 and 3 of Part XV of the SFO, or will, directly or indirectly, be interested in 10%
or more of the issued voting shares of any other members of our Group.
SUBSTANTIAL SHAREHOLDERS
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--- page 374 ---
This section presents certain information regarding our share capital prior to and upon the
completion of the Global Offering.
BEFORE THE GLOBAL OFFERING
As at the Latest Practicable Date, the registered share capital of our Company was
RMB5,469,831,633 comprising 5,469,831,633 Shares with a nominal value of RMB1.00 each.
UPON COMPLETION OF THE GLOBAL OFFERING
Immediately upon completion of the Global Offering and conversion of Domestic
Unlisted Shares into H Shares, assuming the Over-allotment Option is not exercised, the share
capital of our Company will be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
total issued share
capital
(%)
Domestic Unlisted Shares in issue (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,533,406,011 43.93
Foreign Unlisted Shares in issue (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118920,426,548 15.96
H Shares to be converted from
Domestic Unlisted Shares (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,015,999,074 34.96
H Shares to be issued pursuant to the Global
Offering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118297,397,000 5.16
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,767,228,633 100
Immediately upon completion of the Global Offering and conversion of Domestic
Unlisted Shares into H Shares, assuming the Over-allotment Option is fully exercised, the share
capital of our Company will be as follows:
Description of Shares Number of Shares
Approximate
percentage of the
total issued share
capital
(%)
Domestic Unlisted Shares in issue (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,533,406,011 43.59
Foreign Unlisted Shares in issue (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118920,426,548 15.84
H Shares to be converted from
Domestic Unlisted Shares (Note) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,015,999,074 34.69
H Shares to be issued pursuant to the Global
Offering /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118342,006,500 5.88
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,811,838,133 100
SHARE CAPITAL
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Note: For details of the identities of the Shareholders whose Domestic Unlisted Shares will be converted into
H Shares upon Listing, see “History, Development and Corporate Structure — Pre-IPO Investments —
6. Public float” in this prospectus. Domestic Unlisted Shares are held by domestic investors and not
listed or traded on any stock exchange, while Foreign Unlisted Shares are held by foreign investors and
not listed or traded on any stock exchange. As at the Latest Practicable Date, only the Unlisted Shares
held by Luxshare were Foreign Unlisted Shares, and the Unlisted Shares held by other Shareholders
were Domestic Unlisted Shares.
SHARE CLASSES
Upon completion of the Global Offering and conversion of 2,015,999,074 Domestic
Unlisted Shares into H Shares, our Shares will consist of Domestic Unlisted Shares, Foreign
Unlisted Shares and H Shares, all of which are ordinary shares in the share capital of our
Company. Apart from certain qualified domestic institutional investors in the PRC, certain
qualified PRC investors under the Shanghai-Hong Kong Stock Connect and the Shenzhen-
Hong Kong Stock Connect, and other persons who are entitled to hold our H Shares pursuant
to relevant PRC laws and regulations or upon approvals of any competent authorities, H Shares
generally cannot be subscribed for or traded among legal and natural persons of the PRC. On
the other hand, Domestic Unlisted Shares and Foreign Unlisted Shares can only be subscribed
for by and traded between legal or natural PRC persons, qualified foreign institutional
investors and foreign strategic investors, and may only be subscribed for and transferred in
Renminbi.
Unlisted Shares and H Shares are regarded as one class of shares under our Articles of
Association, and will rank pari passu with each other in all other respects and, in particular,
will rank equally for all dividends or distributions declared, paid or made after the date of this
prospectus. Other than cash, dividends could also be paid in the form of shares or a
combination of cash and shares.
CONVERSION OF OUR UNLISTED SHARES INTO H SHARES
All our Unlisted Shares are not listed or traded on any stock exchange. The holders of our
Unlisted Shares may, at their own option, authorize us to apply to the CSRC for conversion of
their respective Unlisted Shares into H Shares. After the conversion of Unlisted Shares, such
converted Shares may be listed or traded on an overseas stock exchange, provided that such
conversion shall have gone through any requisite internal approval process and complied with
the regulations prescribed by the securities regulatory authorities of the State Council and the
regulations, requirements and procedures prescribed by the overseas stock exchange(s) and the
filing procedure with the CSRC shall have been completed. The listing of such converted
Shares on the Stock Exchange will also require the approval of the Stock Exchange. In
addition, such conversion, trading and listing shall in all respects comply with the regulations
prescribed by the State Council’s securities regulatory authorities and the regulations,
requirements and procedures prescribed by the relevant overseas stock exchange.
SHARE CAPITAL
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--- page 376 ---
Based on the procedures for the conversion of our Unlisted Shares into H Shares as
disclosed in this section, we can apply for the listing of all or any portion of our Unlisted
Shares on the Stock Exchange as H Shares in advance of any proposed conversion to ensure
that the conversion process can be completed promptly upon notice to the Stock Exchange and
delivery of Shares for entry on the H Share register. As any listing of additional Shares after
our initial listing on the Stock Exchange is ordinarily considered by the Stock Exchange to be
a purely administrative matter, it will not require such prior application for listing at the time
of our initial listing in Hong Kong.
No voting of class shareholder is required for the listing and trading of the converted
Shares on the Stock Exchange. Any application for listing of the converted Shares on the Stock
Exchange after our initial listing is subject to prior notification by way of announcement to
inform Shareholders and the public of such proposed conversion.
After all the requisite approvals have been obtained, the following procedure will need to
be completed in order to effect the conversion: the relevant Unlisted Shares will be withdrawn
from the Domestic Share register and we will re-register such Shares on our H Share register
maintained in Hong Kong and instruct the H Share Registrar to issue H Share certificates.
Registration on our H Share register will be conditional on (a) our H Share Registrar lodging
with the Stock Exchange a letter confirming the proper entry of the relevant H Shares on the
H Share register of members and the due dispatch of H Share certificates; and (b) the admission
of the H Shares to trade on the Stock Exchange in compliance with the Listing Rules, the
General Rules of HKSCC and the HKSCC Operational Procedures in force from time to time.
Until the converted shares are re-registered on our H Share register, such Shares would not be
listed as H Shares.
TRANSFER OF SHARES ISSUED PRIOR TO LISTING DATE
Pursuant to the PRC Company Law, our Shares issued prior to the Listing shall not be
transferred within 12 months from the Listing Date.
REGISTRATION OF SHARES NOT LISTED ON THE OVERSEAS STOCK
EXCHANGE
According to the Guidelines for the “Full Circulation” Program for Domestic Unlisted
Shares of H-Share Listed Companies ( H΅͡ሗ“ஷ”ˏ)
announced by the CSRC, the domestic shareholders of Domestic Unlisted Shares shall handle
share transfer registration business in accordance with the relevant business rules of the China
Securities Depository and Clearing Corporation Limited. Further, H-share companies should
submit the relevant status reports to the CSRC within 15 days after the transfer registration
with the China Securities Depository and Clearing Corporation Limited of the Domestic
Unlisted Shares involved in the application is completed.
CIRCUMSTANCES UNDER WHICH A GENERAL MEETING IS REQUIRED
For details of circumstances under which a Shareholders’ general meeting is required, see
the section headed “Summary of Articles of Association” in Appendix V to this prospectus.
SHARE CAPITAL
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You should read the following discussion and analysis in conjunction with our
consolidated financial statements included in the Accountants’ Report set out in Appendix
I to this prospectus, together with the accompanying notes. Our consolidated financial
statements have been prepared in accordance with HKFRS Accounting Standards.
The following discussion and analysis contain forward-looking statements that
reflect our current views with respect to future events and financial performance that
involve risks and uncertainties. These statements are based on assumptions and analysis
made by us in light of our experience and perception of historical events, current
conditions and expected future developments, as well as other factors we believe are
appropriate under the circumstances. In evaluating our business, you should carefully
consider the information provided in the section headed “Risk Factors” in this
prospectus.
OVERVIEW
We are a passenger vehicle company headquartered in Wuhu, China. We design, develop,
manufacture and sell a diverse and expanding portfolio of passenger vehicles, including
internal combustion engine (ICE) vehicles and new energy vehicles (NEVs), to cater to the
distinct and evolving needs and preferences of customers in both the domestic and overseas
markets.
Since our founding in 1997, with a commitment to leading industrial innovation and
engaging in the global market, we offer high quality passenger vehicles to users worldwide. We
are the second largest Chinese domestic brand passenger vehicle company, and the 11th largest
passenger vehicle company globally, in terms of global sales volume of passenger vehicles in
2024, according to Frost & Sullivan.
Our revenue increased from RMB92,618 million in 2022 to RMB163,205 million in 2023,
and further to RMB269,897 million in 2024. Our revenue increased from RMB54,910 million
for the three months ended March 31, 2024 to RMB68,223 million for the three months ended
March 31, 2025. Our profit for the year increased from RMB5,806 million in 2022 to
RMB10,444 million in 2023, and further to RMB14,334 million in 2024. Our profit for the
period increased from RMB2,476 million for the three months ended March 31, 2024 to
RMB4,726 million for the three months ended March 31, 2025.
BASIS OF PRESENTATION
The historical financial information has been prepared in accordance with HKFRS
Accounting Standards (which include all Hong Kong Financial Reporting Standards, Hong
Kong Accounting Standards and Interpretations) issued by The Hong Kong Institute of
Certified Public Accountants and accounting principles generally accepted in Hong Kong.
Details regarding the basis of presentation and preparation of the historical financial
information of our Group are set out in notes 2.1 and 2.2 to the Accountants’ Report in
Appendix I to this prospectus.
FINANCIAL INFORMATION
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We have not applied certain new and revised HKFRS Accounting Standards, which have
been issued but are not yet effective, in the consolidated financial statements of our Group. See
note 2.2 to the Accountants’ Report in Appendix I to this prospectus. We intend to apply these
new and revised HKFRS Accounting Standards, if applicable, when they become effective. We
are in the process of making an assessment of the impact of these new and revised HKFRS
Accounting Standards upon initial application. Currently, we consider that these new and
revised HKFRS Accounting Standards are unlikely to have a significant impact on our Group’s
financial performance and financial position.
KEY FACTORS AFFECTING OUR RESULTS OF OPERATIONS
The results of operations of our Group have been and will continue to be affected by a
number of factors, including the key ones set out in the section headed “Risk Factors” in this
prospectus and below:
Conditions of Global and Domestic Passenger Vehicle Markets
Our results of operations are affected by the conditions of the global and domestic
passenger vehicle markets. The global passenger vehicle industry is entering a stage of
maturity after a century of development. It is undergoing a significant transformation in light
of continuous advancement of technologies, such as electrification and intelligentization, as
well as increasing awareness on environmental protection. According to Frost & Sullivan, the
total sales of global passenger vehicle reached 74.3 million units in 2024, is expected to grow
at a CAGR of 3.5% from 2025 to 90.1 million units in 2030, hitting a landmark of 100 million
units by 2035.
Given the differences in size of economy, economic development, infrastructure
construction, and industrial foundation, there is currently an imbalance in the regional
development of the global passenger vehicle market. Mature markets such as China (excluding
export), North America and Europe accounted for 30.4%, 23.9% and 19.5% of the market
share, respectively, in terms of the global passenger vehicle sales in 2024, and are expected to
grow moderately at 1.5%, 2.7% and 2.4%, respectively, from 2025 to 2030. Comparatively
speaking, emerging markets such as South America, the Middle East and North Africa, and
Asia (excluding China) are expected to grow at a higher CAGR of 8.7%, 21.4% and 2.8%,
respectively, from 2025 to 2030.
Currently, ICE vehicles dominate the market, yet with decreasing market share from 2019
to 2024, while NEV are claiming market shares. By 2030, NEV are projected to make up 47.0%
of the market. In recent years, the international recognition of Chinese domestic brands has
steadily grown. Chinese domestic brands progressed significantly in electrification,
particularly in developing electric and hybrid powertrain technologies. These innovations have
significantly outpaced traditional overseas OEMs, and positioned China as a leader in the
global NEV sector.
FINANCIAL INFORMATION
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In recent years, the demand for SUVs has surged due to the growing interest in family
travel and outdoor activities. Looking ahead, as consumer needs diversify and market segments
like urban SUVs and off-road variants expand, the market share of SUVs is expected to
continue growing, reaching 68.1% by 2030.
The sales of our passenger vehicles in both domestic and international markets are
influenced by the conditions of passenger vehicle markets in different regions, particularly
those where we have already established presence. The growth of the local passenger vehicle
markets, along with the local economy, purchasing power, and demand for passenger vehicles,
impacts the sales of our products in these markets, and consequently affects our financial
performance in these areas.
Our Ability to Introduce New Models and Changes to Our Product Mix
Our results of operations depend on our ability to introduce new models and adapt our
product mix to market trends and changing customer tastes and preferences. During the Track
Record Period, we sold passenger vehicles primarily under five major brands, namely CHERY ,
JETOUR, EXEED, iCAR and LUXEED. With these brands’ distinct market positioning and
features, we integrate market insights and diverse customer needs into product definition,
design and development process. This approach enables us to launch popular models to drive
sales growth and capture significant growth opportunities across market segments. See
“Business — Our Products — Passenger V ehicles”.
In line with our global strategies, we will continue to launch new models and versions
under our five major brands to expand our product portfolio and meet diverse customer needs.
Our goals are to penetrate further into mid- to high-end and premium market segments while
achieving a multi-brand strategy. In 2025, we plan to launch more than 60 new models and
versions of passenger vehicles. We believe our proven ability to develop and deliver new
vehicle models allows us to curate a diverse portfolio of passenger vehicles and serve our user
base of evolving and diverse preferences.
Our Ability to Enhance Our Market Presence Domestically and Globally
We are among the top domestic brand passenger vehicle companies in the PRC market.
We ranked second among Chinese domestic brand passenger vehicle companies, in terms of
sales volume (including export volume) with a market share of 11.8% in 2023 and 14.0% in
2024. In 2022, 2023, 2024 and the three months ended March 31, 2024 and 2025, our revenue
in the PRC (including Hong Kong, Macau and Taiwan) were RMB62,231 million, RMB86,145
million, RMB169,000 million, RMB34,534 million and RMB41,934 million respectively,
representing 67.2%, 52.8%, 62.6%, 62.9% and 61.5% of our total revenue during the same
periods, respectively.
FINANCIAL INFORMATION
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We have established a global footprint. We are the No. 1 exporter among the Chinese
domestic brand passenger vehicle companies for 22 consecutive years since 2003 in terms of
passenger vehicle export volume of Chinese domestic brands from 2003 to 2024
(1), according
to Frost & Sullivan. We are the 11th largest passenger vehicle company globally in terms of
sales volume in 2024. As of the Latest Practicable Date, we had sold passenger vehicles to over
100 countries and regions. In 2022, 2023, 2024 and the three months ended March 31, 2024
and 2025, our sales to other countries and regions generated revenue of RMB30,387 million,
RMB77,060 million, RMB100,897 million, RMB20,376 million and RMB26,289 million,
respectively, representing 32.8%, 47.2%, 37.4%, 37.1% and 38.5% of our total revenue during
the same periods, respectively.
By continually expanding into new overseas markets, and strengthening our presence in
existing ones, we aim to expand our customer base both domestically and globally, thereby
promoting our sales in different markets.
Our Ability to Control Costs and Improve Operational Efficiency
Our ability to manage costs and enhance efficiency will impact the results of our
operations. We collaborate with business partners across the industry value chain and work
extensively with them to build an industrial ecosystem with a controllable supply chain. We
believe our collaborative industrial ecosystem can provide us with a safe, flexible and efficient
supply chain, enabling us to build a high-quality, efficient and cost-effective vehicle
development system, supporting our multi-brand strategy and diversified product portfolio
across China and overseas.
We also plan to leverage our vehicle development platform with high compatibility and
adaptability to reduce unit production cost as we scale up to achieve economies of scale. By
optimizing our production process through advanced, intelligent and automated manufacturing,
we aim to enhance our production capacity and our profitability.
Our Ability to Enhance Technological Capabilities
We are committed to research and development driven by market demands. As of March
31, 2025, we had more than 14,400 R&D professionals, accounting for over 50% of our
non-manufacturing employees. According to Frost & Sullivan, technological innovation and
the rapid development of intelligent systems have become pivotal in shaping the future of the
automotive industry. We have strategically focused our R&D efforts on the areas like driving
assistance solutions and smart cockpit to design and develop new passenger vehicles that
provide an optimal driving experience for our customers.
Note:
1. Excluding export volume of brands acquired from overseas by Chinese companies for the purpose of
comparison of export volume of Chinese domestic brands only.
FINANCIAL INFORMATION
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We have established three R&D centers in Wuhu, Hefei and Shanghai in China, and five
overseas R&D centers in Germany, Spain, Brazil, Mexico and Malaysia. As we expand our
business overseas, we expedite the localization of our technical capabilities to make our
products appealing to local customers.
Our research and development expenditure (including capitalized R&D expenditure)
increased from RMB4,128 million in 2022 to RMB10,544 million in 2024. We plan to invest
in research and development with a focus on developing new vehicles and technologies as well
as improving the quality and core technology of our existing products and services. As our
business grows, we anticipate our research and development investments will increase, which
we believe will boost our technological capabilities.
Our Ability to Execute Effective Sales and Marketing Strategies
Effective sales and marketing strategies are crucial for driving our sales growth,
especially in the face of complex market environments and intensifying market competition
both domestically and globally.
We sell our passenger vehicles primarily through a network of dealers in China and
overseas markets. Our dealership outlets market and sell our vehicles as well as provide
repairs, maintenance and other after-sales services. In 2022, 2023 and 2024 and the three
months ended March 31, 2024 and 2025, our selling and distribution expenses amounted to
RMB3,207 million, RMB5,557 million, RMB8,380 million, RMB1,812 million and RMB2,182
million, respectively, representing 3.5%, 3.4%, 3.1%, 3.3% and 3.2% of our total revenue in
the same periods, respectively. The number of our dealership outlets in China and overseas
increased from 3,901 as of December 31, 2022 to 6,621 as of March 31, 2025. As of March 31,
2025, we had 3,663 dealership outlets covering over 310 cities in the PRC and 2,958 overseas
dealership outlets in Asia (excluding China), Europe, Africa, Oceania and the Americas. Our
extensive network of dealership outlets ensures wide market coverage in various areas,
boosting our sales both domestically and globally.
We continually evaluate the effectiveness of various marketing channels and allocate our
marketing expenditure accordingly. Effective marketing helps us boost global sales in a
cost-effective manner. With the growing popularity of online marketing channels, we are
dedicated to increasing our product exposure by creating content on major social media
platforms to precisely target users. As we expand our business, we expect to continually
improve our sales and marketing efficiency.
FINANCIAL INFORMATION
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MATERIAL ACCOUNTING POLICY INFORMATION, JUDGMENTS AND
ESTIMATES
Our Group has identified certain accounting policies that are significant to the preparation
of our consolidated financial statements in accordance with HKFRS Accounting Standards. Our
Group has also made certain accounting judgments and assumptions in the process of applying
our accounting policies. When reviewing our Group’s consolidated financial statements, you
should consider (i) the selection of critical accounting policies; (ii) the judgment and
assumptions affecting the application of such policies; and (iii) the sensitivity or reported
results to change in conditions and assumptions. We set out below those accounting judgment
and estimates used in the preparation of our Group’s financial statements.The details of
material accounting policy information, estimates and judgments, which are important for an
understanding of our Group’s financial condition and results of operations, are set out in notes
2.3 and 3 to the financial statements included in the Accountants’ Report in Appendix I to this
prospectus.
We believe the following accounting policies, estimates and judgments are most critical
to the preparation of the financial information:
Revenue Recognition
Revenue from Contracts with Customers
Revenue from contracts with customers is recognized when control of goods or services
is transferred to the customers at an amount that reflects the consideration to which our Group
expects to be entitled in exchange for those goods or services.
When the consideration in a contract includes a variable amount, the amount of
consideration is estimated to which our Group will be entitled in exchange for transferring the
goods or services to the customer. The variable consideration is estimated at contract inception
and constrained until it is highly probable that a significant revenue reversal in the amount of
cumulative revenue recognized will not occur when the associated uncertainty with the variable
consideration is subsequently resolved.
When the contract contains a financing component which provides the customer with a
significant benefit of financing the transfer of goods or services to the customer for more than
one year, revenue is measured at the present value of the amount receivable, discounted using
the discount rate that would be reflected in a separate financing transaction between our Group
and the customer at contract inception. When the contract contains a financing component
which provides our Group with a significant financial benefit for more than one year, revenue
recognized under the contract includes the interest expense accreted on the contract liability
under the effective interest method. For a contract where the period between the payment by
the customer and the transfer of the promised goods or services is one year or less, the
transaction price is not adjusted for the effects of a significant financing component, using the
practical expedient in HKFRS 15.
FINANCIAL INFORMATION
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Sale of Goods
Our Group manufactures and sells a range of passenger vehicles, and automotive parts
and components. Sales revenue are recognized when control of the goods has been transferred
to the customers, and there is no unfulfilled obligation that could affect the customer’s
acceptance of the goods.
Our Group provides sales rebate and discounts to certain customers for sales of passenger
vehicles, automotive parts and components, and the relevant revenue is recognized based on
contract consideration net of the estimated sales rebate and discount amount.
Passenger vehicles are often sold with volume rebates. To estimate the variable
consideration for the expected future rebates, the most likely amount method is used for
contracts with a single-volume threshold and the expected value method for contracts with
more than one volume threshold. The selected method that best predicts the amount of variable
consideration is primarily driven by the number of volume thresholds contained in the contract.
The requirements on constraining estimates of variable consideration are applied and a refund
liability for the expected future rebates is recognized.
Rendering of Services
The services rendered include automobile repair and maintenance services, extended
warranty services, technology development services, etc. Should one of the following
conditions is satisfied, service provided by our Group, is a performance obligation performed
within a certain period of time. Our Group recognizes revenue within a period of time in
accordance with the progress of contract performance. The conditions are: (1) The customer
obtains and consumes the economic benefits brought by the contract at the same time
performing the contract; (2) The customer is able to control the products under construction
during our Group’s performance; (3) The products of our Group have irreplaceable uses, and
our Group has the right to ask for payment for the cumulative part that has been completed so
far during the entire contract period. Otherwise, our Group recognizes revenue at the point the
customer obtains control of the relevant services.
Provisions
A provision is recognized when a present obligation (legal or constructive) has arisen as
a result of a past event and it is probable that a future outflow of resources will be required to
settle the obligation, provided that a reliable estimate can be made of the amount of the
obligation.
When our Group expects some or all of a provision to be reimbursed, the reimbursement
is recognized as a separate asset, but only when the reimbursement is virtually certain. The
expense relating to a provision is presented in the statement of profit or loss net of any
reimbursement.
FINANCIAL INFORMATION
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Our Group provides for warranties in relation to the sales of passenger vehicles,
automotive parts and components. Provisions for these assurance-type warranties granted by
our Group are initially recognized based on sales volume and past experience of the level of
repairs and returns. The estimation is reviewed on an ongoing basis and is revised when
appropriate.
Foreign Currencies
The historical financial information is presented in RMB, which is our Company’s
functional currency. Each entity in our Group determines its own functional currency and items
included in the historical financial information of each entity are measured using that
functional currency. Foreign currency transactions recorded by the entities in our Group are
initially recorded using their respective functional currency rates prevailing at the dates of the
transactions. Monetary assets and liabilities denominated in foreign currencies are translated at
the functional currency rates of exchange ruling at the end of each of the relevant periods.
Differences arising on settlement or translation of monetary items are recognized in the
statement of profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are
translated using the exchange rates at the dates of the initial transactions. Non-monetary items
measured at fair value in a foreign currency are translated using the exchange rates at the date
when the fair value was measured. The gain or loss arising on translation of a non-monetary
item measured at fair value is treated in line with the recognition of the gain or loss on change
in fair value of the item (i.e., translation difference on the item whose fair value gain or loss
is recognized in other comprehensive income or profit or loss is also recognized in other
comprehensive income or profit or loss, respectively).
The functional currencies of certain overseas subsidiaries, joint ventures and associates
are currencies other than the RMB, mainly including RUB. As at the end of the reporting
period, the assets and liabilities of these entities are translated into RMB at the exchange rates
prevailing at the end of the reporting period and their statements of profit or loss are translated
into RMB at the exchange rates that approximate to those prevailing at the dates of the
transactions.
The resulting exchange differences are recognized in other comprehensive income and
accumulated in the exchange fluctuation reserve, except to the extent that the differences are
attributable to non-controlling interests. On disposal of a foreign operation, the cumulative
amount in the reserve relating to that particular foreign operation is recognized in the statement
of profit or loss.
Any goodwill arising on the acquisition of a foreign operation and any fair value
adjustments to the carrying amounts of assets and liabilities arising on acquisition are treated
as assets and liabilities of the foreign operation and translated at the closing rate.
FINANCIAL INFORMATION
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--- page 385 ---
Leases
Our Group assesses at contract inception whether a contract is, or contains, a lease. A
contract is, or contains, a lease if the contract conveys the right to control the use of an
identified asset for a period of time in exchange for consideration.
Our Group as a Lessee
Our Group applies a single recognition and measurement approach for all leases, except
for short-term leases and leases of low-value assets. Our Group recognizes lease liabilities to
make lease payments and right-of-use assets representing the right to use the underlying assets.
Right-of-use Assets
Right-of-use assets are recognized at the commencement date of the lease (that is the date
the underlying asset is available for use). Right-of-use assets are measured at cost, less
accumulated depreciation and any impairment losses, and adjusted for any remeasurement of
lease liabilities. The cost of right-of-use assets includes the amount of lease liabilities
recognized, initial direct costs incurred, and lease payments made at or before the
commencement date less any lease incentives received. Right-of-use assets are depreciated on
a straight-line basis over the shorter of the lease terms and the estimated useful lives of the
assets as follows:
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 years
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 20 years
Machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 10 years
V ehicles and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years
If ownership of the leased asset transfers to our Group by the end of the lease term or the
cost reflects the exercise of a purchase option, depreciation is calculated using the estimated
useful life of the asset.
Lease Liabilities
Lease liabilities are recognized at the commencement date of the lease at the present value
of lease payments to be made over the lease term. The lease payments include fixed payments
(including in-substance fixed payments) less any lease incentives receivable, variable lease
payments that depend on an index or a rate, and amounts expected to be paid under residual
value guarantees. The lease payments also include the exercise price of a purchase option
reasonably certain to be exercised by our Group and payments of penalties for termination of
a lease, if the lease term reflects our Group exercising the option to terminate the lease. The
variable lease payments that do not depend on an index or a rate are recognized as an expense
in the period in which the event or condition that triggers the payment occurs.
FINANCIAL INFORMATION
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In calculating the present value of lease payments, our Group uses its incremental
borrowing rate at the lease commencement date because the interest rate implicit in the lease
is not readily determinable. After the commencement date, the amount of lease liabilities is
increased to reflect the accretion of interest and reduced for the lease payments made. In
addition, the carrying amount of lease liabilities is remeasured if there is a modification, a
change in the lease term, a change in lease payments (e.g., a change to future lease payments
resulting from a change in an index or rate) or a change in assessment of an option to purchase
the underlying asset.
Short-term Leases and Leases of Low-value Assets
Our Group applies the short-term lease recognition exemption to its short-term leases of
buildings and machinery (i.e. those leases that have a lease term of 12 months or less from the
commencement date and do not contain a purchase option). It also applies the recognition
exemption for leases of low-value assets to leases of machinery, vehicles and others that are
considered to be of low value.
Lease payments on short-term leases and leases of low-value assets are recognized as an
expense on a straight-line basis over the lease term.
RESULTS OF OPERATIONS
The following table sets forth selected items of the consolidated statements of profit or
loss of our Group for the periods indicated:
For the year ended
December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(79,813) (137,115) (233,589) (46,747) (59,766)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,805 26,090 36,308 8,163 8,457
Other income and gains /H1118/H1118/H1118/H11183,822 4,232 6,251 1,174 3,652
Selling and distribution
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,207) (5,557) (8,380) (1,812) (2,182)
Administrative expenses /H1118/H1118/H1118/H1118(1,934) (4,070) (5,999) (1,887) (1,140)
Research and development
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,646) (6,664) (9,243) (2,224) (2,272)
Impairment (losses)/gains on
financial and contract
assets, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(684) 223 258 424 13
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(130) (568) (1,719) (421) (99)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,405) (1,617) (2,310) (692) (872)
FINANCIAL INFORMATION
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For the year ended
December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Share of profits and losses of
– Joint ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118640 854 851 258 112
– Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118247 382 595 188 98
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,508 13,305 16,612 3,171 5,767
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118(702) (2,861) (2,278) (695) (1,041)
Profit for the year/period /H1118/H11185,806 10,444 14,334 2,476 4,726
attributable to
– Owners of our Company /H1118/H11186,266 11,953 14,135 2,712 4,650
– Non-controlling interests /H1118/H1118(460) (1,509) 199 (236) 76
Other comprehensive
income for the
year/period, net of tax /H1118/H1118/H111894 (410) 171 39 (1,030)
Total comprehensive
income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,900 10,034 14,505 2,515 3,696
attributable to
– Owners of our Company /H1118/H11186,360 11,543 14,306 2,751 3,620
– Non-controlling interests /H1118/H1118(460) (1,509) 199 (236) 76
Non-HKFRS Measures
To supplement our consolidated financial statements, which are presented in accordance
with HKFRSs, we also use adjusted profit (non-HKFRS measure) and adjusted EBITDA
(non-HKFRS measure) as additional financial measures, which are not required by, or
presented in accordance with, HKFRSs. We believe these measures provide useful information
to investors and others in understanding and evaluating our consolidated results of operations
in the same manner as they help our management. However, our presentation of adjusted profit
(non-HKFRS measure) and adjusted EBITDA (non-HKFRS measure) may not be comparable
to similarly titled measures presented by other companies. The use of these non-HKFRS
measures has limitations as an analytical tool, and you should not consider them in isolation
from, or as a substitute for an analysis of, our results of operations or financial condition as
reported under HKFRSs.
FINANCIAL INFORMATION
– 377 –


--- page 388 ---
Adjusted Profit (non-HKFRS measure) and Adjusted EBITDA (non-HKFRS measure)
We define adjusted profit (non-HKFRS measure) as profit for the year/period adjusted by
adding equity-settled share-based compensation expenses. We then add back (i) income tax
expense, (ii) net finance costs, and (iii) depreciation and amortization to derive adjusted
EBITDA (non-HKFRS measure). The following table sets out a reconciliation from profit for
the year/period to adjusted profit (non-HKFRS measure) and adjusted EBITDA (non-HKFRS
measure) for the year/period indicated:
For the year ended
December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Reconciliation of profit for
the year/period to
adjusted profit (non-
HKFRS measure) and
adjusted EBITDA (non-
HKFRS measure)
Profit for the year/period /H1118/H11185,806 10,444 14,334 2,476 4,726
Add:
Equity-settled share-based
compensation expenses
(1) /H1118/H1118 – – 2,016 1,632 131
Adjusted profit
(non-HKFRS measure) /H1118/H1118/H11185,806 10,444 16,350 4,108 4,857
Add:
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118702 2,861 2,278 695 1,041
Net finance costs (2) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118599 500 1,350 442 658
Depreciation and
amortization (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,004 2,481 3,849 520 908
Adjusted EBITDA
(non-HKFRS measure) /H1118/H1118/H11189,111 16,286 23,827 5,765 7,464
Notes:
(1) Non-cash expenses arising from shares granted to selected employees. See note 37 to the Accountant’s
Report in Appendix I to this prospectus for details.
(2) Net finance costs represent finance costs less bank interest income.
(3) The amount of depreciation and amortization presented represents the depreciation of property, plant
and equipment, the amortization of other intangible assets, and the depreciation of right-of-use assets.
FINANCIAL INFORMATION
– 378 –


--- page 389 ---
Revenue
In 2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our total
revenue amounted to RMB92,618 million, RMB163,205 million, RMB269,897 million,
RMB54,910 million and RMB68,223 million, respectively.
Revenue by Products
During the Track Record Period, our revenue was primarily from sales of passenger
vehicles, and automotive parts and components. In addition, we also manufacture and sell KD
kits, the revenue of which are included in the sales of passenger vehicles. See “Business — Our
Products” for further details.
The following table sets forth our revenue breakdown by products for the periods
indicated:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(Unaudited)
Passenger vehicles /H1118/H111882,511 89.1 151,228 92.7 246,822 91.5 50,547 92.1 61,639 90.3
Automotive parts and
components /H1118/H1118/H1118/H11188,675 9.4 8,904 5.5 15,864 5.9 2,936 5.3 5,743 8.4
Others (1) /H1118/H1118/H1118/H1118/H1118/H1118/H11181,432 1.5 3,073 1.8 7,211 2.6 1,427 2.6 841 1.3
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 100.0 163,205 100.0 269,897 100.0 54,910 100.0 68,223 100.0
Note:
(1) Others include automotive business-related procurement, production, technology development and other
supporting services.
FINANCIAL INFORMATION
– 379 –


--- page 390 ---
The majority of our revenue was derived from the sales of passenger vehicles,
representing 89.1%, 92.7%, 91.5%, 92.1% and 90.3% of our total revenue in 2022, 2023 and
2024 and the three months ended March 31, 2024 and 2025, respectively.
The table below sets forth the breakdown of our revenue generated from sales of
passenger vehicles by energy type:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(Unaudited)
Passenger vehicles
ICE vehicles /H1118/H1118/H1118/H1118/H111870,258 85.1 143,316 94.8 187,891 76.1 45,951 90.9 42,974 69.7
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,253 14.9 7,912 5.2 58,931 23.9 4,596 9.1 18,665 30.3
– PHEVs and
REEVs /H1118/H1118/H1118/H1118/H1118/H1118/H11181,301 1.6 2,727 1.8 35,314 14.3 2,584 5.1 10,709 17.5
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,952 13.3 5,185 3.4 23,617 9.6 2,012 4.0 7,956 12.8
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0 246,822 100.0 50,547 100.0 61,639 100.0
We generated a majority of our revenue from the sales of ICE vehicles during the Track
Record Period. As a result of our business expansion in both domestic and overseas markets,
our revenue increased from RMB70,258 million to RMB143,316 million from 2022 to 2023,
and further to RMB187,891 million in 2024. Our revenue slightly decreased from RMB45,951
million for the three months ended March 31, 2024 to RMB42,974 million for the three months
ended March 31, 2025.
In 2023, we officially released our NEV new strategy and optimized our NEV product
portfolio by scaling down the sales of certain BEV models. As a result, our revenue from NEV
sales initially decreased from RMB12,253 million in 2022 to RMB7,912 million in 2023. With
the introduction of new NEV models and versions under this strategy, our revenue from NEV
sales surged to RMB58,931 million in 2024. Our revenue from NEV sales increased from
RMB4,596 million for the three months ended March 31, 2024 to RMB18,665 million for the
three months ended March 31, 2025 due to the sales volume growth of our NEV vehicles.
FINANCIAL INFORMATION
– 380 –


--- page 391 ---
The table below sets forth the geographical breakdown of our revenue generated from
sales of passenger vehicles:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(RMB
million) %
(Unaudited)
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,359 64.7 76,695 50.7 148,954 60.3 30,901 61.1 36,971 60.0
Other countries and
regions /H1118/H1118/H1118/H1118/H1118/H111829,152 35.3 74,533 49.3 97,868 39.7 19,646 38.9 24,668 40.0
– Asia (excluding
PRC) /H1118/H1118/H1118/H1118/H1118/H1118/H11186,048 7.3 18,341 12.1 29,449 11.9 5,844 11.6 10,382 16.8
– Europe (2)/H1118/H1118/H1118/H1118/H1118/H111813,964 16.9 42,289 28.0 51,297 20.8 10,103 20.0 10,420 16.9
– Americas /H1118/H1118/H1118/H1118/H1118/H11188,545 10.4 12,427 8.2 13,268 5.4 2,918 5.8 2,394 3.9
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118558 0.7 482 0.3 2,170 0.9 578 1.1 805 1.3
– Oceania and
others /H1118/H1118/H1118/H1118/H1118/H1118/H111837 0.0 994 0.7 1,684 0.7 203 0.4 667 1.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0 246,822 100.0 50,547 100.0 61,639 100.0
Notes:
(1) Including Hong Kong, Macau and Taiwan.
(2) In 2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our revenue from sales of
passenger vehicles in Russia represented 14.6%, 26.8%, 18.6%, 18.4% and 10.9% of our revenue from sales
of passenger vehicles, respectively.
Geographical Breakdown
The following table sets forth the geographical breakdown of our revenue for the periods
indicated:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(Unaudited)
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H111862,231 67.2 86,145 52.8 169,000 62.6 34,534 62.9 41,934 61.5
Other countries and
regions /H1118/H1118/H1118/H1118/H1118/H111830,387 32.8 77,060 47.2 100,897 37.4 20,376 37.1 26,289 38.5
– Asia (excluding
PRC) /H1118/H1118/H1118/H1118/H1118/H1118/H11186,420 7.0 19,057 11.6 29,966 11.2 6,038 11.0 10,649 15.6
– Europe (2)/H1118/H1118/H1118/H1118/H1118/H111814,339 15.5 43,355 26.6 53,221 19.7 10,502 19.1 11,607 17.0
– Americas /H1118/H1118/H1118/H1118/H1118/H11189,000 9.7 13,150 8.1 13,756 5.1 3,033 5.5 2,530 3.7
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118591 0.6 494 0.3 2,247 0.8 589 1.1 836 1.2
– Oceania and
others /H1118/H1118/H1118/H1118/H1118/H1118/H111837 0.0 1,004 0.6 1,707 0.6 214 0.4 667 1.0
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 100.0 163,205 100.0 269,897 100.0 54,910 100.0 68,223 100.0
FINANCIAL INFORMATION
– 381 –


--- page 392 ---
Notes:
(1) Including Hong Kong, Macau and Taiwan.
(2) In 2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our revenue derived from
Russia represented 13.4%, 25.5%, 17.7%, 17.7% and 10.7% of our total revenue, respectively.
In 2022, 2023 and 2024 and the three months ended March 31, 2024 and 2025, our
revenue derived from the PRC (including Hong Kong, Macau and Taiwan) represented 67.2%,
52.8%, 62.6%, 62.9% and 61.5% of our total revenue, respectively; while our revenue derived
from other countries and regions represented 32.8%, 47.2%, 37.4%, 37.1% and 38.5% of our
total revenue, respectively.
Cost of Sales
Our cost of sales mainly comprises cost of materials for manufacturing of our products,
manufacturing costs and labor costs, which in aggregate accounted for 92.6%, 86.9%, 87.3%,
86.5% and 88.0% of our cost of sales, respectively, in 2022, 2023 and 2024 and the three
months ended March 31, 2024 and 2025. In 2022, 2023 and 2024 and the three months ended
March 31, 2024 and 2025, our cost of sales amounted to RMB79,813 million, RMB137,115
million, RMB233,589 million, RMB46,747 million and RMB59,766 million, respectively,
representing 86.2%, 84.0%, 86.5%, 85.1% and 87.6% of our total revenue in the same periods,
respectively. During the same periods, the cost of materials constituted the most part of our
cost of sales, accounting for 86.6%, 81.9%, 82.4%, 81.8% and 82.9% of our cost of sales,
respectively.
The following table sets forth our cost of sales breakdown by nature for the periods
indicated:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(Unaudited)
Cost of materials /H1118/H1118/H111869,144 86.6 112,230 81.9 192,395 82.4 38,229 81.8 49,524 82.9
Direct labor /H1118/H1118/H1118/H1118/H1118/H11181,172 1.5 1,914 1.4 3,675 1.6 733 1.6 1,024 1.7
Manufacturing costs /H1118/H11183,575 4.5 5,067 3.6 7,749 3.3 1,463 3.1 2,026 3.4
Warranty expenses /H1118/H1118/H11182,858 3.6 5,213 3.8 7,477 3.2 1,882 4.0 2,046 3.4
Freight expenses, taxes
and others /H1118/H1118/H1118/H1118/H1118/H11183,064 3.8 12,691 9.3 22,293 9.5 4,440 9.5 5,146 8.6
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111879,813 100.0 137,115 100.0 233,589 100.0 46,747 100.0 59,766 100.0
FINANCIAL INFORMATION
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--- page 393 ---
Gross Profit and Gross Margin
Our gross profit represents revenue less cost of sales, and our gross margin represents
gross profit divided by revenue. In 2022, 2023 and 2024 and the three months ended March 31,
2024 and 2025, our total gross profit amounted to RMB12,805 million, RMB26,090 million,
RMB36,308 million, RMB8,163 million and RMB8,457 million, respectively, and our overall
gross margin was 13.8%, 16.0%, 13.5%, 14.9% and 12.4%, respectively.
The following table sets forth a breakdown of our gross profit and gross margin by
products for the periods indicated:
For the year ended December 31, For the three months ended March 31,
2022 2023 2024 2024 2025
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
Gross
profit
Gross
margin
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(RMB
million) (%)
(Unaudited)
Passenger vehicles /H1118/H111810,751 13.0 24,111 15.9 32,572 13.2 7,482 14.8 7,246 11.8
– ICE V ehicles /H1118/H1118/H1118/H111811,068 15.8 24,565 17.1 32,308 17.2 7,479 16.3 6,185 14.4
– NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118(317) (2.6) (454) (5.7) 264 0.4 3 0.1 1,061 5.7
Automotive parts and
components /H1118/H1118/H1118/H11181,678 19.3 1,702 19.1 3,243 20.4 586 20.0 1,175 20.5
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118376 26.3 277 9.0 493 6.8 95 6.7 36 4.3
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,805 13.8 26,090 16.0 36,308 13.5 8,163 14.9 8,457 12.4
The majority of our gross profit was from sale of our passenger vehicles, which
represented 84.0%, 92.4%, 89.7%, 91.7% and 85.7% of our total gross profit in 2022, 2023 and
2024 and the three months ended March 31, 2024 and 2025, respectively. Our gross margin
from passenger vehicles increased from 13.0% in 2022 to 15.9% in 2023, primarily as a result
of the sales increase in overseas markets with higher average selling prices and thus higher
gross margin and product mix optimization of our passenger vehicles, which then decreased to
13.2% in 2024, primarily as a result of (i) intensifying competition in overseas markets in 2024
and the increase of recycling fees imposed on imported vehicles in Russia since the fourth
quarter of 2024; and (ii) increased sales in NEVs in our product mix in the same year. Our gross
margin from passenger vehicles decreased from 14.8% for the three months ended March 31,
2024 to 11.8% for the three months ended March 31, 2025, primarily due to (i) a significant
increase in revenue contribution of our NEVs to our total revenue from 8.4% to 27.3% during
the same period, which generally had a lower profit margin than ICE vehicles; and (ii)
intensifying competition in overseas markets and the increase of recycling fees imposed on
imported vehicles in Russia since the fourth quarter of 2024. Our gross margin from ICE
vehicles increased from 15.8% in 2022 to 17.1% in 2023 due to increased sales in ICE vehicles
with higher gross margin in overseas markets and the gross margin remained relatively stable
FINANCIAL INFORMATION
– 383 –


--- page 394 ---
at 17.2% in 2024. Our gross margin from ICE vehicles decreased from 16.3% for the three
months ended March 31, 2024 to 14.4% for the three months ended March 31, 2025, primarily
due to intensifying competition in overseas markets and the increase of recycling fees imposed
on imported vehicles in Russia since the fourth quarter of 2024. Our gross margin from NEVs
was -2.6% in 2022 as we were at the early stage of development and production of NEV
vehicles and had not achieved economies of scale. Such gross margin decreased to -5.7% in
2023 as the result of the decrease of the selling prices of some of our BEV models under Little
Ant and QQ Ice Cream in response to the changing market trend and relevant policies. Our
gross margin from NEVs then increased to 0.4% in 2024 as a result of (i) increased sales of
PHEV models as a percentage to total NEV models which had a higher gross margin; and (ii)
decreased sales of certain BEV models under Little Ant and QQ Ice Cream. Our gross margin
from NEV vehicles increased from 0.1% for the three months ended March 31, 2024 to 5.7%
for the three months ended March 31, 2025, primarily due to (i) our effective cost management
measures; (ii) a decrease in raw material costs, especially the procurement costs for battery
cells; and (iii) economies of scale along with the sales volume growth of our NEV vehicles.
Our gross margin from others decreased from 26.3% in 2022 to 9.0% in 2023, then further
decreased to 6.8% in 2024, primarily due to the following reasons: (i) for our technology
development business, our grant of a non-exclusive license relating to utilization of developed
technology for an NEV model in 2022 recorded only minimal costs because development
related expenditures were expensed off when incurred prior to 2022; and (ii) our automotive
business-related procurement increased in 2023 and 2024 which had a lower gross margin.
Leveraging our accumulated expertise, networks and resources in automotive industry chain,
we facilitated such procurement incidental to our supply chain, which primarily involved the
procurement of industrial robotic arms, automation equipment and parts and components. Our
gross margin from others decreased from 6.7% for the three months ended March 31, 2024 to
4.3% for the three months ended March 31, 2025, primarily due to our increased automotive
business-related procurement, which had a lower gross margin.
Other Income and Gains
Our other income and gains primarily comprise bank interest income, investment income,
additional deduction for value-added tax (V A T), research and development subsidies (R&D
subsidies) and other subsidies. Additional deduction for V A T mainly represents the additional
deduction of value-added tax for advanced manufacturing business like ours. The R&D
subsidies and other subsidies mainly represent subsidies from governments to encourage our
R&D activities and operations. In 2022, 2023 and 2024 and the three months ended March 31,
2024 and 2025, our other income and gains amounted to RMB3,822 million, RMB4,232
million, RMB6,251 million, RMB1,174 million and RMB3,652 million, respectively,
representing 4.1%, 2.6%, 2.3%, 2.1% and 5.4% of our total revenue, respectively.
FINANCIAL INFORMATION
– 384 –


--- page 395 ---
The following table sets forth a breakdown of our other income and gains for the periods
indicated:
For the year ended December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Other income
Bank interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118806 1,117 960 250 214
Additional deduction for
value-added tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 205 762 20 148
Research and development
subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118510 514 765 136 150
Other subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118364 704 1,092 473 155
Investment income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118817 1,243 1,085 (6) 198
Others (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118431 815 1,407 236 253
Total other income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,930 4,598 6,071 1,109 1,118
Gains/(Losses)
Fair value gains/(losses) on
derivative financial
instruments, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118230 (265) 52 16 –
Fair value gains on financial
assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862 27 69 42 72
Foreign exchange
gains/(losses), net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118504 (141) – – 2,439
Gain on disposal of items of
property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111896 13 59 7 23
Total gains/(losses) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118892 (366) 180 65 2,534
Total other income and
gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,822 4,232 6,251 1,174 3,652
Note:
(1) Others mainly includes patent licensing income, sales of carbon credits and sales of scrap materials.
FINANCIAL INFORMATION
– 385 –


--- page 396 ---
Selling and Distribution Expenses
Our selling and distribution expenses primarily include advertisement and marketing
expenses, and employee benefit expenses for our sales and marketing personnel. In 2022, 2023
and 2024 and the three months ended March 31, 2024 and 2025, our selling and distribution
expenses amounted to RMB3,207 million, RMB5,557 million, RMB8,380 million, RMB1,812
million and RMB2,182 million, respectively, representing 3.5%, 3.4%, 3.1%, 3.3% and 3.2%
of our total revenue of the same periods, respectively.
Administrative Expenses
Our administrative expenses primarily consist of employee benefit expenses for our
administrative personnel. In 2022, 2023 and 2024 and the three months ended March 31, 2024
and 2025, our administrative expenses amounted to RMB1,934 million, RMB4,070 million,
RMB5,999 million, RMB1,887 million and RMB1,140 million, respectively, representing
2.1%, 2.5%, 2.2%, 3.4% and 1.7% of our total revenue of the same periods, respectively.
Research and Development Expenses
Our research and development expenses primarily consist of employee benefit expenses
for our R&D personnel, cost of materials for R&D activities and design expenses. In 2022,
2023 and 2024 and the three months ended March 31, 2024 and 2025, our research and
development expenses amounted to RMB3,646 million, RMB6,664 million, RMB9,243
million, RMB2,224 million and RMB2,272 million, respectively, representing 3.9%, 4.1%,
3.4%, 4.1% and 3.3% of our total revenue of the same periods, respectively.
Impairment (Losses)/Gains on Financial and Contract Assets, Net
Our impairment (losses)/gains on financial and contract assets, net, represented
provisions/reversal of provisions for impairment of trade receivables, contract assets, financial
assets included in prepayments, other receivables and other assets.
In 2022, we recorded impairment losses on financial and contract assets, net, of RMB684
million, mainly for the provision for our impairment losses on trade receivables and other
receivables; while in 2023 and 2024 and the three months ended March 31, 2024 and 2025, we
recorded impairment gains on financial and contract assets, net, of RMB223 million, RMB258
million, RMB424 million and RMB13 million, respectively, mainly due to reversal of the
provision for our impairment losses as a result of our collection of trade receivables and other
receivables.
FINANCIAL INFORMATION
– 386 –


--- page 397 ---
Finance Costs
Our finance costs comprise interest expenses on bank loans and other borrowings,
long-term liabilities and lease liabilities. In 2022, 2023 and 2024 and the three months ended
March 31, 2024 and 2025, our finance costs amounted to RMB1,405 million, RMB1,617
million, RMB2,310 million, RMB692 million and RMB872 million, respectively, representing
1.5%, 1.0%, 0.9%, 1.3% and 1.3% of our total revenue for the same periods, respectively.
Share of Profits and Losses of Joint Ventures and Associates
Our share of profits and losses of joint ventures and associates comprises invest income
in joint ventures and associates recognized under the equity method. In 2022, 2023 and 2024
and the three months ended March 31, 2024 and 2025, our share of profits of joint ventures and
associates amounted to RMB887 million, RMB1,236 million, RMB1,446 million, RMB446
million and RMB210 million, respectively, representing 1.0%, 0.8%, 0.5%, 0.8% and 0.3% of
our total revenue, respectively.
Income Tax Expense
Our income tax expense primarily includes the PRC enterprise income tax (“ EIT”), and
the applicable income taxes of other countries where we conduct business or have
establishment.
The PRC
Pursuant to the PRC Enterprise Income Tax Law and the respective regulations, the EIT
for our Company and its subsidiaries in China is calculated at a statutory rate of 25% or a
preferential rate of 15% where applicable, on their estimated taxable profits for the year or
period based on the existing legislations, interpretations and practices in respect thereof.
Our Company was recognized as a High and New Technology Enterprise (“ HNTE ”) and
has been enjoying a preferential income tax rate of 15% since 2020. Our Company renewed the
HNTE qualification in 2023 and will continue to enjoy the 15% preferential tax rate till 2025.
Some of our subsidiaries were also recognized as HNTE and enjoy a preferential income tax
rate of 15% in the PRC.
Other Countries
Income tax on profit arising from other jurisdictions have been calculated on the
estimated taxable profit for the year at the respective rates prevailing in the relevant
jurisdictions.
FINANCIAL INFORMATION
– 387 –


--- page 398 ---
A reconciliation of the income tax expense applicable to profit before tax at the statutory
tax rates in the PRC in which our Company is domiciled to the income tax expense at the
effective tax rates are as follows:
For the year ended
December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Profit before income tax /H1118/H1118/H1118/H11186,508 13,305 16,612 3,171 5,767
Tax at PRC statutory tax rate
of 25% /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,627 3,326 4,153 793 1,442
Effect of preferential or
different tax rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(623) (1,425) (1,660) (228) (506)
Effect on opening deferred
tax of decrease in rates /H1118/H1118/H1118– 105 – – –
Adjustments in respect of
current tax of previous
periods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 15 15 (5)
Income not subject to tax /H1118/H1118/H1118(230) (253) (331) (44) (27)
Expenses not deductible for
tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 123 439 267 40
Effect of super deduction for
research and development
costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(621) (1,093) (1,153) (206) (315)
Utilization/recognition of
unrecognized tax losses
and temporary differences
from prior years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(27) (2) (659) (174) (27)
Unrecognized temporary
differences and tax losses /H1118/H1118406 1,979 1,629 320 435
Withholding tax on dividends
of overseas subsidiaries /H1118/H1118/H1118140 101 (155) (48) 4
Tax charge at our Group’s
effective rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118702 2,861 2,278 695 1,041
Profit for the Y ear/Period
In light of the above, we achieved a profit of RMB5,806 million, RMB10,444 million,
RMB14,334 million, RMB2,476 million and RMB4,726 million, with a net profit margin of
6.3%, 6.4%, 5.3%, 4.5% and 6.9% for the same periods, respectively.
FINANCIAL INFORMATION
– 388 –


--- page 399 ---
PERIOD-TO-PERIOD COMPARISON OF OUR RESULTS OF OPERATIONS
Three Months Ended March 31, 2025 as Compared to Three Months Ended March 31,
2024
Revenue
Our revenue increased by RMB13,313 million (or by 24.2%), from RMB54,910 million
for the three months ended March 31, 2024 to RMB68,223 million for the three months ended
March 31, 2025.
Our revenue from sales of passenger vehicles increased by RMB11,092 million (or by
21.9%), from RMB50,547 million for the three months ended March 31, 2024 to RMB61,639
million for the three months ended March 31, 2025.
Our revenue from sales of automotive parts and components increased by RMB2,807
million (or by 95.6%), from RMB2,936 million for the three months ended March 31, 2024 to
RMB5,743 million for the three months ended March 31, 2025, which was primarily due to the
rise in the market demands of our automotive parts and components.
Revenue from Sales of Passenger V ehicles
For the three months ended March 31,
2024 2025
(RMB million) (%) (RMB million) (%)
(Unaudited)
Passenger vehicles
ICE vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845,951 90.9 42,974 69.7
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,596 9.1 18,665 30.3
– PHEVs and REEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,584 5.1 10,709 17.5
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,012 4.0 7,956 12.8
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,547 100.0 61,639 100.0
Our revenue from ICE vehicles decreased by RMB2,977 million (or by 6.5%), from
RMB45,951 million for the three months ended March 31, 2024 to RMB42,974 million for the
three months ended March 31, 2025.
Our revenue from NEV vehicles increased significantly by RMB14,069 million (or by
306.1%), from RMB4,596 million for the three months ended March 31, 2024 to RMB18,665
million for the three months ended March 31, 2025, primarily due to the sales volume growth
of our NEV vehicles.
FINANCIAL INFORMATION
– 389 –


--- page 400 ---
The table below sets forth the geographical breakdown of our revenue from sales of
passenger vehicles:
For the three months ended March 31,
2024 2025
(RMB million) (%) (RMB million) (%)
(Unaudited)
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830,901 61.1 36,971 60.0
Other countries and regions /H1118/H1118 19,646 38.9 24,668 40.0
– Asia (excluding the PRC) /H1118/H1118 5,844 11.6 10,382 16.8
– Europe /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,103 20.0 10,420 16.9
– Americas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,918 5.8 2,394 3.9
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118578 1.1 805 1.3
– Oceania and others /H1118/H1118/H1118/H1118/H1118/H1118203 0.4 667 1.1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850,547 100.0 61,639 100.0
Note:
(1) Including Hong Kong, Macau and Taiwan.
Our revenue from sales of passenger vehicles in the PRC (including Hong Kong, Macau
and Taiwan) increased by RMB6,070 million (or by 19.6%), from RMB30,901 million for the
three months ended March 31, 2024 to RMB36,971 million for the three months ended March
31, 2025. During the same period, our revenue from sales of passenger vehicles in other
countries and regions increased by RMB5,022 million (or by 25.6%), from RMB19,646 million
for the three months ended March 31, 2024 to RMB24,668 million for the three months ended
March 31, 2025. Such increase was primarily due to sales volume growth in both PRC and
other countries and regions along with our further penetration into the PRC (including Hong
Kong, Macau and Taiwan) market and our business expansion overseas.
Cost of Sales
Our cost of sales increased by RMB13,019 million (or by 27.8%), from RMB46,747
million for the three months ended March 31, 2024 to RMB59,766 million for the three months
ended March 31, 2025, which was largely in line with the increase in the sales of our passenger
vehicles.
Gross Profit and Gross Margin
Our gross profit slightly increased by RMB294 million (or by 3.6%), from RMB8,163
million for the three months ended March 31, 2024 to RMB8,457 million for the three months
ended March 31, 2025, which translated into a gross margin of 14.9% and 12.4% for the
corresponding periods, as a result of changes in market conditions and our strategic adjustment.
FINANCIAL INFORMATION
– 390 –


--- page 401 ---
Our gross profit from passenger vehicles remained relatively stable at RMB7,482 million
and RMB7,246 million for the three months ended March 31, 2024 and 2025, respectively. Our
gross margin from passenger vehicles decreased from 14.8% to 11.8% for the same periods,
primarily due to (i) a significant increase in revenue contribution of our NEVs to our total
revenue from 8.4% to 27.3% during the same period, which generally had a lower profit margin
than ICE vehicles; and (ii) intensifying competition in overseas markets and the increase of
recycling fees imposed on imported vehicles in Russia since the fourth quarter of 2024. Our
gross margin from ICE vehicles decreased from 16.3% to 14.4% for the same periods primarily
due to intensifying competition in overseas markets and the increase of recycling fees imposed
on imported vehicles in Russia since the fourth quarter of 2024. Our gross margin from NEV
vehicles increased from 0.1% to 5.7% for the same periods, primarily due to (i) our effective
cost management measures; (ii) a decrease in raw material costs, especially the procurement
costs for battery cells; and (iii) economies of scale along with the sales volume growth of our
NEV vehicles.
Our gross profit from automotive parts and components increased by RMB589 million (or
by 100.5%), from RMB586 million for the three months ended March 31, 2024 to RMB1,175
million for the three months ended March 31, 2025, primarily due to the increase in the market
demands for our automotive parts and components. Our gross margin from automotive parts
and components remained relatively stable at 20.0% and 20.5%, respectively, for the same
periods.
Other Income and Gains
Our other income and gains increased by RMB2,478 million (or by 211.1%), from
RMB1,174 million for the three months ended March 31, 2024 to RMB3,652 million for the
three months ended March 31, 2025, primarily as we recorded foreign exchange gains, net, of
RMB2,439 million mainly as a result of due to a significant decrease in inter-company
payables by our overseas subsidiaries, as a result of appreciation of the functional currencies
of such subsidiaries against the RMB.
Selling and Distribution Expenses
Our selling and distribution expenses increased by RMB370 million (or by 20.4%), from
RMB1,812 million for the three months ended March 31, 2024 to RMB2,182 million for the
three months ended March 31, 2025, primarily due to an increase in advertisement and
marketing expenses as a result of our increasing marketing activities.
Administrative Expenses
Our administrative expenses decreased by RMB747 million (or by 39.6%), from
RMB1,887 million for the three months ended March 31, 2024 to RMB1,140 million for the
three months ended March 31, 2025, primarily due to a decrease in equity-settled share-based
compensation.
FINANCIAL INFORMATION
– 391 –


--- page 402 ---
Research and Development Expenses
Our research and development expenses remained relatively stable at RMB2,224 million
for the three months ended March 31, 2024 and RMB2,272 million for the three months ended
March 31, 2025, respectively.
Impairment (Losses)/Gains on Financial and Contract Assets, Net
We recorded impairment gains on financial and contract assets, net, of RMB424 million
and of RMB13 million for the three months ended March 31, 2024 and 2025, respectively,
primarily due to reversal of provision for impairment losses on trade receivables and other
receivables as a result of our collection efforts.
Finance Costs
Our finance costs increased by RMB180 million (or by 26.0%), from RMB692 million for
the three months ended March 31, 2024 to RMB872 million for the three months ended March
31, 2025, which was largely in line with our business expansion.
Share of Profits and Losses of Joint V entures and Associates
Our share of profits and losses of joint ventures and associates decreased by RMB236
million (or by 52.9%), from RMB446 million for the three months ended March 31, 2024 to
RMB210 million for the three months ended March 31, 2025, primarily due to a decrease in
profit of certain joint ventures and associates.
Income Tax Expense
Our income tax expense increased by RMB346 million (or by 49.8%), from RMB695
million for the three months ended March 31, 2024 to RMB1,041 million for the three months
ended March 31, 2025, which was primarily due to the increase in our profit before tax.
Profit for the Period
For the reasons as discussed above, our profit for the period increased from RMB2,476
million for the three months ended March 31, 2024 to RMB4,726 million for the three months
ended March 31, 2025.
Y ear Ended December 31, 2024 as Compared to Y ear Ended December 31, 2023
Revenue
Our revenue increased by RMB106,692 million (or by 65.4%), from RMB163,205 million
in 2023 to RMB269,897 million in 2024.
FINANCIAL INFORMATION
– 392 –


--- page 403 ---
Our revenue from sales of passenger vehicles increased by RMB95,594 million (or by
63.2%), from RMB151,228 million in 2023 to RMB246,822 million in 2024.
Our revenue from sales of automotive parts and components increased by RMB6,960
million (or by 78.2%), from RMB8,904 million in 2023 to RMB15,864 million in 2024, which
was primarily due to the rise in the market demands of our automotive parts and components
in China and overseas.
Revenue from Sales of Passenger V ehicles
The table below sets forth the breakdown of our revenue from sales of passenger vehicles
by energy type:
For the year ended December 31,
2023 2024
(RMB million) % (RMB million) %
Passenger vehicles
ICE vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118143,316 94.8 187,891 76.1
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,912 5.2 58,931 23.9
– PHEVs and REEVs /H1118/H1118/H1118/H1118/H1118/H1118/H11182,727 1.8 35,314 14.3
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,185 3.4 23,617 9.6
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118151,228 100.0 246,822 100.0
Our revenue from ICE vehicles increased by RMB44,575 million (or by 31.1%), from
RMB143,316 million in 2023 to RMB187,891 million in 2024, primarily due to the increase
in the sales of our ICE vehicles, as a result of (i) the introduction of new versions of ICE
vehicles in both domestic and overseas markets; (ii) our expansion in overseas markets; and
(iii) our continuous marketing efforts in both domestic and overseas markets which enhanced
the recognition of our brands.
Our revenue from NEV vehicles increased significantly by RMB51,019 million (or by
644.8%), from RMB7,912 million in 2023 to RMB58,931 million in 2024, primarily due to
sales volume growth in different types of NEVs as a result of (i) our efforts to optimize our
portfolio of NEVs; and (ii) our expansion in overseas markets. Led by our NEV new strategy
officially released in 2023, we optimized our product portfolio of NEVs, which included (i)
scaling down the sales of certain BEV models under Little Ant and QQ Ice Cream, partly to
respond to the changing market trend and partly to prepare for CHERY’s adaptation to new
energy strategy, whereby Little Ant and QQ Ice Cream are product series under CHERY
primarily focused on compact and mini electric vehicles; (ii) introduction of various types of
BEV models, including four new models that were rolled out in 2024, namely, EXLANTIX ET,
LUXEED R7, iCAR 03 and iCAR V23; and (iii) introduction of new PHEV and REEV models,
including four new models that were rolled out in 2024, namely, Fulwin T9, Fulwin A8, Shan
Hai T1 and Shan Hai T2, as well as (iv) introduction of one NEV version of our existing ICE
model of EXEED.
FINANCIAL INFORMATION
– 393 –


--- page 404 ---
The table below sets forth the geographical breakdown of our revenue from sales of
passenger vehicles:
For the year ended December 31,
2023 2024
(RMB million) % (RMB million) %
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876,695 50.7 148,954 60.3
Other countries and regions /H1118/H1118 74,533 49.3 97,868 39.7
– Asia (excluding PRC) /H1118/H1118/H1118/H1118/H111818,341 12.1 29,449 11.9
– Europe /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,289 28.0 51,297 20.8
– Americas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,427 8.2 13,268 5.4
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118482 0.3 2,170 0.9
– Oceania and others /H1118/H1118/H1118/H1118/H1118/H1118994 0.7 1,684 0.7
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118151,228 100.0 246,822 100.0
Note:
(1) Including Hong Kong, Macau and Taiwan.
Our revenue from sales of passenger vehicles in the PRC (including Hong Kong, Macau
and Taiwan) increased by RMB72,259 million (or by 94.2%), from RMB76,695 million in 2023
to RMB148,954 million in 2024. During the same period, our revenue from sales of passenger
vehicles in other countries and regions increased by RMB23,335 million (or by 31.3%), from
RMB74,533 million in 2023 to RMB97,868 million in 2024. Such increase was primarily due
to sales volume growth in both PRC and other countries and regions along with our further
penetration into the PRC (including Hong Kong, Macau and Taiwan) market and our business
expansion overseas.
Cost of Sales
Our cost of sales increased by RMB96,474 million (or by 70.4%), from RMB137,115
million in 2023 to RMB233,589 million in 2024, which was largely in line with the increase
in the sales of our passenger vehicles.
Gross Profit and Gross Margin
Our gross profit increased by RMB10,218 million (or by 39.2%), from RMB26,090
million in 2023 to RMB36,308 million in 2024, which translated into a gross margin of 16.0%
and 13.5% for the corresponding periods, as a result of the sales increase and product portfolio
optimization of our passenger vehicles.
FINANCIAL INFORMATION
– 394 –


--- page 405 ---
Our gross profit from passenger vehicles increased by RMB8,461 million (or by 35.1%),
from RMB24,111 million in 2023 to RMB32,572 million in 2024, primarily due to the increase
in our revenue from sales of passenger vehicles as sales volume of passenger vehicles surged.
Our gross margin from passenger vehicles decreased from 15.9% to 13.2% for the same years,
primarily due to (i) a significant increase in revenue contribution of our NEVs to our total
revenue from 4.9% in 2023 to 21.9% in 2024 as a result of changes in our product mix as we
focused more on promoting NEVs and launched nine new NEV models in 2024, which
generally had a lower profit margin than ICE vehicles; and (ii) intensifying competition in
overseas markets resulting in a decrease in our gross margin and the increase of recycling fees
imposed on imported vehicles in Russia since the fourth quarter of 2024. Our gross margin
from ICE vehicles remained relatively stable at 17.1% and 17.2% for the same years. We
recorded a gross margin of 0.4% from our NEVs in 2024, as compared to a gross margin of
-5.7% in 2023, as a result of (i) significantly increased sales of PHEV models with a higher
contribution to our sales of NEVs in 2024, which had a higher gross margin than that from our
BEVs; and (ii) a sharp drop in sales of certain BEV models under Little Ant and QQ Ice Cream
which had a lower gross margin.
Our gross profit from automotive parts and components increased by RMB1,541 million
(or by 90.5%), from RMB1,702 million in 2023 to RMB3,243 million in 2024, primarily due
to the increase in the market demands for our automotive parts and components. Our gross
margin from automotive parts and components increased from 19.1% to 20.4% for the same
years, as a result of the economies of scale with our business expansion.
Other Income and Gains
Our other income and gains increased by RMB2,019 million (or by 47.7%), from
RMB4,232 million in 2023 to RMB6,251 million in 2024, primarily due to (i) an increase in
our additional deduction for V A T; (ii) an increase in research and development subsidies and
other subsidies; (iii) an increase in our sales of scrap materials; and (iv) that we recorded fair
value gains on derivative financial instruments in 2024.
Selling and Distribution Expenses
Our selling and distribution expenses increased by RMB2,823 million (or by 50.8%),
from RMB5,557 million in 2023 to RMB8,380 million in 2024, primarily due to (i) an increase
in advertisement and marketing expenses as we launched new models and versions; and (ii) an
increase in employee benefit expenses, including equity-settled share-based compensation, of
our sales personnel, both in line with our business expansion.
Administrative Expenses
Our administrative expenses increased by RMB1,929 million (or by 47.4%), from
RMB4,070 million in 2023 to RMB5,999 million in 2024, primarily due to an increase in
employee benefit expenses, including equity-settled share-based compensation, of our
administrative personnel, as our business expanded.
FINANCIAL INFORMATION
– 395 –


--- page 406 ---
Research and Development Expenses
Our research and development expenses increased by RMB2,579 million (or by 38.7%),
from RMB6,664 million in 2023 to RMB9,243 million in 2024, primarily due to (i) an increase
in our employee benefits expenses, including equity-settled share-based compensation, of our
R&D personnel, and (ii) enhancement of our research and development efforts.
Impairment Gains on Financial and Contract Assets, Net
In 2023 and 2024, we recorded impairment gains on financial and contract assets, net, of
RMB223 million and RMB258 million, respectively, mainly due to reversal of the provision for
our impairment losses as a result of our collection of trade receivables and other receivables.
Finance Costs
Our finance costs increased by RMB693 million (or by 42.9%), from RMB1,617 million
in 2023 to RMB2,310 million in 2024, primarily due to an increase in the average balance of
our bank loans.
Share of Profits and Losses of Joint V entures and Associates
Our share of profits and losses of joint ventures and associates increased by RMB210
million (or by 17.0%), from RMB1,236 million in 2023 to RMB1,446 million in 2024,
primarily due to an increase in profit of certain joint ventures and associates.
Income Tax Expense
Despite the increase in our profit before tax, our income tax expense decreased by
RMB583 million (or by 20.38%), from RMB2,861 million in 2023 to RMB2,278 million in
2024. This decrease was primarily due to the prudent re-evaluation of deferred tax assets to be
recognized by certain subsidiaries of our Group.
Profit for the Y ear
For the reasons as discussed above, our profit for the year increased from RMB10,444
million in 2023 to RMB14,334 million in 2024.
Y ear Ended December 31, 2023 as Compared to Y ear Ended December 31, 2022
Revenue
Our revenue increased by RMB70,587 million (or by 76.2%), from RMB92,618 million
in 2022 to RMB163,205 million in 2023.
FINANCIAL INFORMATION
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--- page 407 ---
Our revenue from sales of passenger vehicles increased by RMB68,717 million (or by
83.3%), from RMB82,511 million in 2022 to RMB151,228 million in 2023.
Our revenue from sales of automotive parts and components increased by RMB229
million (or by 2.6%), from RMB8,675 million in 2022 to RMB8,904 million in 2023, which
was primarily due to the rise in the market demands for our automotive parts and components
in China and overseas.
Revenue from Sales of Our Passenger V ehicles
The table below sets forth the breakdown of our revenue from sales of passenger vehicles
by energy type:
For the year ended December 31,
2022 2023
(RMB million) % (RMB million) %
Passenger vehicles
ICE vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111870,258 85.1 143,316 94.8
NEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,253 14.9 7,912 5.2
– PHEVs and REEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,301 1.6 2,727 1.8
– BEVs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,952 13.3 5,185 3.4
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0
Our revenue from ICE vehicles increased by RMB73,058 million (or by 104.0%), from
RMB70,258 million in 2022 to RMB143,316 million in 2023. The increase was primarily due
to the increase in the sales of our ICE vehicles, as a result of (i) the introduction of new ICE
models and versions in both domestic and overseas markets; (ii) our expansion in overseas
passenger vehicle markets; and (iii) our continuous marketing efforts in both domestic and
overseas markets which enhanced the recognition of our brands.
Our revenue from NEVs decreased by RMB4,341 million (or by 35.4%), from
RMB12,253 million in 2022 to RMB7,912 million in 2023. Such decrease was mainly
attributable to our efforts to optimize our product portfolio of NEVs. In 2023, we officially
released our NEV new strategy and adjusted our product portfolio of BEVs strategically
towards more high-end brands and models, and scaled down the sales of certain BEV models
under the series of Little Ant and QQ Ice Cream, the product series of passenger vehicles that
focused on compact and mini electric vehicles. As a result, sales volume for the product series
of Little Ant and QQ Ice Cream decreased from 191.7 thousand units in 2022 to 95.8 thousand
units in 2023, which in turn led to the decrease of revenue of NEVs.
FINANCIAL INFORMATION
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--- page 408 ---
The table below sets forth the geographical breakdown of our revenue from sales of
passenger vehicles:
For the year ended December 31,
2022 2023
(RMB million) % (RMB million) %
PRC(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111853,359 64.7 76,695 50.7
Other countries and regions /H1118/H1118/H1118/H1118/H1118/H111829,152 35.3 74,533 49.3
– Asia (excluding PRC) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,048 7.3 18,341 12.1
– Europe /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,964 16.9 42,289 28.0
– Americas /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,545 10.4 12,427 8.2
– Africa /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118558 0.7 482 0.3
– Oceania and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111837 0.0 994 0.7
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 100.0 151,228 100.0
Note:
(1) Including Hong Kong, Macau and Taiwan.
Our revenue from sales of passenger vehicles in the PRC (including Hong Kong, Macau
and Taiwan) increased by RMB23,336 million (or by 43.7%), from RMB53,359 million in 2022
to RMB76,695 million in 2023, as a result of our sales volume growth primarily due to our
marketing efforts in promoting our new models and versions of passenger vehicles.
Our revenue from sales of passenger vehicles in other countries and regions increased by
RMB45,381 million (or by 155.7%), from RMB29,152 million in 2022 to RMB74,533 million
in 2023, primarily due to the sales volume growth in our passenger vehicles to overseas
markets in response to the increasing market demands as well as our efforts in expanding our
presence in overseas markets.
Cost of Sales
Our cost of sales increased by RMB57,302 million (or by 71.8%), from RMB79,813
million in 2022 to RMB137,115 million in 2023, which was largely in line with the increase
in the revenue of our passenger vehicles.
Gross Profit and Gross Margin
Our gross profit increased by RMB13,285 million (or by 103.7%), from RMB12,805
million in 2022, to RMB26,090 million in 2023. Our gross margin increased from 13.8% to
16.0% for the same years, primarily as a result of the sales increase and product portfolio
optimization of our passenger vehicles.
FINANCIAL INFORMATION
– 398 –


--- page 409 ---
Our gross profit from passenger vehicles increased by RMB13,360 million (or by
124.3%), from RMB10,751 million in 2022 to RMB24,111 million in 2023, primarily due to
the increase in our revenue from passenger vehicles as sales volume of passenger vehicles
surged. Our gross margin from passenger vehicles increased from 13.0% to 15.9% for the same
years, primarily due to the sales volume growth of our passenger vehicles in overseas markets
with higher average selling prices and thus higher gross margin as well as scaling down the
sales of some of our BEV models. Our gross margin from ICE vehicles increased from 15.8%
to 17.1% for the same years due to increased sales in ICE vehicles with higher gross margin
in overseas markets. Our gross margin from NEVs decreased from -2.6% to -5.7% for the same
years as the result of the decrease of the selling prices of some of our BEV models under Little
Ant and QQ Ice Cream in response to the changing market trend and relevant policies, resulting
in a drop in the gross margin of such BEV models.
Our gross profit from automotive parts and components remained relatively stable at
RMB1,678 million and RMB1,702 million in 2022 and 2023, respectively. Our gross margin
from automotive parts and components remained relatively stable at 19.3% and 19.1% for the
same years, respectively.
Other Income and Gains
Our other income and gains increased by RMB410 million (or by 10.7%), from
RMB3,822 million in 2022 to RMB4,232 million in 2023, primarily due to (i) an increase in
our additional deduction for V A T; and (ii) an increase in bank interest income due to higher
cash balances deposited with banks.
Selling and Distribution Expenses
Our selling and distribution expenses increased by RMB2,350 million (or by 73.3%),
from RMB3,207 million in 2022 to RMB5,557 million in 2023, primarily due to (i) an increase
in advertisement and marketing expenses as we launched new models and versions; and (ii) an
increase in employee benefits of our sales personnel, both in line with our business expansion.
Administrative Expenses
Our administrative expenses increased by RMB2,136 million (or by 110.4%), from
RMB1,934 million in 2022 to RMB4,070 million in 2023, primarily due to an increase in
employee benefit expenses of our administrative personnel as our business expanded.
Research and Development Expenses
Our research and development expenses increased by RMB3,018 million (or by 82.8%),
from RMB3,646 million in 2022 to RMB6,664 million in 2023, primarily due to (i) an increase
in our employee benefits expenses of our R&D personnel; and (ii) enhancement of our research
and development efforts.
FINANCIAL INFORMATION
– 399 –


--- page 410 ---
Impairment (Losses)/Gains on Financial and Contract Assets, Net
We recorded impairment losses on financial and contract assets, net, of RMB684 million
in 2022, primarily due to provision for impairment losses on trade receivables and other
receivables; while we recorded impairment gains on financial and contract assets, net, of
RMB223 million in 2023, primarily due to reversal of provision for impairment losses on trade
receivables and other receivables as a result of our collection efforts.
Finance Costs
Our finance costs increased by RMB212 million (or by 15.1%), from RMB1,405 million
in 2022 to RMB1,617 million in 2023, which was primarily due to an increase in the average
balance of our bank loans.
Share of Profits and Losses of Joint V entures and Associates
Our share of profits and losses of joint ventures and associates increased by RMB349
million (or by 39.3%), from RMB887 million in 2022 to RMB1,236 million in 2023, primarily
due to an increase in profit of certain joint ventures and associates.
Income Tax Expense
Our income tax expense increased by RMB2,159 million (or by 307.5%), from RMB702
million in 2022 to RMB2,861 million in 2023, which was primarily due to the increase in our
profit before tax.
Profit for the Y ear
For the reasons as discussed above, our profit for the year increased from RMB5,806
million in 2022 to RMB10,444 million in 2023.
CERTAIN BALANCE SHEET ITEMS
Inventories
Our inventories comprise raw materials, work in progress and finished goods. Raw
materials mainly include steel products, seats, tires, battery cells and electronic components.
Work in progress and finished goods mainly include semi-completed or completed passenger
vehicles, respectively.
FINANCIAL INFORMATION
– 400 –


--- page 411 ---
The following table sets forth a breakdown of our inventories as of the dates indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,438 1,755 2,370 2,517
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,374 2,618 4,911 4,876
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,061 26,662 29,043 31,114
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,873 31,035 36,324 38,507
Our inventories increased from RMB12,873 million as of December 31, 2022 to
RMB31,035 million as of December 31, 2023, further to RMB36,324 million as of December
31, 2024, and then to RMB38,507 million as of March 31, 2025, primarily due to the increase
of our finished goods as a result of our business expansion. Nevertheless, such increase did not
cause the material change of our inventory turnover days, the details of which are set out as
follows:
For the year ended December 31,
For the
three months
ended
March 31,
20252022 2023 2024
Inventory turnover days (1) /H1118/H1118/H111843.5 58.4 52.6 56.3
Note:
(1) Calculated using the average of opening and closing balances of the inventories for such years/period
divided by cost of sales for the relevant years/period and multiplied by the number of days during such
years/period.
Our inventory turnover days increased from 43.5 days in 2022 to 58.4 days in 2023,
primarily due to increased inventories to serve our overseas market demands as these
inventories generally had longer turnover days caused by long shipping time. Our inventory
turnover days then decreased to 52.6 days in 2024, as we enhanced inventory management
measures. Our inventory turnover days remained relatively stable at 56.3 days for the three
months ended March 31, 2025.
FINANCIAL INFORMATION
– 401 –


--- page 412 ---
The following table set forth an aging analysis of our inventories:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,810 30,931 36,157 38,167
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111858 96 160 324
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118366 1 5
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181211
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,873 31,035 36,324 38,507
As of July 31, 2025, RMB33,626 million (or 87.3%) of our inventories as of March 31,
2025, had been sold or utilized.
Trade Receivables
Our trade receivables represented receivables of income from the sales of our products
from our customers.
The following table sets forth a breakdown of our trade receivables as of the dates
indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,794 12,621 18,488 22,338
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,273) (1,353) (1,065) (1,068)
Total trade receivables /H1118/H1118/H1118/H1118/H11189,521 11,268 17,423 21,270
Our trade receivables increased from RMB9,521 million as of December 31, 2022 to
RMB11,268 million as of December 31, 2023, further increased to RMB17,423 million as of
December 31, 2024, and further to RMB21,270 million as of March 31, 2025, primarily due
to the increase in the sales of our products.
Sales of our passenger vehicles are normally settled in advance of delivery. However, in
the case of long-standing customers with bulk purchases and a good repayment history, we may
offer them credit terms that are generally between 30 and 180 days.
FINANCIAL INFORMATION
– 402 –


--- page 413 ---
We make provisions for impairment of trade receivables based on our assessment of risk
of default and expected losses. We recorded provisions for impairment of trade receivables of
RMB1,273 million, RMB1,353 million, RMB1,065 million and RMB1,068 million as of
December 31, 2022, 2023 and 2024 and as of March 31, 2025, respectively.
The following table set forth an aging analysis of our trade receivables, net of allowance
for credit losses, presented based on the time of revenue recognition:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,059 9,473 17,336 21,233
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118281 1,737 74 29
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118181 58 13 8
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,521 11,268 17,423 21,270
The following table sets forth our trade receivables turnover days for the years/period
indicated:
For the year ended December 31,
For the
three months
ended
March 31,
20252022 2023 2024
Trade receivables turnover
days (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
35.8 26.2 21.0 26.9
Note:
(1) Calculated using the average of opening and closing balances of the trade receivables for such
years/period divided by the total revenue for the relevant years/period and multiplying by the number
of days during such years/period.
In 2022, 2023 and 2024, our trade receivables turnover days were 35.8 days, 26.2 days
and 21.0 days, respectively. The decrease in our trade receivables turnover days was primarily
because we stepped up our efforts in the management and collection of trade receivables. Our
trade receivables turnover days slightly increased to 26.9 days for the three months ended
March 31, 2025 primarily due to seasonal factors.
As of July 31, 2025, RMB17,905 million (or 80.2%) of our trade receivables as of March
31, 2025, had been subsequently settled.
FINANCIAL INFORMATION
– 403 –


--- page 414 ---
Bills Receivables and Financial Assets at Fair Value through Other Comprehensive
Income
We received bank acceptance bills from our customers to settle their payments with us.
Such bank acceptance bills are either booked as our financial assets at fair value through other
comprehensive income if they are issued by reputable banks with higher credit ratings, or as
bills receivables if otherwise.
The following table sets forth a breakdown of our bills receivables as of the dates
indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Bank acceptance bills /H1118/H1118/H1118/H1118/H1118/H11186,167 10,805 774 330
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,167 10,805 774 330
Our bills receivables increased from RMB6,167 million as of December 31, 2022 to
RMB10,805 million as of December 31, 2023 with the increase in our product sales. Our bills
receivables decreased from RMB10,805 million as of December 31, 2023 to RMB774 million
as of December 31, 2024, and further to RMB330 million as of March 31, 2025, as more of our
customers settled payments using bank acceptance bills issued by reputable banks with higher
credit ratings.
The following table sets forth a breakdown of our financial assets at fair value through
other comprehensive income as of the dates indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,359 4,433 7,547 1,802
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,359 4,433 7,547 1,802
For the same reason, our financial assets at fair value through other comprehensive
income increased from RMB2,359 million as of December 31, 2022 to RMB4,433 million as
of December 31, 2023, then further to RMB7,547 million as of December 31, 2024. Our
financial assets at fair value through other comprehensive income then decreased to RMB1,802
million as of March 31, 2025 as we used such bills receivables to settle our payments to
suppliers.
FINANCIAL INFORMATION
– 404 –


--- page 415 ---
Prepayments, Other Receivables and Other Assets
Our prepayments, other receivables and other assets mainly comprise other receivables
and prepayments for acquisition of equity.
The following table sets forth a breakdown of our prepayments, other receivables and
other assets as of the dates indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Non-current portion
Debt investments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118512 380 – –
Prepayments for acquisition
of long-term assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118528 247 757 504
Prepayments for acquisition
of JETOUR business /H1118/H1118/H1118/H1118/H1118– 7,003 – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136 99 84 79
Impairment allowance /H1118/H1118/H1118/H1118/H1118/H1118(77) (26) (2) (2)
Total non-current portion /H1118/H1118 1,099 7,703 839 581
Current portion
Other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,316 19,412 3,847 4,045
V alue-added-tax recoverable /H1118 1,222 2,765 5,126 5,069
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118733 2,149 3,531 3,037
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 14 12 33
Impairment allowance /H1118/H1118/H1118/H1118/H1118(2,937) (2,976) (2,011) (1,987)
Total current portion /H1118/H1118/H1118/H1118/H1118/H111824,344 21,364 10,505 10,197
The non-current portion of our prepayments, other receivables and other assets increased
from RMB1,099 million as of December 31, 2022 to RMB7,703 million as of December 31,
2023, and then decreased to RMB839 million as of December 31, 2024. Such a fluctuation was
primarily caused by the prepayment for acquisition of JETOUR business. The non-current
portion of our prepayments, other receivables and other assets further decreased to RMB581
million as of March 31, 2025, primarily due to a decrease in prepayments for acquisition of
long-term assets in relation to partial settlement of prepayments for purchases of equipment.
The current portion of our prepayments, other receivables and other assets decreased from
RMB24,344 million as of December 31, 2022 to RMB21,364 million as of December 31, 2023
and then decreased to RMB10,505 million as of December 31, 2024, primarily due to the
settlement of certain receivables. The current portion of our prepayments, other receivables and
other assets then decreased to RMB10,197 million as of March 31, 2025, primarily due to a
decrease in prepayments in relation to settlement for prepayments for purchases of materials.
As of July 31, 2025, RMB7,266 million (or 56.9%) of our prepayments, other receivables
and other assets as of March 31, 2025, had been subsequently settled.
FINANCIAL INFORMATION
– 405 –


--- page 416 ---
Financial Assets at Fair Value through Profit or Loss (“FVTPL”)
Our financial assets at FVTPL include (i) unlisted equity investments; (ii) listed
convertible bonds; and (iii) wealth management products and structured deposits issued by
banks in the PRC. All the structured deposits are principal-guaranteed while wealth
management products are not. Such investment in the financial assets at FVTPL shall be
subject to compliance with Chapter 14 of the Listing Rules upon Listing.
The following table sets forth a breakdown of our financial assets at FVTPL as of the
dates indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Non-current portion
Unlisted equity investments, at
fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 45 61 58
Total non-current portion /H1118/H1118/H1118/H1118/H111833 45 61 58
Current portion
Listed convertible bonds /H1118/H1118/H1118/H1118/H1118/H1118/H11181 0 6–––
Wealth management products and
structured deposits, at fair
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,792 11,961 19,579 29,278
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,898 11,961 19,579 29,278
Total/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,931 12,006 19,640 29,336
Our financial assets at FVTPL decreased from RMB13,931 million as of December 31,
2022 to RMB12,006 million as of December 31, 2023, primarily due to the redemption of our
wealth management products and structured deposits. Our financial assets at FVTPL increased
to RMB19,640 million as of December 31, 2024, and then to RMB29,336 million as of March
31, 2025, primarily as a result of our efforts to increase returns of our idle cash and bank
balances.
We make investment decisions case-by-case after thoroughly considering a number of
factors, including but not limited to the macroeconomic environment, general market
conditions, the investment risk management, sources of investment, and the expected profit or
potential loss of the investment.
FINANCIAL INFORMATION
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--- page 417 ---
To monitor and control the potential risks associated with our investment portfolio, we
have adopted internal procedures to manage our investment. With the authorization of the
Board and the supervision by our officer responsible for the supervision on our financial
matters, our financial department is responsible for analyzing, evaluating and determining the
investment plans in accordance with our cash management policies and internal approval
process. Prior to modifying our existing investment portfolio, the proposal must be approved
by our financial controller or the treasury division of the finance department. The performance
of our investments shall be reported to our financial controller or the treasury division of the
finance department on a monthly basis.
Trade and Bills Payables
Our trade and bills payables represented payment obligations to our suppliers.
The following table sets forth a breakdown of our trade and bills payables as of the dates
indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,421 71,547 99,771 95,477
Bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,287 2,861 1,725 6,926
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851,708 74,408 101,496 102,403
Our trade and bills payables increased from RMB51,708 million as of December 31, 2022
to RMB74,408 million as of December 31, 2023 and further to RMB101,496 million as of
December 31, 2024, and then to RMB102,403 million as of March 31, 2025, primarily due to
the increase in our purchases from suppliers in response to our sales increase.
The following table sets forth an aging analysis of trade and bills payables presented
based on the time of purchase as of the dates indicated:
Trade payables
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841,253 70,130 99,286 94,794
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118633 1,094 367 563
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 201 39 42
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118365 122 79 78
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,421 71,547 99,771 95,477
FINANCIAL INFORMATION
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--- page 418 ---
Bills payables
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,287 2,861 1,725 6,926
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,287 2,861 1,725 6,926
The following table sets forth our trade and bills payables turnover days for the periods
indicated:
For the year ended December 31, As of
March 31,
20252022 2023 2024
Trade and bills payables
turnover days (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
206.6 167.9 137.4 155.7
Note:
(1) Calculated using the average of opening and closing balances of the trade and bills payables for such
years/period divided by cost of sales for the relevant years/period and multiplied by the number of days
during such years/period.
During the Track Record Period, our suppliers granted us credit periods generally ranging
from 30 to 180 days either after the issuance of invoices or after we verify the amount of
purchase with our suppliers.
In 2022, 2023 and 2024, our trade and bills payables turnover days were 206.6 days,
167.9 days and 137.4 days, respectively. The decrease in our trade and bills payables turnover
days was mainly due to our efforts in expediting the payment of our trade and bills payables
to our suppliers. For the three months ended March 31, 2025, our trade and bills payables
turnover days were 155.7 days, primarily due to seasonal factors.
As of July 31, 2025, RMB62,049 million (or 60.6%) of our trade and bills payables as of
March 31, 2025, had been subsequently settled.
FINANCIAL INFORMATION
– 408 –


--- page 419 ---
Other Payables and Accruals
Our other payables and accruals mainly comprise accrued salaries, bonuses and benefits,
other payables for additions of property, plant and equipment, other tax payables and other
payables.
The following table sets forth a breakdown of our other payables and accruals as of the
dates indicated:
As of December 31, As of
March 31,
20252022 2023 2024
(RMB million)
Non-current portion
Other payables for additions
of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,019 2,077 2,806 2,806
Equity repurchases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118282 804 836 843
Long-term payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,300 3,000 1,212 1,430
Total non-current portion /H1118/H1118 3,601 5,881 4,854 5,079
Current portion
Accrued salaries, bonuses and
benefits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,934 4,016 4,978 3,494
Other payables for additions
of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,735 3,349 3,371 2,985
Other tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,250 1,573 1,917 2,601
Marketing and promotion
expense payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118985 1,353 2,081 2,190
Deposit from suppliers and
distributors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118953 1,277 1,431 1,462
Transportation fee payables /H1118/H1118 297 990 1,478 1,688
Other payables
(1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,074 6,401 7,181 5,750
Total current portion /H1118/H1118/H1118/H1118/H1118/H111812,228 18,959 22,437 20,170
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,829 24,840 27,291 25,249
Note:
(1) Other payables includes payables due to various service providers and miscellaneous payables.
FINANCIAL INFORMATION
– 409 –


--- page 420 ---
The current portion of our other payables and accruals increased from RMB12,228
million as of December 31, 2022 to RMB18,959 million as of December 31, 2023, primarily
due to (i) an increase in our accrued salaries, bonuses and benefits, primarily as a result of the
increase in our staff and employee incentives as our business grew; and (ii) an increase in our
other payables for additions of property, plant and equipment. The current portion of our other
payables and accruals increased from RMB18,959 million as of December 31, 2023 to
RMB22,437 million as of December 31, 2024, primarily due to (i) an increase in payables of
transportation fees; and (ii) an increase in our other tax payables (mainly our V A T payables),
primarily as a result of the increase in the sales of our products. The current portion of our other
payables and accruals decreased from RMB22,437 million as of December 31, 2024 to
RMB20,170 million as of March 31, 2025, primarily due to (i) a decrease in our accrued
salaries, bonuses and benefits; and (ii) a decrease in our other payables due to third-party
service providers. The non-current portion of our other payables and accruals increased from
RMB3,601 million as of December 31, 2022 to RMB5,881 million as of December 31, 2023,
primarily due to (i) increase in our other payables for additions of property, plant and
equipment; and (ii) increase in our long-term payables, which were mainly conditional
government subsidies that could require partial repayment if we fail to fulfill the relevant
conditions in the future years, and such increase was mainly due to the grant of such subsidies.
The non-current portion of our other payables and accruals then decreased to RMB4,854
million as of December 31, 2024, primarily as we met certain condition which is the
prerequisite for other conditions to be satisfied, therefore, such subsidies were transferred to
deferred income under our consolidated statement of financial position. The non-current
portion of our other payables and accruals then increased to RMB5,079 million, primarily due
to an increase in our long-term payables used for production line upgrade.
As of July 31, 2025, RMB8,150 million (or 32.3%) of our other payables and accruals as
of March 31, 2025, had been subsequently settled.
Contract Liabilities
Our contract liabilities mainly arise from the advance payments made by customers and
rebate payables to customers in relation to our sales of vehicles and components. Our contract
liabilities increased from RMB8,030 million as of December 31, 2022 to RMB18,589 million
as of December 31, 2023, which was primarily due to the increase in the advance payments we
received from customers for sales of our passenger vehicles. Our contract liabilities decreased
to RMB15,319 million as of December 31, 2024, as we (i) enabled multiple payment methods
for some of our customers as our business expanded; and (ii) expedited our product delivery
progress. Our contract liabilities decreased to RMB13,088 million as of March 31, 2025,
primarily due to seasonal factors.
As of July 31, 2025, RMB12,313 million (or 94.1%) of our contract liabilities as of March
31, 2025, had been subsequently recognized as revenue.
FINANCIAL INFORMATION
– 410 –


--- page 421 ---
Property, Plant and Equipment
Our property, plant and equipment mainly comprise buildings, machinery and molds,
electronic equipment and others, vehicles and construction in progress.
As of December 31, 2022, 2023 and 2024 and March 31, 2025, the net book value of our
property, plant and equipment amounted to RMB11,905 million, RMB18,968 million,
RMB23,443 million and RMB24,750 million, respectively. The increases in our property, plant
and equipment were primarily due to purchase of machinery and equipment as we expanded
our production capacity in response to the increase in the demand of our products.
Investments in Joint Ventures and Investments in Associates
Our investments in joint ventures and investments in associates represent our investments
in entities in which we have joint control or significant influence. As of December 31, 2022,
2023 and 2024 and March 31, 2025, our investments in joint ventures amounted to RMB7,626
million, RMB8,265 million, RMB9,793 million and RMB10,817 million, respectively, and our
investments in associates amounted to RMB4,344 million, RMB5,290 million, RMB6,364
million and RMB5,741 million, respectively. The changes in our investments in joint ventures
and investments in associates were primarily a result of changes in number of joint ventures
and associates we invested in during the Track Record Period as well as changes in share of
profits of these joint ventures and associates.
NET CURRENT LIABILITIES/ASSETS
We recorded net current liabilities of RMB4,760 million, RMB17,388 million, RMB3,401
million, RMB2,788 million and net current liabilities of RMB1,260 million as of December 31,
2022, 2023 and 2024, March 31, 2025 and July 31, 2025, respectively.
The following table sets forth our current assets, current liabilities, and net current
liabilities/assets as of the dates indicated:
As of December 31, As of
March 31,
2025
As of
July 31,
20252022 2023 2024
(RMB million)
(Unaudited)
Current assets
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,873 31,035 36,324 38,507 27,562
Trade receivables /H1118/H1118/H1118/H11189,521 11,268 17,423 21,270 35,530
Bills receivables /H1118/H1118/H1118/H1118/H11186,167 10,805 774 330 229
Contract assets /H1118/H1118/H1118/H1118/H1118/H11181,187 455 – – –
Prepayments, other
receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H111824,344 21,364 10,505 10,197 10,548
Prepaid income tax /H1118/H1118 43 541 162 218 57
FINANCIAL INFORMATION
–4 1 1–


--- page 422 ---
As of December 31, As of
March 31,
2025
As of
July 31,
20252022 2023 2024
(RMB million)
(Unaudited)
Financial assets at fair
value through profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,898 11,961 19,579 29,278 22,847
Derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118241 31 – – 18
Financial assets at fair
value through other
comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,359 4,433 7,547 1,802 2,913
Time deposits /H1118/H1118/H1118/H1118/H1118/H11183,373 2,188 7,319 16,204 22,089
Restricted bank
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118927 587 75 2,303 580
Cash and cash
equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,498 41,805
Total current assets /H1118/H111887,619 129,716 162,401 157,607 164,178
Current liabilities
Trade and bills
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851,708 74,408 101,496 102,403 104,111
Other payables and
accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,228 18,959 22,437 20,170 26,915
Derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H11183 8 6 –––
Interest-bearing bank
loans and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H111818,806 31,724 20,068 16,514 13,968
Bonds payables /H1118/H1118/H1118/H1118/H1118/H11187 1– –––
Lease liabilities /H1118/H1118/H1118/H1118/H111846 138 366 428 464
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118577 703 3,120 3,608 2,027
Contract liabilities /H1118/H1118/H11188,030 18,589 15,319 13,088 13,197
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118856 2,395 2,816 3,298 3,562
Deferred income /H1118/H1118/H1118/H1118/H111854 102 180 886 1,194
Total current
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,379 147,104 165,802 160,395 165,438
Net current
(liabilities)/assets /H1118/H1118(4,760) (17,388) (3,401) (2,788) (1,260)
FINANCIAL INFORMATION
– 412 –


--- page 423 ---
Our net current liabilities increased from RMB4,760 million as of December 31, 2022 to
RMB17,388 million as of December 31, 2023. This increase was primarily due to a substantial
increase in our current liabilities during the period, offset by a moderate increase in our current
assets. The increase of our current liabilities was primarily attributable to (i) an increase in
trade and bills payables of RMB22,700 million as a result of our business growth; (ii) an
increase in interest-bearing bank loans and other borrowings of RMB12,918 million; and (iii)
an increase in contract liabilities of RMB10,559 million. Meanwhile, our current assets
increased as a result of (i) an increase in inventories of RMB18,162 million; and (ii) an
increase in cash and cash equivalents of RMB22,362 million, partially offset by prepayment for
acquisition of JETOUR business.
Our net current liabilities position improved from RMB17,388 million as of
December 31, 2023, to RMB3,401 million as of December 31, 2024. This was primarily due
to a substantial increase in our current assets during the period, offset by a moderate increase
in our current liabilities. The increase in current assets primarily includes (i) an increase in
trade receivables of RMB6,155 million; (ii) an increase in financial assets at FVTPL of
RMB7,618 million primarily as a result of our efforts to increase returns of our idle cash and
bank balances; (iii) an increase in financial assets at fair value through other comprehensive
income of RMB3,114 million due to the increase in bank acceptance bills as more payments
by customers were settled by such bank acceptance bills issued by reputable banks with higher
credit ratings; and (iv) an increase in cash and cash equivalents of RMB27,645 million.
Meanwhile, our current liabilities increased, but partially offset by (i) a decrease in
interest-bearing bank loans of RMB11,656 million; and (ii) a decrease in contract liabilities of
RMB3,270 million, as we (a) enabled multiple payment methods for some of our customers as
our business expanded; and (b) expedited our product delivery progress.
Our net current liabilities position further improved from RMB3,401 million as of
December 31, 2024 to RMB2,788 million as of March 31, 2025. Such improvement was
primarily due to a decrease in our current liabilities during the period, slightly outpacing the
decrease in our current assets. The decrease in current liabilities primarily includes (i) a
decrease in interest-bearing bank loans and other borrowings of RMB3,554 million; (ii) a
decrease in other payables and accruals of RMB2,267 million; and (iii) a decrease in contract
liabilities of RMB2,231 million. The decrease in current assets primarily includes a decrease
in our cash and cash equivalents of RMB25,195 million, partially offset by (i) an increase in
financial assets at FVTPL of RMB9,699 million primarily as a result of our efforts to increase
returns of our idle cash and bank balances; (ii) an increase in our time deposits of RMB8,885
million; and (iii) an increase in trade receivables of RMB3,847 million.
We recorded net current liabilities of RMB1,260 million as of July 31, 2025 as compared
to net current liabilities of RMB2,788 million as of March 31, 2025. This was primarily due
to an increase in our current assets during the period, slightly outpacing the increase in our
current liabilities. The increase in current assets primarily includes (i) an increase in trade
receivables of RMB14,260 million; (ii) an increase in time deposits of RMB5,885 million and
(iii) an increase in cash and cash equivalents of RMB4,307 million, partially offset by (i) a
decrease in inventories of RMB10,945 million and (ii) a decrease in financial assets at fair
value through profit or loss of RMB6,431 million. The increase in current liabilities primarily
FINANCIAL INFORMATION
– 413 –


--- page 424 ---
includes (i) an increase in other payables and accruals of RMB6,745 million and (ii) an
increase in trade and bills payables of RMB1,708 million, partially offset by (i) a decrease in
interest-bearing bank and other borrowings of RMB2,546 million and (ii) a decrease in tax
payable of RMB1,581 million.
We seek to improve our net current liabilities position by improving our operating cash
flows. During the Track Record Period, attributable to our continuous business growth, our net
cash flows generated from operating activities increased from RMB9,842 million in 2022 to
RMB24,925 million in 2023 and further to RMB44,887 million in 2024. We also intend to
improve our net current liabilities position by (i) optimizing our debt structure through
replacement of short-term debt with long-term ones; and (ii) increasing our current assets
through (a) promoting increased dividend payouts from joint ventures and associates; and (b)
receipt of the net proceeds from the Global Offering.
Working capital sufficiency
Our Directors are of the view that, taking into account the financial resources available
to us, including cash and cash equivalents, our available banking facilities, cash flows from
operating activities and net proceeds from the Global Offering, we have sufficient working
capital for at least 12 months from the date of this prospectus.
LIQUIDITY AND CAPITAL RESOURCES
During the Track Record Period, we financed our capital expenditure and working capital
requirements mainly through cash generated from operating activities and bank loans. As of
December 31, 2022, 2023 and 2024, March 31, 2025 and July 31, 2025, we had cash and cash
equivalents of approximately RMB12,686 million, RMB35,048 million, RMB62,693 million,
RMB37,498 million and RMB41,805 million, respectively. Our financial strategy includes
diligent monitoring of our cash flows and balances to ensure sufficient liquidity for operational
needs. Throughout the Track Record Period, we successfully managed our financial
obligations, repaying bank loans in time and effectively mitigating liquidity risks. This was
achieved by preserving adequate reserves, utilizing credit lines, and aligning the maturity
timelines of our financial assets and liabilities, ensuring we faced no cash shortages. As of July
31, 2025, we had unutilized banking facilities of RMB104,816 million.
Going forward, we anticipate that our operating cash flows, credit lines, and the net
proceeds from the Global Offering will collectively fulfill our working capital, capital
expenditures and liquidity needs. Our capacity to meet financial commitments and debt
obligations, reduce debt, and cover expenses will hinge on our operational performance and
cash flow generation, which, in turn, are influenced by economic conditions, customer
expenditure levels, and various external factors. As we navigate future business landscapes, we
may require additional funds. Opportunities such as strategic investments, acquisitions, or
partnerships may also necessitate further financial resources. Should our current funds prove
inadequate, we will consider securing additional credit or engaging in equity financing,
acknowledging that such actions could dilute existing shareholder value.
FINANCIAL INFORMATION
– 414 –


--- page 425 ---
Cash flows
The following table sets forth selected cash flow data from our consolidated statements
of cash flows for the periods indicated:
For the year ended
December 31,
For the three months
ended March 31,
2022 2023 2024 2024 2025
(RMB million)
(Unaudited)
Net cash flows from
operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H11189,842 24,925 44,887 16,036 4,538
Net cash flows (used in)/
from investing activities /H1118/H1118/H1118(4,949) 4,023 (3,177) (11,174) (22,095)
Net cash flows (used in)/
from financing activities /H1118/H1118(825) (6,458) (13,783) (1,796) (7,838)
Net increase/(decrease) in
cash and cash equivalents /H1118 4,068 22,490 27,927 3,066 (25,395)
Cash and cash equivalents at
beginning of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,476 12,686 35,048 35,048 62,693
Effect of foreign exchange
rate changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118142 (128) (282) (138) 200
Cash and cash equivalents at
end of the year/period /H1118/H1118/H1118/H111812,686 35,048 62,693 37,976 37,498
Net cash flows from operating activities
We derive our cash inflow from operating activities primarily from receipt of payments
from customers for our products. Our cash outflow from operating activities is primarily for
procurement payments to our suppliers.
For the three months ended March 31, 2025, we had net cash flows from operating
activities of RMB4,538 million. This net cash inflow was primarily due to (i) profit before tax
of RMB5,767 million, as adjusted to reflect non-cash items, which principally included finance
costs of RMB872 million, and depreciation and amortization of non-current assets primarily
consisted of property, plant and equipment of RMB908 million; (ii) an increase in trade
receivables of RMB4,004 million; (iii) a decrease in other payables and accruals of RMB2,487
million; (iv) a decrease in contract liabilities of RMB2,231 million, partially offset by a
decrease in financial assets at fair value through other comprehensive income of RMB5,725
million.
FINANCIAL INFORMATION
– 415 –


--- page 426 ---
For the three months ended March 31, 2024, we had net cash flows from operating
activities of RMB16,036 million. This net cash inflow was primarily due to (i) profit before tax
of RMB3,171 million, as adjusted to reflect non-cash items, which principally included finance
costs of RMB692 million, and depreciation and amortization of non-current assets primarily
consisted of property, plant and equipment of RMB520 million as well as share of profits and
losses of joint ventures and associates of RMB446 million; (ii) a decrease in bills receivables
of RMB9,569 million as certain customers settled payments using such bank acceptance bills
issued by reputable banks with higher credit ratings; (iii) an increase in deferred income of
RMB3,727 million; and (iv) a decrease in financial assets at fair value through other
comprehensive income of RMB2,610 million.
In 2024, we had net cash flows from operating activities of RMB44,887 million. This net
cash inflow was primarily due to (i) profit before tax of RMB16,612 million, as adjusted to
reflect non-cash items, which principally included finance costs of RMB2,310 million, and
depreciation and amortization of non-current assets primarily consisted of property, plant and
equipment of RMB3,849 million; (ii) a decrease in bills receivables of RMB10,081 million as
certain customers settled payments using such bank acceptance bills issued by reputable banks
with higher credit ratings; and (iii) an increase in trade and bills payables of RMB23,490
million, primarily due to the increase in our purchases from suppliers in response to the
increase in the sales of our products.
In 2023, we had net cash flows from operating activities of RMB24,925 million. This net
cash inflow was primarily due to (i) profit before tax of RMB13,305 million, as adjusted to
reflect non-cash items, which principally included finance costs of RMB1,617 million,
depreciation and amortization of non-current assets which primarily consisted of property,
plant and equipment of RMB2,481 million as well as share of profits and losses of joint
ventures and associates of RMB1,236 million and other income from investing activities of
RMB1,308 million; (ii) an increase in trade and bills payables of RMB22,703 million,
primarily due to the increase in our purchases from suppliers in response to the increase in the
sales of our products; (iii) an increase in contract liabilities of RMB10,559 million, primarily
due to the increase in the advance payments we received from customers for sales of our
passenger vehicles, which was primarily due to the increase in our sales of passenger vehicles;
and partially offset by (i) an increase in inventories of RMB20,081 million as we need to
maintain a certain level of inventories (mainly finished passenger vehicles) to serve the
demands of the customers; and (ii) an increase in bills receivables of RMB4,638 million, which
was primarily due to the increase in the sales of our products.
In 2022, we had net cash flows from operating activities of RMB9,842 million. This net
cash inflow was primarily due to (i) profit before tax of RMB6,508 million, as adjusted to
reflect non-cash items, which principally included finance costs of RMB1,405 million, and
depreciation and amortization of non-current assets which primarily consisted of property,
plant and equipment of RMB2,004 million; (ii) an increase in trade and bills payables of
RMB6,669 million, primarily due to the increase in our purchases from suppliers in response
to the increase in the sales of our products; (iii) an increase in other payables and accruals of
RMB7,574 million; (iv) an increase in contract liabilities of RMB2,824 million, primarily due
FINANCIAL INFORMATION
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to the increase in the advance payments we received from dealers for sales of our passenger
vehicles, which was primarily due to the increase in our sales of passenger vehicles, partially
offset by (i) an increase in inventories of RMB6,694 million as we need to maintain a certain
level of inventories (mainly finished passenger vehicles) to serve the demands of the
customers; (ii) an increase in trade receivables of RMB3,180 million, which was primarily due
to the increase in the sales of our products; and (iii) an increase in prepayments, other
receivables and other assets of RMB4,367 million.
Net cash flows (used in)/from investing activities
Our cash outflow from investing activities primarily consisted of (i) payments for
purchases of property, plant and equipment; (ii) placement of time deposits; (iii) purchases of
financial assets at FVTPL; and (iv) advance to related parties. Our cash inflow from investing
activities primarily consisted of (i) proceeds on disposal of property, plant and equipment; (ii)
maturity of time deposits; (iii) proceeds on disposal of financial assets at FVTPL; and (iv)
repayments of related parties.
For the three months ended March 31, 2025, we had net cash flows used in investing
activities of RMB22,095 million. This net cash outflow was primarily due to (i) purchases of
financial assets at FVTPL of RMB55,286 million; and (ii) placement of time deposits of
RMB11,775 million, partially offset by proceeds on disposal of financial assets at FVTPL of
RMB45,690 million.
For the three months ended March 31, 2024, we had net cash flows used in investing
activities of RMB11,174 million. This net cash outflow was primarily due to (i) placement of
time deposits of RMB24,402 million; and (ii) purchases of financial assets at FVTPL of
RMB10,833 million, partially offset by (i) repayments of related parties of RMB13,716 million
as a result of our enhanced efforts to collect our advance to related parties; and (ii) proceeds
on disposal of financial assets at FVTPL of RMB10,598 million.
In 2024, we had net cash flows used in investing activities of RMB3,177 million. This net
cash outflow was primarily due to (i) purchases of property, plant and equipment of RMB7,305
million; (ii) placement of time deposits of RMB34,866 million; and (iii) purchases of financial
assets at FVTPL of RMB25,344 million; and partially offset by (i) maturity of time deposits
of RMB32,301 million; (ii) proceeds on disposal of financial assets at FVTPL of RMB18,224
million; and (iii) repayments of related parties of RMB13,716 million as a result of our
enhanced efforts to collect our advance to related parties.
In 2023, we had net cash flows from investing activities of RMB4,023 million. This cash
inflow was primarily due to (i) proceeds on disposal of financial assets at FVTPL of
RMB15,354 million; (ii) repayments of related parties of RMB15,513 million as a result to our
collection of advance to related parties; and (iii) maturity of time deposits of RMB93,065
million. This net cash inflow was partially offset by (i) payments for purchases of property,
plant and equipment of RMB6,293 million; (ii) placement of time deposits of RMB92,703
million; and (iii) advance to related parties of RMB9,580 million.
FINANCIAL INFORMATION
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In 2022, we had net cash flows used in investing activities of RMB4,949 million. This net
cash outflow was primarily due to (i) purchases of financial assets at FVTPL of RMB17,092
million; (ii) placement of time deposits of RMB107,017 million; and (iii) advance to related
parties of RMB6,439 million. This cash outflow was partially offset by (i) proceeds on disposal
of financial assets at FVTPL of RMB14,387 million; (ii) maturity of time deposits of
RMB111,265 million; and (iii) repayments of related parties of RMB5,555 million as a result
of our efforts to collect advance to related parties.
Net cash flows (used in)/from financing activities
Our cash inflow from financing activities primarily consisted of interest-bearing bank
loans. We use cash in financing activities primarily for repayment of interest-bearing bank
loans and interests paid.
For the three months ended March 31, 2025, we had net cash flows used in financing
activities of RMB7,838 million. This net cash outflow was primarily due to (i) repayments of
interest-bearing bank loans RMB11,320 million; and (ii) dividends paid of RMB3,993 million,
partially offset by proceeds from interest-bearing bank loans and other borrowings of
RMB8,028 million.
For the three months ended March 31, 2024, we had net cash flows used in financing
activities of RMB1,796 million. This net cash outflow was primarily due to (i) repayments of
interest-bearing bank loans of RMB19,981 million; and (ii) interest paid for interest-bearing
bank loans of RMB711 million, partially offset by proceeds from interest-bearing bank loans
of RMB17,844 million.
In 2024, we had net cash flows used in financing activities of RMB13,783 million. This
net cash outflow was primarily due to repayment of interest-bearing bank loans of RMB47,990
million. This net cash outflow was partially offset by proceeds from interest-bearing bank loans
of RMB34,024 million.
In 2023, we had net cash flows used in financing activities of RMB6,458 million. This net
cash outflow was primarily due to (i) repayment of interest-bearing bank loans of RMB42,103
million; and (ii) interests paid for interest-bearing bank loans of RMB1,338 million. This net
cash outflow was partially offset by new interest-bearing bank loans of RMB48,107 million.
In 2022, we had net cash flows used in financing activities of RMB825 million. This net
cash outflow was primarily due to (i) repayment of bank loans of RMB41,114 million; and (ii)
interests paid for interest-bearing bank loans of RMB944 million. This net cash outflow was
partially offset by new interest-bearing bank loans of RMB39,396 million.
FINANCIAL INFORMATION
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INDEBTEDNESS AND CONTINGENT LIABILITIES
As of December 31, 2022, 2023 and 2024, March 31, 2025 and July 31, 2025, except for
the disclosure below, we did not have any other loan issued and outstanding or any loan agreed
to be issued, bank overdrafts, and other similar indebtedness, liabilities under acceptances or
acceptance credits, debentures, mortgages, charges, hire purchase commitments, guarantees or
other material contingent liabilities. Since July 31, 2025, the latest practicable date for the
purpose of the indebtedness statement, and up to the date of this prospectus, there has been no
material change to our indebtedness.
We also confirm that during the Track Record Period and up to the Latest Practicable
Date, (i) our credit facilities were subject to the standard banking conditions and covenants,
and there were no material covenants that impose a substantial limitation on our ability to
obtain further banking facilities; (ii) we had no material default in repayments of our
borrowings and with regard to covenants and/or breaches of the covenants under our credit
facilities; (iii) we had not received any notice from any bank indicating that it might withdraw
or downsize our facilities; (iv) we did not experience any difficulty in obtaining credit facilities
and request for early repayments of our borrowings; and (v) we had no material external debt
financing plans out of the ordinary course of our business.
Indebtedness
Our indebtedness primarily consisted of bank loans and other borrowings and lease
liabilities. The following table sets forth a breakdown of our indebtedness as of the dates
indicated:
As of December 31, As of
March 31,
2025
As of
July 31,
20252022 2023 2024
(RMB million)
(Unaudited)
Bank loans and
other borrowings 33,123 38,508 23,166 21,630 21,314
Lease liabilities /H1118/H1118/H1118211 521 2,319 2,286 2,346
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,334 39,029 25,485 23,916 23,660
Bank loans and other borrowings
Our bank loans and other borrowings during the Track Record Period were denominated
in different currencies, including but not limited to RMB, RUB, TRY and USD. Our bank loans
as of December 31, 2022, 2023 and 2024 and March 31, 2025 bore the average weighted
interest rates of 3.11%, 4.10%, 5.14% and 3.57% per annum.
FINANCIAL INFORMATION
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Our bank loan agreements contain standard terms, conditions, and covenants that are
customary for commercial bank loans. Our Directors confirm that we did not experience any
difficulties in obtaining bank loans and other borrowings, any default in repayment of bank
loans and other borrowings or breach of covenants during the Track Record Period and up to
the Latest Practicable Date. Given our credit history and our current credit status, we believe
that we will not encounter any major difficulties in obtaining additional bank loans and other
borrowings in the future.
As of December 31, 2022, 2023 and 2024, March 31, 2025 and July 31, 2025, we had
bank loans and other borrowings of RMB33,123 million, RMB38,508 million, RMB23,166
million, RMB21,630 million and RMB21,314 million, respectively, the majority of which were
unsecured.
As of March 31, 2025 and the Latest Practicable Date, the outstanding balance of our
bank loans and other borrowings guaranteed by Chery Holding and other related parties was
nil.
Lease liabilities
Our lease liabilities represented the outstanding lease payments primarily in respect of
our leased buildings and properties.
The following table sets forth our lease liabilities as of the dates indicated:
As of December 31, As of
March 31,
2025
As of
July 31,
20252022 2023 2024
(RMB million)
(Unaudited)
Lease liabilities
– Current /H1118/H1118/H1118/H1118/H1118/H111846 138 366 428 464
– Non-current /H1118/H1118 165 383 1,953 1,858 1,882
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118211 521 2,319 2,286 2,346
Contingent Liabilities
As of July 31, 2025, we did not have any material contingent liabilities. Our Directors
confirm that there had been no material change in our contingent liabilities since March 31,
2025 and up to the Latest Practicable Date.
FINANCIAL INFORMATION
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OFF-BALANCE SHEET TRANSACTIONS
We had not entered into any material off-balance sheet transactions or arrangements as of
the Latest Practicable Date.
CAPITAL EXPENDITURES
During the Track Record Period, we paid an aggregate amount of RMB4,716 million,
RMB9,640 million, RMB8,361 million and RMB2,553 million primarily for capital
expenditures on our property, plant and equipment.
The details of our capital expenditure during the Track Record Period are summarized as
follows:
For the year ended December 31,
For the
three months
ended
March 31,
20252022 2023 2024
(RMB million)
Property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,120 9,282 6,684 2,005
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 40 57 18
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118567 318 1,620 530
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,716 9,640 8,361 2,553
COMMITMENTS
As of December 31, 2022, 2023 and 2024 and March 31, 2025, we had capital
commitments contracted for but not yet provided of RMB1,896 million, RMB3,752 million,
RMB2,519 million and RMB2,462 million, respectively, primarily representing contracted but
unprovided commitments for property, plant and equipment, and investment.
RELATED PARTY TRANSACTIONS
During the Track Record Period, we entered into a number of transactions with related
parties. For detail of our related party transactions, see note 46 to the Accountant’s Report in
Appendix I to this prospectus. All loans, advances, which are of a non-trade nature, due to and
from the related parties are expected to be settled before the Listing. It is the view of our
Directors that our transactions with related parties during the Track Record Period was
conducted on an arm’s length basis and with normal commercial terms between the relevant
parties. Our Directors are also of the view that our related party transactions during the Track
Record Period would not distort our historical results or make our historical results not
reflective of our future performance.
FINANCIAL INFORMATION
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KEY FINANCIAL RATIOS
The following table set forth our key financial ratios as of the date or for the period
indicated:
As of/for the year ended December 31,
As of/For the
three months
ended
March 31,
20252022 2023 2024
Return on equity (1) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111885.1% 90.8% 70.8% 73.1%
Return on total assets (2) /H1118/H1118/H1118/H1118/H11185.3% 6.9% 7.3% 8.9%
Current ratio (3) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.95 0.88 0.98 0.98
Quick ratio (4) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.81 0.67 0.76 0.74
Interest-bearing debt ratio (5) /H1118 27.9% 21.8% 11.9% 11.4%
Turnover growth (6) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 76.2% 65.4% 24.2%
Gearing ratio (7) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893.1% 91.9% 87.9% 87.7%
Notes:
(1) Return on equity is calculated based on profit for the year/period divided by the arithmetic mean of the
opening and closing balances of total equity and multiplied by 100%.
(2) Return on total assets is calculated based on profit for the year/period divided by the arithmetic mean
of the opening and closing balances of total assets and multiplied by 100%.
(3) Current ratio is calculated based on total current assets divided by total current liabilities as of the date
indicated.
(4) Quick ratio is calculated based on total current assets less inventories divided by total current liabilities
as of the date indicated.
(5) The interest-bearing debt ratio is calculated as interest-bearing debt (including interest-bearing bank
loans and other borrowings, lease liabilities and bonds payables) divided by total assets as of the date
indicated.
(6) Turnover growth represents the percentage change of our revenue in a year/period when compared with
that in the previous corresponding year/period during the Track Record Period.
(7) Gearing ratio is calculated based on the total liabilities as at the respective dates divided by total assets
as at the respective dates.
Return on equity
Our return on equity increased from 85.1% as of December 31, 2022 to 90.8% as of
December 31, 2023, reflecting the improvements in our profitability. Our return on equity was
70.8% as of December 31, 2024 and 73.1% as of March 31, 2025, respectively.
FINANCIAL INFORMATION
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Return on total assets
Our return on total assets increased from 5.3% as of December 31, 2022 to 6.9% as of
December 31, 2023, further to 7.3% as of December 31, 2024, and then to 8.9% as of March
31, 2025, reflecting the growth in our profitability outpacing that of our total assets.
Current ratio
Our current ratio remained relatively stable throughout the Track Record Period, at 0.95
times, 0.88 times, 0.98 times and 0.98 times as of December 31, 2022, 2023 and 2024 and
March 31, 2025, respectively.
Quick ratio
Our quick ratio decreased from 0.81 times as of December 31, 2022 to 0.67 times as of
December 31, 2023, reflecting the growth in our current liabilities outpacing that of our current
assets due to prepayment for the acquisition of JETOUR business, less the impact of our
inventories. Our quick ratio then increased to 0.76 times as of December 31, 2024, primarily
due to the increase in our current assets at a quicker pace than increase of our current liabilities.
Our quick ratio remained relatively stable at 0.74 times as of March 31, 2025.
Interest-bearing debt ratio
Our interest-bearing debt ratio decreased from 27.9% as of December 31, 2022 to 21.8%
as of December 31, 2023, reflecting an increase in our total assets outpacing that of our
interest-bearing debts. Our interest-bearing debt ratio then decreased to 11.9% as of
December 31, 2024, primarily due to the decrease in our interest-bearing debts as we expedited
the repayment of our bank loans. Our interest-bearing debt ratio slightly decreased to 11.4%
as of March 31, 2025.
Turnover growth
Our revenue amounted to RMB92,618 million, RMB163,205 million, RMB269,897
million, RMB54,910 million and RMB68,223 million in 2022, 2023 and 2024 and the three
months ended March 31, 2024 and 2025, respectively, representing a growth rate of 76.2%
from 2022 to 2023, 65.4% from 2023 to 2024 and 24.2% from the three months ended March
31, 2024 to the three months ended March 31, 2025. See “— Y ear-to-year Comparisons of Our
Results of Operations”.
Gearing ratio
Our gearing ratio decreased from 93.1% as of December 31, 2022 to 91.9% as of
December 31, 2023, reflecting an increase in our total assets resulting from increase in revenue
due to our business expansion, outpacing that of our total liabilities. Our gearing ratio further
decreased to 87.9% as of December 31, 2024 for similar reasons. Our gearing ratio slightly
decreased to 87.7% as of March 31, 2025.
FINANCIAL INFORMATION
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QUANTITATIVE AND QUALITATIVE DISCLOSURE OF FINANCIAL RISKS
We are exposed to various types of financial risks in the ordinary course of business,
including interest rate risk, foreign currency risk, credit risk, and liquidity risk. Our overall risk
management strategy focuses on the unpredictability of financial markets and seeks to
minimize potential adverse effects on our financial performance. Our senior management is
responsible for carrying out our risk management. For details, see note 49 of Appendix I to this
prospectus.
Interest rate risk
Our exposure to risk for changes in market interest rates relates primarily to our long-term
interest-bearing bank borrowings with a floating interest rate. Our policy is to manage our
interest cost using a mix of fixed and variable rate debts. For details, see note 30 of Appendix
I to this prospectus.
Foreign currency risk
We are exposed to transactional exchange rate risk. Such risks arise from transactions
conducted by an operating entity in a currency other than its functional currency. To ensure the
currency risk exposure of our Group is kept to an acceptable level and to minimize the gap
between assets and liabilities in the same currency, we have used foreign currency forward
contracts to manage foreign currency risk associated with foreign currency-denominated assets
and liabilities.
The following table shows the sensitivity analysis of exchange rate risk, reflecting the
impact of reasonable and possible changes in foreign currency exchange rates on profit before
tax under the assumption that other variables remain unchanged:
Increase/(decrease)
in exchange rates
Increase/(decrease)
in profit before tax
(%) (RMB million)
As at December 31, 2022
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 215
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (215)
As at December 31, 2024
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 100
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (100)
If the RUB strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 463
If the RUB weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (463)
FINANCIAL INFORMATION
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Increase/(decrease)
in exchange rates
Increase/(decrease)
in profit before tax
(%) (RMB million)
As at 31 March 2025
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 584
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (584)
If the RUB strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 490
If the RUB weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (490)
If the EUR strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H11185 181
If the EUR weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (181)
Due to the utilization of foreign currency forward contracts, as at December 31, 2023, we
were not exposed to material foreign currency risks.
During the Track Record Period, we formulated certain foreign exchange policies in an
effort to effectively reduce the impact of exchange rate fluctuations on our operating activities.
Such policies include the following:
Principle
 We shall maintain exchange rate risk neutrality by locking in target cost exchange rates,
thereby building a robust financial position.
Measures
 We shall preferentially utilize natural hedges to reduce our foreign exchange risk
exposures. Where natural hedges cannot sufficiently cover our risk exposures, we may
utilize other hedging instruments, depending on the relevant circumstances; and
 We shall continuously optimize settling currencies to minimize foreign exchange risk.
Credit risk
We trade only with recognized and creditworthy third parties. It is our policy that all
customers who wish to trade on credit terms are subject to credit verification procedures. In
addition, receivable balances are monitored on an ongoing basis and our exposure to bad debts
is not significant.
Liquidity risk
Our objective is to maintain a balance between continuity of funding and flexibility
through the use of interest-bearing bank loans, and other available sources of financing.
FINANCIAL INFORMATION
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Capital management
The primary objectives of our Group’s capital management are to safeguard our Group’s
ability to continue as a going concern and to maintain healthy capital ratios in order to support
its business and maximize shareholders’ value.
Our Group manages its capital structure and makes adjustments to it in light of changes
in economic conditions. To maintain or adjust the capital structure, our Group may adjust the
dividend payment to shareholders, return capital to shareholders or issue new shares.
DIVIDENDS
In 2022, 2023 and 2024, and the three months ended March 31, 2025, dividends of nil,
RMB1,094 million, nil and RMB3,993 million were declared and paid, respectively. Our Board
retains the discretion to distribute dividends in the future, considering our operational
outcomes, financial stability, cash necessities, and other pertinent factors at the time. As of the
date of this prospectus, we do not have any formal dividend policy. The declaration, payment,
and dividend amounts were subject to our existing articles of association and will adhere to our
Articles of Association which will take effect upon Listing and the laws of the PRC. Moreover,
our Directors hold the authority to issue interim dividends on the currently held shares of our
Company and sanction their payment from legally accessible funds. It should be noted that any
future dividend declarations may vary from past patterns and will be determined by our Board.
DISTRIBUTABLE RESERVES
As of March 31, 2025, our Company had retained earnings of RMB18,467 million under
HKFRS Accounting Standards, as reserves available for distribution to our Shareholders.
UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
For details of our unaudited pro forma adjusted combined net tangible assets, see
Appendix II to this prospectus.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commission and other fees
incurred in connection with the Global Offering. Assuming the Over-allotment Option is not
exercised and based on the Offer Price of HK$29.25 per Offer Share (being the mid-point of
the indicative Offer Price range), listing expenses to be borne by us are estimated to be
approximately RMB235 million (HK$258 million), comprising: (i) underwriting fees of
RMB139 million (HK$153 million); and (ii) non-underwriting-related expenses of RMB96
million (HK$105 million), which are further categorized into: (a) fees and expenses of legal
advisers and accountants of RMB62 million (HK$68 million); and (b) other fees and expenses
of RMB34 million (HK$37 million), approximately RMB85 million (HK$93 million) of which
FINANCIAL INFORMATION
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was charged or is expected to be charged to our consolidated statements of profit or loss, and
approximately RMB150 million (HK$165 million) of which is expected to be deducted from
equity upon the completion of the Global Offering. The listing expenses are expected to
represent approximately 3.0% of the gross proceeds of the Global Offering, assuming an Offer
Price of HK$29.25 per Offer Share (being the mid-point of the indicative Offer Price range)
and that the Over-allotment Option is not exercised. The listing expenses above are the latest
practicable estimate for reference only, and the actual amount may differ from this estimate.
NO MATERIAL ADVERSE CHANGE
Our Directors confirm that, up to the Latest Practicable Date, there had been no material
adverse change in our business, financial condition and results of operations since March 31,
2025, which is the end date of the years reported on in the Accountants’ Report as set out in
Appendix I to this prospectus, and there is no event since March 31, 2025 which would
materially affect the information in the Accountants’ Report as set out in Appendix I to this
prospectus.
DISCLOSURE REQUIRED UNDER THE LISTING RULES
We confirm that, as of the Latest Practicable Date, there were no circumstances that
would give rise to a disclosure requirement under Rule 13.13 to 13.19 of the Listing Rules.
FINANCIAL INFORMATION
– 427 –


--- page 438 ---
THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone
Investment Agreement ”, and together the “ Cornerstone Investment Agreements ”) with the
cornerstone investors set out below (each a “ Cornerstone Investor ”, and together the
“Cornerstone Investors ”), pursuant to which the Cornerstone Investors have agreed to,
subject to certain conditions, subscribe, or cause their designated entities to subscribe, at the
Offer Price for such number of Offer Shares (rounded down to the nearest whole board lot of
100 H Shares) that may be purchased for an aggregate amount of approximately US$587.00
million (or approximately HK$4,572.50 million, calculated based on an exchange rate of
US$1.00 to HK$7.7897) and exclusive of brokerage fee, the SFC transaction levy, the AFRC
transaction levy and the Stock Exchange trading fee) (the “ Cornerstone Placing ”).
Based on the Offer Price of HK$30.75 per H Share, being the maximum Offer Price, the
total number of Offer Shares to be subscribed for by the Cornerstone Investors would be
148,698,500 H Shares, representing approximately (i) 50.00% of the H Shares offered pursuant
to the Global Offering (assuming the Over-allotment Option is not exercised); (ii) 2.58% of our
total issued share capital immediately upon completion of the Global Offering (assuming the
Over-allotment Option is not exercised); and (iii) 2.56% of our total issued share capital
immediately upon completion of the Global Offering and the full exercise of the Over-
allotment Option.
We believe that the Cornerstone Placing reflects our Cornerstone Investors’ confidence in
our Company and its business prospect. We also believe that the Cornerstone Placing will
enhance the profile of our Company. We became acquainted with each of the Cornerstone
Investors through our Group’s business network in its ordinary course of operation, or through
introduction by our Company’s business partners or the Overall Coordinators in the Global
Offering.
The Cornerstone Placing will form part of the International Offering, and save as
otherwise obtained consent from the Stock Exchange, the Cornerstone Investors (and for PSBC
Wealth, who will subscribe for our Offer Shares through qualified domestic institutional
investors (“ QDII(s) ”), the QDIIs), and their respective close associates will not subscribe for
any Offer Shares under the Global Offering (other than pursuant to the Cornerstone Investment
Agreements). The Offer Shares to be subscribed by the Cornerstone Investors (and for PSBC
Wealth, who will subscribe for our Offer Shares through QDIIs, the QDIIs) will rank pari passu
in all respects with the fully paid H Shares in issue following the Global Offering of the
Company. Save for the Offer Shares to be subscribed by Huangshan Construction Investment,
Jinghui Ruiying and Hefei Jianhui, the Offer Shares to be subscribed by all other Cornerstone
Investors will be counted towards the public float of our Company under Rule 8.08 of the
Listing Rules (as amended and replaced by Rule 19A.13A(1)). Immediately following the
completion of the Global Offering, the Cornerstone Investors or their close associates will not,
by virtue of their cornerstone investments, have any Board representation in our Company; and
none of the Cornerstone Investors and their close associates will become a substantial
Shareholder of our Company. Other than a guaranteed allocation of the relevant Offer Shares
CORNERSTONE INVESTORS
– 428 –


--- page 439 ---
at the final Offer Price, the Cornerstone Investors do not have any preferential rights under
each of their respective Cornerstone Investment Agreements, as compared with other public
Shareholders. There are no side arrangements or agreements between our Company and the
Cornerstone Investors or any benefit, direct or indirect, conferred on the Cornerstone Investors
by virtue of or in relation to the Listing, other than a guaranteed allocation of the relevant Offer
Shares at the final Offer Price, following the principles as set out in Chapter 4.15 of the Listing
Guide.
Among the Cornerstone Investors, Huangshan Construction Investment, Jinghui Ruiying,
Gotion HK and Hefei Jianhui are close associates of the existing Shareholders. The Stock
Exchange has granted a waiver from strict compliance with the requirements under Rule 10.04
of and consent under Paragraph 5(2) of Appendix F1 to the Listing Rules and paragraph 18 of
Chapter 4.15 of the Guide for New Listing Applicants to permit H Shares in the International
Offering to be placed to certain close associates of the existing Shareholders. For further
details, see “Waivers from Strict Compliance with Listing Rules — Consent under Paragraph
18 of Chapter 4.15 of the Guide for New Listing Applicants in Respect of Subscriptions of
Offer Shares by Close Associates of Existing Shareholders.”
Save as otherwise disclosed, to the best knowledge of our Company, (i) other than the
cornerstone investors who are close associates of the existing Shareholders, each of the
Cornerstone Investors (and for PSBC Wealth, who will subscribe for our Offer Shares through
QDIIs, the QDIIs) is an Independent Third Party; (ii) other than the cornerstone investors who
are close associates of the existing Shareholders, none of the Cornerstone Investors (and for
PSBC Wealth, who will subscribe for our Offer Shares through QDIIs, the QDIIs) is
accustomed to taking instructions from our Company, the Directors, the Supervisors, chief
executive, substantial Shareholders, existing Shareholders or any of their respective
subsidiaries or their respective close associates in relation to the acquisition, disposal, voting
or other disposition of the Offer Shares; (iii) other than the cornerstone investors who are close
associates of the existing Shareholders, none of the subscription of the relevant Offer Shares
by any of the Cornerstone Investors (or for PSBC Wealth, who will subscribe for our Offer
Shares through QDIIs, the QDIIs) is financed by our Company, the Directors, the Supervisors,
chief executive, substantial Shareholders, existing Shareholders or any of their respective
subsidiaries or their respective close associates; (iv) each Cornerstone Investor will be utilizing
its internal financial resources, financial resources of its shareholders or (in the case of
Cornerstone Investors which are funds or investment managers) the assets managed for its
investors as its source of funding for the subscription of the Offer Shares; (v) each Cornerstone
Investor has sufficient funds to settle its respective investment under the Cornerstone Placing;
and (vi) each of the Cornerstone Investors has confirmed that all necessary approvals have been
obtained with respect to the Cornerstone Placing and that no specific approval from any stock
exchange (if relevant) is required for the relevant Cornerstone Placing. In addition, to the best
knowledge of our Company, save as otherwise disclosed, each of the Cornerstone Investors is
independent from each other and makes independent investment decisions.
CORNERSTONE INVESTORS
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--- page 440 ---
The Cornerstone Investors have agreed to pay for the relevant Offer Shares that they have
subscribed before dealings in the Company’s H Shares commence on the Stock Exchange.
Some of the Cornerstone Investors have agreed that, our Company, the Joint Sponsors and the
Overall Coordinators may in their sole discretion defer the delivery of all or part of the Offer
Shares it will subscribe to on a date later than the Listing Date. Such delayed delivery
arrangement is in place to facilitate the over-allocation in the International Offering. There will
be no delayed delivery if there is no over-allocation in the International Offering. Where
delayed delivery takes place, (i) there would be delayed delivery of Offer Shares to some of
the Cornerstone Investors based on commercial negotiations with the Cornerstone Investors,
(ii) the delayed delivery date should be no later than three business days following the last day
on which the Over-allotment Option may be exercised, (iii) no extra payment will be made to
the relevant Cornerstone Investors for the purpose of the delayed delivery arrangement, and
(iv) each of the Cornerstone Investors has agreed that it shall nevertheless pay for the relevant
Offer Shares in full before the Listing. As such, there will not be any deferred settlement in
payment by the Cornerstone Investors.
Details of the actual number of Offer Shares to be allocated to the Cornerstone Investors
will be disclosed in the allotment results announcement of our Company to be published on or
around Wednesday, September 24, 2025.
To the best knowledge of the Company and the Overall Coordinators, and based on the
indicative interest of investment of the Cornerstone Investors and/or their close associates as
of the date of this prospectus, certain Cornerstone Investors and/or their close associates may
participate in the International Offering as placees and subscribe for further Offer Shares in the
Global Offering. The Stock Exchange has granted a waiver from strict compliance with the
requirements under Rule 10.04 of and consent under Paragraph 5(2) of Appendix F1 to the
Listing Rules and paragraph 18 of Chapter 4.15 of the Guide for New Listing Applicants to
permit H Shares in the International Offering to certain Cornerstone Investors who will
subscribe for further Offer Shares as placees in the International Offering. For further details,
see “Waivers from Strict Compliance with Listing Rules — Consent under Paragraph 18 of
Chapter 4.15 of the Guide for New Listing Applicants in Respect of Subscriptions of Offer
Shares by Close Associates of Existing Shareholders.” Whether such Cornerstone Investors
and/or their close associates will place orders in the International Offering are uncertain and
will be subject to the final investment decisions of such investors and the terms and conditions
of the Global Offering.
CORNERSTONE INVESTORS
– 430 –


--- page 441 ---
OUR CORNERSTONE INVESTORS
The table below sets out details of the Cornerstone Placing:
Based on the Offer Price of HK$30.75, being the maximum Offer Price
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is fully exercised
Cornerstone Investor
Investment
amount (1)
Number
of Offer
Shares (2)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
(in millions)
JSC International
Investment Fund SPC
(acting for and on behalf
of ShanRui SP) /H1118/H1118/H1118/H1118/H1118/H1118HK$1,480.00 48,130,000 16.18 0.83 14.07 0.83
HHLRA /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$60.00 15,199,300 5.11 0.26 4.44 0.26
Shanghai Greenwoods and
CICC Financial Trading
Limited (in connection
with Greenwoods OTC
Swaps) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$55.00 13,932,700 4.68 0.24 4.07 0.24
HK Greenwoods /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$5.00 1,266,600 0.43 0.02 0.37 0.02
Huangshan Construction
Investment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$41.00 10,386,200 3.49 0.18 3.04 0.18
Jinghui Ruiying /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$41.00 10,386,200 3.49 0.18 3.04 0.18
Horizon Together /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$40.00 10,132,800 3.41 0.18 2.96 0.17
Dajia Life /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$33.00 8,359,600 2.81 0.14 2.44 0.14
Martis Fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$33.00 8,359,600 2.81 0.14 2.44 0.14
Gotion HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$29.00 7,346,300 2.47 0.13 2.15 0.13
Hefei Jianhui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$20.00 5,066,400 1.70 0.09 1.48 0.09
PSBC Wealth /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$20.00 5,066,400 1.70 0.09 1.48 0.09
Xingyu HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$20.00 5,066,400 1.70 0.09 1.48 0.09
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy, and to be converted to Hong Kong dollars based on the exchange rate as disclosed in this prospectus.
(2) Rounded down to the nearest whole board lot of 100 H Shares.
(3) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the date of exercise of Over-allotment Option.
(4) If the final Offer Price is less than the maximum Offer Price of HK$30.75, in accordance with the terms of
the Cornerstone Investment Agreements to satisfy the relevant requirements under the Listing Rules, each
Cornerstone Investor’s investment amount shall be deducted on a pro rata basis at the sole and absolute
discretion of the Joint Sponsors, the Overall Coordinators and the Company, so that the number of Offer Shares
to be acquired by each Cornerstone Investor remain the same with the table above.
CORNERSTONE INVESTORS
– 431 –


--- page 442 ---
Based on the Offer Price of HK$29.25, being the mid-point of the Offer Price
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is fully exercised
Cornerstone Investor
Investment
amount (1)
Number
of Offer
Shares (2)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
(in millions)
JSC International
Investment Fund SPC
(acting for and on behalf
of ShanRui SP) /H1118/H1118/H1118/H1118/H1118/H1118HK$1,407.80 48,130,000 16.18 0.83 14.07 0.83
HHLRA /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$57.07 15,199,300 5.11 0.26 4.44 0.26
Shanghai Greenwoods and
CICC Financial Trading
Limited (in connection
with Greenwoods OTC
Swaps) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$52.32 13,932,700 4.68 0.24 4.07 0.24
HK Greenwoods /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$4.76 1,266,600 0.43 0.02 0.37 0.02
Huangshan Construction
Investment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$39.00 10,386,200 3.49 0.18 3.04 0.18
Jinghui Ruiying /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$39.00 10,386,200 3.49 0.18 3.04 0.18
Horizon Together /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$38.05 10,132,800 3.41 0.18 2.96 0.17
Dajia Life /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$31.39 8,359,600 2.81 0.14 2.44 0.14
Martis Fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$31.39 8,359,600 2.81 0.14 2.44 0.14
Gotion HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$27.59 7,346,300 2.47 0.13 2.15 0.13
Hefei Jianhui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$19.02 5,066,400 1.70 0.09 1.48 0.09
PSBC Wealth /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$19.02 5,066,400 1.70 0.09 1.48 0.09
Xingyu HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$19.02 5,066,400 1.70 0.09 1.48 0.09
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy, and to be converted to Hong Kong dollars based on the exchange rate as disclosed in this prospectus.
(2) Rounded down to the nearest whole board lot of 100 H Shares.
(3) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the date of exercise of Over-allotment Option.
CORNERSTONE INVESTORS
– 432 –


--- page 443 ---
Based on the Offer Price of HK$27.75, being the minimum Offer Price
Assuming the
Over-allotment Option
is not exercised
Assuming the
Over-allotment Option
is fully exercised
Cornerstone Investor
Investment
amount (1)
Number
of Offer
Shares (2)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
Approximate
%o ft h e
Offer Shares
Approximate
%o ft h e
issued share
capital (3)
(in millions)
JSC International
Investment Fund SPC
(acting for and on behalf
of ShanRui SP) /H1118/H1118/H1118/H1118/H1118/H1118HK$1,335.61 48,130,000 16.18 0.83 14.07 0.83
HHLRA /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$54.15 15,199,300 5.11 0.26 4.44 0.26
Shanghai Greenwoods and
CICC Financial Trading
Limited (in connection
with Greenwoods OTC
Swaps) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$49.63 13,932,700 4.68 0.24 4.07 0.24
HK Greenwoods /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$4.51 1,266,600 0.43 0.02 0.37 0.02
Huangshan Construction
Investment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$37.00 10,386,200 3.49 0.18 3.04 0.18
Jinghui Ruiying /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$37.00 10,386,200 3.49 0.18 3.04 0.18
Horizon Together /H1118/H1118/H1118/H1118/H1118/H1118/H1118US$36.10 10,132,800 3.41 0.18 2.96 0.17
Dajia Life /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$29.78 8,359,600 2.81 0.14 2.44 0.14
Martis Fund /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$29.78 8,359,600 2.81 0.14 2.44 0.14
Gotion HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$26.17 7,346,300 2.47 0.13 2.15 0.13
Hefei Jianhui /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$18.05 5,066,400 1.70 0.09 1.48 0.09
PSBC Wealth /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$18.05 5,066,400 1.70 0.09 1.48 0.09
Xingyu HK /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118US$18.05 5,066,400 1.70 0.09 1.48 0.09
Notes:
(1) Exclusive of brokerage, the SFC transaction levy, the Stock Exchange trading fee and the AFRC transaction
levy, and to be converted to Hong Kong dollars based on the exchange rate as disclosed in this prospectus.
(2) Rounded down to the nearest whole board lot of 100 H Shares.
(3) Assuming no other changes are made to the issued share capital of our Company between the Latest Practicable
Date and the date of exercise of Over-allotment Option.
CORNERSTONE INVESTORS
– 433 –


--- page 444 ---
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in connection with the Cornerstone Placing.
JSC International Investment Fund SPC (acting for and on behalf of ShanRui SP)
JSC International Investment Fund SPC (acting for and on behalf of ShanRui SP) is
indirectly held by JSC Shanrui (Beijing) Equity Investment Fund Partnership Enterprise
(Limited Partnership) (“ JSC ShanRui ”), a limited partnership established in the PRC. ShanRui
SP is the fund issued by JSC International Investment Fund SPC and wholly owned by JSC
ShanRui. It is owned as to 99.93% by China State-Owned Enterprise Mixed-Ownership Reform
Fund Co., Ltd.* (ʮ̡) (a national fund approved by
the State Council of the People’s Republic of China, entrusted by the State-owned Assets
Supervision and Administration Commission of the State Council, and initiated by China
Chengtong Holdings Group Co., Ltd. (ʮ̡)) as a limited partner and
0.07% by Jingquan Shancheng Management Consulting (Beijing) Co., Ltd.* (ഛ༐၍ଣፔ
༔(̏ԯ)ʮ̡) (wholly owned by the State-owned Assets Supervision and Administration
Commission of Beijing Municipal People’s Government) as a general partner.
HHLR Advisors, Ltd.
HHLR Advisors, Ltd. (“ HHLRA ”), part of the Hillhouse Group, is an exempted company
incorporated in the Cayman Islands and acts as the investment manager of investment funds
(collectively the “ HHLRA Funds ”), which are limited partnerships formed under the laws of
the Cayman Islands. There is no individual limited partner investor who holds an economic
interest of 30% or more in the HHLRA Funds.
HHLRA collaborates with industry-defining enterprises, aiming to establish alignment
with sustainable, forward-thinking companies across industrial, consumer, healthcare and
business services sectors. HHLRA manages capital for global institutions, including non-profit
foundations, endowments, and pensions. HHLRA is entering the cornerstone investment
agreement with the Company in its capacity as an investment manager and on behalf of the
HHLRA Funds.
Shanghai Greenwoods and CICC Financial Trading Limited (in connection with
Greenwoods OTC Swaps)
CICC FT and China International Capital Corporation Limited will enter into a series of
cross border delta-one OTC swap transactions (collectively, the “ Greenwoods OTC Swaps ”)
with each other and the ultimate clients (the “ CICC FT Ultimate Clients (Greenwoods) ”),
pursuant to which CICC FT will hold the Offer Shares on a non-discretionary basis to hedge
the Greenwoods OTC Swaps while the economic risks and returns of the underlying Offer
Shares are passed to the CICC FT Ultimate Clients (Greenwoods), subject to customary fees
and commissions. The Greenwoods OTC Swaps will be fully funded by the CICC FT Ultimate
Clients (Greenwoods). During the terms of the Greenwoods OTC Swaps, all economic returns
of the Offer Shares subscribed by CICC FT will be passed to the CICC FT Ultimate Clients
(Greenwoods) and all economic loss shall be borne by the CICC FT Ultimate Clients
CORNERSTONE INVESTORS
– 434 –


--- page 445 ---
(Greenwoods) through the Greenwoods OTC Swaps, and CICC FT will not take part in any
economic return or bear any economic loss in relation to the Offer Shares. The Greenwoods
OTC Swaps are linked to the Offer Shares and the CICC FT Ultimate Clients (Greenwoods)
may, after expiration of the lock-up period beginning from the date of the cornerstone
agreement entered into between CICC FT and the Company and ending on the date which is
six months from the Listing Date, request to early terminate the Greenwoods OTC Swaps at
their own discretions, upon which CICC FT may dispose of the Offer Shares and settle the
Greenwoods OTC Swaps in cash in accordance with the terms and conditions of the
Greenwoods OTC Swaps. Despite that CICC FT will hold the legal title of the Offer Shares by
itself, it will not exercise the voting rights attaching to the relevant Offer Shares during the
terms of the Greenwoods OTC Swaps according to its internal policy. To the best of CICC FT’s
knowledge having made all reasonable inquiries, each of the CICC FT Ultimate Clients
(Greenwoods) is an independent third party of CICC FT, CICCHKS and the companies which
are members of the same group of CICCHKS, and no single ultimate beneficial owner holds
30% or more interests in each of the CICC FT Ultimate Clients (Greenwoods).
CICC FT is a wholly-owned subsidiary of China International Capital Corporation
Limited, of which its shares are listed on the Shanghai Stock Exchange (stock code: 601995)
and the Stock Exchange (stock code: 3908). CICC FT is a connected client (as defined under
Appendix F1 to the Listing Rules) of CICCHKS, holding securities on a non-discretionary
basis on behalf of independent third parties. The Company has applied to the Stock Exchange
for, and the Stock Exchange has granted, its consent under paragraph 5(1) of Appendix F1 to
the Listing Rules to permit us to allocate the Offer Shares to CICC FT. See “Waivers from
Strict Compliance with Listing Rules — Consent in Respect of the Proposed Subscription of
H Shares by Certain Cornerstone Investor Who Is A Connected Client.”
The CICC FT Ultimate Clients (Greenwoods) are certain domestic private funds
(including a total of no more than seven funds, each being an Independent Third Party)
managed by Shanghai Greenwoods Asset Management Co., Ltd. (ʮ̡)
(“Shanghai Greenwoods ”). Shanghai Greenwoods is a private fund management company
with the registration under AMAC. Shanghai Greenwoods is one of the largest and earliest PRC
domestic asset managers mainly specializing in investing into companies in the Greater China
region. Shanghai Greenwoods focuses on fundamental research, value investments, and local
due diligence. Investors of funds managed by Shanghai Greenwoods include institutional
investors and high-net-worth individuals professional investors. Mr. Jiang Jinzhi is the
Chairman, a major shareholder and an ultimate beneficial owner of Shanghai Greenwoods. No
other shareholder holds 30% or more interest in Shanghai Greenwoods. As confirmed by
Shanghai Greenwoods, the subscription of the Offer Shares as cornerstone investor will be
made by Shanghai Greenwoods in its capacity as the fund manager of domestic private funds
through TRS mechanism.
According to our PRC Legal Advisers, the aforementioned transaction structure does not
violate the PRC laws and regulations.
CORNERSTONE INVESTORS
– 435 –


--- page 446 ---
HK Greenwoods
Greenwoods Asset Management Hong Kong Limited (“ HK Greenwoods ”) is a private
fund management company incorporated in Hong Kong with limited liability. Established in
2005, HK Greenwoods is one of the largest and earliest China-focused asset managers mainly
specializing in investing into companies in the Greater China region. HK Greenwoods focuses
on fundamental research, value investments, and local due diligence. Investors of funds and
accounts managed by HK Greenwoods includes institutional investors and high-net-worth
individuals professional investors. Mr. Jiang Jinzhi, through a holding company, is the ultimate
beneficial owner of HK Greenwoods. Mr. Jiang Jinzhi is an Independent Third Party and the
chairman of HK Greenwoods. As confirmed by HK Greenwoods, the subscription of the Offer
Shares as a cornerstone investor will be made by HK Greenwoods in its capacity as the
investment manager of Greenwoods V alue Income Fund and no single ultimate beneficial
owner holds 30% or more interests in Greenwoods V alue Income Fund. HK Greenwoods and
Shanghai Greenwoods are affiliate of each other.
Huangshan Construction Investment
Huangshan Construction Investment (Hong Kong) International Limited (“ Huangshan
Construction Investment ”) is a limited company incorporated under the laws of Hong Kong,
principally engaged in investment holding, trading and consulting. It is wholly owned by
Huangshan Construction Investment Private Equity Fund Management Co., Ltd., a direct
wholly-owned subsidiary of Huangshan Construction Investment Group Co., Ltd.* (ܔ
ʮ̡), which in turn is directly wholly owned by the State-owned Assets
Supervision and Administration Commission of Huangshan Municipal People’s Government.
Jinghui Ruiying
Jinghui Ruiying (Hong Kong) Limited (“ Jinghui Ruiying ”) is a limited company
incorporated under the laws of Hong Kong, principally engaged in investment holding. It is
wholly owned by Hefei Jinghui Ruiying Enterprise Management Consulting Partnership
Enterprise (Limited Partnership)* (Άุ၍ଣፔ༔ΥྫΆุ(Υྫ), “ Heifei
Jinghui Ruiying ”). Heifei Jinghui Ruiying is 99.9667% owned by Nexchip Semiconductor
Corporation* (ʮ̡,“ Nexchip ”), which acts as the limited partner.
Nexchip is an A-share listed company on the Shanghai Stock Exchange (stock code: 688249)
and a leading pure-play 12-inch foundry, providing end-to-end wafer fabrication services
covering technology nodes from 150nm to 40nm, the actual controller of which is the
State-owned Assets Supervision and Administration Commission of Hefei Municipal People’s
Government. Hefei Jinghui Ruiying is 0.0333% owned by Hefei Jinghe Huixin Enterprise
Management Consulting Partnership Enterprise (Limited Partnership)* (Άุ၍
ଣፔ༔ΥྫΆุ(Υྫ)) (“ Hefei Jinghe Huixin ”), which acts as the general partner. Hefei
Jinghe Huixin is respectively owned as to 51% by Mr. Huang Mingduan, being an Independent
Third Party, and 49% by Hefei Jinghe Huixin Private Equity Fund Management Co., Ltd.* ( Υ
CORNERSTONE INVESTORS
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ʮ̡), which in turn is owned as to 50% by Mr. Huang
Mingduan. There is no other shareholder holding 30% or more equity interest in Hefei Jinghe
Huixin Private Equity Fund Management Co., Ltd.
Horizon Together
Horizon Together Holding Ltd. (“ Horizon Together ”) is an exempted company with
limited liability incorporated under the laws of the Cayman Islands on August 29, 2022.
Horizon Together is wholly owned by Horizon Robotics. Horizon Robotics is a company listed
on the Stock Exchange (stock code: 9660) and a leading intelligent driving technology
company, empowered by its proprietary software and hardware technologies. The company’s
solutions combine cutting-edge algorithms, purpose-built software and advanced processing
hardware, providing the core technologies for intelligent driving that enhance the safety and
experience of drivers and passengers.
Dajia Life
Dajia Life Insurance Co., Ltd. (“ Dajia Life ”) is a professional life insurance company
which is a subsidiary of Dajia Insurance Group, which is ultimately controlled by China
Insurance Security Fund Company Limited (“ China Insurance Company ”). China Insurance
Company is wholly owned by the Ministry of Finance of the People’s Republic of China.
Established in June 2010 and headquartered in Beijing, Dajia Life has a registered capital of
RMB30.79 billion and mainly engages in various personal insurance businesses such as life
insurance, health insurance, accident insurance, reinsurance business of the above-mentioned
businesses, and other businesses approved by the National Financial Regulatory
Administration. Currently, Dajia Life has a total of 19 provincial-level branches in operation.
Martis Fund
Martis Fund, L.P . (“ Martis Fund ”) is an exempted limited partnership registered under
the laws of Cayman Islands, focusing on healthcare, telecommunication, media, technology
and consumer industries investment. The general partner of Martis Fund is Pulsating Star GP
Limited, which is 100% ultimately controlled by Mr. Eric Li, being an Independent Third Party.
No limited partner holds more than 30% partnership interest in Martis Fund. Mr. Eric Li is a
Hong Kong citizen with extensive experience in the investment industry. Through several
investment funds he ultimately controls, Mr. Eric Li focuses on the investment in healthcare,
telecommunication, media, technology and consumer industries, and has successfully invested
in several companies listed in Hong Kong, including Giant Biogene (stock code: 02367), WL
Delicious (stock code: 09985) and SF Intra-City (stock code: 09699) as pre-IPO investor,
Guming (stock code: 01364) and Sanhua (stock code: 02050) as cornerstone investor.
CORNERSTONE INVESTORS
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Gotion HK
GOTION HIGH-TECH (HK) LIMITED (“ Gotion HK ”) is a limited company
incorporated in Hong Kong and a wholly-owned subsidiary of Gotion High-tech Co., Ltd.
(“GOTION ”). GOTION was founded in 1995, with headquarter in Hefei, Anhui Province, as
a joint stock company incorporated in the PRC with limited liability. GOTION is a new energy
battery enterprise and green energy solution provider. GOTION principally engages in the
business of lithium iron phosphate materials and batteries, ternary materials and batteries,
power battery packs, energy storage battery packs and battery management systems, etc. Its
products are widely used in new energy vehicles, such as passenger cars, commercial vehicles
and special purpose vehicles. GOTION also provides green energy system solutions for energy
storage customers. GOTION has been listed on the Shenzhen Stock Exchange since May 2015
(stock code: 002074) and the Swiss Stock Exchange since July 2022 (stock code: GOTION),
respectively.
Hefei Jianhui
Hefei Jianhui Zhanxin Cornerstone Investment Company Limited (“ Hefei Jianhui ”) is a
limited company incorporated under the laws of Hong Kong, principally engaged in
investment. It is wholly owned by Hefei Jianhui Zhanxin Equity Investment Fund Partnership
Enterprise (Limited Partnership)* (ΥྫΆุ(Υྫ)) (“ Jianhui
Fund ”). Jianhui Fund is owned as to 0.1212% by Hefei Jiantou Capital Management Co., Ltd.*
(ʮ̡), being a general partner of Jianhui Fund and actually controlled
by the State-owned Assets Supervision and Administration Commission of Hefei Municipal
People’s Government. There is no limited partner holding 30% or more partnership interest in
Jianhui Fund.
PSBC Wealth
PSBC Wealth Management Co., Ltd. (“ PSBC Wealth ”) was established on December 18,
2019, with a registered capital of RMB8.0 billion, in which Postal Savings Bank of China Co.,
Ltd. (stock code: 1658) holds a 100% stake and is ultimately controlled by China Post Group
Corporation Limited. Its business scope is public issuance of wealth management products to
the general public, investment and management of entrusted assets for investors; non-public
issuance of wealth management products to eligible investors, investment and management of
entrusted assets for investors; financial advisory and consulting services, etc. PSBC Wealth
remained firmly committed to balanced development of scale, quality and profitability, aimed
at fostering core competitiveness, deepened investment analysis, marketing, internal control,
operational reforms and digital transformation, and continued to improve the rule-based,
specialized and market-oriented development of wealth management business.
CORNERSTONE INVESTORS
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Xingyu HK
Xingyu Automotive Lighting (Hong Kong) Company Limited (“ Xingyu HK ”) is a limited
company incorporated under the laws of Hong Kong, principally engaged in automotive
lighting market development and maintenance of customer and supplier relationships. It is
wholly owned by Changzhou Xingyu Automotive Lighting Systems Co., Ltd.* (ρԓዱ
ʮ̡)( “ Xingyu Co., Ltd. ”), the A shares of which are listed on the Shanghai Stock
Exchange under stock code 601799. Xingyu Co., Ltd. is principally engaged in supplying
lighting products to vehicle manufacturers.
Xingyu Co., Ltd. is our supplier of lighting products, the procurement contract of which
was entered into on an arm’s length basis and on normal commercial terms and in the ordinary
course of business of our Company.
CLOSING CONDITIONS
The obligation of each Cornerstone Investor to subscribe for the Offer Shares under the
respective Cornerstone Investment Agreement is subject to, among other things, the following
closing conditions:
(i) the Underwriting Agreements being entered into and having become effective and
unconditional (in accordance with their respective original terms or as subsequently
waived or varied by agreement of the parties thereto) by no later than the time and
date as specified in the Underwriting Agreements, and neither of the aforesaid
Underwriting Agreements having been terminated;
(ii) the Offer Price having been agreed upon between our Company and the Overall
Coordinators (for themselves and on behalf of the underwriters of the Global
Offering);
(iii) the Listing Committee of the Stock Exchange having granted the approval for the
listing of, and permission to deal in, the H Shares (including the H Shares subscribed
for by the Cornerstone Investors) as well as other applicable waivers and approvals,
and such approval, permission or waiver having not been revoked prior to the
commencement of dealings in the H Shares on the Stock Exchange;
(iv) no laws shall have been enacted or promulgated by any governmental authority
which prohibits the consummation of the transactions contemplated in the Global
Offering or in the respective Cornerstone Investment Agreements and there shall be
no orders or injunctions from a court of competent jurisdiction in effect precluding
or prohibiting consummation of such transactions; and
CORNERSTONE INVESTORS
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(v) the respective acknowledgements, representations, warranties, undertakings and
confirmations of relevant Cornerstone Investor under the respective Cornerstone
Investment Agreement are accurate and true in all material respects and not
misleading and that there is no material breach of the Cornerstone Investment
Agreement on the part of the relevant Cornerstone Investor.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that it will not, whether directly or
indirectly, at any time during the period of six months from (and inclusive of) the Listing Date
(the “ Lock-up Period ”), dispose of, in any way, any of the Offer Shares or any interest in any
company or entity holding such Offer Shares that they have purchased pursuant to the relevant
Cornerstone Investment Agreement, save for certain limited circumstances, such as transfers to
any of its wholly-owned subsidiaries who will be bound by the same obligations of such
Cornerstone Investor, including the Lock-up Period restriction.
CORNERSTONE INVESTORS
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FUTURE PLANS
See “Business — Our Strategies” for a detailed description of our future plans.
USE OF PROCEEDS
Assuming an Offer Price of HK$29.25 per H Share (being the mid-point of the Offer Price
Range of between HK$27.75 and HK$30.75 per H Share) and the Over-allotment Option is not
exercised, we estimate that we will receive net proceeds of approximately HK$8,441.2 million
from the Global Offering after deducting the underwriting commissions and other estimated
expenses paid and payable by us in connection with the Global Offering. In line with our
strategies, we intend to use our proceeds from the Global Offering for the purposes and in the
amounts set forth below:
 Approximately 35.0% of the net proceeds, or HK$2,954.4 million, in the next one
to three years, is expected to be used for the R&D of passenger vehicles of different
models and versions to further expand our product portfolio, including:
(i) approximately 20.0% of the net proceeds, or HK$1,688.2 million, is expected
to be used for developing and expanding our NEV offerings. We plan to
continuously introduce NEV models and NEVs of existing product series to
enrich our product portfolio and promote the adoption of green mobility
globally. We plan to continue to invest in the R&D in NEV models under each
of our brands, namely CHERY , JETOUR, EXEED, iCAR and LUXEED,
respectively and roll out a variety of PHEVs, REEVs and BEVs with distinct
models including SUV , sedans and MPVs and market positionings covering
mass market segment, mid- to high-segment and premium segment to further
increase our domestic and overseas market share. For example, we plan to
launch more than eight NEV models in the second half of 2025 covering
PHEVs, REEVs and BEVs with a MSRP range from RMB100,000 to
RMB400,000. The annual sales volume of these models is targeted to exceed
400,000 units.
(ii) approximately 15.0% of the net proceeds, or HK$1,266.2 million, is expected
to be used for the upgrade and broadening of our existing product series.
Leveraging our extensive expertise in vehicle development, we will effectively
integrate the distinct needs and preferences of consumers across various
regions and demographics into our product development. For example, we will
develop vehicles with more appealing exterior designs, improved energy
efficiency, advanced driving assistance features and enhanced intelligent
cockpit functionality. For the existing product series that enjoy wide
recognition, for example, Tiggo, Arrizo, and Jetour Traveler, we endeavor to
promote the continuous launch of popular models in the future.
FUTURE PLANS AND USE OF PROCEEDS
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 Approximately 25.0% of the net proceeds, or HK$2,110.3 million, in the next one
to three years, is expected to be used for the R&D in the next-generation vehicle and
advanced technologies to enhance our core technological competencies, including:
(i) approximately 10.0% of the net proceeds, or HK$844.1 million, is expected to
be invested in upgrading our electrification technologies and vehicle platform
architecture, in particular,
/H11568we plan to invest in the upgrade and broadening of our new energy
powertrain technologies by (i) developing key components such as more
advanced hybrid engine, hybrid transmission and electric motor to
enhance the comprehensive performance of our new energy powertrain;
and (ii) achieving mass production of in-house developed high-
performance batteries and accelerating R&D and commercialization of
next-generation battery technologies. Moreover, we will also explore
potential new power type for our passenger vehicles; and
/H11568we plan to invest in the upgrade of our vehicle platform architecture,
including (i) continuing to enhance our chassis technology by developing
next-generation intelligent chassis to provide users with better driving
and riding experience, (ii) continuing to develop next-generation E/E
architecture to build a more competitive vehicle architecture; (iii)
enhancing the R&D in key parts and components to expand our in-house
developed key parts and components portfolio.
(ii) approximately 15.0% of the net proceeds, or HK$1,266.2 million, is expected
to be used to invest in the driving assistance solutions and intelligent cockpit
solutions, in particular,
/H11568we plan to increase investment in R&D of driving assistance
technologies. Leveraging our strong R&D capabilities, we will continue
to upgrade and broadening in-house developed driving assistance
solutions. For example, we plan to achieve adoption of our self-developed
CNOA on our passenger vehicles to realize point to point travel in the city
and handle complex urban driving scenarios. We also plan to develop
more advanced driving assistance technologies. In addition, we plan to
enhance the practicality and cost-effectiveness of our driving assistance
solutions, carry out the vehicle testing across various regions globally as
well as increase the penetration of our driving assistance solutions among
our ICE vehicles and NEVs with different markets and price range and
powertrain types to strengthen our product competitiveness across models
and markets and empower a superior driving experience for users
worldwide through driving assistance technologies; and
FUTURE PLANS AND USE OF PROCEEDS
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/H11568we plan to continue to upgrade Lion OS, our intelligent cockpit system,
by investing in R&D on hardware and software to establish an automotive
intelligent ecosystem with smooth interaction and rich applications.
Moreover, we plan to continue to enhance smart interaction, infotainment
and mobility experience of our intelligent cockpit system by utilizing
advanced sensors and intelligent software, thereby providing comfort and
technological experience of intelligent cockpit system to global users.
 Approximately 20.0% of the net proceeds, or HK$1,688.2 million, in the next one
to four years, is expected to be used to expand overseas markets and execute our
globalization strategy. In particular,
(i) we will expand our overseas production capacity subject to local market
conditions. We will execute overseas capacity expansion plans at appropriate
time and locations, promoting the deep integration of the industrial chain with
local markets. We plan to utilize approximately HK$1,010.6 million to
establish new production facilities and expand the existing overseas production
facilities in countries including Vietnam or Malaysia to produce passenger
vehicles including models of ICE vehicles and NEVs under OMODA and
JAECOO brand that meet the needs and preferences of local customers. The
designed production capacity for the new production facilities in Vietnam is
19,000 units annually and the additional designed production capacity for the
expansion of the existing production facilities in Malaysia is 36,000 units
annually; and
(ii) we will continue to strengthen our international presence. We plan to increase
the deployment of overseas R&D teams to develop technologies and products
that better align with local driving habits. We plan to recruit 1,000 to 1,500
R&D personnel with bachelor’s degrees or higher and extensive knowledge
and skills in the R&D, design and manufacturing of automobiles at our
overseas R&D centers located in areas including Europe, Southeast Asia and
North America. We will also further improve our global sales and service
network. By conducting multi-channel marketing activities, participating in
exhibitions and through other means, we aim to further promote our brand and
products in international markets such as Europe including Netherlands,
Germany, France, Portugal and Sweden, as well as other international markets
including Southeast Asia, Latin America, the Middle East and Australia, build
broader brand recognition and continuously enhance our global brand equity.
 Approximately 10.0% of the net proceeds, or HK$844.1 million, in the next one to
four years, is expected to be used to upgrade our production facilities in Wuhu,
Anhui province. In particular, we plan to use our existing multiple intelligent
factories with advanced automation, digital integration and Internet-of-things (IoT)
enabled production as a benchmark to upgrade and transform the plants at our Wuhu
production bases into an advanced factory. This will accommodate our rapidly
FUTURE PLANS AND USE OF PROCEEDS
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developing innovative technologies and meet the manufacturing needs of various
new models. We will procure advanced intelligent manufacturing equipment and
integrate it with our continuously evolving manufacturing technologies to enhance
the digitalization and intelligence levels of our production facilities, steadily
improving our production efficiency. For instance, we will deploy visual inspection
system to effectively improve defect detection accuracy and enhance quality
assurance, along with automated assembly systems to ensure more consistent output
while reducing manual operations. With the same designed production capacity, the
upgraded factory will enable us to produce higher-caliber passenger vehicles with
superior quality and better cost-effectiveness.
 Approximately 10.0% of the net proceeds, or HK$844.1 million, is expected to be
used for the working capital and general corporate purposes.
In the event that the Offer Price is set at the maximum Offer Price or the minimum Offer
Price of the indicative Offer Price range, the net proceeds of the Global Offering will increase
or decrease by approximately HK$438.0 million, respectively.
The additional net proceeds that we would receive if the Over-allotment Option is
exercised in full would be (i) HK$1,371.7 million (assuming an Offer Price of HK$30.75 per
H Share, being the maximum Offer Price), (ii) HK$1,304.8 million (assuming an Offer Price
of HK$29.25 per H Share, being the mid-point of the Offer Price range) and (iii) HK$1,237.9
million (assuming an Offer Price of HK$27.75 per H Share, being the minimum Offer Price).
To the extent that the net proceeds from the Global Offering (including the net proceeds
from the exercise of the Over-allotment Option) are either more or less than expected, we may
adjust our allocation of the net proceeds for the above purposes on a pro rata basis.
FUTURE PLANS AND USE OF PROCEEDS
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--- page 455 ---
HONG KONG UNDERWRITERS
China International Capital Corporation Hong Kong Securities Limited
Huatai Financial Holdings (Hong Kong) Limited
GF Securities (Hong Kong) Brokerage Limited
CLSA Limited
BOCI Asia Limited
CMB International Capital Limited
ABCI Securities Company Limited
Futu Securities International (Hong Kong) Limited
UNDERWRITING
This prospectus is published solely in connection with the Hong Kong Public Offering.
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters.
The Global Offering comprises the Hong Kong Public Offering of initially 29,739,700
Hong Kong Offer Shares and the International Offering of initially 267,657,300 International
Offer Shares, subject to, in each case, reallocation on the basis as described in the section
headed “Structure of the Global Offering” as well as the Over-allotment Option (applicable
only to the International Offering).
UNDERWRITING ARRANGEMENTS
Hong Kong Public Offering
Hong Kong Underwriting Agreement
We entered into the Hong Kong Underwriting Agreement with, among others, the Hong
Kong Underwriters on September 16, 2025. Pursuant to the Hong Kong Underwriting
Agreement, we are offering the Hong Kong Offer Shares for subscription by the public in Hong
Kong at the Offer Price on, and subject to, the terms and conditions set out in this prospectus
and the Hong Kong Underwriting Agreement.
Subject to (a) the Listing Committee granting listing of, and permission to deal in, our H
Shares in issue and to be issued pursuant to the Global Offering (including additional H Shares
which may be issued pursuant to the exercise of the Over-allotment Option) and the H Shares
to be converted from Unlisted Shares on the Main Board of the Stock Exchange, and the listing
and permission not having been revoked; and (b) certain other conditions set out in the Hong
Kong Underwriting Agreement, the Hong Kong Underwriters have agreed severally (but not
jointly) to subscribe for, or procure subscribers for, their respective applicable proportions of
the Hong Kong Offer Shares being offered but which are not taken up under the Hong Kong
Public Offering, on the terms and conditions set out in this prospectus and the Hong Kong
Underwriting Agreement.
UNDERWRITING
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If, for any reason, the Offer Price is not agreed between us and the Overall Coordinators
(on behalf of the Underwriters) by 12:00 noon on Tuesday, September 23, 2025, the Global
Offering will not proceed.
The Hong Kong Underwriting Agreement is conditional upon and subject to, among other
things, the International Underwriting Agreement having been entered into, becoming
unconditional and not having been terminated.
Grounds for Termination
The Overall Coordinators (for themselves and on behalf of the Hong Kong Underwriters),
can, in their sole and absolute discretion, by a notice in writing to us, terminate the Hong Kong
Underwriting Agreement with immediate effect if, at any time at or prior to 8:00 a.m. on the
Listing Date:
(a) there develops, occurs, exists or comes into force:
(i) any new law or regulation or any change or development involving a
prospective change in existing laws or regulations, or the interpretation or
application thereof by any court or any competent Authority in or affecting
Hong Kong, the PRC, the United States, the United Kingdom, the European
Union (or any member thereof) or other jurisdictions relevant to the Group or
the Global Offering (each a “ Relevant Jurisdiction ” and collectively, the
“Relevant Jurisdictions ”); or
(ii) any change or development involving a prospective change, or any event or
series of events or circumstances likely to result in a change or prospective
change, in any local, national, regional or international financial, political,
military, industrial, economic, fiscal, legal, regulatory, currency, credit or
market conditions or sentiments, Taxation, equity securities or currency
exchange rate or controls or any monetary or trading settlement system, or
foreign investment regulations (including, without limitation, a devaluation of
the Hong Kong dollar, United States dollar or Renminbi against any foreign
currencies, a change in the system under which the value of the Hong Kong
dollar is linked to that of the United States dollar or the Renminbi is linked to
any foreign currency or currencies) or other financial markets (including,
without limitation, conditions and sentiments in stock and bond markets,
money and foreign exchange markets, the inter-bank markets and credit
markets) in or affecting any Relevant Jurisdictions; or
(iii) any event or series of events, or circumstances in the nature of force majeure
(including, without limitation, any acts of government, declaration of a
regional, national or international emergency or war, calamity, crisis, economic
sanctions, strikes, labor disputes, other industrial actions, lock-outs, fire,
explosion, flooding, tsunami, earthquake, volcanic eruption, civil commotion,
UNDERWRITING
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--- page 457 ---
riots, rebellion, public disorder, paralysis in government operations, acts of
war, epidemic, pandemic, outbreak or escalation, adverse mutation or
aggravation of diseases, interruption or delay in transportation, local, national,
regional or international outbreak or escalation of hostilities (whether or not
war is or has been declared), act of God or act of terrorism (whether or not
responsibility has been claimed)) in or affecting any of the Relevant
Jurisdictions; or
(iv) any moratorium, suspension or limitation (including, without limitation, any
imposition of or requirement for any minimum or maximum price limit or price
range) on the trading in shares or securities generally on the Stock Exchange,
the Shanghai Stock Exchange, the Shenzhen Stock Exchange, the New Y ork
Stock Exchange, the NASDAQ Global Market or the London Stock Exchange;
or
(v) any general moratorium on commercial banking activities in the PRC (imposed
by the People’s Bank of China), Hong Kong (imposed by the Financial
Secretary or the Hong Kong Monetary Authority or other competent authority),
New Y ork (imposed at the U.S. Federal or New Y ork State level or by any other
Authority), London, the European Union (or any member thereof) or any of the
other Relevant Jurisdictions (declared by any relevant competent authority) or
any disruption in commercial banking or foreign exchange trading or securities
settlement or clearing services, procedures or matters in or affecting any of the
Relevant Jurisdictions; or
(vi) other than with the prior written consent of the Overall Coordinators, the issue
or requirement to issue by the Company of a supplement or amendment to the
prospectus or other documents in connection with the offer and sale of the
Offer Shares pursuant to the Companies (Winding up and Miscellaneous
Provisions) Ordinance or the Listing Rules or upon any requirement or request
of the Stock Exchange and/or the SFC; or
(vii) the imposition of sanctions or export controls, in whatever form, directly or
indirectly, on any member of the Group or by or on any Relevant Jurisdiction;
or
(viii) any valid demand by creditors for payment or repayment of indebtedness of the
Company or any of its Major Subsidiaries (as defined in the Hong Kong
Underwriting Agreement) or in respect of which the Company or any of its
Major Subsidiaries is liable prior to its stated maturity; or
UNDERWRITING
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--- page 458 ---
(ix) any non-compliance of the prospectus (or any other documents used in
connection with the contemplated offering, allotment, issue, subscription or
sale of any of the Offer Shares), the CSRC filings or any aspect of the Global
Offering with the Listing Rules or any other applicable laws; or
(x) any litigation, dispute, legal action or claim or regulatory or administrative
investigation or action being threatened, instigated or announced against the
Company or any of its Major Subsidiaries or any Director, Supervisor or senior
management members as named in the prospectus; or
(xi) any contravention by the Company or any Director or Supervisor of the Listing
Rules or applicable laws; or
(xii) that any Director, Supervisor or any member of senior management of the
Company named in the prospectus seeks to retire, or is removed from office or
vacating his/her office; or
(xiii) that any Director, Supervisor or any member of senior management of the
Company named in the prospectus is being charged with an indictable offence
or prohibited by operation of law or otherwise disqualified from taking part in
the management or taking directorship of a company,
which, in any such case individually or in the aggregate, in the sole and absolute
opinion of the Joint Sponsors and the Overall Coordinators (for themselves and on
behalf of the Hong Kong Underwriters): (A) has or will or is likely to have a
material adverse effect, whether directly or indirectly; or (B) has or will or is likely
to have a material adverse effect on the success of the Global Offering or the level
of applications under the Hong Kong Public Offering or the level of indications of
interest under the International Offering; or (C) makes or will make or is likely to
make it impracticable, inadvisable, inexpedient or incapable for any material part of
the Hong Kong Underwriting Agreement, the Hong Kong Public Offering or the
Global Offering to be performed or implemented as envisaged, or for the Hong Kong
Public Offering and/or the Global Offering to proceed, or to market the Global
Offering or the delivery or distribution of the Offer Shares on the terms and in the
manner contemplated by the Offering Documents (as defined in the Hong Kong
Underwriting Agreement); or (D) has or will or may have the effect of making any
part of the Hong Kong Underwriting Agreement (including underwriting) incapable
of performance in accordance with its terms or preventing the processing of
applications and/or payments pursuant to the Global Offering or pursuant to the
underwriting thereof; or
UNDERWRITING
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--- page 459 ---
(b) there comes to the notice of any of the Joint Sponsors and the Overall Coordinators
(for themselves and on behalf of the Hong Kong Underwriters) that:
(i) any statement contained in any of Offering Documents (as defined in the Hong
Kong Underwriting Agreement) and/or any notices, announcements,
advertisements, communications or other documents issued or used by or on
behalf of the Company in connection with the Global Offering (including any
supplement or amendment thereto) (collectively, the “ Global Offering
Documents ”) was, when it was issued, or has become untrue, incorrect,
inaccurate, incomplete or misleading in any material respects; or that any
estimate, forecast, expression of opinion, intention or expectation contained in
any such documents (including any supplement or amendment thereto), was,
when it was issued, or has become unfair or misleading in any material respect
or based on untrue, dishonest or unreasonable assumptions or given in bad
faith; or
(ii) any statement contained in any of the CSRC filings was, when it was issued,
or has become untrue, incorrect, inaccurate, incomplete or misleading; or that
any estimate, forecast, expression of opinion, intention or expectation
contained in the CSRC filings (including any supplement or amendment
thereto), was, when it was issued, or has become unfair or misleading in any
respect or based on untrue, dishonest or unreasonable assumptions or given in
bad faith; or
(iii) any matter has arisen or has been discovered which would, had it arisen or been
discovered immediately before the date of the prospectus, constitute a material
omission or misstatement in any Global Offering Document or the CSRC
filings; or
(iv) any breach of, or any event or circumstance rendering untrue or incorrect or
misleading in any respect, any of the representations, warranties and
undertakings given by the Company in the Hong Kong Underwriting
Agreement or the International Underwriting Agreement (including any
supplement or amendment thereto, as applicable); or
(v) any event, act or omission which gives rise or is likely to give rise to any
liability of any of the Indemnifying Party pursuant to the indemnities in the
Hong Kong Underwriting Agreement or the International Underwriting
Agreement (including any supplement or amendment thereto, as applicable); or
(vi) any material breach of any of the obligations or undertakings imposed upon the
Company under the Hong Kong Underwriting Agreement or the International
Underwriting Agreement; or
UNDERWRITING
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(vii) that the Chairman of the Board is removed from office or vacating his office;
or
(viii) the Company withdraws the prospectus (and/or any other documents used in
connection with the subscription or sale of any of the Offer Shares pursuant to
the Global Offering) or the Global Offering; or
(ix) that the approval by the Listing Committee of the listing of, and permission to
deal in, the H Shares in issue and to be issued pursuant to the Global Offering
(including pursuant to any exercise of the Over-allotment Option) is refused or
not granted, other than subject to customary conditions, on or before the
Listing Date, or if granted, the approval is subsequently withdrawn, cancelled,
qualified (other than by customary conditions), revoked or withheld; or
(x) (A) the notice of acceptance of the CSRC filings issued by the CSRC and/or
the results of the CSRC filings published on the website of the CSRC is
rejected, withdrawn, revoked or invalidated; or (B) other than with the prior
written consent of the Overall Coordinators, the issue or requirement to issue
by the Company of a supplement or amendment to the CSRC filings pursuant
to the CSRC Rules or upon any requirement or request of the CSRC; or (C) any
non-compliance of the CSRC filings with the CSRC Rules or any other
applicable laws; or
(xi) any prohibition on the Company for whatever reason from offering, allotting,
issuing or selling any of the Offer Shares (including H Shares that may be
issued pursuant to the exercise of the Over-allotment Option) pursuant to the
terms of the Global Offering or any prohibition on the Company for whatever
reason from converting any Domestic Unlisted Shares into H Shares upon
completion of the Global Offering; or
(xii) any expert (other than any of the Joint Sponsors) has withdrawn its consent to
the issue of the prospectus with the inclusion of its reports, letters and/or legal
opinions (as the case may be) and references to its name included in the form
and context in which it respectively appears; or
(xiii) an order or petition is presented for the winding-up or liquidation of the
Company, or the Company makes any composition or arrangement with its
creditors or enters into a scheme of arrangement or any resolution is passed for
the winding-up of the Company or a provisional liquidator, receiver or
manager is appointed over all or part of the assets or undertaking of the
Company or anything analogous thereto occurs in respect of the Company; or
(xiv) that (i) a material portion of the orders placed or confirmed in the bookbuilding
process or (ii) any investment commitment made by any cornerstone investors
under the Cornerstone Investment Agreements signed with such cornerstone
UNDERWRITING
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investors, have been withdrawn, terminated or cancelled, as a result of the
payment of the relevant investment amount not being received or settled in the
stipulated time and manner or otherwise.
Indemnity
We have agreed to indemnify the Hong Kong Underwriters for certain losses which they
may suffer or incur, including losses arising from their performance of their obligations under
the Hong Kong Underwriting Agreement and any breach by our Company of the Hong Kong
Underwriting Agreement.
The Hong Kong Underwriters’ Interests in our Company
Save for their respective obligations under the Hong Kong Underwriting Agreement, as
of the Latest Practicable Date, none of the Hong Kong Underwriters was interested directly or
indirectly in any Shares or any securities of any member of our Group or had any right or
option (whether legally enforceable or not) to subscribe for or purchase, or to nominate persons
to subscribe for or purchase, any Shares or any securities of any member of our Group.
The Hong Kong Underwriters and their affiliates may, subject to applicable laws and
regulations and in their ordinary and usual course of business, (i) provide financing in
connection with the subscription for, or purchase of, our securities with security interests over
all or part of such securities subscribed or purchased, and/or (ii) participate in or facilitate the
subscription for, or purchase of, our securities.
UNDERWRITING
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Lock Up Arrangement
Undertakings by our Company to the Hong Kong Stock Exchange pursuant to the Listing
Rules
Pursuant to Rule 10.08 of the Listing Rules, we have undertaken to the Hong Kong Stock
Exchange that we will not exercise our power to issue further Shares, or securities convertible
into Shares (whether or not of a class already listed), or form the subject of any agreement to
such an issue within six months from the Listing Date (whether or not such issue of Shares or
securities will be completed within six months from the Listing Date) except the Offer Shares
to be issued pursuant to the Global Offering (including any additional Shares which may be
issued pursuant to the exercise of the Over-allotment Option), or under any of the
circumstances provided under Rule 10.08 of the Listing Rules.
Undertakings pursuant to the Hong Kong Underwriting Agreement
(A) Undertaking by our Company
Pursuant to the Hong Kong Underwriting Agreement, we have undertaken to each of the
Joint Sponsors, the Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries and the Hong Kong Underwriters that except pursuant to the Conversion of
Domestic Unlisted Shares into H Shares and the Global Offering (including pursuant to the
Over-allotment Option), at any time after the date of this Agreement up to and including the
date falling six months after the Listing Date (the “ First Six Month Period ”), it will not,
without the prior written consent of the Joint Sponsors and the Overall Coordinators (for
themselves and on behalf of the Hong Kong Underwriters) and unless in compliance with the
requirements of the Listing Rules (including pursuant to the exceptions set out in Rule 10.08
of the Listing Rules):
(a) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree
to allot, issue or sell, assign, mortgage, charge, pledge, hypothecate, lend, grant or
sell any option, warrant, contract or right to subscribe for or purchase, grant or
purchase any option, warrant, contract or right to allot, issue or sell, or otherwise
transfer or dispose of or create an Encumbrance over, or agree to transfer or dispose
of or create an Encumbrance over, either directly or indirectly, conditionally or
unconditionally, or repurchase, any legal or beneficial interest in any H Shares or
any other securities of the Company, or any interest in any of the foregoing
(including, without limitation, any securities convertible into or exchangeable or
exercisable for or that represent the right to receive, or any warrants or other rights
to purchase H Shares or other securities of the Company, or any interest in any of
the foregoing, as applicable), or deposit any H Shares or other securities of the
Company, as applicable, with a depositary in connection with the issue of depositary
receipts; or
UNDERWRITING
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(b) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership (legal or beneficial) of any H
Shares or any other securities of the Company, or any interest in any of the foregoing
(including, without limitation, any securities which are convertible into or
exchangeable or exercisable for or that represent the right to receive, or any warrants
or other rights to purchase, any H Shares or other securities of the Company, or any
interest in any of the foregoing); or
(c) enter into any transaction with the same economic effect as any transaction
described in paragraph (a) or (b) above; or
(d) offer to or contract to or agree to announcement, or publicly disclose that the
Company will or may enter into any transaction described in paragraph (a), (b) or
(c) above,
in each case, whether the transaction described in paragraph (a), (b) or (c) above is to be settled
by delivery of H Shares or such other equity securities of ours or in cash or otherwise (whether
or not the allotment or issue of Shares or such other securities of ours will be completed within
the First Six-month Period).
We have undertaken to each of the Joint Sponsors, the Sponsor-Overall Coordinators, the
Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries and the Hong Kong Underwriters that we will,
and our Single Largest Shareholder has undertaken to each of the Joint Sponsors, the
Sponsor-Overall Coordinators, the Overall Coordinators, the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries and the Hong
Kong Underwriters to procure that we will, comply with the minimum public float
requirements (the “ Minimum Public Float Requirement ”) and the minimum free float
requirements (the “ Minimum Free Float Requirement ”) specified in the Listing Rules. In
addition, we have undertaken to each of the Joint Sponsors, the Sponsor-Overall Coordinators,
the Overall Coordinators, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries and the Hong Kong Underwriters that we will not
(a) effect any purchase of the H Shares, or agree to do so, which may reduce the holdings of
the H Shares held by the public (as defined in Rule 8.24 of the Listing Rules) to below the
Minimum Public Float Requirement or any waiver granted and not revoked by the Stock
Exchange prior to the expiration of the First Six Month Period without first having obtained
the prior written consent of the Joint Sponsors and the Overall Coordinators (for themselves
and on behalf of the Hong Kong Underwriters); or (b) enter into any agreement, arrangement
or transaction which shall cause or have the effect of causing the portion of the H Shares that
are held by the public and that are available for trading and not subject to any disposal
restrictions whether under contract, the Listing Rules, applicable Laws or otherwise) on the
Listing Date to fall below the Minimum Free Float Requirement under Rule 8.08A of the
Listing Rules (as amended and replaced by Rule 19A.13C of the Listing Rules).
UNDERWRITING
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International Offering
International Underwriting Agreement
In connection with the International Offering, we expect to enter into the International
Underwriting Agreement with, among others, the International Underwriters on the Price
Determination Date. Under the International Underwriting Agreement, the International
Underwriters would, subject to certain conditions, severally (but not jointly) agree to purchase
or procure purchasers for the International Offer Shares initially offered pursuant to the
International Offering. It is expected that the International Underwriting Agreement may be
terminated on grounds similar to those contained in the Hong Kong Underwriting Agreement.
See the subsection headed “Structure of the Global Offering — The International Offering” for
further details.
Over-allotment Option
We intend to grant to the International Underwriters the Over-allotment Option,
exercisable in whole or in part, at the sole and absolute discretion of the Overall Coordinators
on behalf of the International Underwriters from the Listing Date until 30 days from the last
day permitted for the making of applications under the Hong Kong Public Offering, pursuant
to which we may be required to allot and issue up to an aggregate of 44,609,500 additional H
Shares, representing 15.0% of the number of Offer Shares initially available under the Global
Offering at the Offer Price to cover over-allocations in the International Offering, if any. See
the subsection headed “Structure of the Global Offering — Over-allotment Option” for details.
COMMISSION AND EXPENSES
The Underwriters will receive an underwriting commission of 0.9% of the aggregate
Offer Price of all the Offer Shares (including any Offer Shares to be issued pursuant to the
exercise of the Over-allotment Option). For unsubscribed Hong Kong Offer Shares reallocated
to the International Offering, the underwriting commission will not be paid to the Hong Kong
Underwriters but will instead be paid to the International Underwriters. In addition, the
Underwriters may receive a discretionary incentive fee of up to 0.9% of the aggregate Offer
Price of all the Offer Shares (including any Offer Shares to be issued pursuant to the exercise
of the Over-allotment Option). The ratio of fixed fees and discretionary fees payable by the
Company to the Underwriters is expected to be approximately 36.11: 63.89 (assuming the
discretionary incentive fee is paid in full).
UNDERWRITING
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Assuming the Over-allotment Option is not exercised at all, and based on an Offer Price
of HK$29.25 per H Share (being the mid-point of the indicative Offer Price range), the
aggregate commissions and fees, together with the Stock Exchange listing fees, the SFC
transaction levy, the AFRC transaction levy, the Hong Kong Stock Exchange trading fee, legal
and other professional fees and printing and other expenses relating to the Global Offering to
be borne by the Company are estimated to amount to approximately RMB235 million in
aggregate.
JOINT SPONSORS’ FEE
A fee of HK$1,333,300 is payable by the Company as sponsor fees to each Joint Sponsor.
JOINT SPONSORS’ INDEPENDENCE
Each Joint Sponsor satisfies the independence criteria set out in Rule 3A.07 of the Listing
Rules.
ACTIVITIES BY UNDERWRITERS
Each of the Underwriters and their respective affiliates may individually undertake a
variety of activities which do not form part of the underwriting or stabilizing process.
The Underwriters and their respective affiliates are diversified financial institutions with
relationships in countries around the world. These entities engage in a wide range of
commercial and investment banking, brokerage, funds management, trading, hedging,
investing and other activities for their own account and for the account of others. In the
ordinary course of their business activities, the Underwriters and their respective affiliates may
purchase, sell or hold a broad array of investments and actively trade securities, derivatives,
loans, commodities, currencies, credit default swaps and other financial instruments for their
own account and for the accounts of their customers. These investment and trading activities
may involve or relate to our assets, securities and/or instruments and/or persons and entities
with relationships with us and may also include swaps and other financial instruments entered
into for hedging purposes in connection with our loans and other debt.
In relation to our H Shares, the activities of the Underwriters and their respective
affiliates may include acting as agent for buyers and sellers of our H Shares, entering into
transactions with those buyers and sellers in a principal capacity, including as a lender to initial
purchasers of our H Shares (whose financing may be secured by our H Shares) in the Global
Offering, proprietary trading in our H Shares, and entering into over the counter or listed
derivative transactions or listed or unlisted securities transactions (including issuing securities
such as derivative warrants listed on a stock exchange) which have as their underlying assets,
assets including our H Shares. Such transactions may be carried out as bilateral agreements or
trades with selected counterparties. Those activities may require hedging activity by those
entities involving, directly or indirectly, the buying and selling of our H Shares, which may
have a negative impact on the trading price of our H Shares. All such activities may take place
UNDERWRITING
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in Hong Kong and elsewhere in the world and may result in the Underwriters and their
respective affiliates holding long and/or short positions in our H Shares, in baskets of securities
or indices including our H Shares, in units of funds that may purchase our H Shares, or in
derivatives related to any of the foregoing.
In relation to issues by the Underwriters or their respective affiliates of any listed
securities having our H Shares as their underlying securities, whether on the Hong Kong Stock
Exchange or on any other stock exchange, the rules of the stock exchange may require the
issuer of those securities (or one of its affiliates or agents) to act as a market maker or liquidity
provider in the security, and this will also result in hedging activity in our H Shares in most
cases.
All these activities may occur both during and after the end of the stabilizing period
described in the section headed “Structure of the Global Offering.” Such activities may affect
the market price or value of our H Shares, the liquidity or trading volume in our H Shares and
the volatility of the price of our H Shares, and the extent to which this occurs from day to day
cannot be estimated.
It should be noted that when engaging in any of these activities, the Underwriters and
their respective affiliates will be subject to certain restrictions, including the following:
(a) the Underwriters and their respective affiliates (other than the Stabilizing Manager
or any person acting for it) must not, in connection with the distribution of the Offer
Shares, effect any transactions (including issuing or entering into any option or other
derivative transactions relating to the Offer Shares), whether in the open market or
otherwise, with a view to stabilizing or maintaining the market price of any of the
Offer Shares at levels other than those which might otherwise prevail in the open
market; and
(b) the Underwriters and their respective affiliates must comply with all applicable laws
and regulations, including the market misconduct provisions of the SFO, including
the provisions prohibiting insider dealing, false trading, price rigging and stock
market manipulation.
Some of the Underwriters or their respective affiliates have provided from time to time
and are expected to provide to our Group investment banking and other services in the future
for which the Underwriters or their respective affiliates have received or will receive
customary fees and commissions.
In addition, the Underwriters or their respective affiliates may provide financing to
investors to finance their subscriptions of Offer Shares in the Global Offering.
UNDERWRITING
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THE GLOBAL OFFERING
The Global Offering consists of (subject to reallocation and the Over-allotment Option as
described below):
(a) the Hong Kong Public Offering of initially 29,739,700 H Shares as described below
under “— The Hong Kong Public Offering”; and
(b) the International Offering of initially 267,657,300 H Shares outside the United
States (including to professional and institutional investors in Hong Kong) in
offshore transactions in reliance on Regulation S, as described below under the
subsection headed “— The International Offering.”
Investors may either apply for our H Shares under the Hong Kong Public Offering; or
apply for or indicate an interest, if qualified to do so, for our H Shares under the International
Offering, but may not do both.
The Offer Shares will represent approximately 5.2% of the total Shares in issue
immediately following the completion of the Global Offering (assuming that the Over-
allotment Option is not exercised). If the Over-allotment Option is exercised in full, the Offer
Shares will represent approximately 5.9% of the total Shares in issue immediately following
the completion of the Global Offering.
UNDERWRITING ARRANGEMENTS
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters
under the terms of the Hong Kong Underwriting Agreement, subject to agreement on the Offer
Price between us and the Overall Coordinators (on behalf of the Underwriters) on or around
the Price Determination Date and subject to the other conditions set out in the subsection
headed “— Conditions of the Global Offering.”
We expect to enter into the International Underwriting Agreement relating to the
International Offering on or about the Price Determination Date.
The underwriting arrangements, the Hong Kong Underwriting Agreement and the
International Underwriting Agreement are summarized in the section headed “Underwriting.”
STRUCTURE OF THE GLOBAL OFFERING
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THE HONG KONG PUBLIC OFFERING
Number of H Shares Initially Offered
We are initially offering 29,739,700 H Shares at the Offer Price for subscription by the
public in Hong Kong, representing approximately (i) 10% of the 297,397,000 H Shares initially
made available under the Global Offering and (ii) 0.52% of the total Shares in issue
immediately following the completion of the Global Offering (subject to the reallocation of
Offer Shares between the International Offering and the Hong Kong Public Offering and
assuming the Over-allotment Option is not exercised).
Allocation
Allocation of H Shares to investors under the Hong Kong Public Offering will be based
solely on the level of valid applications received under the Hong Kong Public Offering. The
basis of allocation may vary, depending on the number of Hong Kong Offer Shares validly
applied for by applicants. The allocation of Hong Kong Offer Shares could, where appropriate,
consist of balloting, which would mean that some applicants may receive a higher allocation
than others who have applied for the same number of Hong Kong Offer Shares, and those
applicants who are not successful in the ballot may not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of Hong Kong Offer Shares available under
the Hong Kong Public Offering (after taking into account any reallocation referred to below)
will be divided equally (to the nearest board lot) into two pools: Pool A and Pool B (with any
odd lots being allocated to pool A).
 Pool A : The Hong Kong Offer Shares in Pool A will be allocated on an equitable
basis to applicants who have applied for Hong Kong Offer Shares with a total price
of HK$5 million or less (excluding the brokerage fee, the SFC transaction levy, the
AFRC transaction levy and the Hong Kong Stock Exchange trading fee).
 Pool B : The Hong Kong Offer Shares in Pool B will be allocated on an equitable
basis to applicants who have applied for Hong Kong Offer Shares with a total price
of more than HK$5 million and up to the total value of Pool B (excluding the
brokerage fee, the SFC transaction levy, the AFRC transaction levy and the Hong
Kong Stock Exchange trading fee).
For the purpose of the immediately preceding paragraph only, the “price” for the Hong
Kong Offer Shares means the price payable on application. See the subsection headed “—
Pricing — Price Payable on Application.”
Applicants should be aware that applications in Pool A and Pool B are likely to receive
different allocation ratios. If Hong Kong Offer Shares in one pool (but not both pools) are
undersubscribed, the unsubscribed Hong Kong Offer Shares will be transferred to the other
pool to satisfy demand in that other pool and be allocated accordingly.
STRUCTURE OF THE GLOBAL OFFERING
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Applicants can only receive an allocation of Hong Kong Offer Shares from either Pool A
or Pool B but not from both pools. Multiple or suspected multiple applications and any
application for more than 14,869,800 Hong Kong Offer Shares (being 50% of the H Shares
initially made available under the Hong Kong Public Offering) will be rejected.
Reallocation
The Offer Shares to be offered in the Hong Kong Public Offering and the International
Offering may, in certain circumstances, be reallocated as between these offerings at the
discretion of the Overall Coordinators. Subject to the allocation cap described in the
subsequent paragraph, the Overall Coordinators may in their discretion reallocate Offer Shares
from the International Offering to the Hong Kong Public Offering to satisfy valid applications
under the Hong Kong Public Offering in accordance with the guidance in Chapter 4.14 of the
Guide for New Listing Applicants. In addition, if the Hong Kong Public Offering is not fully
subscribed, the Overall Coordinators will have the discretion (but shall not be under any
obligation) to reallocate to the International Offering all or any unsubscribed Hong Kong Offer
Shares in such amounts as they deem appropriate.
If: (i) the International Offer Shares are undersubscribed and the Hong Kong Offer Shares
are fully subscribed or oversubscribed irrespective of the number of times; or (ii) the
International Offer Shares are fully subscribed or oversubscribed and the Hong Kong Offer
Shares are fully subscribed or oversubscribed irrespective of the number of times, up to
14,869,800 Offer Shares may be reallocated to the Hong Kong Public Offering from the
International Offering, so that the total number of the Offer Shares available under the Hong
Kong Public Offering following such reallocation will be increased to 44,609,500 Offer Shares,
representing approximately 15% of the number of the Offer Shares initially available under the
Global Offering (before exercise of the Over-allotment Option), and the final Offer Price shall
be fixed at the bottom end of the indicative Offer Price range (i.e. HK$27.75 per Offer Share).
In addition, the Overall Coordinators may reallocate Offer Shares from the International
Offering to the Hong Kong Public Offering to satisfy valid applications under the Hong Kong
Public Offering, in such proportions as the Overall Coordinators may, in their sole and absolute
discretion, determine.
Given the initial allocation of the Offer Shares to the Hong Kong Public Offering and the
International Offering follows the provision of Paragraph 4.2(b) of Practice Note 18 of the
Listing Rules, no mandatory clawback or reallocation mechanism is required to increase the
number of Offer Shares under the Hong Kong Public Offering to a certain percentage of the
total number of Offer Shares offered under the Global Offering.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 470 ---
Details of any reallocation of Offer Shares between the Hong Kong Public Offering and
the International Offering will be disclosed in the results announcement of the Global Offering
expected to be published on Wednesday, September 24, 2025.
Applications
Each applicant under the Hong Kong Public Offering must give an undertaking and
confirmation in the application submitted by that applicant that he/she/it and any person(s) for
whose benefit the applicant is making the application have not applied for or taken up, or
indicated an interest for, and will not apply for or take up, or indicate an interest for, any
International Offer Shares under the International Offering, and that applicant’s application is
liable to be rejected if either or both of the undertaking and confirmation are breached or untrue
(as the case may be) or the applicant has been or will be placed or allocated International Offer
Shares under the International Offering.
THE INTERNATIONAL OFFERING
Number of H Shares Initially Offered
We are initially offering 267,657,300 H Shares at the Offer Price for subscription or sale
under the International Offering, representing approximately 90% of the 297,397,000 H Shares
initially made available under the Global Offering. Subject to the reallocation of the Offer
Shares between the International Offering and the Hong Kong Public Offering, the number of
H Shares initially offered under the International Offering will represent approximately 4.64%
of the total Shares in issue immediately following the completion of the Global Offering
(assuming the Over-allotment Option is not exercised).
Allocation
The International Offering will include selective marketing of Offer Shares to
institutional and professional investors and other investors anticipated to have a sizeable
demand for the Offer Shares in Hong Kong and other jurisdictions outside the United States in
reliance on Regulation S. Professional investors generally include brokers, dealers, companies
(including fund managers) whose ordinary business involves dealing in shares and other
securities and corporate entities that regularly invest in shares and other securities.
Allocation of Offer Shares under the International Offering will be effected in accordance
with the “book-building” process described in the subsection headed “— Pricing —
Determining the Offer Price” and based on a number of factors, including the level and timing
of demand, total size of the relevant investor’s invested assets or equity assets in the relevant
sector and whether or not it is expected that that investor is likely to buy further H Shares,
and/or hold or sell its H Shares, after the Listing. This basis of allocation is intended to result
in a distribution of the Offer Shares which is likely to lead to the establishment of a solid and
stable professional and institutional shareholder base to the benefit of our Group and our
Shareholders as a whole.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 471 ---
The Overall Coordinators (on behalf of the Underwriters) may require an investor who
has been offered (or has indicated an interest for) Offer Shares under the International Offering
and who has made an application under the Hong Kong Public Offering to provide sufficient
information to the Overall Coordinators so as to allow it to identify the relevant applications
under the Hong Kong Public Offering and to ensure that they are excluded from any allocation
of Offer Shares under the International Offering.
Reallocation
The total number of Offer Shares to be issued or sold pursuant to the International
Offering may change as a result of any reallocation of Offer Shares between the Hong Kong
Public Offering and the International Offering as described in the subsection headed “— The
Hong Kong Public Offering — Reallocation”, and the exercise of the Over-allotment Option
in whole or in part as described in the subsection headed “— Over-allotment Option.”
PRICING
Offer Price Range
The Offer Price will be not more than HK$30.75 per H Share and is expected to be not
less than HK$27.75 per H Share, unless otherwise announced, as explained below.
Price Payable on Application
Applicants for Hong Kong Offer Shares may be required to pay, on application (subject
to application channel), the maximum Offer Price per Hong Kong Offer Share plus the
brokerage fee of 1.0%, the SFC transaction levy of 0.0027%, the AFRC transaction levy of
0.00015% and the Hong Kong Stock Exchange trading fee of 0.00565%, amounting to a total
of HK$3,106.00 for one board lot of 100 H Shares. Applicants should be aware that the
Offer Price to be determined on the Price Determination Date may be, but is not expected
to be, lower than the Minimum Offer Price .
If the Offer Price is less than the maximum Offer Price of HK$30.75 per Offer Share,
appropriate refund payments (including the brokerage fee, the SFC transaction levy, the AFRC
transaction levy and the Hong Kong Stock Exchange trading fee attributable to the surplus
application monies) will be made to successful applicants. See the subsection headed “How to
Apply for the Hong Kong Offer Shares — Despatch/Collection of H Share Certificates and
Refund of Application Monies.”
STRUCTURE OF THE GLOBAL OFFERING
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Determining the Offer Price
The International Underwriters are soliciting from prospective investors indications of
interest in acquiring our H Shares in the International Offering. Prospective investors will be
required to specify the number of International Offer Shares under the International Offering
they would be prepared to acquire either at different prices or at a particular price. This
process, known as “book-building”, is expected to continue up to, but to cease on or around,
the Price Determination Date.
The Offer Price is expected to be fixed by agreement between the Overall Coordinators
(on behalf of the Underwriters) and us, on the Price Determination Date, when market demand
for the Offer Shares will be determined. The Price Determination Date is expected to be on or
before Tuesday, September 23, 2025 (Hong Kong time) and, in any event, not later than 12:00
noon on Tuesday, September 23, 2025 (Hong Kong time).
Reduction in Offer Price Range and/or Number of Offer Shares
The Overall Coordinators (on behalf of the Underwriters) may, based on the level of
interest expressed by prospective investors during the book-building process in respect of the
International Offering, and with our consent, reduce the indicative Offer Price range and/or the
number of Offer Shares below that stated in this prospectus at any time on or before the
morning of the last day for making applications under the Hong Kong Public Offering. In this
case, we will as soon as practicable after the decision to make the reduction (and no later than
the morning of the last day for making applications under the Hong Kong Public Offering)
publish on the website of the Hong Kong Stock Exchange at www.hkexnews.hk and our
website at www.chery-auto.com notice of the reduction, the cancellation of the Global
Offering and the relaunch of the Global Offering at the revised number of Offer Shares and/or
the revised Offer Price. This notice will also include confirmation or revision, as appropriate,
of the working capital statement and the Global Offering statistics as set out in this prospectus,
as well as any other financial information which may change as a result of the reduction.
We will, as soon as practicable following the decision to make the reduction, in addition
to publishing the notice, issue a supplemental prospectus containing details in relation to the
change in the number of Offer Shares being offered and/or the indicative Offer Price range. The
Global Offering will be cancelled and subsequently relaunched on FINI pursuant to the
supplemental prospectus.
Before making applications for the Hong Kong Offer Shares, applicants should have
regard to the possibility that any announcement of a reduction in the indicative Offer Price
range and/or number of Offer Shares may not be made until the day which is the last day for
making applications under the Hong Kong Public Offering.
In the absence of a notice of reduction, the number of Offer Shares will not be reduced
and the Offer Price, if agreed upon between us and the Overall Coordinators (on behalf of the
Underwriters), will not be set outside the indicative Offer Price range.
STRUCTURE OF THE GLOBAL OFFERING
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Announcement of the Offer Price and Basis of Allocations
The Offer Price, level of applications in the Hong Kong Public Offering, level of
indications of interest in the International Offering, and basis of allocations of the Hong Kong
Offer Shares are expected to be made available through a variety of channels in the manner
described in the subsection headed “How to Apply for the Hong Kong Offer Shares —
Publication of Results.”
OVER-ALLOCATION
Following any over-allocation of H Shares in connection with the Global Offering, the
Stabilizing Manager (or any person acting for it) may cover the over-allocation by exercising
the Over-allotment Option in full or in part, or by using H Shares purchased by the Stabilizing
Manager (or any person acting for it) in the secondary market at prices that do not exceed the
Offer Price or a combination of these means.
OVER-ALLOTMENT OPTION
In connection with the Global Offering, we may grant the Over-allotment Option to the
International Underwriters, exercisable by the Overall Coordinators in their sole and absolute
discretion on behalf of the International Underwriters.
Pursuant to the Over-allotment Option (if granted), the International Underwriters have
the right, exercisable by the Overall Coordinators (in their sole and absolute discretion on
behalf of the International Underwriters) at any time from the Listing Date until 30 days from
the last day for the making of applications under the Hong Kong Public Offering (being the last
day for the exercise of the Over-allotment Option, which is Wednesday, October 22, 2025), to
require us to allot and issue up to 44,609,500 additional Offer Shares representing not more
than 15% of the total number of Offer Shares initially available under the Global Offering, at
the Offer Price, to cover over-allocations in the International Offering.
If the Over-allotment Option is exercised in full, the additional Offer Shares will
represent approximately 0.77% of the total number of Shares in issue immediately following
completion of the Global Offering and the exercise of the Over-allotment Option. We will make
an announcement if the Over-allotment Option is exercised.
STABILIZATION
Stabilization is a practice used by underwriters in some markets to facilitate the
distribution of securities. To stabilize, the underwriters may bid for, or purchase, the securities
in the secondary market, during a specified period of time, to retard, and if possible, prevent
a decline in the market price of the securities below the Offering Price. These transactions may
be effected in jurisdictions where it is permitted to do so, in each case in compliance with all
applicable laws and regulatory requirements, including those in Hong Kong. In Hong Kong, the
price at which stabilization is effected cannot exceed the offer price of shares.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 474 ---
In connection with the Global Offering, the Stabilizing Manager (or any person acting for
it), on behalf of the Underwriters, may over-allocate or effect short sales or any other
stabilizing transactions with a view to stabilizing or maintaining the market price of our H
Shares at a level higher than that which might otherwise prevail in the open market. However,
there is no obligation on the Stabilizing Manager to conduct any stabilizing activity. Stabilizing
actions, if taken, (a) will be conducted at the absolute discretion of the Stabilizing Manager (or
any person acting for it) and in what the Stabilizing Manager reasonably regards as being in
our best interest, (b) may be discontinued at any time and (c) is required to end within 30 days
of the last day for making applications under the Hong Kong Public Offering.
Stabilizing activities permitted in Hong Kong pursuant to the Securities and Futures
(Price Stabilizing) Rules (Chapter 571W of the Laws of Hong Kong) include (a) over-
allocation for the purpose of preventing or minimising any reduction in the market price of our
H Shares, (b) selling or agreeing to sell our H Shares so as to establish a short position in them
for the purpose of preventing or minimising any reduction in the market price of our H Shares,
(c) subscribing, or agreeing to subscribe, for our H Shares pursuant to the Over-allotment
Option in order to close out any position established under (a) or (b), (d) purchasing, or
agreeing to purchase, our H Shares for the sole purpose of preventing or minimising any
reduction in the market price of our H Shares, (e) selling or agreeing to sell our H Shares to
liquidate a long position held as a result of those purchases and (f) offering or attempting to
do anything described in (b), (c), (d) or (e).
Specifically, applicants for and investors in the Offer Shares should note that:
(a) as a result of effecting transactions to stabilize or maintain the market price of our
H Shares, the Stabilizing Manager (or any person acting for it) may maintain a long
position in our H Shares;
(b) the size of the long position, and the period for which the Stabilizing Manager (or
any person acting for it) will maintain the long position is at the discretion of the
Stabilizing Manager and is uncertain;
(c) liquidation of any long position by the Stabilizing Manager (or any person acting for
it) and selling in the open market may have an adverse impact on the market price
of our H Shares;
(d) stabilizing action by the Stabilizing Manager (or any person acting for it) is not
permitted to support the price of our H Shares for longer than the stabilizing period,
which begins on the Listing Day and ends on Wednesday, October 22, 2025 (being
the 30th day after the last day for making applications under the Hong Kong Public
Offering). As a result, demand for our H Shares, and their market price, may fall
after the end of the stabilizing period;
STRUCTURE OF THE GLOBAL OFFERING
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--- page 475 ---
(e) stabilizing activities by the Stabilizing Manager (or any person acting for it) may
stabilize, maintain or otherwise affect the market price of our H Shares. This means
the price of our H Shares may be higher than the price that otherwise might exist in
the open market;
(f) there is no assurance that the price of our H Shares can stay at or above the Offer
Price by the taking of any stabilizing action either during or after the stabilizing
period; and
(g) bids for or market purchases of our H Shares by the Stabilizing Manager (or any
person acting for it) may be made at a price at or below the Offer Price and therefore
at or below the price paid for our H Shares by purchasers.
In order to effect stabilization actions, the Stabilizing Manager will arrange cover of up
to an aggregate of 44,609,500 H Shares, representing up to 15% of the initial Offer Shares,
through delayed delivery arrangements with investors who have been allocated Offer Shares in
the International Offering. The delayed delivery arrangements (if specifically agreed by an
investor) relate only to the delay in the delivery of the Offer Shares to such investor and the
Offer Price for the Offer Shares allocated to such investor will be paid on the Listing Date.
Both the size of such cover and the extent to which the Over-allotment Option can be exercised
will depend on whether arrangements can be made with investors such that a sufficient number
of H Shares can be delivered on a delayed basis. If no investor in the International Offering
agrees to the delayed delivery arrangements, no stabilizing actions will be undertaken by the
Stabilizing Manager and the Over-allotment Option will not be exercised.
We will make an announcement in compliance with the Securities and Futures (Price
Stabilizing) Rules (Chapter 571W of the Laws of Hong Kong) within seven days of the
expiration of the stabilizing period.
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of applications for the Hong Kong Offer Shares will be conditional on:
(a) the Listing Committee granting approval for the listing of, and permission to deal in,
our H Shares in issue and to be issued pursuant to the Global Offering (including any
additional H Shares which may be issued pursuant to the exercise of the
Over-allotment Option) on the Main Board of the Hong Kong Stock Exchange as
described in this prospectus and the approval not having been withdrawn, canceled
or revoked;
(b) the execution and delivery of the International Underwriting Agreement on or
around the Price Determination Date;
(c) the Offer Price having been agreed between us and the Overall Coordinators (on
behalf of the Underwriters); and
STRUCTURE OF THE GLOBAL OFFERING
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--- page 476 ---
(d) the obligations of the Underwriters under both the Hong Kong Underwriting
Agreement and the International Underwriting Agreement having become
unconditional and not having been terminated in accordance with their respective
terms,
in each case on or before the dates and times specified in the respective Underwriting
Agreements (unless and to the extent such conditions are waived on or before such dates and
times).
The consummation of each of the Hong Kong Public Offering and the International
Offering is conditional upon, among others, the other becoming unconditional and not having
been terminated in accordance with their terms.
If the above conditions are not fulfilled or waived before the dates and times specified,
the Global Offering will not proceed and will lapse, and the Hong Kong Stock Exchange will
be notified immediately. We will publish a notice of the lapse of the Hong Kong Public
Offering on the website of the Hong Kong Stock Exchange at www.hkexnews.hk and our
website at www.chery-auto.com on the next Business Day following the lapse. In this case, all
application monies will be returned, without interest, on the terms set out in the subsection
headed “How to Apply for the Hong Kong Offer Shares — Despatch/Collection of H Share
Certificates and Refund of Application Monies.” In the meantime, the application monies will
be held in separate accounts with the receiving banks or other bank(s) in Hong Kong licensed
under the Banking Ordinance (Chapter 155 of the Laws of Hong Kong).
If, for any reason, we and the Overall Coordinators (on behalf of the Underwriters) are
unable to reach agreement on the Offer Price by 12:00 noon on the Price Determination Date,
the Global Offering will not proceed and will lapse.
H Share certificates for the Offer Shares are expected to be issued on Wednesday,
September 24, 2025, but they will only become valid evidence of title at 8:00 a.m. on Thursday,
September 25, 2025, provided the Global Offering has become unconditional in all respects at
or before that time.
DEALING ARRANGEMENTS
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00
a.m. in Hong Kong on Thursday, September 25, 2025, it is expected that dealings in our H
Shares on the Hong Kong Stock Exchange will commence at 9:00 a.m. on Thursday, September
25, 2025.
Our H Shares will be traded in board lots of 100 H Shares each and the stock code of our
H Shares will be 9973.
STRUCTURE OF THE GLOBAL OFFERING
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--- page 477 ---
IMPORTANT NOTICE TO INVESTORS OF HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering and below are the procedures for application.
This prospectus is available at the website of the Hong Kong Stock Exchange at
www.hkexnews.hk under the “ HKEXnews > New Listings > New Listing Information ”
section, and our website at www.chery-auto.com.
The contents of this prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance.
APPLICATIONS FOR THE HONG KONG OFFER SHARES
1. Who can apply
Y ou can apply for Hong Kong Offer Shares if you or the person(s) for whose benefit you
are applying:
 are 18 years of age or older;
 have a Hong Kong address (for the White Form eIPO service only);
 are outside the United States (within the meaning of Regulation S), and are a person
described in paragraph (h)(3) of Rule 902 of Regulation S; and
 are not a legal or natural person (except qualified domestic institutional investors)
of the People’s Republic of China.
Unless permitted by the Listing Rules, you cannot apply for any Hong Kong Offer Shares
if you or the person(s) for whose benefit you are applying for:
 are an existing holder or beneficial owner of our Shares and/or a substantial
shareholder of any of our subsidiaries;
 are our director, supervisor or chief executive officer of ours and/or any of our
subsidiaries;
 are a close associate of any of the above persons;
 are our connected person or will become our connected person immediately upon
completion of the Global Offering; or
 have been allocated or have applied for any International Offer Shares or otherwise
participate in the International Offering.
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--- page 478 ---
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 a.m. on Wednesday,
September 17, 2025 and end at 12:00 noon on Monday, September 22, 2025 (Hong Kong
time).
To apply for Hong Kong Offer Shares, you may use one of the following application
channels:
Application
Channel Platform Target Investors Application Time
White Form
eIPO
service /H1118/H1118/H1118/H1118
www.eipo.com.hk
Investors who would
like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in your
own name.
From 9:00 a.m. on
Wednesday,
September 17, 2025
to 11:30 a.m.,
Monday,
September 22, 2025,
Hong Kong time.
The latest time for
completing full
payment of
application monies
will be 12:00 noon
on Monday,
September 22, 2025,
Hong Kong time.
HKSCC
EIPO
channel /H1118/H1118/H1118
Y our broker or
custodian who is an
HKSCC Participant
will submit
electronic
application
instructions on your
behalf through
HKSCC’s FINI
system in
accordance with
your instruction.
Investors who would
not like to receive a
physical H Share
certificate. Hong
Kong Offer Shares
successfully applied
for will be allotted
and issued in the
name of HKSCC
Nominees, deposited
directly into CCASS
and credited to your
designated HKSCC
Participant’s stock
account.
Contact your broker or
custodian for the
earliest and latest
time for giving such
instructions, as this
may vary by broker
or custodian.
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--- page 479 ---
The White Form eIPO service and the HKSCC EIPO channel are facilities subject to
capacity limitations and potential service interruptions and you are advised not to wait until the
last day of the application period to apply for Hong Kong Offer Shares.
For those applying through the White Form eIPO service, once you complete payment
in respect of any application instructions given by you or for your benefit through the White
Form eIPO service to make an application for Hong Kong Offer Shares, an actual application
shall be deemed to have been made. If you are a person for whose benefit the electronic
application instructions are given, you shall be deemed to have declared that only one set of
electronic application instructions has been given for your benefit. If you are an agent for
another person, you shall be deemed to have declared that you have only given one set of
electronic application instructions for the benefit of the person for whom you are an agent
and that you are duly authorized to give those instructions as an agent.
For the avoidance of doubt, giving an application instruction under the White Form eIPO
service more than once and obtaining different application reference numbers without effecting
full payment in respect of a particular reference number will not constitute an actual
application.
If you apply through the White Form eIPO service, you are deemed to have authorized
the White Form eIPO Service Provider to apply on the terms and conditions in this
prospectus, as supplemented and amended by the terms and conditions of the White Form
eIPO service.
By instructing your broker or custodian to apply for the Hong Kong Offer Shares on your
behalf through the HKSCC EIPO channel, you (and, if you are joint applicants, each of you
jointly and severally) are deemed to have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC Participants) to apply for Hong Kong
Offer Shares on your behalf and to do on your behalf all the things stated in this prospectus
and any supplement to it.
For those applying through HKSCC EIPO channel, an actual application will be deemed
to have been made for any application instructions given by you or for your benefit to HKSCC
(in which case an application will be made by HKSCC Nominees on your behalf) provided such
application instruction has not been withdrawn or otherwise invalidated before the closing time
of the Hong Kong Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor
HKSCC Nominees shall be liable to you or any other person in respect of any actions taken by
HKSCC or HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any
breach of the terms and conditions of this prospectus.
Only one application may be made for the benefit of any person. If you are suspected of
making more than one application through the White Form eIPO service or any other channel,
all of your applications are liable to be rejected.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 480 ---
3. Information Required to Apply
Y ou must provide the following information with your application:
For Individual/Joint Applicants For Corporate Applicants
 Full name(s) (2) as shown on your
identity document
 Full name(s) (2) as shown on your
identity document
 Identity document’s issuing country
or jurisdiction
 Identity document’s issuing country
or jurisdiction
 Identity document type, with order
of priority:
 Identity document type, with order
of priority:
i. HKID card; or i. LEI registration document; or
ii. National identification
document; or
iii. Passport; and
 Identity document number
ii. Certificate of incorporation; or
iii. Business registration
certificate; or
iv. Other equivalent document; and
 Identity document number
Notes:
(1) If you are applying through the White Form eIPO service, you are required to provide a valid e-mail
address, a contact telephone number and a Hong Kong address. Y ou are also required to declare that the
identity information provided by you follows the requirements as described in Note 2 below. In
particular, where you cannot provide a HKID number, you must confirm that you do not hold a HKID
card.
(2) The applicant’s full name as shown on their identity document must be used and the surname, given
name, middle and other names (if any) must be input in the same order as shown on the identity
document. If an applicant’s identity document contains both an English and Chinese name, both English
and Chinese names must be used. Otherwise, either English or Chinese names will be accepted. The
order of priority of the applicant’s identity document type must be strictly followed and where an
individual applicant has a valid HKID card (including both Hong Kong Residents and Hong Kong
Permanent Residents), the HKID number must be used when making an application to subscribe for
shares in a public offer. Similarly for corporate applicants, a LEI number must be used if an entity has
a LEI certificate.
(3) If the applicant is a trustee, the client identification data (“ CID”) of the trustee, as set out above, will
be required. If the applicant is an investment fund (i.e. a collective investment scheme, or CIS), the CID
of the asset management company or the individual fund, as appropriate, which has opened a trading
account with the broker will be required, as above.
(4) The maximum number of joint applicants on FINI is capped at four
1 in accordance with market practice.
1 Subject to change, if the Company’s Articles and applicable company law prescribe a lower cap.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 481 ---
(5) If you are applying as a nominee, you must provide: (i) the full name (as shown on the identity
document), the identity document’s issuing country or jurisdiction, the identity document type; and (ii),
the identity document number, for each of the beneficial owners or, in the case(s) of joint beneficial
owners, for each joint beneficial owner. If you do not include this information, the application will be
treated as being made for your benefit.
(6) If you are applying as an unlisted company and (i) the principal business of that company is dealing in
securities; and (ii) you exercise statutory control over that company, then the application will be treated
as being for your benefit and you should provide the required information in your application as stated
above.
“Unlisted company ” means a company with no equity securities listed on the Stock Exchange or any
other stock exchange.
“Statutory control ” means you:
 control the composition of the board of directors of the company;
 control more than half of the voting power of the company; or
 hold more than half of the issued share capital of the company (not counting any part of it which
carries no right to participate beyond a specified amount in a distribution of either profits or
capital).
For those applying through HKSCC EIPO channel, and making an application under a
power of attorney, we and the Overall Coordinators, as our agent, have discretion to consider
whether to accept it on any conditions we think fit, including evidence of the attorney’s
authority.
Failing to provide any required information may result in your application being rejected.
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118: 100 H Shares
Permitted Number of Hong
Kong Offer Shares for
application and amount
payable on application/
successful allotment /H1118/H1118/H1118/H1118/H1118
: Hong Kong Offer Shares are available for
application in specified board lot sizes only. Please
refer to the amount payable associated with each
specified board lot size in the table below.
The maximum Offer Price is HK$30.75 per
H Share.
If you are applying through the HKSCC EIPO
channel, you are required to pre-fund your
application based on the amount specified by your
broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 482 ---
By instructing your broker or custodian to apply
for the Hong Kong Offer Shares on your behalf
through the HKSCC EIPO channel, you (and, if
you are joint applicants, each of you jointly and
severally) are deemed to have instructed and
authorized HKSCC to cause HKSCC Nominees
(acting as nominee for the relevant HKSCC
Participants) to arrange payment of the final Offer
Price, brokerage, SFC transaction levy, the Hong
Kong Stock Exchange trading fee and the AFRC
transaction levy by debiting the relevant nominee
bank account at the designated bank for your
broker or custodian.
If you are applying through the White Form eIPO
service, you may refer to the table below for the
amount payable for the number of H Shares you
have selected. Y ou must pay the respective amount
payable on application in full upon application for
Hong Kong Offer Shares.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
100 3,106.00 3,000 93,180.34 50,000 1,553,005.69 700,000 21,742,079.63
200 6,212.03 4,000 124,240.45 60,000 1,863,606.83 800,000 24,848,091.00
300 9,318.03 5,000 155,300.57 70,000 2,174,207.97 900,000 27,954,102.38
400 12,424.04 6,000 186,360.68 80,000 2,484,809.10 1,000,000 31,060,113.76
500 15,530.06 7,000 217,420.79 90,000 2,795,410.23 2,000,000 62,120,227.50
600 18,636.07 8,000 248,480.91 100,000 3,106,011.38 3,000,000 93,180,341.26
700 21,742.08 9,000 279,541.03 200,000 6,212,022.76 4,000,000 124,240,455.00
800 24,848.09 10,000 310,601.13 300,000 9,318,034.13 5,000,000 155,300,568.76
900 27,954.10 20,000 621,202.28 400,000 12,424,045.50 10,000,000 310,601,137.50
1,000 31,060.12 30,000 931,803.41 500,000 15,530,056.88 14,869,800
(1) 461,857,679.44
2,000 62,120.22 40,000 1,242,404.56 600,000 18,636,068.26
Notes:
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 483 ---
No application for any other number of the Hong Kong Offer Shares will be considered
and any such application is liable to be rejected.
5. Multiple Applications Prohibited
Y ou or your joint applicant(s) shall not make more than one application for your own
benefit, except where you are a nominee and provide the information of the underlying investor
in your application as required under the paragraph headed “— Applications for Hong Kong
Offer Shares — Information Required to Apply” in this section. If you are suspected of
submitting or cause to submit more than one application, all of your applications will be
rejected.
Multiple applications made either through (i) the White Form eIPO service, (ii) HKSCC
EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected. If you
have made an application through the White Form eIPO service or HKSCC EIPO channel,
you or the person(s) for whose benefit you have made the application shall not apply for any
International Offer Shares.
6. Terms and conditions of an application
By applying for Hong Kong Offer Shares through the White Form eIPO service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following
things on your behalf):
(a) undertake to execute all relevant documents and instruct and authorize us and/or the
Overall Coordinators (or its agents or nominees), as our agent, to execute any
documents for you and to do on your behalf all things necessary to register any Hong
Kong Offer Shares allocated to you in your name or in the name of HKSCC
Nominees as required by the Articles of Association, and (if you are applying
through the HKSCC EIPO channel) to deposit the allotted Hong Kong Offer Shares
directly into CCASS for the credit of your designated HKSCC Participant’s stock
account on your behalf;
(b) confirm that you have read and understand the terms and conditions and application
procedures set out in this prospectus and the designated website of the White Form
eIPO Service Provider (or as the case may be, the agreement you entered into with
your broker or custodian), and agree to be bound by them;
(c) (if you are applying through the HKSCC EIPO channel) agree to the arrangements,
undertakings and warranties under the participant agreement between your broker or
custodian and HKSCC and observe the General Rules of HKSCC and the HKSCC
Operational Procedures for giving application instructions to apply for Hong Kong
Offer Shares;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 484 ---
(d) confirm that you are aware of the restrictions on offers and sales of shares set out
in this prospectus and they do not apply to you, or the person(s) for whose benefit
you have made the application;
(e) confirm that you have read this prospectus and any supplement to it and have only
relied on the information and representations contained therein in making your
application (or as the case may be, causing your application to be made), and will
not rely on any other information or representations, except those contained in any
supplement to this prospectus;
(f) agree that none of us, the Relevant Persons, the H Share Registrar and HKSCC is
or will be liable for any information and representations not contained in this
prospectus (and any supplement to it);
(g) agree to disclose the details of your application and your personal data and any other
personal data which may be required about you and the person(s) for whose benefit
you have made the application to us, the Relevant Persons, receiving bank(s), the H
Share Registrar, HKSCC, HKSCC Nominees, the Hong Kong Stock Exchange, the
SFC and any other statutory regulatory or governmental bodies or otherwise as
required by laws, rules or regulations, for the purposes under the paragraph headed
“— Personal Data — Purposes” and “— Personal Data — Transfer of personal data”
in this section;
(h) agree (without prejudice to any other rights which you may have once your
application (or as the case may be, HKSCC Nominees’ application) has been
accepted) that you will not rescind it because of an innocent misrepresentation;
(i) agree that subject to Section 44A(6) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, any application made by you or HKSCC
Nominees on your behalf cannot be revoked once it is accepted, which will be
evidenced by the notification of the result of the ballot by the H Share Registrar by
way of publication of the results at the time and in the manner as specified in the
paragraph headed “— Publication of Results” in this section;
(j) confirm that you are aware of the situations specified in the paragraph headed “—
Circumstances in which Y ou Will Not Be Allocated Hong Kong Offer Shares” in this
section;
(k) agree that your application or HKSCC Nominees’ application, any acceptance of it
and the resulting contract will be governed by and construed in accordance with the
laws of Hong Kong;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 485 ---
(l) agree to comply with the Companies Ordinance, Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association, the PRC
Companies Law and laws of any other place that apply to your application, and that
neither we nor the Relevant Persons will breach any law inside and/or outside Hong
Kong as a result of the acceptance of your offer to purchase, or any action arising
from your rights and obligations under the terms and conditions contained in this
prospectus;
(m) confirm that (a) your application or HKSCC Nominees’ application on your behalf
is not financed directly or indirectly by the Company, any of the directors, chief
executives, substantial Shareholder(s) or existing shareholder(s) of the Company or
any of its subsidiaries or any of their respective close associates; and (b) you are not
accustomed or will not be accustomed to taking instructions from the Company, any
of the directors, chief executives, substantial shareholder(s) or existing
shareholder(s) of the Company or any of its subsidiaries or any of their respective
close associates in relation to the acquisition, disposal, voting or other disposition
of the H Shares registered in your name or otherwise held by you;
(n) warrant that the information you have provided is true and accurate;
(o) confirm that you understand that we, our Directors and the Overall Coordinators will
rely on your declarations and representations in deciding whether or not to make any
allotment of any of the Hong Kong Offer Shares to you and that you may be
prosecuted for making a false declaration;
(p) agree to accept the Hong Kong Offer Shares applied for, or any lesser number
allocated to you under the application;
(q) declare and represent that this is the only application made and the only application
intended by you to be made to benefit you or the person for whose benefit you are
applying;
(r) represent, warrant and undertake that (i) you understand that the Hong Kong Offer
Shares have not been and will not be registered under the U.S. Securities Act; and
(ii) you and any person for whose benefit you are applying for the Hong Kong Offer
Shares are outside the United States (as defined in Regulation S) or are a person
described in paragraph (h)(3) of Rule 902 of Regulation S;
(s) undertake and confirm that you or the person(s) for whose benefit you have made
the application have not applied for or taken up, or indicated an interest for, and will
not apply for or take up, or indicate an interest for, any International Offer Shares
nor have participated in the International Offering;
(t) confirm that you are aware of the restrictions on the Global Offering set out in this
prospectus;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 486 ---
(u) (if you are making the application for your own benefit) warrant that no other
application has been or will be made for your benefit by giving electronic
application instructions to HKSCC directly or through the White Form eIPO
service or by any one as your agent or by any other person;
(v) (if you are making the application as an agent for the benefit of another person)
warrant that: (i) no other application has been or will be made by you as agent for
or for the benefit of that person or by that person or by any other person as agent
for that person by giving application instructions to HKSCC; and (ii) you have due
authority to give electronic application instructions on behalf of that other person
as its agent; and
(w) if the laws of any place outside Hong Kong apply to your application, agree and
warrant that you have complied with all these laws and none of us nor any Relevant
Person will breach any of these laws as a result of the acceptance of your offer to
purchase, or any action arising from your rights and obligations under the terms and
conditions contained in this prospectus.
PUBLICATION OF RESULTS
Results of Allocation
Y ou can check whether you are successfully allocated any Hong Kong Offer Shares
through:
Platform Date/Time
Applying through White Form eIPO service or HKSCC EIPO channel :
Website /H1118/H1118/H1118/H1118The designated results of allocation at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) with a
“search by ID” function.
The full list of (i) wholly or partially
successful applicants using the White
Form eIPO service and HKSCC EIPO
channel, and (ii) the number of Hong
Kong Offer Shares conditionally allotted
to them, among other things, will be
displayed on the “Allotment Results” page
of the White Form eIPO service at
www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ).
24 hours, from 11:00
p.m., Wednesday,
September 24, 2025 to
12:00 midnight,
Tuesday, September
30, 2025 (Hong Kong
time)
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 487 ---
Platform Date/Time
The Hong Kong Stock Exchange’s website at
www.hkexnews.hk and our website at
www.chery-auto.com which will provide
links to the above mentioned web sites of
the H Share Registrar.
No later than 11:00 p.m.
on Wednesday,
September 24, 2025
(Hong Kong time).
Telephone /H1118/H1118/H1118+852 2862 8555 — the allocation results
telephone enquiry line provided by the H
Share Registrar
Between 9:00 a.m. and
6:00 p.m., from
Thursday, September
25, 2025 to Tuesday,
September 30, 2025
(excluding Saturday,
Sunday and public
holiday in Hong
Kong)
For those applying through HKSCC EIPO channel, you may also check with your broker
or custodian from 6:00 p.m., Tuesday, September 23, 2025 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m.,
Tuesday, September 23, 2025 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
Allocation Announcement
We expect to announce the results of the final Offer Price, the level of indications of
interest in the International Offering, the level of applications in the Hong Kong Public
Offering and the basis of allocations of Hong Kong Offer Shares on the Hong Kong Stock
Exchange’s website at www.hkexnews.hk and our website at www.chery-auto.com by no later
than 11:00 p.m. on Wednesday, September 24, 2025 (Hong Kong time).
CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
Y ou should note the following situations in which no Hong Kong Offer Shares will be
allocated to you or the person(s) for whose benefit you are applying for:
1. If your application is revoked:
Y our application or the application made by HKSCC Nominees on your behalf may be
revoked pursuant to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 488 ---
2. If we or our agents exercise discretion to reject your application:
We, the Overall Coordinators, the H Share Registrar and our/their respective agents and
nominees have full discretion to reject or accept any application, or to accept only part of any
application, without giving any reasons.
3. If the allocation of Hong Kong Offer Shares is void:
The allocation of Hong Kong Offer Shares will be void if the Hong Kong Stock Exchange
does not grant permission to list our Shares either:
 within three weeks from the closing date of the application lists; or
 within a longer period of up to six weeks if the Hong Kong Stock Exchange notifies
us of that longer period within three weeks of the closing date of the application
lists.
4. If:
 you make multiple applications or suspected multiple applications. Y ou may refer to
the paragraph headed “— Applications for the Hong Kong Offer Shares — 5.
Multiple Applications Prohibited” in this section on what constitutes multiple
applications;
 your application instruction is incomplete;
 your payment (or confirmation of funds, as the case may be) is not made correctly;
 the Underwriting Agreements do not become unconditional or are terminated; or
 we or the Overall Coordinators believe that by accepting your application, we or
they would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted H Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC
Participants will be required to hold sufficient application funds on deposit with their
designated bank before balloting. After balloting of Hong Kong Offer Shares, the Receiving
Bank will collect the portion of these funds required to settle each HKSCC Participant’s actual
Hong Kong Offer Share allotment from their designated bank.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 489 ---
There is a risk of money settlement failure. In the extreme event of money settlement
failure by a HKSCC Participant (or its designated bank), who is acting on your behalf in
settling payment for your allotted shares, HKSCC will contact the defaulting HKSCC
Participant and its designated bank to determine the cause of failure and request such
defaulting HKSCC Participant to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected
Hong Kong Offer Shares will be reallocated to the International Offering. Hong Kong Offer
Shares applied for by you through the broker or custodian may be affected to the extent of the
settlement failure. In the extreme case, you will not be allocated any Hong Kong Offer Shares
due to the money settlement failure by such HKSCC Participant. None of us, the Relevant
Persons, the H Share Registrar and HKSCC is or will be liable if Hong Kong Offer Shares are
not allocated to you due to the money settlement failure.
DESPATCH/COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
Y ou will receive one H Share certificate for all Hong Kong Offer Shares allocated to you
under the Hong Kong Public Offering (except pursuant to applications made through the
HKSCC EIPO channel where the H Share certificate will be deposited into CCASS as
described below).
We will not issue: (i) temporary document of title in respect of our H Shares; or (ii)
receipt for sums paid on application.
H Share certificates will only become valid evidence of title at 8:00 a.m. on Thursday,
September 25, 2025 (Hong Kong time), provided that the Global Offering has become
unconditional and the right of termination described in the section headed “Underwriting” has
not been exercised. Investors who trade H Shares prior to the receipt of H Share certificates
or the H Share certificates becoming valid evidence of title do so entirely at their own risk.
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 490 ---
The following sets out the relevant procedures and time:
White Form eIPO service HKSCC EIPO channel
Despatch/collection of H Share certificate
For physical H Share
certificates of
1,000,000 or more
Offer Shares issued
under your own
name /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Collection in person from our H
Share Registrar at Shops 1712-
1716, 17th Floor, Hopewell
Centre, 183 Queen’s Road East,
Wan Chai, Hong Kong.
Time: from 9:00 a.m. to 1:00 p.m.
on Thursday, September 25,
2025 (Hong Kong time) If you
are an individual, you must not
authorize any other person to
collect for you. If you are a
corporate applicant, your
authorized representative must
bear a letter of authorization
from your corporation stamped
with your corporation’s chop.
H Share certificates will
be issued in the name
of HKSCC Nominees,
deposited into CCASS
and credited to your
designated HKSCC
Participant’s stock
account.
No action by you is
required.
Both individuals and authorized
representatives must produce, at
the time of collection, evidence
of identity acceptable to the H
Share Registrar.
Note: If you do not collect your H
Share certificate(s) personally
within the time above, it/they
will be sent to the address
specified in your application
instructions by ordinary post at
your own risk.
For physical H Share
certificates of less
than 1,000,000
Offer Shares issued
under your own
name /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Y our H Share certificate(s) will be
sent to the address specified in
your application instructions by
ordinary post at your own risk.
Time: Wednesday, September 24,
2025
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 491 ---
White Form eIPO service HKSCC EIPO channel
Refund mechanism for surplus application monies paid by you
Date /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Thursday, September 25, 2025 Subject to the
arrangement between
you and your broker or
custodian
Responsible party /H1118/H1118/H1118H Share Registrar Y our broker or custodian
Application monies
paid through single
bank account /H1118/H1118/H1118/H1118/H1118
Any refund will be despatched to
the bank account in the form of
White Form e-Refund payment
instructions.
Y our broker or custodian
will arrange refund to
your designated bank
account subject to the
arrangement between
you and it.
Application monies
paid through
multiple bank
accounts /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Refund cheque(s) will be
dispatched to the address as
specified in your application
instructions by ordinary post at
your own risk.
Except in the event of any Severe Weather Signals (as defined below) in force in Hong
Kong on the business day before the Listing Date rendering it impossible for the relevant share
certificates to be dispatched to HKSCC in a timely manner, the Company shall procure the H
Share Registrar to arrange for delivery of the supporting documents and share certificates in
accordance with the contingency arrangements as agreed between them. Y ou may refer to “—
Severe Weather Arrangements” in this section.
SEVERE WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Monday, September 22, 2025 if, there is
(are):
 a tropical cyclone warning signal number 8 or above;
 a “black” rainstorm warning; and/or
 an “extreme conditions” announcement issued after a super typhoon (“ Extreme
Conditions ”),
(collectively, “ Severe Weather Signals ”)
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Monday, September
22, 2025.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 492 ---
Instead they will open between 11:45 a.m. and 12:00 noon and/or close at 12:00 noon on
the next business day which does not have any of those warnings in Hong Kong in force at any
time between 9:00 a.m. and 12:00 noon.
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the Listing Date. Should there be any changes to the
dates mentioned in the section headed “Expected Timetable” in this prospectus, an
announcement will be made and published on the Hong Kong Stock Exchange’s website at
www.hkexnews.hk and our website at www.chery-auto.com of the revised timetable.
If any of those warnings is hoisted on Wednesday, September 24, 2025, the H Share
Registrar will make appropriate arrangements for the delivery of the H Share certificates to the
CCASS Depository’s service counter so that they would be available for trading on Thursday,
September 25, 2025.
If any of those warnings is hoisted on Wednesday, September 24, 2025, for physical H
Share certificates of less than 1,000,000 Hong Kong Offer Shares issued under your own name
which are initially scheduled for despatch on Wednesday, September 24, 2025, despatch will
be made by ordinary post when the post office re-opens after any of those warnings is lowered
or canceled (e.g. in the afternoon of Wednesday, September 24, 2025 or Thursday, September
25, 2025).
If any of those warnings is hoisted on Thursday, September 25, 2025, for physical H Share
certificates of equal to or more than 1,000,000 Hong Kong Offer Shares issued under your own
name which are initially scheduled for collection at the H Share Registrar’s office from 9:00
a.m. to 1:00 p.m. on Thursday, September 25, 2025, you may pick them up from the H Share
Registrar’s office after any of those warnings is lowered or canceled (e.g. in the afternoon of
Thursday, September 25, 2025 or Friday, September 26, 2025).
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
ADMISSION OF OUR H SHARES INTO CCASS
If the Hong Kong Stock Exchange grants the listing of, and permission to deal in, our H
Shares and we comply with the stock admission requirements of HKSCC, our H Shares will be
accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS with
effect from the Listing Date or any other date HKSCC chooses. Settlement of transactions
between Exchange Participants is required to take place in CCASS on the second settlement
day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 493 ---
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
Y ou should seek the advice of your broker or other professional advisor for details of the
settlement arrangement as such arrangements may affect your rights and interests.
PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by us, the Relevant Persons, the H Share Registrar and the receiving bank(s)
about you in the same way as it applies to personal data about applicants other than HKSCC
Nominees. This personal data may include client identifier(s) and your identification
information. By giving application instructions to HKSCC, you acknowledge that you have
read, understood and agree to all of the terms of the Personal Information Collection Statement
below.
Personal Information Collection Statement
This Personal Information Collection Statement informs applicant for, and holder of,
Hong Kong Offer Shares, of the policies and practices of ours and the H Share Registrar in
relation to personal data and the Personal Data (Privacy) Ordinance (Chapter 486 of the Laws
of Hong Kong).
Reasons for the collection of your personal data
It is necessary for applicants and registered holders of Hong Kong Offer Shares to ensure
that personal data supplied to us or our agents and the H Share Registrar is accurate and
up-to-date when applying for Hong Kong Offer Shares or transferring Hong Kong Offer Shares
into or out of their names or in procuring the services of the H Share Registrar.
Failure to supply the requested data or supplying inaccurate data may result in your
application for the Hong Kong Offer Shares being rejected, or in the delay or the inability of
us or the H Share Registrar to effect transfers or otherwise render their services. It may also
prevent or delay registration or transfers of Hong Kong Offer Shares which you have
successfully applied for and/or the despatch of H Share certificate(s) to which you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform us and
the H Share Registrar immediately of any inaccuracies in the personal data supplied.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 483 –


--- page 494 ---
Purposes
Y our personal data may be used, held, processed, and/or stored (by whatever means) for
the following purposes:
 processing your application and refund cheque and White Form e-Refund payment
instruction(s), where applicable, verification of compliance with the terms and
application procedures set out in this prospectus and announcing results of
allocation of Hong Kong Offer Shares;
 compliance with applicable laws and regulations in Hong Kong and elsewhere;
 registering new issues or transfers into or out of the names of the holders of our
H Shares including, where applicable, HKSCC Nominees;
 maintaining or updating our register of members;
 verifying identities of applicants for and holders of our H Shares and identifying any
duplicate applications for our H Shares;
 facilitating Hong Kong Offer Shares balloting;
 establishing benefit entitlements of holders of our H Shares, such as dividends,
rights issues, bonus issues, etc.;
 distributing communications from us and our subsidiaries;
 compiling statistical information and profiles of the holder of our H Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 any other incidental or associated purposes relating to the above and/or to enable us
and the H Share Registrar to discharge our or their obligations to applicants and
holders of our H Shares and/or regulators and/or any other purposes to which the
applicants and holders of the H Shares may from time to time agree.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 495 ---
Transfer of personal data
Personal data held by us and the H Share Registrar relating to the applicants for and
holders of Hong Kong Offer Shares will be kept confidential, but we and the H Share Registrar
may, to the extent necessary for achieving any of the above purposes, disclose, obtain or
transfer (whether within or outside Hong Kong) the personal data to, from or with any of the
following:
 our appointed agents such as financial advisers, receiving bank(s) and overseas
principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H Share Registrar for the purposes of providing its services or
facilities or performing its functions in accordance with its rules or procedures and
operating FINI and CCASS (including where applicants for the Hong Kong Offer
Shares request a deposit into CCASS);
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to us or the H Share
Registrar in connection with their respective business operation;
 the Hong Kong Stock Exchange, the SFC and any other statutory regulatory or
governmental bodies or otherwise as required by laws, rules or regulations including
for the purpose of the Hong Kong Stock Exchange’s administration of the Listing
Rules and the SFC’s performance of its statutory functions; and
 any persons or institutions with which the holders of Hong Kong Offer Shares have
or propose to have dealings, such as their bankers, solicitors, accountants or
stockbrokers, etc.
Retention of personal data
We and the H Share Registrar will keep the personal data of the applicants and holders
of Hong Kong Offer Shares for as long as necessary to fulfill the purposes for which the
personal data were collected. Personal data which is no longer required will be destroyed or
dealt with in accordance with the Personal Data (Privacy) Ordinance (Chapter 486 of the Laws
of Hong Kong).
Access to and correction of personal data
Applicants for and holders of Hong Kong Offer Shares have the right to ascertain whether
we or the H Share Registrar hold their personal data, to obtain a copy of that data, and to
correct any data that is inaccurate. We and the H Share Registrar have the right to charge a
reasonable fee for the processing of such requests. All requests for access to data or correction
of data should be addressed to us and the H Share Registrar, at our and their registered address
disclosed in the section headed “Corporate Information” in this prospectus or as notified from
time to time, for the attention of the secretary, or the H Share Registrar for the attention of the
privacy compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 496 ---
The following is the text of a report received from our Company’ s reporting accountants,
Ernst & Young, Certified Public Accountants, Hong Kong, for the purpose of incorporation in
the prospectus.
⭰㰟㛪姯⸒Ṳ⋀㈧
榀㸖毩歁㵳勘䙮怺979噆
⤑⏋✱ᷧ⺎27㧺
Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
ey.com
Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF CHERY AUTOMOBILE CO., LTD., CHINA INTERNATIONAL
CAPITAL CORPORATION HONG KONG SECURITIES LIMITED, HUATAI
FINANCIAL HOLDINGS (HONG KONG) LIMITED, AND GF CAPITAL (HONG
KONG) LIMITED
Introduction
We report on the historical financial information of Chery Automobile Co., Ltd. (the
“Company”) and its subsidiaries (together, the “Group”) set out on pages I-4 to I-130, which
comprises the consolidated statements of profit or loss, statements of comprehensive income,
statements of changes in equity and statements of cash flows of the Group for each of the years
ended 31 December 2022, 2023 and 2024 and the three months ended 31 March 2025 (the
“Relevant Periods”), and the consolidated statements of financial position of the Group and the
statements of financial position of the Company as at 31 December 2022, 2023 and 2024 and
31 March 2025, and material accounting policy information and other explanatory information
(together, the “Historical Financial Information”). The Historical Financial Information set out
on pages I-4 to I-130 forms an integral part of this report, which has been prepared for
inclusion in the prospectus of the Company dated 17 September 2025 (the “Prospectus”) in
connection with the initial listing of the shares of the Company on the Main Board of The Stock
Exchange of Hong Kong Limited (the “Stock Exchange”).
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 preparation
set out in note 2.1 to the Historical Financial Information, and for such internal control as the
directors determine is necessary to enable the preparation of the Historical Financial
Information that is free from material misstatement, whether due to fraud or error.
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 497 ---
Reporting accountants’ responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 Accountants’ Reports on Historical Financial
Information in Investment Circulars issued by the Hong Kong Institute of Certified Public
Accountants (“HKICPA”). This standard requires that we comply with ethical standards and
plan and perform our work to obtain reasonable assurance about whether the Historical
Financial Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ 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 accountants consider internal control relevant to the entity’s
preparation of the Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation set out in note 2.1 to the Historical Financial Information, in order
to design procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Our work also
included evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the directors, as well as evaluating the overall presentation of
the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion, the Historical Financial Information gives, for the purposes of the
accountants’ report, a true and fair view of the financial position of the Group and the Company
as at 31 December 2022, 2023 and 2024 and 31 March 2025 and of the financial performance
and cash flows of the Group for each of the Relevant Periods in accordance with the basis of
preparation set out in note 2.1 to the Historical Financial Information.
Review of interim comparative financial information
We have reviewed the interim comparative financial information of the Group which
comprises the consolidated statement of profit or loss, statement of comprehensive income,
statement of changes in equity and statement of cash flows for the three months ended 31
March 2024 and other explanatory information (the “Interim Comparative Financial
Information”). The directors of the Company are responsible for the preparation of the Interim
Comparative Financial Information in accordance with the basis of preparation set out in note
2.1 to the Historical Financial Information. Our responsibility is to express a conclusion on the
Interim Comparative Financial Information based on our review. We conducted our review in
accordance with Hong Kong Standard on Review Engagements 2410 Review of Interim
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 498 ---
Financial Information Performed by the Independent Auditor of the Entity issued by the
HKICPA. A review consists of making inquiries, primarily of persons responsible for financial
and accounting matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with Hong Kong Standards
on Auditing and consequently does not enable us to obtain assurance that we would become
aware of all significant matters that might be identified in an audit. Accordingly, we do not
express an audit opinion. Based on our review, nothing has come to our attention that causes
us to believe that the Interim Comparative Financial Information, for the purposes of the
accountants’ report, is not prepared, in all material respects, in accordance with the basis of
preparation set out in note 2.1 to the Historical Financial Information.
Report on matters under the Rules Governing the Listing of Securities on the Stock
Exchange 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 11 to the Historical Financial Information which contains information
about the dividends paid by the Company in respect of the Relevant Periods.
Ernst & Y oung
Certified Public Accountants
Hong Kong
17 September 2025
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 499 ---
I. HISTORICAL FINANCIAL INFORMATION
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The financial statements of the Group for the Relevant Periods, on which the Historical
Financial Information is based, were audited by Ernst & Y oung in accordance with Hong Kong
Standards on Auditing issued by the HKICPA (the “Underlying Financial Statements”).
The Historical Financial Information is presented in Renminbi (“RMB”) and all values
are rounded to the nearest million (RMB million) except when otherwise indicated.
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 500 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
Y ear ended 31 December
Three months ended
31 March
Notes 2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
REVENUE /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 92,618 163,205 269,897 54,910 68,223
Cost of sales /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(79,813) (137,115) (233,589) (46,747) (59,766)
Gross profit /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,805 26,090 36,308 8,163 8,457
Other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 3,822 4,232 6,251 1,174 3,652
Selling and distribution expenses /H1118 (3,207) (5,557) (8,380) (1,812) (2,182)
Administrative expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,934) (4,070) (5,999) (1,887) (1,140)
Research and development
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,646) (6,664) (9,243) (2,224) (2,272)
Impairment (losses)/gains on
financial and contract assets,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(684) 223 258 424 13
Other expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(130) (568) (1,719) (421) (99)
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 (1,405) (1,617) (2,310) (692) (872)
Share of profits and losses of:
Joint ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118640 854 851 258 112
Associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118247 382 595 188 98
PROFIT BEFORE TAX /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 6,508 13,305 16,612 3,171 5,767
Income tax expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 (702) (2,861) (2,278) (695) (1,041)
PROFIT FOR THE
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,806 10,444 14,334 2,476 4,726
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,266 11,953 14,135 2,712 4,650
Non-controlling interests /H1118/H1118/H1118/H1118/H1118 (460) (1,509) 199 (236) 76
5,806 10,444 14,334 2,476 4,726
EARNINGS PER SHARE
A TTRIBUTABLE TO
ORDINARY EQUITY
HOLDERS OF THE PARENT /H1118/H111812
Basic (RMB)
– For profit for the year/period /H1118/H1118/H1118 1.15 2.19 2.58 0.50 0.85
Diluted (RMB)
– For profit for the year/period /H1118/H1118/H1118 1.15 2.19 2.58 0.50 0.85
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 501 ---
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Y ear ended 31 December
Three months ended
31 March
2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
PROFIT FOR THE YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H11185,806 10,444 14,334 2,476 4,726
OTHER COMPREHENSIVE INCOME
Other comprehensive income that may
be reclassified to profit or loss in
subsequent periods:
Exchange differences on translation of
foreign operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111877 (419) 131 62 (1,017)
Share of other comprehensive income of joint
ventures and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1) (8) (12) (36) 11
Net other comprehensive income that
may be reclassified to profit or loss in
subsequent periods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876 (427) 119 26 (1,006)
Other comprehensive income that will not
be reclassified to profit or loss in
subsequent periods:
Changes in fair value of equity investments
designated at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 16 52 13 (24)
Share of other comprehensive income of joint
ventures and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118( 1 ) 1–––
Net other comprehensive income that will not
be reclassified to profit or loss in
subsequent periods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 17 52 13 (24)
OTHER COMPREHENSIVE INCOME FOR
THE YEAR/PERIOD, NET OF TAX /H1118/H1118/H1118/H1118/H111894 (410) 171 39 (1,030)
TOTAL COMPREHENSIVE INCOME FOR
THE YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,900 10,034 14,505 2,515 3,696
Attributable to:
Owners of the parent /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,360 11,543 14,306 2,751 3,620
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(460) (1,509) 199 (236) 76
5,900 10,034 14,505 2,515 3,696
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 502 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As at
31 December
As at
31 December
As at
31 December
As at
31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H111813 11,905 18,968 23,443 24,750
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(a) 1,106 1,404 3,350 3,292
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 1,196 1,081 2,057 2,400
Investments in joint ventures /H1118/H1118/H1118/H1118/H1118/H111816 7,626 8,265 9,793 10,817
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 4,344 5,290 6,364 5,741
Equity investments designated at fair
value through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 349 323 313 282
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 1,099 7,703 839 581
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 33 45 61 58
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 4,691 3,829 5,131 4,915
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(c) 1,987 2,810 244 35
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(b) 5–––
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,341 49,718 51,595 52,871
CURRENT ASSETS
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 12,873 31,035 36,324 38,507
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 9,521 11,268 17,423 21,270
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823 6,167 10,805 774 330
Contract assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 1,187 455 – –
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 24,344 21,364 10,505 10,197
Prepaid income tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111843 541 162 218
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 13,898 11,961 19,579 29,278
Derivative financial instruments /H1118/H1118/H1118/H111829 241 31 – –
Financial assets at fair value through
other comprehensive income /H1118/H1118/H1118/H1118/H111825 2,359 4,433 7,547 1,802
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(c) 3,373 2,188 7,319 16,204
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(b) 927 587 75 2,303
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(a)
12,686 35,048 62,693 37,498
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111887,619 129,716 162,401 157,607
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 503 ---
As at
31 December
As at
31 December
As at
31 December
As at
31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
CURRENT LIABILITIES
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 51,708 74,408 101,496 102,403
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H111828 12,228 18,959 22,437 20,170
Derivative financial instruments /H1118/H1118/H1118/H111829 3 8 6––
Interest-bearing bank loans and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 18,806 31,724 20,068 16,514
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 7 1–––
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(b) 46 138 366 428
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118577 703 3,120 3,608
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 8,030 18,589 15,319 13,088
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 856 2,395 2,816 3,298
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 54 102 180 886
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,379 147,104 165,802 160,395
NET CURRENT LIABILITIES /H1118/H1118/H1118/H1118/H1118 (4,760) (17,388) (3,401) (2,788)
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,581 32,330 48,194 50,083
NON-CURRENT LIABILITIES
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H111828 3,601 5,881 4,854 5,079
Interest-bearing bank loans and
other borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 14,317 6,784 3,098 5,116
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 6 2 5–––
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(b) 165 383 1,953 1,858
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 151 241 231 241
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 515 1,177 5,283 4,179
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 1,792 3,283 6,851 7,815
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H111821,166 17,749 22,270 24,288
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,415 14,581 25,924 25,795
EQUITY
Equity attributable to owners of the
parent
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836 5,470 5,470 5,470 5,470
Treasury shares /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(34) – – –
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838 3,784 9,981 21,018 21,125
9,220 15,451 26,488 26,595
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(805) (870) (564) (800)
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,415 14,581 25,924 25,795
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 504 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Y ear ended 31 December 2022
Attributable to owners of the parent
Share
capital
Treasury
shares
Other
comprehensive
income*
Other
reserves*
Exchange
fluctuation
reserve*
Surplus
reserves*
Accumulated
loss* Total
Non-
controlling
interests Total equity
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
(note 36) (note 38) (note 38)
At 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H11185,470 – 15 24,503 (72) 519 (24,477) 5,958 (712) 5,246
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118 –– –––– 6,266 6,266 (460) 5,806
Other comprehensive income for
the year:
Change in fair value of equity
investments at fair value
through other comprehensive
income, net of tax /H1118/H1118/H1118/H1118/H1118 –– 1 9––– – 1 9 – 1 9
Share of other comprehensive
income of joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2) – – – – (2) – (2)
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –– 7 7– – 7 7 – 7 7
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 17 – 77 – 6,266 6,360 (460) 5,900
Transfer of other reserves upon
the disposal of equity
investments at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (36) – – – 36 – – –
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118 – – – (3,862) – – – (3,862) – (3,862)
Deemed contribution from one
shareholder /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 147 – – – 147 – 147
Share of other reserves of joint
ventures and associates /H1118/H1118/H1118 – – –4 1 – – –4 1 1 96 0
Capital contribution from non-
controlling shareholders /H1118/H1118/H1118 –– –9–– –9 3 9 2 4 0 1
Transfer to safety production
reserve /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –2–– ( 2 ) – ––
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (34) – 601 – – – 567 (44) 523
At 31 December 2022 /H1118/H1118/H1118/H1118 5,470 (34) (4) 21,441 5 519 (18,177) 9,220 (805) 8,415
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 505 ---
Y ear ended 31 December 2023
Attributable to owners of the parent
Share
capital
Treasury
shares
Other
comprehensive
income*
Other
reserves*
Exchange
fluctuation
reserve*
Surplus
reserves*
Accumulated
loss* Total
Non-
controlling
interests Total equity
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
(note 36) (note 38) (note 38)
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H11185,470 (34) (4) 21,441 5 519 (18,177) 9,220 (805) 8,415
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118 –– –––– 1 1,953 11,953 (1,509) 10,444
Other comprehensive income for
the year:
Change in fair value of equity
investments at fair value
through other comprehensive
income, net of tax /H1118/H1118/H1118/H1118/H1118 –– 1 6––– – 1 6 – 1 6
Share of other comprehensive
income of joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (7) – – – – (7) – (7)
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – (419) – – (419) – (419)
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 9 – (419) – 11,953 11,543 (1,509) 10,034
Transfer of other reserves upon
the disposal of equity
investments at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (36) – – – 36 – – –
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118 – – – (4,050) – – – (4,050) – (4,050)
Acquisition of non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (754) – – – (754) 712 (42)
Deemed contribution from one
shareholder /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 128 – – – 128 – 128
Share of other reserves of joint
ventures and associates /H1118/H1118/H1118 –– – 9 8–– – 9 8( 2 ) 9 6
Capital contribution from non-
controlling shareholders /H1118/H1118/H1118 – – – 156 – – – 156 729 885
Transfer to safety production
reserve /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 36 – – (36) – – –
Dividend declared /H1118/H1118/H1118/H1118/H1118/H1118 –– –––– (1,094) (1,094) – (1,094)
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 34 – 170 – – – 204 5 209
At 31 December 2023 /H1118/H1118/H1118/H1118 5,470 – (31) 17,225 (414) 519 (7,318) 15,451 (870) 14,581
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 506 ---
Y ear ended 31 December 2024
Attributable to owners of the parent
Share
capital
Other
comprehensive
income*
Share-based
compensation*
Other
reserves*
Exchange
fluctuation
reserve*
Surplus
reserves*
Accumulated
(loss)/retained
profits* Total
Non-
controlling
interests Total equity
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
(note 36) (note 38) (note 38)
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11185,470 (31) – 17,225 (414) 519 (7,318) 15,451 (870) 14,581
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118 –– –––– 14,135 14,135 199 14,334
Other comprehensive income for
the year: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Change in fair value of equity
investments at fair value
through other comprehensive
income, net of tax /H1118/H1118/H1118/H1118/H1118 – 5 2 –––– – 5 2 – 5 2
Share of other comprehensive
income of joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (12) –––– – (12) – (12)
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 131 – – 131 – 131
Total comprehensive income for
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 40 – – 131 – 14,135 14,306 199 14,505
Transfer of other reserves upon
the disposal of equity
investments at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (30) –––– 3 0– ––
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118 – – – (7,320) – – – (7,320) – (7,320)
Acquisition of subsidiaries /H1118/H1118/H1118 –– –––– –– 4 3 9 4 3 9
Acquisition of non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (40) – – – (40) (77) (117)
Disposal of subsidiaries /H1118/H1118/H1118/H1118 – – – (153) – – – (153) (132) (285)
Share-based compensation /H1118/H1118/H1118 – – 2,016 – – – – 2,016 – 2,016
Share of other reserves of joint
ventures and associates /H1118/H1118/H1118 – – – 183 – – – 183 – 183
Capital contribution from non-
controlling shareholders /H1118/H1118/H1118 – – –1 5 – – –1 5 2 54 0
Transfer to safety production
reserve /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 27 – – (27) – – –
Contribution from the
shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,012 – – – 2,012 (105) 1,907
Transfer from retained profits /H1118/H1118 – – – – – 2,073 (2,073) – – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 18 – – – 18 (43) (25)
At 31 December 2024 /H1118/H1118/H1118/H1118 5,470 (21) 2,016 11,967 (283) 2,592 4,747 26,488 (564) 25,924
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 507 ---
Three months ended 31 March 2024 (unaudited)
Attributable to owners of the parent
Share
capital
Other
comprehensive
income
Share-based
compensation
Other
reserves
Exchange
fluctuation
reserve
Surplus
reserves
Accumulated
loss Total
Non-
controlling
interests Total equity
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
(note 36) (note 38) (note 38)
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11185,470 (31) – 17,225 (414) 519 (7,318) 15,451 (870) 14,581
Profit for the period /H1118/H1118/H1118/H1118/H1118 –– –––– 2,712 2,712 (236) 2,476
Other comprehensive income for
the period: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Change in fair value of equity
investments at fair value
through other comprehensive
income, net of tax /H1118/H1118/H1118/H1118/H1118 – 1 3 –––– – 1 3 – 1 3
Share of other comprehensive
income of joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (36) –––– – (36) – (36)
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –– 6 2– – 6 2 – 6 2
Total comprehensive income for
the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (23) – – 62 – 2,712 2,751 (236) 2,515
Transfer of other reserves upon
the disposal of equity
investments at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (30) –––– 3 0– ––
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118 – – – (7,320) – – – (7,320) – (7,320)
Acquisition of subsidiaries /H1118/H1118/H1118 –– –––– –– 4 3 9 4 3 9
Acquisition of non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – (7) – – – (7) (51) (58)
Share-based compensation /H1118/H1118/H1118 – – 1,632 – – – – 1,632 – 1,632
Share of other reserves of joint
ventures and associates /H1118/H1118/H1118 –– – 1 9–– – 1 9 – 1 9
Capital contribution from non-
controlling shareholders /H1118/H1118/H1118 –– –––– –– 11
Transfer to safety production
reserve /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –6–– ( 6 ) – ––
Contribution from the
shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 1,894 – – – 1,894 (158) 1,736
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –5–– –5 (57) (52)
At 31 March 2024 /H1118/H1118/H1118/H1118/H1118/H11185,470 (84) 1,632 11,822 (352) 519 (4,582) 14,425 (932) 13,493
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 508 ---
Three months ended 31 March 2025
Attributable to owners of the parent
Share
capital
Other
comprehensive
income*
Share-based
compensation*
Other
reserves*
Exchange
fluctuation
reserve*
Surplus
reserves*
Retained
profits* Total
Non-
controlling
interests Total equity
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
(note 36) (note 38) (note 38)
At 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H11185,470 (21) 2,016 11,967 (283) 2,592 4,747 26,488 (564) 25,924
Profit for the period /H1118/H1118/H1118/H1118/H1118 –– –––– 4,650 4,650 76 4,726
Other comprehensive income for
the period: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Change in fair value of equity
investments at fair value
through other comprehensive
income, net of tax /H1118/H1118/H1118/H1118/H1118 – (24) –––– – (24) – (24)
Share of other comprehensive
income of joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1 1 –––– – 1 1 – 1 1
Exchange differences on
translation of foreign
operations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – (1,017) – – (1,017) – (1,017)
Total comprehensive income for
the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (13) – – (1,017) – 4,650 3,620 76 3,696
Disposal of interest in
subsidiaries without loss of
control /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 282 – – – 282 (273) 9
Disposal of subsidiaries /H1118/H1118/H1118/H1118 –– –––– –– (84) (84)
Share-based compensation /H1118/H1118/H1118 –– 1 3 1––– – 1 3 1 – 1 3 1
Share of other reserves of joint
ventures and associates /H1118/H1118/H1118 –– – 1 5–– – 1 5 – 1 5
Capital contribution from non-
controlling shareholders /H1118/H1118/H1118 –– –9–– –9 2 6 3 5
Transfer to safety production
reserve /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 28 – – (28) – – –
Contribution from the
shareholders /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – –4 0 – – –4 0 1 75 7
Dividend declared /H1118/H1118/H1118/H1118/H1118/H1118 –– –––– (3,993) (3,993) – (3,993)
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– –3–– –3 25
At 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H11185,470 (34) 2,147 12,344 (1,300) 2,592 5,376 26,595 (800) 25,795
* These reserve accounts comprise the consolidated reserves of RMB3,784 million, RMB9,981 million,
RMB21,018 million and RMB21,125 million in the consolidated statements of financial position at the end of
each of the Relevant Periods, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 509 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Y ear ended 31 December
Three months ended
31 March
Notes 2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
CASH FLOWS FROM
OPERA TING ACTIVITIES
Profit before tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,508 13,305 16,612 3,171 5,767
Adjustments for:
Finance costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 1,405 1,617 2,310 692 872
Share of profits and losses of joint
ventures and associates /H1118/H1118/H1118/H1118/H1118/H1118(887) (1,236) (1,446) (446) (210)
Depreciation and amortisation of
non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 2,004 2,481 3,849 520 908
Gain on disposal of items of
property, plant and equipment /H1118/H11185 (96) (13) (59) (7) (23)
Fair value (gains)/losses on
derivative financial instruments /H1118 (230) 265 (52) (16) –
Fair value gains on financial assets
at fair value through profit or
loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(62) (27) (69) (42) (72)
Provision for impairment
of assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 770 347 1,193 13 424
Other income from investing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(930) (1,308) (1,100) – (179)
Assets-related government grants
released /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(88) (77) (163) (56) (57)
Employee benefit contributed by
one shareholder /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118147 128 – – –
Share-based compensation /H1118/H1118/H1118/H1118/H1118/H1118 – – 2,016 1,632 131
Effect of foreign exchange rate
changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(24) 177 193 98 (5)
8,517 15,659 23,284 5,559 7,556
(Increase)/decrease in restricted
bank deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(20) 345 512 198 (228)
(Increase)/decrease in inventories /H1118 (6,694) (20,081) (7,519) 1,659 (1,941)
Increase in trade receivables /H1118/H1118/H1118/H1118 (3,180) (1,840) (2,740) (212) (4,004)
(Increase)/decrease in bills
receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(465) (4,638) 10,081 9,569 440
Decrease in contract assets /H1118/H1118/H1118/H1118/H1118 271 770 479 13 –
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 510 ---
Y ear ended 31 December
Three months ended
31 March
Notes 2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
(Increase)/decrease in
prepayments, other receivables
and other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,367) (2,170) (1,697) 1,611 12
(Increase)/decrease in financial
assets at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,266) (2,074) (3,109) 2,610 5,725
Increase in capitalised
development expenditures /H1118/H1118/H1118/H1118/H1118 (482) (185) (1,301) (69) (488)
Increase in trade and bills
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,669 22,703 23,490 671 1,121
Increase/(decrease) in other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H11187,574 5,126 313 (5,604) (2,487)
Increase in deferred income /H1118/H1118/H1118/H1118/H1118 – – 3,727 3,727 –
Increase/(decrease) in contract
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,824 10,559 (3,295) (4,818) (2,231)
Increase in provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,116 3,030 3,952 1,518 1,446
Cash generated from operations /H1118/H1118 10,497 27,204 46,177 16,432 4,921
Income tax paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(655) (2,279) (1,290) (396) (383)
Net cash flows from operating
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,842 24,925 44,887 16,036 4,538
CASH FLOWS FROM
INVESTING ACTIVITIES
Purchases of items of property,
plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,471) (6,293) (7,305) (2,543) (1,906)
Purchases of other intangible
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(85) (133) (319) (12) (42)
Receipt of government grants for
non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118399 787 623 123 22
Additions to right-of-use assets /H1118/H1118/H1118 (29) (40) (57) (1) (18)
Disposal of right-of-use assets /H1118/H1118/H1118 3 2––––
Advance to related parties /H1118/H1118/H1118/H1118/H1118/H1118(6,439) (9,580) – – –
Repayments of related parties /H1118/H1118/H1118/H1118 5,555 15,513 13,716 13,716 –
Placement of time deposits /H1118/H1118/H1118/H1118/H1118(107,017) (92,703) (34,866) (24,402) (11,775)
Maturity of time deposits /H1118/H1118/H1118/H1118/H1118/H1118111,265 93,065 32,301 2,340 3,099
Investments in debt investments /H1118/H1118 (574) ––––
Recovery of debt investments /H1118/H1118/H1118/H1118 62 132 380 380 –
Purchases of financial assets at
fair value through profit or loss (17,092) (12,755) (25,344) (10,833) (55,286)
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 511 ---
Y ear ended 31 December
Three months ended
31 March
Notes 2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
Proceeds on disposal of financial
assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,387 15,354 18,224 10,598 45,690
Proceeds on disposal of items of
property, plant and equipment /H1118/H1118 246 162 305 183 36
Proceeds on disposal of other
intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 712––
Purchases of equity investments
designated at fair value through
other comprehensive income /H1118/H1118 (15) (25) – – –
Proceeds on disposal of equity
investments designated at fair
value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H11181 1 26 76 86 8 –
Settlement on derivative financial
instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(63) 550 (270) (100) –
Investments in joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(666) (714) (493) – –
Proceeds on disposal of
investments in joint ventures
and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118289 339 33 31 55
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 12 179 – (51)
Acquisition of a subsidiary /H1118/H1118/H1118/H1118/H111840(e) – – (800) (800) –
Interest received /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118110 117 233 77 61
Dividends received /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 167 213 1 20
Increase in restricted bank
deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– (2,000)
Net cash flows (used in)/generated
from investing activities /H1118/H1118/H1118/H1118/H1118/H1118(4,949) 4,023 (3,177) (11,174) (22,095)
CASH FLOWS FROM
FINANCING ACTIVITIES
Proceeds from interest-bearing
bank loans and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839,396 48,107 34,024 17,844 8,028
Repayments of interest-bearing
bank loans and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(41,114) (42,103) (47,990) (19,981) (11,320)
Interest paid for interest-bearing
bank loans and other
borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(944) (1,338) (1,900) (711) (780)
Payments of listing expenses /H1118/H1118/H1118/H1118 –––– ( 7 )
APPENDIX I ACCOUNTANTS’ REPORT
– I-16 –


--- page 512 ---
Y ear ended 31 December
Three months ended
31 March
Notes 2022 2023 2024 2024 2025
RMB
million
RMB
million
RMB
million
RMB
million
RMB
million
(unaudited)
Acquisition of subsidiaries under
common control /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (11,053) – – –
Acquisition of non-controlling
interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (37) (117) (58) –
Repayments of bonds payables /H1118/H1118/H1118 (2) (696) – – –
Principal portion of lease
payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(85) (94) (199) (63) (27)
Proceeds from long-term
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,367 1,261 1,623 6 257
Repayments of long-term
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(561) (296) (552) (94) (55)
Capital contribution from
non-controlling shareholders /H1118/H1118/H1118 118 885 40 1 35
Dividends paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1,094) – – (3,993)
Contribution from shareholders /H1118/H1118/H1118 – – 1,288 1,260 14
Disposal of interest in subsidiaries
without loss of control /H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– 1 0
Net cash flows used in financing
activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(825) (6,458) (13,783) (1,796) (7,838)
NET INCREASE/(DECREASE) IN
CASH AND CASH
EQUIV ALENTS /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,068 22,490 27,927 3,066 (25,395)
Cash and cash equivalents at
beginning of year/period /H1118/H1118/H1118/H1118/H1118/H11188,476 12,686 35,048 35,048 62,693
Effect of foreign exchange rate
changes, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118142 (128) (282) (138) 200
CASH AND CASH
EQUIV ALENTS A T END OF
YEAR/PERIOD /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,976 37,498
ANAL YSIS OF BALANCES OF
CASH AND CASH
EQUIV ALENTS
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H111818,978 40,633 70,331 65,425 56,040
Less: Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(c) (5,360) (4,998) (7,563) (27,060) (16,239)
Less: Restricted bank deposits /H1118/H1118/H111826(b) (932) (587) (75) (389) (2,303)
Cash and cash equivalents as
stated in the statement of
financial position and statement
of cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,976 37,498
APPENDIX I ACCOUNTANTS’ REPORT
– I-17 –


--- page 513 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
As at
31 December
As at
31 December
As at
31 December
As at
31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
NON-CURRENT ASSETS
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 8,364 12,977 15,259 16,272
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(a) 748 654 2,178 2,146
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 423 472 1,407 1,781
Investments in joint ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816 7,531 8,152 9,273 10,248
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 1,671 1,319 2,014 1,181
Investments in subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 9,715 12,795 15,708 15,862
Equity investments designated at fair value
through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H111818 282 270 260 248
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 433 7,160 653 339
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 3,440 2,107 2,388 2,404
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(b) 5–––
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832,612 45,906 49,140 50,481
CURRENT ASSETS
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 5,177 9,743 9,721 9,504
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822 9,585 16,785 45,005 51,283
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823 3,485 4,636 477 1,089
Prepayments, other receivables and
other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 20,047 21,832 10,075 14,241
Prepaid income tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 54 – –
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820 6,025 5,212 19,118 29,265
Financial assets at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 1,903 1,338 4,557 1,291
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(c) 503 1,657 5,914 13,721
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(b) 296 25 – 2,000
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826(a) 5,693 19,433 55,287 28,757
Total current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111852,747 80,715 150,154 151,151
APPENDIX I ACCOUNTANTS’ REPORT
– I-18 –


--- page 514 ---
As at
31 December
As at
31 December
As at
31 December
As at
31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
CURRENT LIABILITIES
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827 26,788 44,759 79,780 80,718
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 18,415 27,699 47,907 49,938
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 10,383 13,379 9,566 6,796
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 7 1–––
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(b) 9 4 127 244
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 2,158 2,598
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 4,543 8,873 4,338 4,709
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 635 1,492 2,682 2,928
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 19 16 118 865
Total current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111860,863 96,222 146,676 148,796
NET CURRENT (LIABILITIES)/ASSETS /H1118/H1118/H1118/H1118 (8,116) (15,507) 3,478 2,355
TOTAL ASSETS LESS CURRENT
LIABILITIES /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,496 30,399 52,618 52,836
NON-CURRENT LIABILITIES
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 839 1,995 2,727 2,723
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 10,747 5,403 2,640 2,640
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 6 2 5–––
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(b) 8 5 1,524 1,415
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 176 709 4,974 4,026
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111835 1,453 2,842 4,956 5,262
Total non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,848 10,954 16,821 16,066
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,648 19,445 35,797 36,770
EQUITY
Equity attributable to owners of the parent
Share capital /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836 5,470 5,470 5,470 5,470
Reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838 5,178 13,975 30,327 31,300
Total equity /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,648 19,445 35,797 36,770
APPENDIX I ACCOUNTANTS’ REPORT
– I-19 –


--- page 515 ---
II. NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. CORPORATE AND GROUP INFORMATION
Chery Automobile Co., Ltd. (formerly known as “Anhui Auto Parts Co., Ltd.”, hereinafter “the Company”) was
incorporated and registered in the People’s Republic of China (hereinafter referred to as “PRC”) as a limited liability
company in 1997. On March 24, 2008, the Company was converted into a joint stock limited company. The registered
office of the Company is located at No. 8, Changchun Road, Wuhu City, Anhui.
During the Relevant Periods, the Company and its subsidiaries (collectively, the “Group”) were principally
engaged in the manufacturing and sales of passenger vehicles, automotive parts and components.
In the opinion of the directors, before the equity transfer, the holding company and the ultimate holding
company of the Company is Chery Holding Group Co., Ltd. (the “Chery Holding”), which is incorporated in PRC.
In January 2025, an equity transfer was carried out by Chery Holding. Under the equity transfer, the shares of the
Company directly held by Chery Holding were transferred to the shareholders of Chery Holding on a pro rata basis.
The equity transfer was completed on January 20, 2025. Upon completion of the equity transfer, Chery Holding no
longer holds any shares in the Company, and the Company has neither holding company nor ultimate holding
company.
As at the date of this report and during the Relevant Periods, the particulars of the Company’s principal
subsidiaries are set out below:
Name
Place and date of
incorporation/
registration and
place of business
Issued ordinary/
registered share
capital
Percentage of equity
attributable to the
Company
Principal activitiesDirect Indirect
Anhui Chery Automobile Sales Co.,
Ltd.* (ʮ
̡) (note (a)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
14 August 2000
RMB3,000 million 100 – Sales of passenger
vehicles
JSC Chery Automobile RUS
(note (b)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Russia
5 December 2005
Russian Ruble
(“RUB”) 12 million
100 – Sales of passenger
vehicles
Chery New Energy Automobile Co.,
Ltd.* (ࠢ
ʮ̡) (note (c)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
22 April 2010
RMB1,034 million 48.20 – Manufacturing and
sales of
passenger
vehicles
Wuhu Acteco Powertrain Co., Ltd.*
(ʮ̡)
(note (a)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
29 September 2005
RMB2,000 million 100 – Manufacturing and
sales of
automotive parts
and components
Wuhu Chery Technology Co., Ltd.*
(ʮ̡)
(note (a)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
21 November 2001
RMB1,893 million 100 – Manufacturing and
sales of
automotive parts
and components
Wuhu Jetour Automobile Sales
Co., Ltd.* ( ጾಳઠ௄ӛԓቖਯϞ
ʮ̡) (note (d)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
28 April 2017
RMB500 million 100 – Sales of passenger
vehicles
Soueast Motor Corporation Ltd.*
(ی؇(ܔ)ʮ
̡) (note (e)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
21 May 1992
RMB2,784 million – 70 Manufacturing and
sales of
passenger
vehicles
iCAR Ecological Technology Co.,
Ltd.* (ʮ̡)
(note (f)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
18 November 2015
RMB1,000 million – 48.20 Sales of passenger
vehicles
Wuhu Chery Auto Parts
Procurement Co., Ltd.* ( ጾಳփ
ʮ̡)
(note (a)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mainland China
29 September 2005
RMB5 million 60 40 Supply Chain
Management
APPENDIX I ACCOUNTANTS’ REPORT
– I-20 –


--- page 516 ---
Notes:
(a) The statutory financial statements of these entities for the year ended 31 December 2022 prepared in
accordance with the China Accounting Standards for Business Enterprises were audited by Zhongqin
Wanxin Certified Public Accountants LLP (ה(౷ஷΥྫ)), certified public
accountants registered in the Mainland China. The statutory financial statements of these entities for the
years ended 31 December 2023 and 2024 prepared in accordance with the China Accounting Standards
for Business Enterprises were audited by RSM Certified Public Accountants LLP (ה(त
౷ஷΥྫ)), certified public accountants registered in the Mainland China.
(b) The statutory financial statements of this entity for the years ended 31 December 2022 and 2023
prepared in accordance with Russian Accounting Standards were audited by HelpAudit LLC
(Общество с ограниченной ответственностью «ХЭЛП-АУДИТ») , certified public accountants
registered in Russia. The statutory financial statements of this entity for the year ended 31 December
2024 prepared in accordance with Russian Accounting Standards were audited by Gruppa Financy LLC
(ООО “ГРУППА ФИНАНСЫ”) , certified public accountants registered in Russia.
(c) The statutory financial statements of this entity for the years ended 31 December 2022, 2023 and 2024
prepared in accordance with the China Accounting Standards for Business Enterprises were audited by
RSM Certified Public Accountants LLP (ה(౷ஷΥྫ)), certified public
accountants registered in the Mainland China.
(d) The statutory financial statements of this entity for the years ended 31 December 2022 and 2023
prepared in accordance with the China Accounting Standards for Business Enterprises were audited by
Anhui Xinzhongtian Certified Public Accountants Co., Ltd. (ʮ̡),
certified public accountants registered in the Mainland China. The statutory financial statements of this
entity for the year ended 31 December 2024 prepared in accordance with the China Accounting
Standards for Business Enterprises were audited by RSM Certified Public Accountants LLP (ࠇ
ה(౷ஷΥྫ)), certified public accountants registered in the Mainland China.
(e) On 18 February 2024, the Group acquired Soueast Motor Corporation Ltd. Further details of this
acquisition are included in notes 40 and 46 to the Historical Financial Information. The statutory
financial statements of the entity for the year ended 31 December 2022 prepared in accordance with the
China Accounting Standards for Business Enterprises were audited by Grant Thornton Certified Public
Accountants LLP Fuzhou Branch (ה(౷ஷΥྫ)הcertified public
accountants registered in the Mainland China. The statutory financial statements of the entity for the
years ended 31 December 2023 and 2024 prepared in accordance with the China Accounting Standards
for Business Enterprises were audited by RSM Certified Public Accountants LLP (ה(त
౷ஷΥྫ)), certified public accountants registered in the Mainland China.
(f) No audited financial statements have been prepared for the entity for the years ended 31 December 2022,
2023 and 2024, as the entity was not subject to any statutory audit requirements under the relevant rules
and regulations in its jurisdiction of incorporation. The entity is a wholly-owned subsidiary of Chery
New Energy Automobile Co., Ltd.
* The English names of the PRC companies above represent management’s best efforts in translating the
Chinese names of these companies as no English names have been registered.
The above table lists the subsidiaries of the Company which, in the opinion of the directors, principally
affected the results during the Relevant Periods or formed a substantial portion of the net assets of the Group. To give
details of other subsidiaries would, in the opinion of the directors, result in particulars of excessive length.
APPENDIX I ACCOUNTANTS’ REPORT
– I-21 –


--- page 517 ---
The Company
The carrying amounts of the Company’s investments in subsidiaries are as follows:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Investment, at cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,252 13,332 16,245 16,399
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(537) (537) (537) (537)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,715 12,795 15,708 15,862
2.1 BASIS OF PREPARATION
The Historical Financial Information has been prepared in accordance with HKFRS Accounting Standards
(which include all Hong Kong Financial Reporting Standards, Hong Kong Accounting Standards (“HKASs”) and
Interpretations) as issued by the HKICPA and accounting principles generally accepted in Hong Kong.
All HKFRS Accounting Standards effective for the accounting period commencing from 1 January 2025,
together with the relevant transitional provisions, have been early adopted by the Group in the preparation of the
Historical Financial Information throughout the Relevant Periods.
The Historical Financial Information has been prepared under the historical cost convention, except for
financial assets at fair value through profit or loss, equity investments designated at fair value through other
comprehensive income, financial assets at fair value through other comprehensive income and derivative financial
instruments which have been measured at fair value.
The Group’s net current liabilities amounted to RMB4,760 million, RMB17,388 million, RMB3,401 million
and RMB2,788 million at 31 December 2022, 2023 and 2024 and 31 March 2025, respectively. Taking into account
the available facilities from banks and cash flows from operations for the twelve months from 31 March 2025, the
directors of the Company believe that the Group will have sufficient financial resources to settle the borrowings and
payments that will be due within next twelve months and consequently, the Historical Financial Information has been
prepared on a going concern basis.
Basis of consolidation
The Historical Financial Information includes the financial statements of the Group for the Relevant Periods.
A subsidiary is an entity (including a structured entity), directly or indirectly, controlled by the Company. Control
is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and
has the ability to affect those returns through its power over the investee (i.e., existing rights that give the Group the
current ability to direct the relevant activities of the investee).
Generally, there is a presumption that a majority of voting rights results in control. When the Company has
less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee, including:
(a) the contractual arrangement with the other vote holders of the investee;
(b) rights arising from other contractual arrangements; and
(c) the Group’s voting rights and potential voting rights.
The financial statements of the subsidiaries are prepared for the same reporting period as the Company, using
consistent accounting policies. The results of subsidiaries are consolidated from the date on which the Group obtains
control, and continue to be consolidated until the date that such control ceases.
APPENDIX I ACCOUNTANTS’ REPORT
– I-22 –


--- page 518 ---
Profit or loss and each component of other comprehensive income are attributed to the owners of the parent
of the Group and to the non-controlling interests, even if this results in the non-controlling interests having a deficit
balance. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions
between members of the Group are eliminated in full on consolidation.
The Group reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control described above. A change in the ownership interest of a
subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities,
any non-controlling interest and the exchange fluctuation reserve; and recognises the fair value of any investment
retained and any resulting surplus or deficit in profit or loss. The Group’s share of components previously recognised
in other comprehensive income is reclassified to profit or loss or retained profits, as appropriate, on the same basis
as would be required if the Group had directly disposed of the related assets or liabilities.
2.2 ISSUED BUT NOT YET EFFECTIVE HKFRS ACCOUNTING STANDARDS
The Group has not applied the following new and revised HKFRS Accounting Standards, that have been issued
but are not yet effective, in the Historical Financial Information. The Group intends to apply these new and revised
HKFRS Accounting Standards, if applicable, when they become effective.
HKFRS 18 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Presentation and Disclosure in Financial Statements
2
HKFRS 19 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Subsidiaries without Public Accountability: Disclosures 2
Amendments to HKFRS 9 and HKFRS 7 /H1118/H1118/H1118/H1118Amendments to the Classification and Measurement of
Financial Instruments 1
Amendments to HKFRS 9 and HKFRS 7 /H1118/H1118/H1118Contracts Referencing Nature-dependent Electricity 1
Amendments to HKFRS 10 and HKAS 28 /H1118/H1118/H1118Sale or Contribution of Assets between an Investor and
its Associate or Joint V enture 3
Annual Improvements to HKFRS Accounting
Standards – V olume 11 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Amendments to HKFRS 1, HKFRS 7, HKFRS 9,
HKFRS 10 and HKAS 7 1
1 Effective for annual periods beginning on or after 1 January 2026
2 Effective for annual periods beginning on or after 1 January 2027
3 No mandatory effective date yet determined but available for adoption
The Group is in the process of making an assessment of the impact of these new and revised HKFRS
Accounting Standards upon initial application. HKFRS 18 introduces new requirements on presentation within the
statement of profit or loss, including specified totals and subtotals. It also requires disclosure of management-defined
performance measures in a note and includes new requirements for aggregation and disaggregation of financial
information. The new requirements are expected to impact the Group’s presentation in the statement of profit or loss,
statement of comprehensive income and disclosures of the Group’s financial performance. Currently, the Group
considers that these new and revised HKFRS Accounting Standards are unlikely to have a significant impact on the
Group’s financial performance and financial position.
2.3 MATERIAL ACCOUNTING POLICY INFORMATION
Investments in associates and joint ventures
An associate is an entity in which the Group has a long-term interest of generally not less than 20% of the
equity voting rights and over which it has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of the investee, but is not control or joint control over those policies.
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 joint venture. Joint control is the contractually agreed sharing of control of an
arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the
parties sharing control.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 519 ---
The Group’s investments in associates and joint ventures are stated in the consolidated statement of financial
position at the Group’s share of net assets under the equity method of accounting, less any impairment losses.
The Group’s share of the post-acquisition results and other comprehensive income of associates and joint
ventures is included in the consolidated statement of profit or loss and consolidated other comprehensive income,
respectively. In addition, when there has been a change recognised directly in the equity of the associate or joint
venture, the Group recognises its share of any changes, when applicable, in the consolidated statement of changes
in equity. Unrealised gains and losses resulting from transactions between the Group and its associates or joint
ventures are eliminated to the extent of the Group’s investments in the associates or joint ventures, except where
unrealised losses provide evidence of an impairment of the assets transferred. Goodwill arising from the acquisition
of associates or joint ventures is included as part of the Group’s investments in associates or joint ventures.
Upon loss of significant influence over the associate or joint control over the joint venture, the Group measures
and recognises any retained investment at its fair value. Any difference between the carrying amount of the associate
or joint venture upon loss of significant influence or joint control and the fair value of the retained investment and
proceeds from disposal is recognised in profit or loss.
Business combination under common control
The consolidated financial statements incorporate the financial statements items of the combining businesses
in which the common control combination occurs as if they had been combined from the date when the combining
businesses first came under the control of the controlling party.
The net assets of the combining businesses are consolidated using the existing book values from the controlling
party’s perspective. No amount is recognised in respect of goodwill or bargain purchase gain at the time of common
control combination.
The consolidated income statement includes the results of each of the combining businesses from the earliest
date presented or since the date when the combining businesses first came under the common control, where this is
a shorter period.
Business combinations other than under common control and goodwill
Business combinations are accounted for using the acquisition method. The consideration transferred is
measured at the acquisition date fair value which is the sum of the acquisition date fair values of assets transferred
by the Group, liabilities assumed by the Group to the former owners of the acquiree and the equity interests issued
by the Group in exchange for control of the acquiree. For each business combination, the Group elects whether to
measure the non-controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s
identifiable net assets. All other components of non-controlling interests are measured at fair value. Acquisition-
related costs are expensed as incurred.
The Group determines that it has acquired a business when the acquired set of activities and assets includes
an input and a substantive process that together significantly contribute to the ability to create outputs.
When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate
classification and designation in accordance with the contractual terms, economic circumstances and pertinent
conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts of the
acquiree.
Any contingent consideration to be transferred by the acquirer is recognised at fair value at the acquisition
date. Contingent consideration classified as an asset or liability is measured at fair value with changes in fair value
recognised in profit or loss. Contingent consideration that is classified as equity is not remeasured and subsequent
settlement is accounted for within equity.
Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred, the
amount recognised for non-controlling interests and any fair value of the Group’s previously held equity interests in
the acquiree over the identifiable assets acquired and liabilities assumed. If the sum of this consideration and other
items is lower than the fair value of the net assets acquired, the difference is, after reassessment, recognised in profit
or loss as a gain on bargain purchase.
APPENDIX I ACCOUNTANTS’ REPORT
– I-24 –


--- page 520 ---
After initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is
tested for impairment annually or more frequently if events or changes in circumstances indicate that the carrying
value may be impaired. The Group performs its annual impairment test of goodwill as at 31 December. For the
purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated
to each of the Group’s cash-generating units, or groups of cash-generating units, that are expected to benefit from
the synergies of the combination, irrespective of whether other assets or liabilities of the Group are assigned to those
units or groups of units.
Impairment is determined by assessing the recoverable amount of the cash-generating unit (group of
cash-generating units) to which the goodwill relates. Where the recoverable amount of the cash-generating unit
(group of cash-generating units) is less than the carrying amount, an impairment loss is recognised. An impairment
loss recognised for goodwill is not reversed in a subsequent period.
Where goodwill has been allocated to a cash-generating unit (or group of cash-generating units) and part of
the operation within that unit is disposed of, the goodwill associated with the operation disposed of is included in
the carrying amount of the operation when determining the gain or loss on the disposal. Goodwill disposed of in these
circumstances is measured based on the relative value of the operation disposed of and the portion of the
cash-generating unit retained.
Fair value measurement
The Group measures its certain of bills, wealth management products, derivative financial instruments and
equity investments at fair value at the end of each of the Relevant Periods. Fair value is the price that would be
received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or
transfer the liability takes place either in the principal market for the asset or liability, or in the absence of a principal
market, in the most advantageous market for the asset or liability. The principal or the most advantageous market
must be accessible by the Group. The fair value of an asset or a liability is measured using the assumptions that
market participants would use when pricing the asset or liability, assuming that market participants act in their
economic best interest.
A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate
economic benefits by using the asset in its highest and best use or by selling it to another market participant that
would use the asset in its highest and best use.
The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data
are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
All assets and liabilities for which fair value is measured or disclosed in the Historical Financial Information
are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant
to the fair value measurement as a whole:
Level 1 – based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is observable, either directly or indirectly
Level 3 – based on valuation techniques for which the lowest level input that is significant to the fair
value measurement is unobservable
For assets and liabilities that are recognised in the Historical Financial Information on a recurring basis, the
Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation
(based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each of
the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-25 –


--- page 521 ---
Impairment of non-financial assets
Where an indication of impairment exists, or when annual impairment testing for an asset is required (other
than inventories, contract assets, deferred tax assets and financial assets), the asset’s recoverable amount is estimated.
An asset’s recoverable amount is the higher of the asset’s or cash-generating unit’s value in use and its fair value less
costs of disposal, and is determined for an individual asset, unless the asset does not generate cash inflows that are
largely independent of those from other assets or groups of assets, in which case the recoverable amount is
determined for the cash-generating unit to which the asset belongs.
An impairment loss is recognised only if the carrying amount of an asset exceeds its recoverable amount. 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 assessments of the time value of money and the risks specific to the asset. An
impairment loss is charged to the statement of profit or loss in the period in which it arises in those expense categories
consistent with the function of the impaired asset.
An assessment is made at the end of each of the Relevant Periods as to whether there is an indication that
previously recognised impairment losses may no longer exist or may have decreased. If such an indication exists, the
recoverable amount is estimated. A previously recognised impairment loss of an asset other than goodwill is reversed
only if there has been a change in the estimates used to determine the recoverable amount of that asset, but not to
an amount higher than the carrying amount that would have been determined (net of any depreciation/amortisation)
had no impairment loss been recognised for the asset in prior years. A reversal of such an impairment loss is credited
to the statement of profit or loss in the period in which it arises.
Related parties
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 that person:
(i) has control or joint control over 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;
or
(b) the party is an entity where 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 of a parent, subsidiary or fellow
subsidiary of the other entity);
(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); and
(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.
APPENDIX I ACCOUNTANTS’ REPORT
– I-26 –


--- page 522 ---
Property, plant and equipment and depreciation
Property, plant and equipment, other than construction in progress, are stated at cost less accumulated
depreciation and any 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.
Expenditure incurred after items of property, plant and equipment have been put into operation, such as repairs
and maintenance, is normally charged to the statement of profit or loss in the period in which it is incurred. In
situations where the recognition criteria are satisfied, the expenditure for a major inspection is capitalised in the
carrying amount of the asset as a replacement. Where significant parts of property, plant and equipment are required
to be replaced at intervals, the Group recognises such parts as individual assets with specific useful lives and
depreciates them accordingly.
Depreciation is calculated on the straight-line basis to write off the cost of each item of property, plant and
equipment to its residual value over its estimated useful life. The principal annual rates used for this purpose are as
follows:
Category Principal annual rate
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.71%-12.50%
Machinery and molds /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186.33%-25.00%
Electronic equipments and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189.50%-25.00%
V ehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189.50%-33.33%
Leasehold improvements /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186.67%-33.33%
Freehold lands /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180%
Where parts of an item of property, plant and equipment have different useful lives, the cost of that item is
allocated on a reasonable basis among the parts and each part is depreciated separately. Residual values, useful lives
and the depreciation method are reviewed, and adjusted if appropriate, at least at each financial year end.
An item of property, plant and equipment including any significant part initially recognised is derecognised
upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss on disposal
or retirement recognised in the statement of profit or loss in the year the asset is derecognised is the difference
between the net sales proceeds and the carrying amount of the relevant asset.
Construction in progress is stated at cost less any impairment losses, and is not depreciated. It is reclassified
to the appropriate category of property, plant and equipment when completed and ready for use.
Intangible assets (other than goodwill)
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets
acquired in a business combination is the fair value at the date of acquisition. The useful lives of intangible assets
are assessed to be either finite or indefinite. Intangible assets with finite lives are subsequently amortised over the
useful economic life and assessed for impairment whenever there is an indication that the intangible asset may be
impaired. The amortisation period and the amortisation method for an intangible asset with a finite useful life are
reviewed at least at each financial year end.
Software
Purchased software and others is stated at cost less any impairment losses and are amortised on the straight-line
basis over their estimated useful lives of 2 to 10 years.
Patents
Patents are stated at cost less any impairment losses and are amortised on the straight-line basis over their
estimated useful lives of 3 to 5 years.
APPENDIX I ACCOUNTANTS’ REPORT
– I-27 –


--- page 523 ---
Research and Development costs
All research costs are charged to the statement of profit or loss as incurred.
Expenditure incurred on projects to develop new products is capitalised and deferred only when the Group can
demonstrate the technical feasibility of completing the intangible asset so that it will be available for use or sale, its
intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, the
availability of resources to complete the project and the ability to measure reliably the expenditure during the
development. Product development expenditure which does not meet these criteria is expensed when incurred.
Deferred development costs are stated at cost less any impairment losses and are amortised using the
straight-line basis over the commercial lives of the underlying products of 3-5 years, commencing from the date when
the products are put into commercial production.
Leases
The Group assesses at contract inception whether a contract is, or contains, a lease. A contract is, or contains,
a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for
consideration.
Group as a lessee
The Group applies a single recognition and measurement approach for all leases, except for short-term leases
and leases of low-value assets. The Group recognises lease liabilities to make lease payments and right-of-use assets
representing the right to use the underlying assets.
(a) Right-of-use assets
Right-of-use assets are recognised at the commencement date of the lease (that is the date the underlying
asset is available for use). Right-of-use assets are measured at cost, less accumulated depreciation and any
impairment losses, and adjusted for any remeasurement of lease liabilities. The cost of right-of-use assets
includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments made at
or before the commencement date less any lease incentives received. Right-of-use assets are depreciated on a
straight-line basis over the shorter of the lease terms and the estimated useful lives of the assets as follows:
Leasehold land /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 years
Buildings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 20 years
Machinery /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 10 years
V ehicles and others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 to 5 years
If ownership of the leased asset transfers to the Group by the end of the lease term or the cost reflects
the exercise of a purchase option, depreciation is calculated using the estimated useful life of the asset.
(b) Lease liabilities
Lease liabilities are recognised at the commencement date of the lease at the present value of lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance
fixed payments) less any lease incentives receivable, variable lease payments that depend on an index or a rate,
and amounts expected to be paid under residual value guarantees. The lease payments also include the exercise
price of a purchase option reasonably certain to be exercised by the Group and payments of penalties for
termination of a lease, if the lease term reflects the Group exercising the option to terminate the lease. The
variable lease payments that do not depend on an index or a rate are recognised as an expense in the period
in which the event or condition that triggers the payment occurs.
In calculating the present value of lease payments, the Group uses its incremental borrowing rate at the
lease commencement date because the interest rate implicit in the lease is not readily determinable. After the
commencement date, the amount of lease liabilities is increased to reflect the accretion of interest and reduced
for the lease payments made. In addition, the carrying amount of lease liabilities is remeasured if there is a
modification, a change in the lease term, a change in lease payments (e.g., a change to future lease payments
resulting from a change in an index or rate) or a change in assessment of an option to purchase the underlying
asset.
APPENDIX I ACCOUNTANTS’ REPORT
– I-28 –


--- page 524 ---
(c) Short-term leases and leases of low-value assets
The Group applies the short-term lease recognition exemption to its short-term leases of buildings and
machinery (that is those leases that have a lease term of 12 months or less from the commencement date and
do not contain a purchase option). It also applies the recognition exemption for leases of low-value assets to
leases of machinery, vehicles and others that are considered to be of low value.
Lease payments on short-term leases and leases of low-value assets are recognised as an expense on a
straight-line basis over the lease term.
Investments and other financial assets
Initial recognition and measurement
Financial assets are classified, at initial recognition, as subsequently measured at amortised cost, fair value
through other comprehensive income, and fair value through profit or loss.
The classification of financial assets at initial recognition depends on the financial asset’s contractual cash
flow characteristics and the Group’s business model for managing them. With the exception of trade receivables that
do not contain a significant financing component or for which the Group has applied the practical expedient of not
adjusting the effect of a significant financing component, the Group initially measures a financial asset at its fair
value plus in the case of a financial asset not at fair value through profit or loss, transaction costs. Trade receivables
that do not contain a significant financing component or for which the Group has applied the practical expedient are
measured at the transaction price determined under HKFRS 15 in accordance with the policies set out for “Revenue
recognition” below.
In order for a financial asset to be classified and measured at amortised cost or fair value through other
comprehensive income, it needs to give rise to cash flows that are solely payments of principal and interest (“SPPI”)
on the principal amount outstanding. Financial assets with cash flows that are not SPPI are classified and measured
at fair value through profit or loss, irrespective of the business model.
The Group’s business model for managing financial assets refers to how it manages its financial assets in order
to generate cash flows. The business model determines whether cash flows will result from collecting contractual
cash flows, selling the financial assets, or both. Financial assets classified and measured at amortised cost are held
within a business model with the objective to hold financial assets in order to collect contractual cash flows, while
financial assets classified and measured at fair value through other comprehensive income are held within a business
model with the objective of both holding to collect contractual cash flows and selling. Financial assets which are not
held within the aforementioned business models are classified and measured at fair value through profit or loss.
Purchases or sales of financial assets that require delivery of assets within the period generally established by
regulation or convention in the marketplace are recognised on the trade date, that is, the date that the Group commits
to purchase or sell the asset.
Subsequent measurement
The subsequent measurement of financial assets depends on their classification as follows:
Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest method and are
subject to impairment. Gains and losses are recognised in the statement of profit or loss when the asset is
derecognised, modified or impaired.
Financial assets at fair value through other comprehensive income (debt instruments)
For debt investments at fair value through other comprehensive income, interest income, foreign exchange
revaluation and impairment losses or reversals are recognised in the statement of profit or loss and computed in the
same manner as for financial assets measured at amortised cost. The remaining fair value changes are recognised in
other comprehensive income. Upon derecognition, the cumulative fair value change recognised in other
comprehensive income is recycled to the statement of profit or loss.
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Financial assets designated at fair value through other comprehensive income (equity investments)
Upon initial recognition, the Group can elect to classify irrevocably its equity investments as equity
investments designated at fair value through other comprehensive income when they meet the definition of equity
under HKAS 32 Financial Instruments: Presentation and are not held for trading. The classification is determined
on an instrument-by-instrument basis.
Gains and losses on these financial assets are never recycled to the statement of profit or loss. Dividends are
recognised as other income in the statement of profit or loss when the right of payment has been established, except
when the Group benefits from such proceeds as a recovery of part of the cost of the financial asset, in which case,
such gains are recorded in other comprehensive income. Equity investments designated at fair value through other
comprehensive income are not subject to impairment assessment.
Financial assets at fair value through profit or loss
Financial assets at fair value through profit or loss are carried in the statement of financial position at fair value
with net changes in fair value recognised in the statement of profit or loss.
This category includes derivative instruments and equity investments which the Group had not irrevocably
elected to classify at fair value through other comprehensive income. Dividends on the equity investments are also
recognised as other income in the statement of profit or loss when the right of payment has been established.
A derivative embedded in a hybrid contract, with a financial liability or non-financial host, is separated from
the host and accounted for as a separate derivative if the economic characteristics and risks are not closely related
to the host; a separate instrument with the same terms as the embedded derivative would meet the definition of a
derivative; and the hybrid contract is not measured at fair value through profit or loss. Embedded derivatives are
measured at fair value with changes in fair value recognised in the statement of profit or loss. Reassessment occurs
if there is a change in the terms of the contract that significantly modifies the cash flows.
A derivative embedded within a hybrid contract containing a financial asset host is not accounted for
separately. The financial asset host together with the embedded derivative is required to be classified in its entirety
as a financial asset at fair value through profit or loss.
Derecognition of financial assets
A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets)
is primarily derecognised (i.e., removed from the Group’s consolidated statement of financial position) when:
 the rights to receive cash flows from the asset have expired; or
 the Group has transferred its rights to receive cash flows from the asset or has assumed an obligation
to pay the received cash flows in full without material delay to a third party under a “pass-through”
arrangement; and either (a) the Group has transferred substantially all the risks and rewards of the asset,
or (b) the Group has neither transferred nor retained substantially all the risks and rewards of the asset,
but has transferred control of the asset.
When the Group has transferred its rights to receive cash flows from an asset or has entered into a pass-through
arrangement, it evaluates if, and to what extent, it has retained the risk and rewards of ownership of the asset. When
it has neither transferred nor retained substantially all the risks and rewards of the asset nor transferred control of
the asset, the Group continues to recognise the transferred asset to the extent of the Group’s continuing involvement.
In that case, the Group also recognises an associated liability. The transferred asset and the associated liability are
measured on a basis that reflects the rights and obligations that the Group has retained.
Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower
of the original carrying amount of the asset and the maximum amount of consideration that the Group could be
required to repay.
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Impairment of financial assets
The Group recognises an allowance for expected credit losses (“ECLs”) for all debt instruments not held at fair
value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance
with the contract and all the cash flows that the Group expects to receive, discounted at an approximation of the
original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or
other credit enhancements that are integral to the contractual terms.
General approach
ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase
in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are
possible within the next 12 months (a 12-month ECL). For those credit exposures for which there has been a
significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over
the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).
At the end of each the Relevant Periods, the Group assesses whether the credit risk on a financial instrument
has increased significantly since initial recognition. When making the assessment, the Group compares the risk of a
default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the
financial instrument as at the date of initial recognition and considers reasonable and supportable information that
is available without undue cost or effort, including historical and forward-looking information.
The Group considers a financial asset in default when contractual payments are 90 days past due. However,
in certain cases, the Group may also consider a financial asset to be in default when internal or external information
indicates that the Group is unlikely to receive the outstanding contractual amounts in full before taking into account
any credit enhancements held by the Group.
The Group assesses on a forward looking basis the expected credit losses and the impairment methodology
applied depends on whether there has been a significant increase in credit risk.
A financial asset is written off when there is no reasonable expectation of recovering the contractual cash
flows.
Debt investments at fair value through other comprehensive income and financial assets at amortised cost are
subject to impairment under the general approach and they are classified within the following stages for measurement
of ECLs except for trade receivables and contract assets which apply the simplified approach as detailed below.
Stage 1 – Financial instruments for which credit risk has not increased significantly since initial
recognition and for which the loss allowance is measured at an amount equal to 12-month
ECLs
Stage 2 – Financial instruments for which credit risk has increased significantly since initial recognition
but that are not credit-impaired financial assets and for which the loss allowance is measured
at an amount equal to lifetime ECLs
Stage 3 – Financial assets that are credit-impaired at the reporting date (but that are not purchased or
originated credit-impaired) and for which the loss allowance is measured at an amount equal
to lifetime ECLs
Simplified approach
For trade receivables and contract assets that do not contain a significant financing component or when the
Group applies the practical expedient of not adjusting the effect of a significant financing component, the Group
applies the simplified approach in calculating ECLs. Under the simplified approach, the Group does not track changes
in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Group has
established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking
factors specific to the debtors and the economic environment.
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Financial liabilities
Initial recognition and measurement
Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or
loss, loans and borrowings, payables.
All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and
payables, net of directly attributable transaction costs.
The Group’s financial liabilities include trade and bills payables, other payables and accruals, derivative
financial instruments, interest-bearing bank loans and other borrowings and bonds payables.
Subsequent measurement
The subsequent measurement of financial liabilities depends on their classification as follows:
Financial liabilities at amortised cost (trade and bills payables, other payables and accruals, interest-bearing bank
loans and other borrowings and bonds payables)
After initial recognition, trade and bills payables, other payables and accruals, interest-bearing bank loans and
other borrowings and bonds payables are subsequently measured at amortised cost, using the effective interest rate
method unless the effect of discounting would be immaterial, in which case they are stated at cost. Gains and losses
are recognised in the statement of profit or loss when the liabilities are derecognised as well as through the effective
interest rate amortisation process.
Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs
that are an integral part of the effective interest rate. The effective interest rate amortisation is included in finance
costs in the statement of profit or loss.
Financial guarantee contracts
Financial guarantee contracts issued by the Group are those contracts that require a payment to be made to
reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance
with the terms of a debt instrument. A financial guarantee contract is recognised initially as a liability at its fair value,
adjusted for transaction costs that are directly attributable to the issuance of the guarantee. Subsequent to initial
recognition, the Group measures the financial guarantee contracts at the higher of: (i) the ECL allowance determined
in accordance with the policy as set out in “Impairment of financial assets”; and (ii) the amount initially recognised
less, when appropriate, the cumulative amount of income recognised.
Derecognition of financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or
expires.
When 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 a recognition of a new liability, and the difference between the respective
carrying amounts is recognised in the statement of profit or loss.
Offsetting of financial instruments
Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial
position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to
settle on a net basis, or to realise the assets and settle the liabilities simultaneously.
APPENDIX I ACCOUNTANTS’ REPORT
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Derivative financial instruments
Initial recognition and subsequent measurement
The Group uses derivative financial instruments, such as forward currency contracts and interest rate swaps,
to hedge its foreign currency risk and interest rate risk, respectively. Such derivative financial instruments are
initially recognised at fair value on the date on which a derivative contract is entered into and are subsequently
remeasured at fair value. Derivatives are carried as assets when the fair value is positive and as liabilities when the
fair value is negative.
Any gains or losses arising from changes in fair value of derivatives are taken directly to the statement of profit
or loss.
Inventories
Inventories are stated at the lower of cost and net realisable value.
Costs incurred in bringing each product to its present location and condition comprises direct materials, direct
labour and an appropriate proportion of overheads and are accounted for as follows:
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Purchase cost on the weighted average basis
Finished goods and work in progress /H1118/H1118Cost of direct materials, labors and an appropriate proportion of
manufacturing overheads based on the normal operating capacity
but excluding borrowing costs
Net realisable value is based on estimated selling prices less any estimated costs to be incurred to completion
and disposal.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position comprise cash on hand and at banks, and
short-term highly liquid deposits with a maturity of generally within three months that are readily convertible into
known amounts of cash, subject to an insignificant risk of changes in value and held for the purpose of meeting
short-term cash commitments.
For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise cash on hand
and at banks, and short-term deposits as defined above, less bank overdrafts which are repayable on demand and form
an integral part of the Group’s cash management.
Provisions
A provision is recognised when a present obligation (legal or constructive) has arisen as a result of a past event
and it is probable that a future outflow of resources will be required to settle the obligation, provided that a reliable
estimate can be made of the amount of the obligation.
When the Group expects some or all of a provision to be reimbursed, the reimbursement is recognised as a
separate asset, but only when the reimbursement is virtually certain. The expense relating to a provision is presented
in the statement of profit or loss net of any reimbursement.
The Group provides for warranties in relation to the sales of passenger vehicles, automotive parts and
components. Provisions for these assurance-type warranties granted by the Group are initially recognised based on
sales volume and past experience of the level of repairs and returns. The estimation is reviewed on an ongoing basis
and is revised when appropriate.
Income tax
Income tax comprises current and deferred tax. Income tax relating to items recognised outside profit or loss
is recognised outside profit or loss, either in other comprehensive income or directly in equity.
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Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of
each of the Relevant Periods, taking into consideration interpretations and practices prevailing in the countries in
which the Group operates.
Deferred tax is provided, using the liability method, on all temporary differences at the end of each of the
Relevant Periods between the tax bases of assets and liabilities and their carrying amounts for financial reporting
purposes.
Deferred tax liabilities are recognised for all taxable temporary differences, except:
 when the deferred tax liability arises from the initial recognition of goodwill or an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss and does not give rise to equal taxable and deductible
temporary differences; and
 in respect of taxable temporary differences associated with investments in subsidiaries, associates and
joint ventures, when the timing of the reversal of the temporary differences can be controlled and it is
probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, and the carryforward of unused tax
credits and any unused tax losses. Deferred tax assets are recognised to the extent that it is probable that taxable profit
will be available against which the deductible temporary differences, and the carryforward of unused tax credits and
unused tax losses can be utilised, except:
 when the deferred tax asset relating to the deductible temporary differences arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss and does not give rise
to equal taxable and deductible temporary differences; and
 in respect of deductible temporary differences associated with investments in subsidiaries, associates
and joint ventures, deferred tax assets are only recognised to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and taxable profit will be available against
which the temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed at the end of each of the Relevant Periods and reduced
to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the
deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at the end of each of the Relevant
Periods and are recognised to the extent that it has become probable that sufficient taxable profit will be available
to allow all or part of the deferred tax asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively
enacted by the end of each of the Relevant Periods.
Deferred tax assets and deferred tax liabilities are offset if and only if the Group has a legally enforceable right
to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to
income taxes levied by the same taxation authority on either the same taxable entity or 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.
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and all attaching conditions will be complied with. When the grant relates to an expense item, it is
recognised as income on a systematic basis over the periods that the costs, for which it is intended to compensate,
are expensed.
Where the grant relates to an asset, the fair value is credited to a deferred income account and is released to
the statement of profit or loss over the expected useful life of the relevant asset by equal annual instalments.
APPENDIX I ACCOUNTANTS’ REPORT
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Revenue recognition
Revenue from contracts with customers
Revenue from contracts with customers is recognised when control of goods or services is transferred to the
customers at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those
goods or services.
When the consideration in a contract includes a variable amount, the amount of consideration is estimated to
which the Group will be entitled in exchange for transferring the goods or services to the customer. The variable
consideration is estimated at contract inception and constrained until it is highly probable that a significant revenue
reversal in the amount of cumulative revenue recognised will not occur when the associated uncertainty with the
variable consideration is subsequently resolved.
When the contract contains a financing component which provides the customer with a significant benefit of
financing the transfer of goods or services to the customer for more than one year, revenue is measured at the present
value of the amount receivable, discounted using the discount rate that would be reflected in a separate financing
transaction between the Group and the customer at contract inception. When the contract contains a financing
component which provides the Group with a significant financial benefit for more than one year, revenue recognised
under the contract includes the interest expense accreted on the contract liability under the effective interest method.
For a contract where the period between the payment by the customer and the transfer of the promised goods or
services is one year or less, the transaction price is not adjusted for the effects of a significant financing component,
using the practical expedient in HKFRS 15.
(a) Sale of goods
The Group manufactures and sells a range of passenger vehicles, automotive parts and components.
Sales revenue are recognised when control of the goods has been transferred to the customers, and there is no
unfulfilled obligation that could affect the customer’s acceptance of the goods.
The Group provides sales rebate and discounts to certain customers for sales of passenger vehicles,
automotive parts and components, and the relevant revenue is recognized based on contract consideration net
of the estimated sales rebate and discount amount.
Passenger vehicles are often sold with volume rebates. To estimate the variable consideration for the
expected future rebates, the most likely amount method is used for contracts with a single-volume threshold
and the expected value method for contracts with more than one volume threshold. The selected method that
best predicts the amount of variable consideration is primarily driven by the number of volume thresholds
contained in the contract. The requirements on constraining estimates of variable consideration are applied and
a refund liability for the expected future rebates is recognised.
(b) Rendering of services
The services rendered include automobile repair and maintenance services, extended warranty services,
technology development services, etc. Should one of the following conditions is satisfied, service provided by
the Group, is a performance obligation performed within a certain period of time. The Group recognizes
revenue within a period of time in accordance with the progress of contract performance. The conditions are:
(1) The customer obtains and consumes the economic benefits brought by the contract at the same time
performing the contract; (2) The customer is able to control the products under construction during the Group’s
performance; (3) The products of the Group have irreplaceable uses, and the Group has the right to ask for
payment for the cumulative part that has been completed so far during the entire contract period. Otherwise,
the Group recognises revenue at the point the customer obtains control of the relevant services.
Other income
Interest income is recognised on an accrual basis using the effective interest method by applying the rate that
exactly discounts the estimated future cash receipts over the expected life of the financial instrument or a shorter
period, when appropriate, to the net carrying amount of the financial asset.
APPENDIX I ACCOUNTANTS’ REPORT
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Dividend income is recognised when the shareholders’ right to receive payment has been established, it is
probable that the economic benefits associated with the dividend will flow to the Group and the amount of the
dividend can be measured reliably.
Contract assets
If the Group performs by transferring goods or services to a customer before being unconditionally entitled to
the consideration under the contract terms, a contract asset is recognised for the earned consideration that is
conditional. Contract assets are subject to impairment assessment, details of which are included in the accounting
policies for impairment of financial assets. They are reclassified to trade receivables when the right to the
consideration becomes unconditional.
Contract liabilities
A contract liability is recognised when a payment is received or a payment is due (whichever is earlier) from
a customer before the Group transfers the related goods or services. Contract liabilities are recognised as revenue
when the Group performs under the contract (i.e., transfers control of the related goods or services to the customer).
Share-based payments
The Company operates several equity-settled, share-based compensation plans (the “Plan”). Employees
(including directors) of the Group receive remuneration in the form of share-based payments, whereby employees
render services in exchange for equity instruments (“equity-settled transactions”). The cost of equity-settled
transactions with employees is measured by reference to the fair value at the date at which they are granted. The fair
value is determined by an external valuer using a black-scholes model, further details of which are given in note 37
to the Historical Financial Information.
The cost of equity-settled transactions is recognised in employee benefit expense, together with a
corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled.
The cumulative expense recognised for equity-settled transactions at the end of each reporting period until the vesting
date reflects the extent to which the vesting period has expired and the Group’s best estimate of the number of equity
instruments that will ultimately vest. The charge or credit to the statement of profit or loss for a period represents
the movement in the cumulative expense recognised as at the beginning and end of that period.
Service and non-market performance conditions are not taken into account when determining the grant date
fair value of awards, but the likelihood of the conditions being met is assessed as part of the Group’s best estimate
of the number of equity instruments that will ultimately vest. Market performance conditions are reflected within the
grant date fair value. Any other conditions attached to an award, but without an associated service requirement, are
considered to be non-vesting conditions. Non-vesting conditions are reflected in the fair value of an award and lead
to an immediate expensing of an award unless there are also service and/or performance conditions.
For awards that do not ultimately vest because non-market performance and/or service conditions have not
been met, no expense is recognised. Where awards include a market or non-vesting condition, the transactions are
treated as vesting irrespective of whether the market or non-vesting condition is satisfied, provided that all other
performance and/or service conditions are satisfied.
Where the terms of an equity-settled award are modified, as a minimum an expense is recognised as if the
terms had not been modified, if the original terms of the award are met. In addition, an expense is recognised for any
modification that increases the total fair value of the share-based payments, or is otherwise beneficial to the employee
as measured at the date of modification. Where an equity-settled award is cancelled, it is treated as if it had vested
on the date of cancellation, and any expense not yet recognised for the award is recognised immediately.
Other employee benefits
Pension scheme
The employees of the Group’s subsidiaries which operate in Mainland China and overseas are required to
participate in a central pension scheme operated by the local municipal government. The Group is required to
contribute a certain percentage of their payroll costs to the central pension scheme. The contributions are charged to
the statements of profit or loss as they become payable in accordance with the rules of the central pension scheme.
APPENDIX I ACCOUNTANTS’ REPORT
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Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, i.e.,
assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised as
part of the cost of those assets. The capitalisation of such borrowing costs ceases when the assets are substantially
ready for their intended use or sale. All other borrowing costs are expensed in the period in which they are incurred.
Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds.
Dividends
Final dividends are recognised as a liability when they are approved by the shareholders in a general meeting.
Proposed final dividends are disclosed in the notes to the Historical Financial Information. Interim dividends are
simultaneously proposed and declared, because the Company’s memorandum and articles of association grant the
directors the authority to declare interim dividends. Consequently, interim dividends are recognised immediately as
a liability when they are proposed and declared.
Foreign currencies
The Historical Financial Information is presented in RMB, which is the Company’s functional currency. Each
entity in the Group determines its own functional currency and items included in the financial statements of each
entity are measured using that functional currency. Foreign currency transactions recorded by the entities in the
Group are initially recorded using their respective functional currency rates prevailing at the dates of the transactions.
Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency rates of
exchange ruling at the end of each of the Relevant Periods. Differences arising on settlement or translation of
monetary items are recognised in the statement of profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the
exchange rates at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency
are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on
translation of a non-monetary item measured at fair value is treated in line with the recognition of the gain or loss
on change in fair value of the item (i.e., translation difference on the item whose fair value gain or loss is recognised
in other comprehensive income or profit or loss is also recognised in other comprehensive income or profit or loss,
respectively).
The functional currencies of certain overseas subsidiaries, joint ventures and associates are currencies other
than RMB, mainly including RUB. As at the end of the reporting period, the assets and liabilities of these entities
are translated into RMB at the exchange rates prevailing at the end of the reporting period and their statements of
profit or loss are translated into RMB at the exchange rates that approximate to those prevailing at the dates of the
transactions.
The resulting exchange differences are recognised in other comprehensive income and accumulated in the
exchange fluctuation reserve, except to the extent that the differences are attributable to non-controlling interests. On
disposal of a foreign operation, the cumulative amount in the reserve relating to that particular foreign operation is
recognised in the statement of profit or loss.
Any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying
amounts of assets and liabilities arising on acquisition are treated as assets and liabilities of the foreign operation and
translated at the closing rate.
3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES
The preparation of the Group’s Historical Financial Information requires management to make judgements,
estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and their
accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and
estimates could result in outcomes that could require a material adjustment to the carrying amounts of the assets or
liabilities affected in the future.
APPENDIX I ACCOUNTANTS’ REPORT
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Judgements
In the process of applying the Group’s accounting policies, management has made the following judgements,
apart from those involving estimations, which have the most significant effect on the amounts recognised in the
Historical Financial Information:
Business model
The classification of financial assets at initial recognition depends on the business model the Group adopts to
manage financial assets. In judging the business model, the Group considers, among others, the methods by which
it assesses and the way by which it reports to the key managers about the results of financial assets, the risks
confronted by the results of financial assets and relevant risks management methods, and the way determining the
compensation of business operators. When determining whether the business model maintained for the purpose of
receiving contractual cash flows, the Group needs to analyse the reasons for selling financial assets before expiry
dates, the time, frequency and consideration of the selling.
Consolidation of entities in which the Group holds less than a majority of voting rights
The Group considers that it controls Chery New Energy Automobile Co., Ltd. and its subsidiaries including
iCAR Ecological Technology Co., Ltd., even though it owns less than 50% of the voting rights. This is because the
Group is the single largest shareholder of Chery New Energy Automobile Co., Ltd. with a 48.2% equity interest. The
remaining 51.8% of the equity shares in Chery New Energy Automobile Co., Ltd. are widely held by many other
shareholders, and those other shareholders significantly overlap with shareholders of the Company. Besides, the
Group is entitled to appoint more than 50% of directors of the board of Chery New Energy Automobile Co., Ltd.
Having taken into account the significantly overlapped shareholders base of the Company and Chery New Energy
Automobile Co., Ltd., the Group considers that it controls Chery New Energy Automobile Co., Ltd. and its
subsidiaries.
Significant influence over associates in which the Group holds less than 20% of shareholding
The Group’s equity shares of some associates are less than 20%. Considering the Group is entitled to appoint
and has appointed directors to the board of directors of those associates, and has participated in policy-making
processes of those associates, the Group concludes that it has a significant influence over those associates and
considers them as associates.
Government grants
Government grants are recognised at their fair value where there is reasonable assurance that the grant will be
received and all attaching conditions will be complied with. The Group applies judgement in evaluating whether or
not all attaching conditions will be complied with, taking into account of all relevant factors, and the information
available.
Estimation uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the end of each
of the Relevant Periods, that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year, are described below.
Provision for expected credit losses
The Group calculates expected credit losses through default risk exposure and expected credit loss rate. In
determining the expected credit loss rate, the Group uses data such as internal historical credit loss experience, etc.
and adjusts historical data based on current conditions and forward-looking information. When considering
forward-looking information, the indicators used by the Group include the risk of economic downturn, external
market environment, technological environment and changes in customer situations. The Group regularly monitors
and reviews assumptions related to the calculation of expected credit losses.
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 534 ---
Impairment of non-financial assets (other than goodwill)
The Group assesses whether there are any indicators of impairment for all non-financial assets (including the
right-of-use assets) at the end of the Relevant Periods. Non-financial assets are tested for impairment when there are
indicators that the carrying amounts may not be recoverable. An impairment exists when the carrying value of an
asset or a cash-generating unit exceeds its recoverable amount, which is the higher of its fair value less costs of
disposal and its value in use. The calculation of the fair value less costs of disposal is based on available data from
binding sales transactions in an arm’s length transaction of similar assets or observable market prices less incremental
costs for disposing of the asset. When value in use calculations are undertaken, management must estimate the
expected future cash flows from the asset or cash-generating unit and choose a suitable discount rate in order to
calculate the present value of those cash flows.
Leases — Estimating the incremental borrowing rate
The Group cannot readily determine the interest rate implicit in a lease, and therefore, it uses an incremental
borrowing rate (“IBR”) to measure lease liabilities. The IBR is the rate of interest that the Group would have to pay
to borrow over a similar term, and with a similar security, the funds necessary to obtain an asset of a similar value
to the right-of-use asset in a similar economic environment. The IBR therefore reflects what the Group “would have
to pay”, which requires estimation when no observable rates are available (such as for subsidiaries that do not enter
into financing transactions) or when it needs to be adjusted to reflect the terms and conditions of the lease. The Group
estimates the IBR using observable inputs (such as market interest rates) when available and is required to make
certain entity-specific estimates (such as the subsidiary’s stand-alone credit rating).
Deferred tax assets
Deferred tax assets are recognised for unused tax losses and deductible temporary differences to the extent that
it is probable that taxable profit will be available against which the losses and the deductible temporary differences
can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that
can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning
strategies. Further details are contained in note 33 to the Historical Financial Information.
Development costs
Development costs are capitalised in accordance with the accounting policy for research and development
costs in note 2.3 to the Historical Financial Information. Determining the amounts to be capitalised requires
management to make assumptions regarding the expected future cash generation of the assets, discount rates to be
applied and the expected period of benefits.
Warranty provisions
Provisions for warranties granted by the Group for the passenger vehicles sold are recognized based on sales
volumes and past experiences of costs for repairs and replacement, among others. The estimate of unit warranty cost
may not be equal to the actual warrant costs in the future. The Group reassesses the unit warranty cost at least
annually and the unit warranty cost is revised when appropriate.
Impairment of inventory
Inventories are stated at the lower of cost and net realizable value at the end of each reporting period. The net
realisable value is the estimated selling price in the current course of business, less applicable costs, selling expenses
and tax charges. Management of the Group make the best estimate on the net realizable value and the corresponding
impairment of inventory, while the impairment assessment may still be significantly changed due to the change of
market conditions.
V ariable consideration for sales rebates
The Group estimates variable consideration to be included in the transaction price for the sale of passenger
vehicles with rebates.
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 535 ---
Management assesses the expected rebates based on factors primarily consist of the customer’s historical
rebate entitlement, accumulated purchases to date, accumulated retails to date, etc. Any significant changes in
experience as compared to historical patterns and rebate entitlements of customers will impact the expected rebate
estimated by the Group.
The Group updates its assessment of expected rebates quarterly and the refund liabilities are adjusted
accordingly. Estimates of expected rebates are sensitive to changes in circumstances and the Group’s past experience
regarding rebate entitlements may not be representative of customers’ actual rebate entitlements in the future.
4. OPERATING SEGMENT INFORMATION
During the Relevant Periods, the Group was principally engaged in the manufacturing and sales of passenger
vehicles and automotive parts and components in the PRC and overseas. The executive directors of the Company
review the operating results of the business as one operating segment to make strategic decisions and resources
allocation. Therefore, the Group regards that there is only one segment which is used to make strategic decisions.
The following table shows the Group’s total consolidated revenue by location of customers:
Geographical information
(a) Revenue from external customers
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
PRC (including Hong Kong,
Macau and Taiwan) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862,231 86,145 169,000 34,534 41,934
Other countries/regions /H1118/H1118/H1118/H1118/H1118/H1118/H111830,387 77,060 100,897 20,376 26,289
Total revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
The revenue information above is based on the locations of the customers.
(b) Non-current assets
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
PRC (including Hong Kong,
Macau and Taiwan) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,807 42,231 45,142 46,918
Other countries/regions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834 126 637 600
Total non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,841 42,357 45,779 47,518
The non-current asset information above is based on the locations of the assets and excludes financial
instruments and deferred tax assets.
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 536 ---
Information about major customers
External customers from which the revenue amounted to over 10% of the total revenue of the Group for each
of the Relevant Periods and the three months ended 31 March 2024 were as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Customer A /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118**** 7,285
* Less than 10% of the Group’s revenue
5. REVENUE, OTHER INCOME AND GAINS
An analysis of revenue is as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Revenue from contracts with
customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
Revenue from contracts with customers
(a) Disaggregated revenue information
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Types of goods or services
Passenger vehicles /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882,511 151,228 246,822 50,547 61,639
Automotive parts and
components /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,675 8,904 15,864 2,936 5,743
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,432 3,073 7,211 1,427 841
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
Timing of revenue recognition
Recognized at a point in time /H1118/H1118/H111892,518 163,081 269,676 54,862 68,152
Recognized over time /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100 124 221 48 71
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111892,618 163,205 269,897 54,910 68,223
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 537 ---
The following table shows the amounts of revenue recognised in each reporting period that were included in
the contract liabilities at the beginning of each reporting period:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Sales of goods or services /H1118/H1118/H1118/H1118/H11185,206 8,030 18,589 13,332 13,521
(b) Performance obligations
Information about the Group’s performance obligations is summarised below:
Sale of passenger vehicles, automotive parts and components
The Group mainly manufactures and sells a range of passenger vehicles, automotive parts and
components to its customers. Sales revenue are recognised when control of the goods is transferred to the
customers, and there is no unfulfilled obligation that could affect the customer’s acceptance of the goods.
Payment in advance is normally required, except for some long-standing customers with bulk purchases and
good credit standing, where payment is generally due from 30 to 180 days from delivery.
For the performance obligations, they are generally satisfied within less than a year, and the Group has
elected the practical expedient for not to disclose the remaining performance obligations.
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Other income
Bank interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118806 1,117 960 250 214
Additional deduction for value-
added tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 205 762 20 148
Research and development
subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118510 514 765 136 150
Other subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118364 704 1,092 473 155
Investment income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118817 1,243 1,085 (6) 198
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118431 815 1,407 236 253
Sub-total other income /H1118/H1118/H1118/H1118/H1118/H1118/H11182,930 4,598 6,071 1,109 1,118
Gains/(losses)
Gain on disposal of items of
property, plant and equipment /H1118 96 13 59 7 23
Fair value gains/(losses) on
derivative financial
instruments, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118230 (265) 52 16 –
Fair value gains on financial
assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862 27 69 42 72
Foreign exchange gain/(losses),
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118504 (141) – – 2,439
Sub-total gains/(losses) /H1118/H1118/H1118/H1118/H1118/H1118/H1118892 (366) 180 65 2,534
Total other income and gains /H1118/H1118/H11183,822 4,232 6,251 1,174 3,652
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 538 ---
6. PROFIT BEFORE TAX
The Group’s profit before tax is arrived at after charging or crediting:
Y ear ended 31 December Three months ended 31 March
Notes 2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Cost of inventories sold* /H1118/H1118/H1118/H1118 79,041 135,515 231,316 46,044 59,077
Depreciation of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 1,601 1,929 2,864 320 654
Amortisation of other
intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 284 429 672 128 176
Depreciation of right-of-use
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(a) 119 123 313 72 78
Research and development
costs* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,646 6,664 9,243 2,224 2,272
Lease payments not included
in the measurement of lease
liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814(c) 76 108 151 32 43
Auditor’s remuneration /H1118/H1118/H1118/H1118/H1118 22 1 2–1
Listing expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 1 4– 2 2
Employee benefit expense
(excluding directors’ and
supervisors’ remuneration)
Wages and salaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,488 7,900 9,665 2,418 3,016
Pension scheme contributions /H1118 266 469 652 163 230
Share-based compensation /H1118/H1118/H1118 – – 1,988 1,627 124
Impairment of financial and
contract assets, net:
Impairment/(reversal of
impairment provision) of
trade receivables, net /H1118/H1118/H1118/H1118/H111822 173 85 15 (233) 10
Reversal of impairment
provision of contract assets,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 (14) (38) (24) (1) –
Impairment/(reversal of
impairment provision) of
financial assets included in
prepayments, other
receivables and other assets,
net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 525 (270) (249) (190) (23)
Written-down of inventories to
net realisable value, net /H1118/H1118/H1118 61 431 982 275 434
Warranty provisions, net /H1118/H1118/H1118/H111835 2,858 5,213 7,477 1,882 2,046
Impairment of an investment
in an associate** /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 336 161 –
Impairment of items of
property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 24 139 133 1 3
Impairment of intangible
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 1––––
Foreign exchange
gains/(losses), net /H1118/H1118/H1118/H1118/H1118/H1118/H1118504 (141) (851) (159) 2,439
Dividend income from equity
investments at fair value
through other comprehensive
income*** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 29 32 1 13
Gain on bargain purchase**** /H1118 ––88–
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 539 ---
* Cost of inventories sold and research and development costs include expenses relating to staff cost,
depreciation and amortisation expenses, which are also included in the respective total amounts
disclosed separately above for each of these types of expenses.
** Impairment of an investment in an associate is included in “Other expenses” in the consolidated
statement of profit or loss.
*** Dividend income from equity investments at fair value through other comprehensive income is included
in “Other income and gains” in the consolidated statement of profit or loss.
**** Gain on bargain purchase is included in “Other income and gains” in the consolidated statement of profit
or loss.
7. FINANCE COSTS
An analysis of finance costs is as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Interest expenses on bank loans
and other borrowings /H1118/H1118/H1118/H1118/H1118/H11181,243 1,375 1,919 643 787
Interest on long-term liabilities /H1118/H1118 153 221 290 27 60
Interest on lease liabilities /H1118/H1118/H1118/H1118/H11189 21 101 22 25
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,405 1,617 2,310 692 872
8. DIRECTORS’ AND SUPERVISORS’ REMUNERATION
Directors’ and Supervisors’ remuneration for the Relevant Periods, disclosed pursuant to the Listing Rules,
section 383(1)(a), (b), (c) and (f) of the Hong Kong Companies Ordinance and Part 2 of the Companies (Disclosure
of Information about Benefits of Directors) Regulation, is as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB thousand RMB thousand RMB thousand RMB thousand RMB thousand
(unaudited)
Fees /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118952 924 1,374 231 411
Other emoluments:
Salaries, allowances, bonuses and
benefits in kind (including
contributions to pension
plans)* /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,419 10,527 23,172 7,551 6,706
Share-based compensation
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 28,142 4,950 7,311
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,419 10,527 51,314 12,501 14,017
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,371 11,451 52,688 12,732 14,428
* Certain executive directors and supervisors of the Company are entitled to bonus payments which are
related to the operating profit of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 540 ---
During the year ended 31 December 2024, certain directors were granted shares, in respect of their services
to the Group, under the share-based compensation plan of the Company, further details of which are set out in note
37 to the Historical Financial Information. The fair value of the share-based compensation, which is recognised in
the statement of profit or loss over the vesting period, was determined as at the date of grant and the amount included
in the Historical Financial Information for the year ended 31 December 2024 is included in the above directors’ and
supervisors’ remuneration disclosures.
(a) Independent non-executive directors
The fees paid to independent non-executive directors during the Relevant Periods were as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB thousand RMB thousand RMB thousand RMB thousand RMB thousand
(unaudited)
Mr. Shang Wenjiang /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0– 4 5
Mr. Y ang Mianzhi /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0– 4 5
Mr. Y e Shengji /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0– 4 5
Mr. Lu Feng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0– 4 5
Mr. Y ang Shanlin (iii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0––
Mr. Lai Ni Hium.Frank (iv) /H1118/H1118/H1118/H1118 –––– 3 0
Ms. Shi Qin (ii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 9 0– 1 0
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 540 – 220
(i) All of independent non-executive directors of the Company were appointed in March 2024.
(ii) Ms. Shi Qin resigned as an independent non-executive director of the Company in January 2025.
(iii) Mr. Y ang Shanlin declared in June 2025 that he waived all allowances while serving as an independent
non-executive director.
(iv) Mr. Lai Ni Hium.Frank was appointed as an independent non-executive director of the Company in
February 2025.
There were no other emoluments payable to the independent non-executive directors during the Relevant
Periods.
(b) Executive directors, non-executive directors and supervisors
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Y ear ended 31 December 2022
Executive director:
Mr. Yin Tongyue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,644 – 4,644
Non-executive directors: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mr. Xia Feng (i) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 0–– 4 0
Mr. Y u Zhijun (ii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 0–– 4 0
Mr. Li Bin (iv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 0–– 8 0
Mr. Xing Hui (v) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Jinhua (xiv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 0–– 8 0
Mr. Wang Laisheng (vi) /H1118/H1118/H1118/H1118/H1118/H1118/H11188 0–– 8 0
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 541 ---
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Mr. Wang Zhaoyuan (vii) /H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Huang Linmu (viii) /H1118/H1118/H1118/H1118/H1118/H1118/H11188 0–– 8 0
Mr. Hu Jingyuan (ix) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 0–– 4 0
Mr. Cui Mingshou (iii) /H1118/H1118/H1118/H1118/H1118/H1118/H11184 0–– 4 0
Mr. Huang Zuchao (x) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Bao Siyu (xi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118840 – – 840
Supervisors:
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 4–– 8 4
Mr. Zhang Jinsong (xii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,732 – 1,732
Mr. Hong Gaoming (xiii) /H1118/H1118/H1118/H1118/H1118/H1118– 3,043 – 3,043
Ms. Li Qingxiang (xv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 8–– 2 8
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118112 4,775 – 4,887
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118952 9,419 – 10,371
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Y ear ended 31 December 2023
Executive director:
Mr. Yin Tongyue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 5,852 – 5,852
Non-executive directors: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Mr. Li Bin (iv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 5–– 4 5
Mr. Yi Lei (xvi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 5–– 7 5
Mr. Xing Hui (v) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Jinhua (xiv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Laisheng (vi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Zhaoyuan (vii) /H1118/H1118/H1118/H1118/H1118/H11186 0–– 6 0
Mr. Wang Zhaohui (xvii) /H1118/H1118/H1118/H1118/H1118/H11186 0–– 6 0
Mr. Hu Jingyuan (ix) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Huang Zuchao (x) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 0–– 6 0
Ms. Liu Ling (xviii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 0–– 6 0
Mr. Bao Siyu (xi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118840 – – 840
Supervisors:
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 4–– 8 4
Mr. Zhang Jinsong (xii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,816 – 1,816
Mr. Hong Gaoming (xiii) /H1118/H1118/H1118/H1118/H1118/H1118– 2,859 – 2,859
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111884 4,675 – 4,759
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118924 10,527 – 11,451
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 542 ---
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Y ear ended 31 December 2024
Executive director:
Mr. Yin Tongyue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 7,000 – 7,000
Mr. Zhang Guozhong (xix) /H1118/H1118/H1118/H1118/H1118 – 8,590 26,470 35,060
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 15,590 26,470 42,060
Non-executive directors:
Ms. Wang Laichun (xx) /H1118/H1118/H1118/H1118/H1118/H1118/H11189 0–– 9 0
Mr. Yi Lei (xvi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Xing Hui (v) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Jinhua (xiv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Wang Laisheng (vi) /H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Wang Zhaohui (xvii) /H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Mr. Hu Jingyuan (ix) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118120 – – 120
Ms. Li Jing (xx) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 0–– 9 0
Ms. Liu Ling (xviii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Bao Siyu (xi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118750 – – 750
Supervisors:
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 4–– 8 4
Mr. Xu Hui (xxii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Mr. Cai Changfeng (xxi) /H1118/H1118/H1118/H1118/H1118/H1118– 2,529 308 2,837
Mr. Zhang Jinsong (xii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 856 615 1,471
Mr. Hong Gaoming (xiii) /H1118/H1118/H1118/H1118/H1118/H1118– 4,197 749 4,946
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111884 7,582 1,672 9,338
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118834 23,172 28,142 52,148
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Three months ended 31 March 2024
(unaudited)
Executive director:
Mr. Yin Tongyue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,750 – 1,750
Mr. Zhang Guozhong (xix) /H1118/H1118/H1118/H1118/H1118 – 3,699 4,813 8,512
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 5,449 4,813 10,262
Non-executive directors:
Mr. Yi Lei (xvi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Xing Hui (v) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Wang Jinhua (xiv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Wang Laisheng (vi) /H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Wang Zhaohui (xvii) /H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Hu Jingyuan (ix) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Ms. Liu Ling (xviii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Bao Siyu (xi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118210 – – 210
Supervisors:
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 1–– 2 1
Mr. Zhang Jinsong (xii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118– 214 62 276
Mr. Hong Gaoming (xiii) /H1118/H1118/H1118/H1118/H1118/H1118– 1,888 75 1,963
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 2,102 137 2,260
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118231 7,551 4,950 12,732
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 543 ---
Fees
Salaries,
allowances,
bonuses and
benefits in kind
(including
contributions to
pension plans)
Share-based
compensation
expenses
Total
remuneration
RMB thousand RMB thousand RMB thousand RMB thousand
Three months ended 31 March 2025
Executive director:
Mr. Yin Tongyue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,295 – 1,295
Mr. Zhang Guozhong (xix) /H1118/H1118/H1118/H1118/H1118 – 4,936 7,219 12,155
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 6,231 7,219 13,450
Non-executive directors:
Ms. Wang Laichun (xx) /H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Yin Xiangling (xxiii) /H1118/H1118/H1118/H1118/H1118/H11181 5–– 1 5
Ms. Li Jing (xx) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Xing Hui (v) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 0–– 1 0
Mr. Wang Jinhua (xiv) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Wang Xiaowei (xxiv) /H1118/H1118/H1118/H1118/H1118/H11181 5–– 1 5
Mr. Wang Zhaohui (xvii) /H1118/H1118/H1118/H1118/H1118/H11181 0–– 1 0
Mr. Hu Jingyuan (ix) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 0–– 3 0
Mr. Bao Siyu (xi) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 – – 170
Supervisors:
Mr. Wu Y unfei /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 1–– 2 1
Mr. Xu Hui (xxii) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
Mr. Cai Changfeng (xxi) /H1118/H1118/H1118/H1118/H1118/H1118– 475 92 567
Sub-total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821 475 92 588
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191 6,706 7,311 14,208
(i) Mr. Xia Feng was appointed by Wuhu Investment Holding Co., Ltd* (“Wuhu Investment Holding”,
ʮ̡), a shareholder with significant influence over the Group, as non-
executive director of the Company in December 2019 and resigned in April 2022. The director’s
allowance that Mr. Xia was entitled to was paid to Wuhu Investment Holding.
(ii) Mr. Y u Zhijun was appointed by Qingdao Wudaokou New Energy Automobile Industry Fund Enterprise
(Limited Partnership)* (“Qingdao Wudaokou”,Άุ(Υྫ)) as
non-executive director of the Company in June 2021 and resigned in April 2022. The director’s
allowance that Mr. Y u was entitled to was paid to Qingdao Wudaokou.
(iii) Mr. Cui Mingshou was appointed by Qingdao Wudaokou as non-executive director of the Company in
June 2021 and resigned in April 2022. The director’s allowance that Mr. Cui was entitled to was paid
to Qingdao Wudaokou.
(iv) Mr. Li Bin was appointed as non-executive director of the Company by Luxshare Limited, a shareholder
with significant influence over the Group, in April 2022 and resigned in May 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 544 ---
(v) Mr. Xing Hui was appointed by Wuhu Investment Holding as non-executive director of the Company
in November 2021 and resigned in January 2025. The director’s allowance that Mr. Xing was entitled
to is payable to Wuhu Investment Holding.
(vi) Mr. Wang Laisheng was appointed as non-executive director of the Company by Luxshare Limited in
May 2022 and resigned in May 2024.
(vii) Mr. Wang Zhaoyuan was appointed as non-executive director of the Company by Anhui Credit
Financing Guaranty Group Co., Ltd.* (“Anhui Credit Guaranty”ʮ̡)i n
June 2021 and resigned in June 2023. The director’s allowance that Mr. Wang was entitled to was paid
to the Anhui Guarantee.
(viii) Mr. Huang Linmu was appointed as non-executive director of the Company by Anhui Provincial
Investment Group Holding Co., Ltd.* (“Anhui Investment Holding”ʮ̡)i n
June 2021 and resigned in September 2022. The director’s allowance that Mr. Huang was entitled to was
paid to Anhui Investment Holding.
(ix) Mr. Hu Jingyuan was appointed by Anhui Investment Holding as non-executive director of the Company
in September 2022. The director’s allowance that Mr. Hu was entitled to is payable to Anhui Investment
Holding.
(x) Mr. Huang Zuchao was appointed as non-executive director of the Company by Qingdao Wudaokou
from December 2019 to April 2022, and appointed as non-executive director of the Company by
Qingdao Xincheng Haishun New Energy Automobile Partnership (Limited Partnership)* (“Qingdao
Xincheng”㒥༐ऎනอঐ๕ӛԓΥྫΆุ(Υྫ)) from April 2022 to May 2023, and resigned
in May 2023. The director’s allowance that Mr. Huang was entitled to was paid to Shandong Xincheng
Hengye Group Co., Ltd* (ʮ̡).
(xi) Mr. Bao Siyu was appointed as non-executive director of the Company in June 2021. He is an employee
of Chery Holding Group Co., Ltd, and he is not entitled to director’s allowance during the Relevant
Periods.
(xii) Mr. Zhang Jinsong was appointed as a supervisor of the Company in December 2021 and resigned in
March 2024.
(xiii) Mr. Hong Gaoming was appointed as a supervisor of the Company in April 2022 and resigned in March
2024.
(xiv) Mr. Wang Jinhua was appointed as non-executive director of the Company by Wuhu Investment Holding
in April 2022. The director’s allowance that Mr. Wang was entitled to is payable to Wuhu Investment
Holding.
(xv) Ms. Li Qingxiang was appointed as supervisor of the Company by Qingdao Wudaokou in June 2021, and
resigned in April 2022. The director’s allowance that Ms. Li was entitled to was paid to Qingdao
Wudaokou.
(xvi) Mr. Yi Lei was appointed as non-executive director of the Company by Luxshare Limited in May 2023
and resigned in March 2024.
(xvii) Mr. Wang Zhaohui was appointed as non-executive director of the Company by Anhui Credit Guaranty
in July 2023 and resigned in January 2025. The director’s allowance that Mr. Wang was entitled to is
payable to the Anhui Guarantee.
(xviii) Ms. Liu Ling was appointed as non-executive director of the Company by Wuhu Kingsman Enterprise
Management Partnership (Limited Partnership)* (“Wuhu Kingsman”౶ਟΆุ၍ଣΥྫΆุ(Ϟ
Υྫ)) in May 2023 and resigned in March 2024. The director’s allowance that Ms. Liu was entitled
to was paid to Wuhu Kingsman.
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 545 ---
(xix) Mr. Zhang Guozhong was appointed as executive director of the Company in March 2024.
(xx) Ms. Li Jing and Ms. Wang Laichun were appointed as non-executive directors of the Company by
Luxshare Limited in March 2024.
(xxi) Mr. Cai Changfeng was appointed as supervisor of the Company in March 2024.
(xxii) Mr. Xu Hui was appointed as supervisor of the Company in March 2024. He is an employee of Chery
Holding Group Co., Ltd and he is not entitled to director’s allowance during the year ended 31
December 2024.
(xxiii) Mr. Yin Xiangling was appointed as non-executive director of the Company by Anhui Credit Guaranty
in February 2025. The director’s allowance that Mr. Yin was entitled to is payable to the Anhui Credit
Guaranty.
(xxiv) Mr. Wang Xiaowei was appointed by Wuhu Investment Holding as non-executive director of the
Company in February 2025. The director’s allowance that Mr. Wang was entitled to is payable to Wuhu
Investment Holding.
There was no arrangement under which a director or a supervisor waived or agreed to waive any
remuneration during the Relevant Periods except Mr. Y ang Shanlin.
* The English name of these entities above represents the best effort made by the management of the
Company to directly translate the Chinese name as it does not register any official English name.
9. FIVE HIGHEST PAID EMPLOYEES
The five individuals whose remunerations were the highest in the Group for the years ended 31 December
2022, 2023, 2024, and the three months ended 31 March 2024 and 2025 include nil, nil, 1, nil and 1 director
respectively, details of whose remuneration are set out in note 8(b) above. Details of the remunerations of the
remaining 5, 5, 4, 5 and 4 individuals who are neither directors nor supervisors of the Company during the years
ended 31 December 2022, 2023 and 2024 and the three months ended 31 March 2024 and 2025, respectively, are as
follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB thousand RMB thousand RMB thousand RMB thousand RMB thousand
(unaudited)
Salaries, allowances, bonuses and
benefits in kind (including
contributions to pension plans) /H1118 56,188 49,406 12,325 2,554 20,813
Share-based compensation
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 116,616 130,587 15,060
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111856,188 49,406 128,941 133,141 35,873
APPENDIX I ACCOUNTANTS’ REPORT
– I-50 –


--- page 546 ---
The number of non-director and non-supervisor highest paid employees whose remuneration fell within the
following bands is as follows:
Number of employees
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
(unaudited)
HK$3,950,001 to HK$4,000,000 /H1118/H1118/H1118/H1118/H1118––––1
HK$7,500,001 to HK$8,000,000 /H1118/H1118/H1118/H1118/H1118–2–––
HK$8,500,001 to HK$9,000,000 /H1118/H1118/H1118/H1118/H11181–––1
HK$10,000,001 to HK$10,500,000 /H1118/H1118/H1118/H111811–––
HK$11,500,001 to HK$12,000,000 /H1118/H1118/H1118/H1118–1––1
HK$12,500,001 to HK$13,000,000 /H1118/H1118/H1118/H11182––––
HK$14,500,001 to HK$15,000,000 /H1118/H1118/H1118/H1118––––1
HK$17,500,001 to HK$18,000,000 /H1118/H1118/H1118/H1118–1–––
HK$21,000,001 to HK$21,500,000 /H1118/H1118/H1118/H11181––––
HK$25,000,001 to HK$25,500,000 /H1118/H1118/H1118 –––2–
HK$27,500,001 to HK$28,000,000 /H1118/H1118/H1118 –––1–
HK$29,000,001 to HK$29,500,000 /H1118/H1118/H1118/H1118––1––
HK$30,000,001 to HK$30,500,000 /H1118/H1118/H1118 –––1–
HK$31,500,001 to HK$32,000,000 /H1118/H1118/H1118/H1118––1––
HK$37,500,001 to HK$38,000,000 /H1118/H1118/H1118/H1118–––1–
HK$39,000,001 to HK$39,500,000 /H1118/H1118/H1118/H1118––1––
HK$41,000,001 to HK$41,500,000 /H1118/H1118/H1118/H1118––1––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111855454
For the year ended 31 December 2024 and the three months ended 31 March 2024 and 2025, shares were
granted to non-director and non-supervisor highest paid employee in respect of their services to the Group, under the
share-based compensation plan of the Company, further details of which are included in the disclosures in note 37
to the Historical Financial Information. The fair value of the share-based compensation, which has been recognised
in the statement of profit or loss over the vesting period, was determined as at the date of grant and the amount
included in the Historical Financial Information is included in the above non-director and non-supervisor executive
highest paid employees’ remuneration disclosures.
10. INCOME TAX
PRC corporate income tax
Under the PRC Corporate Income Tax Law and the respective regulations, the corporate income tax for the
Company and its subsidiaries is calculated at a statutory rate of 25% or a preferential rate of 15% where applicable,
on their estimated taxable profits for the year based on the existing legislations, interpretations and practices in
respect thereof.
In 2020, Chery Automobile Co., Ltd. was recognized as a “High and New Technology Enterprise” (“HNTE”),
therefore enjoyed a preferential income tax rate of 15% in 2020 to 2022. The Company renewed its HNTE recognition
in 2023 and can enjoy the 15% preferential income tax rate in 2023 to 2025.
In 2021, Chery New Energy Automobile Co., Ltd was recognized as a HNTE, therefore enjoyed a preferential
income tax rate of 15% in 2021 to 2023. Chery New Energy Automobile Co., Ltd renewed its HNTE recognition in
2024 and can enjoy the 15% preferential income tax rate in 2024 to 2026.
In 2023, Wuhu Acteco Powertrain Co., Ltd. was recognized as a HNTE, and therefore can enjoy a preferential
income tax rate of 15% in 2023 to 2025. The tax rate for Wuhu Acteco Powertrain Co., Ltd. during 2022 is 25%.
APPENDIX I ACCOUNTANTS’ REPORT
– I-51 –


--- page 547 ---
Corporate income tax in other jurisdictions
Income tax on profit arising from other jurisdictions have been calculated on the estimated taxable profit for
the Relevant Periods at the respective rates prevailing in the relevant jurisdictions, which are ranging from 20% –
30%.
The income tax expense of the Group is analyzed as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Current income tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001 1,909 3,486 736 828
Deferred income tax
(note 33) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(299) 952 (1,208) (41) 213
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118702 2,861 2,278 695 1,041
A reconciliation of the income tax expense applicable to profit before tax at the statutory tax rates in PRC in
which the Company is domiciled to the income tax expense at the effective tax rates are as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Profit before income tax /H1118/H1118/H1118/H1118/H1118/H11186,508 13,305 16,612 3,171 5,767
Tax at PRC statutory tax rate of
25% /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,627 3,326 4,153 793 1,442
Effect of preferential or
different tax rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(623) (1,425) (1,660) (228) (506)
Effect on opening deferred tax of
decrease in rates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1 0 5–––
Adjustments in respect of current
tax of previous periods /H1118/H1118/H1118/H1118/H1118– – 15 15 (5)
Income not subject to tax /H1118/H1118/H1118/H1118/H1118(230) (253) (331) (44) (27)
Expenses not deductible for tax /H1118/H1118 30 123 439 267 40
Effect of super deduction for
research and development
costs /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(621) (1,093) (1,153) (206) (315)
Utilization/recognition of
unrecognized tax losses and
temporary differences from
prior years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(27) (2) (659) (174) (27)
Unrecognized temporary
differences and tax losses /H1118/H1118/H1118/H1118406 1,979 1,629 320 435
Withholding tax on dividends of
overseas subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118140 101 (155) (48) 4
Tax charge at the Group’s
effective rate /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118702 2,861 2,278 695 1,041
The share of tax attributable to associates and to joint ventures amounting to RMB292 million, RMB309
million, RMB290 million, RMB43 million, respectively, is included in “Share of profits and losses of joint ventures
and associates” in the consolidated statement of profit or loss during the Relevant Periods.
APPENDIX I ACCOUNTANTS’ REPORT
– I-52 –


--- page 548 ---
Pillar Two income taxes
The Group is within the scope of the Pillar Two model rules. The Group has applied the mandatory exception
to recognising and disclosing information about deferred tax assets and liabilities arising from Pillar Two income
taxes, and will account for the Pillar Two income taxes as current tax when incurred. Pillar Two legislation has been
enacted or substantively enacted in certain jurisdictions in which the Group operates, and the legislation is effective
for the Group’s financial year beginning 1 January 2024.
The Group has assessed its potential exposure based on the information available regarding the financial
performance of the Group in the fiscal year of 2024 and in the first quarter of 2025. As such, it may not be entirely
representative of future circumstances. Based on the assessment, the Group does not expect a material exposure to
Pillar Two income taxes.
11. DIVIDENDS
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Final /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,094 – – 3,993
The final dividends of RMB0.2 (inclusive of tax) for each ordinary share to all shareholders whose names were
registered in the register of members and were entitled to participate in the distribution on the record date in respect
of the year ended 31 December 2023 were approved by the Annual General Meeting of the Company.
The final dividends of RMB0.73 (inclusive of tax) for each ordinary share to all shareholders whose names
were registered in the register of members and were entitled to participate in the distribution on the record date in
respect of 30 November 2024 were declared and approved by the Annual General Meeting of the Company in 2025.
No dividend was paid or declared by the Company during the years ended 31 December 2022 and 2024.
12. EARNINGS PER SHARE ATTRIBUTABLE TO ORDINARY EQUITY HOLDERS OF THE PARENT
The calculation of the basic earnings per share amounts is based on the profit attributable to ordinary equity
holders of the parent, and the weighted average number of ordinary shares during the Relevant Periods and the three
months ended 31 March 2024.
The Group had no potentially dilutive ordinary shares in issue during the Relevant Periods and the three
months ended 31 March 2024.
The calculations of basic and diluted earnings per share are based on:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Earnings
Profit attributable to ordinary
equity holders of the parent,
used in the basic and diluted
earnings per share calculation: /H1118 6,266 11,953 14,135 2,712 4,650
APPENDIX I ACCOUNTANTS’ REPORT
– I-53 –


--- page 549 ---
Number of shares
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
Million Million Million Million Million
(unaudited)
Shares
Weighted average number of
ordinary shares in issue during
the year/period used in the
basic and diluted earnings per
share calculation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,436* 5,470 5,470 5,470 5,470
* The weighted average number of shares was after taking into account the effect of treasury shares held.
13. PROPERTY, PLANT AND EQUIPMENT
The Group
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2022
As at 1 January 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,377 12,523 480 153 5 1,443 19,981
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118(1,887) (8,224) (403) (101) – (82) (10,697)
Net carrying amount /H1118/H1118 3,490 4,299 77 52 5 1,361 9,284
As at 1 January 2022, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H11183,490 4,299 77 52 5 1,361 9,284
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 179 30 33 2 3,871 4,120
Acquisition of
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118204 50 2 – – 29 285
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(26) (112) (2) (8) – (2) (150)
Disposal of a subsidiary /H1118 – (2) – – – (8) (10)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(219) (1,337) (28) (16) (1) – (1,601)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (18) – (1) – (5) (24)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851 1,957 14 10 – (2,032) –
Exchange realignment /H1118/H1118 –1–– ––1
As at 31 December 2022,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H11183,505 5,017 93 70 6 3,214 11,905
As at 31 December 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,596 13,846 520 168 7 3,301 23,438
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,091) (8,829) (427) (98) (1) (87) (11,533)
Net carrying amount /H1118/H1118 3,505 5,017 93 70 6 3,214 11,905
APPENDIX I ACCOUNTANTS’ REPORT
– I-54 –


--- page 550 ---
As at 31 December 2022, certain of the Group’s buildings with an aggregate net carrying value of
approximately RMB1,036 million did not have property ownership certificates registered under the names of the
Company and the respective subsidiaries of the Group.
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2023
As at 1 January 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,596 13,846 520 168 7 3,301 23,438
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,091) (8,829) (427) (98) (1) (87) (11,533)
Net carrying amount /H1118/H1118 3,505 5,017 93 70 6 3,214 11,905
As at 1 January 2023, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H11183,505 5,017 93 70 6 3,214 11,905
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,229 305 212 72 1 7,463 9,282
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4) (95) (18) (10) – (22) (149)
Disposal of subsidiaries /H1118 – (1) – – – – (1)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118(280) (1,580) (44) (24) (1) – (1,929)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (106) (1) (1) – (31) (139)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118455 4,689 27 30 – (5,201) –
Exchange realignment /H1118/H1118 – 1 – (2) – – (1)
As at 31 December 2023,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H11184,905 8,230 269 135 6 5,423 18,968
As at 31 December 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,273 18,282 722 246 8 5,532 32,063
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,368) (10,052) (453) (111) (2) (109) (13,095)
Net carrying amount /H1118/H1118 4,905 8,230 269 135 6 5,423 18,968
As at 31 December 2023, certain of the Group’s buildings with an aggregate net carrying value of
approximately RMB1,514 million did not have property ownership certificates registered under the names of the
Company and the respective subsidiaries of the Group.
As at 31 December 2023, certain of the Group’s construction in progress with aggregate net carrying values
of approximately RMB303 million was mortgaged to secure certain interest-bearing bank borrowings and bank
facilities of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-55 –


--- page 551 ---
Buildings
Freehold
lands
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2024
As at 1 January 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,273 – 18,282 722 246 8 5,532 32,063
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118(2,368) – (10,052) (453) (111) (2) (109) (13,095)
Net carrying amount /H1118/H1118 4,905 – 8,230 269 135 6 5,423 18,968
As at 1 January 2024,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H11184,905 – 8,230 269 135 6 5,423 18,968
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876 85 1,329 229 85 61 4,819 6,684
Acquisition of a
subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118641 – 180 7 1 – 490 1,319
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(9) – (121) (13) (17) – (68) (228)
Disposal of subsidiaries /H1118 (15) – (227) (24) – – (39) (305)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118(338) – (2,323) (143) (46) (14) – (2,864)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (128) – (3) – (2) (133)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118520 – 6,209 194 49 – (6,972) –
Exchange realignment /H1118/H1118 4 6 2 (4) (6) – – 2
As at 31 December 2024,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H11185,784 91 13,151 515 198 53 3,651 23,443
As at 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,456 91 24,910 1,049 330 67 3,724 38,627
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118(2,672) – (11,759) (534) (132) (14) (73) (15,184)
Net carrying amount /H1118/H1118 5,784 91 13,151 515 198 53 3,651 23,443
As at 31 December 2024, certain of the Group’s buildings with an aggregate net carrying value of
approximately RMB2,718 million did not have property ownership certificates registered under the names of the
Company and the respective subsidiaries of the Group.
As at 31 December 2024, certain of the Group’s buildings, machineries and construction in progress with
aggregate net carrying values of approximately RMB250 million, RMB183 million and RMB21 million respectively
were mortgaged to secure certain interest-bearing bank borrowings and bank facilities of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-56 –


--- page 552 ---
Buildings
Freehold
lands
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 March 2025
As at 1 January 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,456 91 24,910 1,049 330 67 3,724 38,627
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118(2,672) – (11,759) (534) (132) (14) (73) (15,184)
Net carrying amount /H1118/H1118 5,784 91 13,151 515 198 53 3,651 23,443
As at 1 January 2025, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H11185,784 91 13,151 515 198 53 3,651 23,443
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118973 – 36 13 37 3 943 2,005
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2) – (3) – (5) (2) – (12)
Disposal of subsidiaries /H1118 – – (39) (5) – – (4) (48)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118(79) – (516) (22) (16) (21) – (654)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (1) – – – (2) (3)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118155 – 535 3 6 18 (717) –
Exchange realignment /H1118/H1118 – – (1) 10 10 – – 19
As at 31 March 2025, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H11186,831 91 13,162 514 230 51 3,871 24,750
As at 31 March 2025: /H1118/H1118
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,577 91 25,304 1,062 376 86 3,946 40,442
Accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118(2,746) – (12,142) (548) (146) (35) (75) (15,692)
Net carrying amount /H1118/H1118 6,831 91 13,162 514 230 51 3,871 24,750
As at 31 March 2025, certain of the Group’s buildings with an aggregate net carrying value of approximately
RMB2,221 million did not have property ownership certificates registered under the names of the Company and the
respective subsidiaries of the Group.
As at 31 March 2025, certain of the Group’s buildings and machineries with aggregate net carrying values of
approximately RMB274 million and RMB179 million respectively were mortgaged to secure certain interest-bearing
bank borrowings and bank facilities of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-57 –


--- page 553 ---
The Company
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2022
As at 1 January 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,965 8,129 349 94 1,075 14,612
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118(1,780) (6,022) (317) (78) (76) (8,273)
Net carrying amount /H1118/H1118/H1118/H11183,185 2,107 32 16 999 6,339
As at 1 January 2022,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,185 2,107 32 16 999 6,339
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 65 6 – 3,018 3,089
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(26) (23) – (1) – (50)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(198) (797) (8) (4) – (1,007)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (2) – – (5) (7)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813 1,499 – 3 (1,515) –
As at 31 December 2022,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,974 2,849 30 14 2,497 8,364
As at 31 December 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,939 9,127 353 82 2,578 17,079
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118(1,965) (6,278) (323) (68) (81) (8,715)
Net carrying amount /H1118/H1118/H1118/H11182,974 2,849 30 14 2,497 8,364
As at 31 December 2022, certain of the Company’s buildings with an aggregate net carrying value of
approximately RMB1,010 million did not have property ownership certificates registered under the Company’s name.
APPENDIX I ACCOUNTANTS’ REPORT
– I-58 –


--- page 554 ---
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2023
As at 1 January 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,939 9,127 353 82 2,578 17,079
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,965) (6,278) (323) (68) (81) (8,715)
Net carrying amount /H1118/H1118/H1118/H1118/H11182,974 2,849 30 14 2,497 8,364
As at 1 January 2023,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,974 2,849 30 14 2,497 8,364
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,173 195 85 – 4,527 5,980
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4) (60) (14) – – (78)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(240) (994) (11) (4) – (1,249)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (13) (1) (1) (25) (40)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118340 3,156 – 17 (3,513) –
As at 31 December 2023,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,243 5,133 89 26 3,486 12,977
As at 31 December 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,447 12,084 411 95 3,585 22,622
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,204) (6,951) (322) (69) (99) (9,645)
Net carrying amount /H1118/H1118/H1118/H1118/H11184,243 5,133 89 26 3,486 12,977
As at 31 December 2023, certain of the Company’s buildings with an aggregate net carrying value of
approximately RMB1,490 million did not have property ownership certificates registered under the Company’s name.
APPENDIX I ACCOUNTANTS’ REPORT
– I-59 –


--- page 555 ---
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 December 2024
As at 1 January 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,447 12,084 411 95 – 3,585 22,622
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,204) (6,951) (322) (69) – (99) (9,645)
Net carrying amount /H1118/H1118/H1118/H1118/H11184,243 5,133 89 26 – 3,486 12,977
As at 1 January 2024,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,243 5,133 89 26 – 3,486 12,977
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 447 45 7 21 3,096 3,626
Acquisition of Jetour
business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839 547 38 – – 129 753
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1) (25) (5) – – (4) (35)
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(268) (1,711) (54) (10) (2) – (2,045)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (12) – (3) – (2) (17)
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118143 4,862 97 41 – (5,143) –
As at 31 December 2024,
net of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,166 9,241 210 61 19 1,562 15,259
As at 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,639 17,483 560 136 21 1,634 26,473
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,473) (8,242) (350) (75) (2) (72) (11,214)
Net carrying amount /H1118/H1118/H1118/H1118/H11184,166 9,241 210 61 19 1,562 15,259
As at 31 December 2024, certain of the Company’s buildings with an aggregate net carrying value of
approximately RMB2,085 million did not have property ownership certificates registered under the Company’s name.
APPENDIX I ACCOUNTANTS’ REPORT
– I-60 –


--- page 556 ---
Buildings
Machinery
and molds
Electronic
equipments
and others Vehicles
Leasehold
improvements
Construction
in progress Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 31 March 2025
As at 1 January 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,639 17,483 560 136 21 1,634 26,473
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,473) (8,242) (350) (75) (2) (72) (11,214)
Net carrying amount /H1118/H1118/H1118/H1118/H11184,166 9,241 210 61 19 1,562 15,259
As at 1 January 2025, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,166 9,241 210 61 19 1,562 15,259
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 6 752–– 4 4 6 1,420
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– ( 1 ) –––– ( 1 )
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(58) (325) (16) (3) (2) – (404)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––– ( 2 ) ( 2 )
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 0 5 2112 (76) –
As at 31 March 2025, net
of accumulated
depreciation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,095 8,972 197 59 19 1,930 16,272
As at 31 March 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,626 17,467 563 134 23 2,004 27,817
Accumulated depreciation
and impairment /H1118/H1118/H1118/H1118/H1118/H1118(2,531) (8,495) (366) (75) (4) (74) (11,545)
Net carrying amount /H1118/H1118/H1118/H1118/H11185,095 8,972 197 59 19 1,930 16,272
As at 31 March 2025, certain of the Company’s buildings with an aggregate net carrying value of
approximately RMB1,939 million did not have property ownership certificates registered under the Company’s name.
APPENDIX I ACCOUNTANTS’ REPORT
– I-61 –


--- page 557 ---
14. LEASES
The Group as a lessee
The Group has lease contracts for various items of buildings and machinery, vehicles and others used in its
operations. Lump sum payments were made upfront to acquire the leased land from the owners with lease periods
of 50 years, and no ongoing payments will be made under the terms of these land leases. Leases of buildings generally
have lease terms between 2 and 20 years, while machinery, vehicles and others generally have lease terms between
2 and 10 years.
(a) Right-of-use assets
The Group
The carrying amounts of the Group’s right-of-use assets and the movements during the Relevant Periods are
as follows:
Leasehold land Buildings Machinery
Vehicles and
others Total
RMB million RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118907 178 35 – 1,120
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829 72 – – 101
Acquisition of a
subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184 4––– 4 4
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(26) (78) (15) – (119)
Early cancellation
of leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (14) – – (14)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(26) – – – (26)
As at 31 December 2022
and 1 January 2023 /H1118/H1118/H1118 928 158 20 – 1,106
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840 383 – 4 427
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(30) (82) (10) (1) (123)
Early cancellation of
leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1) – – (1)
Exchange realignment /H1118/H1118/H1118 – (4) – (1) (5)
As at 31 December 2023
and 1 January 2024 /H1118/H1118/H1118 938 454 10 2 1,404
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111857 1,793 125 – 1,975
Acquisition of
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118337 22 – – 359
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(40) (247) (25) (1) (313)
Early cancellation of
leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (28) – – (28)
Disposal of a subsidiary /H1118/H1118 (11) (24) – – (35)
Exchange realignment /H1118/H1118/H1118 – (12) – – (12)
As at 31 December 2024
and 1 January 2025 /H1118/H1118/H1118 1,281 1,958 110 1 3,350
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 86–– 2 4
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(12) (62) (4) – (78)
Early cancellation of
leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (3) – – (3)
Disposal of a subsidiary /H1118/H1118 – (15) – – (15)
Exchange realignment /H1118/H1118/H1118 – 1 4–– 1 4
As at 31 March 2025 /H1118/H1118/H1118/H11181,287 1,898 106 1 3,292
APPENDIX I ACCOUNTANTS’ REPORT
– I-62 –


--- page 558 ---
As at 31 December 2022, 31 December 2023, 31 December 2024 and 31 March 2025, certain of the Group’s
leasehold land with an aggregate net carrying value of approximately RMB49 million, RMB47 million and RMB324
million and RMB322 million respectively, did not have land use right certificates registered under the names of the
respective subsidiaries of the Group.
As at 31 December 2023, 31 December 2024 and 31 March 2025, certain of the Group’s leasehold land with
aggregate net carrying values of approximately RMB89 million and RMB86 million and RMB86 million,
respectively, were pledged as collateral for bank loans.
The Company
The carrying amounts of the Company’s right-of-use assets and the movements during the Relevant Periods
are as follows:
Leasehold land Buildings Machinery Total
RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118774 13 – 787
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–1 5 –1 5
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(21) (10) – (31)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(23) – – (23)
As at 31 December 2022 and 1
January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118730 18 – 748
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(22) (9) – (31)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(63) – – (63)
As at 31 December 2023 and 1
January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118645 9 – 654
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,330 111 1,441
Acquisition of Jetour business /H1118/H1118/H1118/H1118 37 171 – 208
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(21) (93) (11) (125)
As at 31 December 2024 and 1
January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118661 1,417 100 2,178
Depreciation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5) (24) (3) (32)
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118656 1,393 97 2,146
As at 31 December 2022, 31 December 2023, 31 December 2024 and 31 March 2025, certain of the Company’s
leasehold land with an aggregate net carrying value of approximately RMB49 million, RMB47 million and RMB324
million and RMB322 million, respectively, did not have land use right certificates registered under the Company’s
name.
APPENDIX I ACCOUNTANTS’ REPORT
– I-63 –


--- page 559 ---
(b) Lease liabilities
The carrying amount of lease liabilities and the movements during the Relevant Periods are as follows:
The Group
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Carrying amount at the beginning of
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118223 211 521 2,319
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111872 387 1,918 6
Additions as a result of acquisition
of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 2 2–
Accretion of interest recognised
during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 21 101 25
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(85) (94) (199) (27)
Early cancellation of leases /H1118/H1118/H1118/H1118/H1118/H1118(8) (1) (10) (3)
Disposal of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (23) (15)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (3) (11) (19)
Carrying amount at the end of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118211 521 2,319 2,286
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846 138 366 428
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118165 383 1,953 1,858
Included in the above balances are the following balances with related parties:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd.**
and its subsidiaries, joint ventures
and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850 172 161 162
Associates and its subsidiaries /H1118/H1118/H1118/H1118 44 46 48 48
Ruichuang* and its subsidiaries /H1118/H1118/H1118 8522
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–1––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102 224 211 212
The balances of lease liabilities with related parties are all trade in nature.
* Wuhu Ruichuang Investment Co., Ltd. ( /H11033Ruichuang /H11033) is a shareholder of the Company. For further
information, refer to note 37(a).
** Chery Holding Group Co., Ltd. is no longer a related party of the Group since the completion of the
equity transfer on January 20, 2025. The above balance with Chery Holding Group Co., Ltd. as of 31
March 2025 is disclosed to maintain consistency in disclosure during the Relevant Periods. The same
practice is adopted in disclosure of other notes where balances or amounts with Chery Holding Group
Co., Ltd. is disclosed.
APPENDIX I ACCOUNTANTS’ REPORT
– I-64 –


--- page 560 ---
The Company
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Carrying amount at the beginning of
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812 17 9 1,651
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815 – 1,441 –
Acquisition of Jetour business /H1118/H1118/H1118/H1118 – – 157 –
Accretion of interest recognised
during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 1 64 14
Payments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) (9) (20) (6)
Carrying amount at the end of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 9 1,651 1,659
Analysed into:
Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 4 127 244
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 5 1,524 1,415
Included in the above balances are the following balances with related parties:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 1 161 162
Ruichuang and its subsidiaries /H1118/H1118/H1118/H1118 8522
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 6 163 164
The balances of lease liabilities with related parties are all trade in nature.
The maturity analysis of lease liabilities is disclosed in note 49 to the Historical Financial Information.
(c) The amounts recognised in profit or loss in relation to leases are as follows:
The Group
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Interest on lease liabilities /H1118/H1118/H1118/H1118/H11189 21 101 22 25
Depreciation of right-of-use
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118119 123 313 72 78
Expense relating to short-term
leases and leases of low-value
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111876 108 151 32 43
Total amount recognised in profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118204 252 565 126 146
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 561 ---
The Company
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Interest on lease liabilities /H1118/H1118/H1118/H1118/H11181 1 64 16 14
Depreciation of right-of-use
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831 31 125 19 32
Expense relating to short-term
leases and leases of low-value
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 31 51 13 9
Total amount recognised in profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862 63 240 48 55
(d) The total cash outflow for leases is disclosed in note 42(c) to the Historical Financial Information.
15. OTHER INTANGIBLE ASSETS
The Group
Patents
Capitalised
development
expenditures Software Total
RMB million RMB million RMB million RMB million
31 December 2022
As at 1 January 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,724 285 616 2,625
Accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,424) – (551) (1,975)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118300 285 65 650
At 1 January 2022, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118300 285 65 650
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 482 85 567
Injection by non-controlling
shareholder of a subsidiary /H1118/H1118/H1118/H1118/H1118280 – – 280
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118380 (380) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(204) – (80) (284)
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (1) (1)
Acquisition of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118––33
Disposal of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2) (2)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(17) – – (17)
At 31 December 2022, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118739 387 70 1,196
As at 31 December 2022 and at
1 January 2023:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,362 387 702 3,451
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,623) – (632) (2,255)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118739 387 70 1,196
APPENDIX I ACCOUNTANTS’ REPORT
– I-66 –


--- page 562 ---
Patents
Capitalised
development
expenditures Software Total
RMB million RMB million RMB million RMB million
31 December 2023
At 1 January 2023, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118739 387 70 1,196
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 185 133 318
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118476 (476) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(338) – (91) (429)
Disposal of a subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2) (2)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (1) (1)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (1) (1)
At 31 December 2023, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118877 96 108 1,081
As at 31 December 2023 and at
1 January 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,838 96 814 3,748
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,961) – (706) (2,667)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118877 96 108 1,081
31 December 2024
At 1 January 2024, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118877 96 108 1,081
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,301 319 1,620
Transfer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118765 (765) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(512) – (160) (672)
Acquisition of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118– – 38 38
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (4) (4)
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2) (2)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (4) (4)
At 31 December 2024, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,130 632 295 2,057
At 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,603 632 1,157 5,392
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,473) – (862) (3,335)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,130 632 295 2,057
31 March 2025
At 1 January 2025, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H11181,130 632 295 2,057
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 488 42 530
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(129) – (47) (176)
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (13) (13)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––22
At 31 March 2025, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001 1,120 279 2,400
At 31 March 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,603 1,120 1,166 5,889
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,602) – (887) (3,489)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,001 1,120 279 2,400
APPENDIX I ACCOUNTANTS’ REPORT
– I-67 –


--- page 563 ---
As at 31 December 2023, 31 December 2024 and 31 March 2025, certain of the Group’s patents, with an
aggregate net carrying value of approximately RMB236 million, RMB135 million and RMB121 million, respectively,
were pledged as collateral for bank loans.
The Company
Patents
Capitalised
development
expenditures Software Total
RMB million RMB million RMB million RMB million
31 December 2022
As at 1 January 2022:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,349 153 443 1,945
Accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,310) – (424) (1,734)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839 153 19 211
At 1 January 2022, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H111839 153 19 211
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 309 8 317
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118269 (269) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(88) – (17) (105)
At 31 December 2022, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118220 193 10 423
As at 31 December 2022 and at
1 January 2023
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,618 193 450 2,261
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,398) – (440) (1,838)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118220 193 10 423
31 December 2023
At 1 January 2023, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118220 193 10 423
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 176 77 253
Transfers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118272 (272) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(169) – (35) (204)
At 31 December 2023, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118323 97 52 472
As at 31 December 2023 and at
1 January 2024
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,891 97 522 2,510
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,568) – (470) (2,038)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118323 97 52 472
APPENDIX I ACCOUNTANTS’ REPORT
– I-68 –


--- page 564 ---
Patents
Capitalised
development
expenditures Software Total
RMB million RMB million RMB million RMB million
31 December 2024
At 1 January 2024, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118323 97 52 472
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,025 212 1,237
Transfer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118471 (471) – –
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(323) – (102) (425)
Acquisition of Jetour business /H1118/H1118/H1118/H1118 105 – 19 124
Disposal /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (1) (1)
At 31 December 2024, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118576 651 180 1,407
At 31 December 2024:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,497 651 790 3,938
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,921) – (610) (2,531)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118576 651 180 1,407
31 March 2025
At 1 January 2025, net of
accumulated amortisation /H1118/H1118/H1118/H1118/H1118/H1118576 651 180 1,407
Additions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 471 2 473
Amortisation /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(69) – (30) (99)
At 31 March 2025, net of
accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118507 1,122 152 1,781
At 31 March 2025:
Cost /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,497 1,122 792 4,411
Accumulated amortisation and
impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,990) – (640) (2,630)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118507 1,122 152 1,781
16. INVESTMENTS IN JOINT VENTURES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,626 8,265 9,793 10,817
The Group’s trade and non-trade receivable and payable balances with the joint ventures are disclosed in notes
19, 22, 27, 28 and 32 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-69 –


--- page 565 ---
Particulars of the Group’s and the Company’s material joint venture are as follows:
Name
Particulars of
paid-in capital held
Place of
registration
and business
Percentage of
Principal
activities
Ownership
interest
Voting
power
Profit
sharing
Chery Jaguar Land
Rover Automotive
Co., Ltd. ( փ๿ઠ
ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Registered
paid-in capital
of RMB1
each
Mainland China 50 50 50 Manufacture
and sales
of
vehicles
Chery HuiYin
Motor Finance
Service Co., Ltd.
(ږ
ʮ̡)/H1118
Ordinary shares Mainland China 49 49 49 Auto
financial
services
The above investment is directly held by the Company. The English name of the particulars of the Group’s
material joint ventures above represents the best effort made by the management of the Company to directly translate
the Chinese name as it does not register any official English name.
The following table illustrates the summarised financial information in respect of Chery Jaguar Land Rover
Automotive Co., Ltd., adjusted for any differences in accounting policies and reconciled to the carrying amount in
the consolidated financial statements:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H11182,461 2,920 2,309 2,237
Other current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,945 2,013 2,714 2,608
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,406 4,933 5,023 4,845
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,368 10,006 7,922 7,485
Financial liabilities, excluding trade
and other payables and
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,968 811 813 276
Other current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,999 7,746 6,071 5,945
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,967 8,557 6,884 6,221
Non-current financial liabilities,
excluding trade and other
payables and provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118148 415 – –
Other non-current liabilities /H1118/H1118/H1118/H1118/H1118/H111861 63 136 271
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118209 478 136 271
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,598 5,904 5,925 5,838
Reconciliation to the Group’s
interest in the joint venture:
Proportion of the Group’s
ownership /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850% 50% 50% 50%
Group’s share of net assets of the
joint venture /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,799 2,952 2,963 2,919
Carrying amount of the investment /H1118 2,799 2,952 2,963 2,919
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,319 14,077 11,637 1,747
Profit/(loss) and total comprehensive
income for the year/period /H1118/H1118/H1118/H1118/H1118192 306 21 (87)
APPENDIX I ACCOUNTANTS’ REPORT
– I-70 –


--- page 566 ---
The following table illustrates the summarised financial information in respect of Chery HuiYin Motor Finance
Service Co., Ltd., adjusted for any differences in accounting policies and reconciled to the carrying amount in the
consolidated financial statements:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Cash and balance with central banks 226 96 348 267
Due from banks and other financial
institutions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,863 4,776 6,199 7,151
Other assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,259 45,904 65,519 71,141
Total Assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111836,348 50,776 72,066 78,559
Financial liabilities, excluding trade
and other payables and
provisions /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825,743 38,523 58,532 65,241
Other liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,957 2,335 2,025 1,465
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827,700 40,858 60,557 66,706
Net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,648 9,918 11,509 11,853
Reconciliation to the Group’s
interest in the joint venture:
Proportion of the Group’s
ownership /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111849% 49% 49% 49%
Group’s share of net assets of the
joint venture /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,237 4,859 5,640 5,808
Carrying amount of the investment /H1118 4,237 4,859 5,640 5,808
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,342 2,908 3,952 1,056
Profit and total comprehensive
income for the year/period /H1118/H1118/H1118/H1118/H11181,044 1,364 1,708 342
Dividend received /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111837 46 56 –
The following table illustrates the aggregate financial information of the Group’s joint ventures that are not
individually material:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of the joint ventures’ profit
for the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111832 33 4 (12)
Share of the joint ventures’ total
comprehensive income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111830 26 (10) (2)
Aggregate carrying amount of the
Group’s investments in the joint
ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118590 454 1,190 2,091
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,531 8,152 9,273 10,248
APPENDIX I ACCOUNTANTS’ REPORT
– I-71 –


--- page 567 ---
The Company’s trade and non-trade receivable and payable balances with the joint ventures are disclosed in
notes 19, 22, 28 and 32 to the Historical Financial Information, respectively.
The following table illustrates the aggregate financial information of the Company’s joint ventures that are not
individually material:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of the joint ventures’
profit/(loss) for the year/period /H1118/H1118 41 16 (59) 6
Share of the joint ventures’ total
comprehensive income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111839 8 (73) 8
Aggregate carrying amount of the
Company’s investments in the
joint ventures /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118495 341 670 1,521
17. INVESTMENTS IN ASSOCIATES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H11185,235 6,181 7,591 6,968
Less: impairment for investment in
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118891 891 1,227 1,227
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,344 5,290 6,364 5,741
The Group’s and the Company’s trade and non-trade receivable and payable balances with the associates are
disclosed in notes 19, 22, 27, 28 and 32 to the Historical Financial Information, respectively.
The following table illustrates the aggregate financial information of the Group’s associates that are not
individually material:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of the associates’ profit for
the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118247 382 595 98
Share of the associates’ total
comprehensive income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118247 382 597 99
Aggregate carrying amount of the
Group’s investments in the
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,344 5,290 6,364 5,741
APPENDIX I ACCOUNTANTS’ REPORT
– I-72 –


--- page 568 ---
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H11181,715 1,363 2,083 1,250
Less: impairment for investment in
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111844 44 69 69
Share of net assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671 1,319 2,014 1,181
The following table illustrates the aggregate financial information of the Company’s associates that are not
individually material:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Share of the associates’ (loss)/profit
for the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(16) 223 97 16
Share of the associates’ total
comprehensive income for the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(16) 223 97 16
Aggregate carrying amount of the
Company’s investments in the
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,671 1,319 2,014 1,181
18. EQUITY INVESTMENTS DESIGNATED AT FAIR V ALUE THROUGH OTHER COMPREHENSIVE
INCOME
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Equity investments designated at
fair value through other
comprehensive income
Listed equity investments, at fair
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111889 61 – –
Unlisted equity investments, at fair
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118260 262 313 282
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118349 323 313 282
The above equity investments were irrevocably designated at fair value through other comprehensive income
as the Group considers these investments to be strategic in nature.
During the Relevant Periods, the Group received dividends in the amounts of RMB19 million, RMB29 million,
RMB32 million and RMB13 million, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-73 –


--- page 569 ---
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Equity investments designated at
fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118
Listed equity investments, at fair
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111847 61 – –
Unlisted equity investments, at fair
value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118235 209 260 248
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118282 270 260 248
During the Relevant Periods, the Company received dividends in the amounts of RMB19 million, RMB29
million and RMB30 million and RMB13 million, respectively.
19. PREPAYMENTS, OTHER RECEIV ABLES AND OTHER ASSETS
The Group
As at 31 December As at 31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-Current portion
Debt investments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 512 380 – –
Prepayments for acquisition of
long-term assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 528 247 757 504
Prepayments for acquisition of
Jetour business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840(d) – 7,003 – –
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118136 99 84 79
Impairment allowance /H1118/H1118/H1118/H1118/H1118(b) (77) (26) (2) (2)
Total non-current portion /H1118/H1118/H1118 1,099 7,703 839 581
Current portion
Other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 25,316 19,412 3,847 4,045
V alue-added-tax recoverable /H1118/H1118 1,222 2,765 5,126 5,069
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118733 2,149 3,531 3,037
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 14 12 33
Impairment allowance /H1118/H1118/H1118/H1118/H1118(b) (2,937) (2,976) (2,011) (1,987)
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118 24,344 21,364 10,505 10,197
APPENDIX I ACCOUNTANTS’ REPORT
– I-74 –


--- page 570 ---
The Company
As at 31 December As at 31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-Current portion
Prepayments for acquisition of
long-term assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118 433 157 653 339
Prepayments for acquisition of
Jetour business /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111840(d) – 7,003 – –
Total non-current portion /H1118/H1118/H1118 433 7,160 653 339
Current portion
Other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 20,431 21,064 8,000 9,314
V alue-added-tax recoverable /H1118/H1118 203 889 1,266 1,353
Prepayments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118263 631 1,281 4,044
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183369
Impairment allowance /H1118/H1118/H1118/H1118/H1118(b) (853) (755) (478) (479)
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118 20,047 21,832 10,075 14,241
Impairment of other receivables is measured as either 12-month expected credit losses or life time expected
credit losses, 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 expected credit losses.
(a) The carrying amount with related parties included in the above balances are as follows:
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,357 14,062 211 209
Associates and its subsidiaries /H1118/H1118/H1118/H11181,907 1,177 260 103
Joint ventures and its subsidiaries /H1118/H1118 242 234 243 311
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118253 335 6 9
Luxshare Limited and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–––5
Impairment allowance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(570) (483) (306) (305)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,189 15,325 414 332
As at 31 December 2022, 2023, 2024 and 31 March 2025, the non-trade balances of prepayments, other
receivables and other assets of the Group amounted to RMB21,602 million, RMB13,832 million, RMB103 million
and RMB28 million, respectively. The non-trade balances with the related parties are expected to be settled before
the Listing.
APPENDIX I ACCOUNTANTS’ REPORT
– I-75 –


--- page 571 ---
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,241 276 55 48
Company’s subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,285 18,015 6,404 7,682
Associates and its subsidiaries /H1118/H1118/H1118/H11181,223 536 32 29
Joint ventures and its subsidiaries /H1118/H1118 242 234 243 238
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 250 6 9
Impairment allowance /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(452) (446) (303) (314)
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,709 18,865 6,437 7,692
As at 31 December 2022, 2023, 2024 and 31 March 2025, the non-trade balances of prepayments, other
receivables and other assets of the Company amounted to RMB10,716 million, RMB256 million and RMB28
million and RMB28 million, respectively. The non-trade balances with the related parties are expected to be
settled before the Listing.
(b) Impairment allowance for other receivables
The Group
As at 31 December 2022
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118825 – 2,222 3,047
Transfers into stage 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(48) – 48 –
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(49) – 574 525
Foreign exchange realignment /H1118/H1118/H1118/H1118 1 5–– 1 5
Written off /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(13) – – (13)
Debt-to-equity settlement /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (560) (560)
As at 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118730 – 2,284 3,014
As at 31 December 2023
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118730 – 2,284 3,014
Transfers into stage 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5) – 5 –
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(238) – 226 (12)
Foreign exchange realignment /H1118/H1118/H1118/H1118 1––1
Written off /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1) – – (1)
As at 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118487 – 2,515 3,002
APPENDIX I ACCOUNTANTS’ REPORT
– I-76 –


--- page 572 ---
As at 31 December 2024
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118487 – 2,515 3,002
Transfers into stage 3 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6) – 6 –
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(238) – (11) (249)
Foreign exchange realignment /H1118/H1118/H1118/H1118 (1) – (1) (2)
Written off /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (738) (738)
As at 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118242 – 1,771 2,013
As at 31 March 2025
12-month Stage 1 Lifetime Stage 2 Lifetime Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118242 – 1,771 2,013
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(22) – (1) (23)
Written off /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1) – – (1)
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118219 – 1,770 1,989
The Company
As at 31 December 2022
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118420 – 459 879
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 – 364 534
Debt-to-equity settlement /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (560) (560)
As at 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118590 – 263 853
As at 31 December 2023
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118590 – 263 853
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(90) – (8) (98)
As at 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118500 – 255 755
As at 31 December 2024
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118500 – 255 755
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(260) – (17) (277)
As at 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118240 – 238 478
APPENDIX I ACCOUNTANTS’ REPORT
– I-77 –


--- page 573 ---
As at 31 March 2025
12-month
Stage 1
Lifetime
Stage 2
Lifetime
Stage 3 Total
RMB million RMB million RMB million RMB million
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118240 – 238 478
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181––1
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118241 – 238 479
20. FINANCIAL ASSETS AT FAIR V ALUE THROUGH PROFIT OR LOSS
The Group
As at 31 December As at 31 March
Notes 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-current portion
Unlisted equity investments,
at fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 33 45 61 58
Current portion
Listed convertible bonds /H1118/H1118/H1118(b) 1 0 6–––
Wealth management products
and structured deposits, at
fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(c) 13,792 11,961 19,579 29,278
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118 13,898 11,961 19,579 29,278
(a) The Group’s unlisted equity investments represent the Group’s equity interests in those companies.
None of the shareholdings exceeded 20% of the issued capital of the respective investees and the Group
did not have significant influence on these invested entities.
(b) Wuhu Chery Technology Co., Ltd. acquired convertible bonds issued by Rayhoo Motor Dies Co., Ltd.*
(ʮ̡) on 24 June 2022 and the convertible bonds are fully sold on 19 June 2023.
(c) The wealth management products and structured deposits were issued by banks in Mainland China. They
were mandatorily classified as financial assets at fair value through profit or loss as their contractual
cash flows are not solely payments of principal and interest. All the structured deposits are
principal-guaranteed while wealth management products are not principal-guaranteed.
* The English name of these entities above represents the best effort made by the management of the
Company to directly translate the Chinese name as it does not register any official English name.
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Current Portion
Wealth management products and
structured deposits, at fair value /H1118/H1118 6,025 5,212 19,118 29,265
APPENDIX I ACCOUNTANTS’ REPORT
– I-78 –


--- page 574 ---
21. INVENTORIES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,438 1,755 2,370 2,517
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,374 2,618 4,911 4,876
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,061 26,662 29,043 31,114
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,873 31,035 36,324 38,507
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group’s inventories with a carrying amount of
nil, nil, RMB1,288 million and RMB1,246 million, respectively, were pledged as security for the Group’s bank loans.
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Raw materials /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118737 1,020 1,506 1,409
Work in progress /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118655 1,093 1,865 1,889
Finished goods /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,785 7,630 6,350 6,206
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,177 9,743 9,721 9,504
22. TRADE RECEIV ABLES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,160 1,787 2,535 2,315
Associates and its subsidiaries /H1118/H1118/H1118/H1118 419 542 1,058 1,353
Joint ventures and its subsidiaries /H1118/H1118 419 484 719 862
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111866 11 39 58
Third parties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,730 9,797 14,137 17,750
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,794 12,621 18,488 22,338
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,273) (1,353) (1,065) (1,068)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,521 11,268 17,423 21,270
Advance payments is normally required for sales of passenger vehicles, except for some long-standing
customers with bulk purchases and good credit standing, where payment is generally due from 30 to 180 days from
delivery. Trade receivables are non-interest bearing.
APPENDIX I ACCOUNTANTS’ REPORT
– I-79 –


--- page 575 ---
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Company’s subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,104 7,765 30,137 36,701
Chery holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118225 246 1,030 556
Associates and its subsidiaries /H1118/H1118/H1118/H1118 264 335 708 985
Joint ventures and its subsidiaries /H1118/H1118 414 482 580 674
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 7 30 51
Third parties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,398 8,917 13,553 13,180
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,406 17,752 46,038 52,147
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(821) (967) (1,033) (864)
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,585 16,785 45,005 51,283
An aging analysis of the trade receivables as at 31 December 2022, 2023, 2024 and 31 March 2025 based on
the time of revenue recognition and net of loss allowance, is as follows:
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,059 9,473 17,336 21,233
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118281 1,737 74 29
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118181 58 13 8
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,521 11,268 17,423 21,270
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188,843 14,983 42,326 49,306
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118736 1,608 2,178 1,977
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 194 501 –
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,585 16,785 45,005 51,283
APPENDIX I ACCOUNTANTS’ REPORT
– I-80 –


--- page 576 ---
The movements in the loss allowance for impairment of trade receivables are as follows:
The Group
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H11181,093 1,273 1,353 1,065
Impairment losses, net (note 6) /H1118/H1118/H1118/H1118 173 85 15 10
Amount written-off as uncollectible /H1118 (1) (7) (297) –
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 2 (6) (7)
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,273 1,353 1,065 1,068
The Company
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H1118809 821 967 1,033
Impairment losses, net /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812 146 198 (169)
Amount written-off as uncollectible /H1118 – – (132) –
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118821 967 1,033 864
The Group applies the simplified approach to provide for expected credit losses prescribed by HKFRS 9, which
permits the use of the lifetime expected credit loss provision for all trade receivables. The Group overall considers
the characteristics of the shared credit risk and the aging of the trade receivables to measure the expected credit
losses. The expected credit losses of trade receivables are assessed on an individual or portfolio basis. Considering
the credit risk characteristics of different customers, the Group assesses the expected credit losses of trade receivables
with shared risk characteristics based on their ageing portfolio, adjusted as appropriate to reflect current and
forward-looking information. The aging profile is determined based on the revenue recognition date.
The information about the credit risk exposure on the Group’s trade receivables are set out below:
The Group
As at 31 December 2022
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.27% 8,710 (111) 8,599
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.10% 290 (9) 281
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824.90% 241 (60) 181
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 325 (325) –
Provision on an individual basis-
National NEV subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H11184.96% 484 (24) 460
Provision on an individual basis-
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 744 (744) –
10,794 (1,273) 9,521
APPENDIX I ACCOUNTANTS’ REPORT
– I-81 –


--- page 577 ---
As at 31 December 2023
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.93% 9,392 (181) 9,211
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184.93% 1,827 (90) 1,737
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828.40% 81 (23) 58
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 295 (295) –
Provision on an individual basis-
National NEV subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H11185.07% 276 (14) 262
Provision on an individual basis-
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 750 (750) –
12,621 (1,353) 11,268
As at 31 December 2024
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.28% 17,070 (219) 16,851
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185.13% 78 (4) 74
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111827.78% 18 (5) 13
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 81 (81) –
Provision on an individual basis-
National NEV subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H11185.09% 511 (26) 485
Provision on an individual basis-
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 730 (730) –
18,488 (1,065) 17,423
As at 31 March 2025
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181.28% 21,217 (272) 20,945
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186.45% 31 (2) 29
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838.46% 13 (5) 8
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 43 (43) –
Provision on an individual basis-
National NEV subsidies /H1118/H1118/H1118/H1118/H1118/H1118/H11184.95% 303 (15) 288
Provision on an individual basis-
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 731 (731) –
22,338 (1,068) 21,270
APPENDIX I ACCOUNTANTS’ REPORT
– I-82 –


--- page 578 ---
The information about the credit risk exposure on the Company’s trade receivables are set out below:
The Company
As at 31 December 2022
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.30% 8,870 (27) 8,843
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.26% 753 (17) 736
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825.00% 8 (2) 6
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 177 (177) –
Provision on an individual basis /H1118/H1118/H1118 100.00% 598 (598) –
10,406 (821) 9,585
As at 31 December 2023
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.55% 15,066 (83) 14,983
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184.57% 1,685 (77) 1,608
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826.79% 265 (71) 194
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 159 (159) –
Provision on an individual basis /H1118/H1118/H1118 100.00% 577 (577) –
17,752 (967) 16,785
As at 31 December 2024
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.33% 42,466 (140) 42,326
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.29% 2,252 (74) 2,178
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825.00% 668 (167) 501
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 28 (28) –
Provision on an individual basis /H1118/H1118/H1118 100.00% 624 (624) –
46,038 (1,033) 45,005
As at 31 March 2025
Expected credit
loss rate
Gross carrying
amount
Expected credit
losses
Net carrying
amount
RMB million RMB million RMB million
Provision on a collective basis
Aged within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.33% 49,470 (164) 49,306
Aged 1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.28% 2,044 (67) 1,977
Aged 2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118N/A – – –
Aged over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118100.00% 9 (9) –
Provision on an individual basis /H1118/H1118/H1118 100.00% 624 (624) –
52,147 (864) 51,283
APPENDIX I ACCOUNTANTS’ REPORT
– I-83 –


--- page 579 ---
23. BILLS RECEIV ABLES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Bank acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,167 10,805 774 330
As at 31 December 2022, 2023, 2024 and 31 March 2025, bank acceptance bills of the Group amounting to
RMB305 million, RMB384 million, RMB349 million, and RMB10 million, respectively, were pledged as collaterals
to issue bills payable. All bank acceptance bills are aged within 6 months. The Group considers that there is no
material credit risk in the bank acceptance bills held by the Group.
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Bank acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,485 4,636 477 1,089
As at 31 December 2022, 2023, 2024 and 31 March 2025, bank acceptance bills of the Company amounting
to RMB553 million, RMB584 million, RMB349 million, and RMB419 million, respectively, were pledged as
collaterals to issue bills payable.
24. CONTRACT ASSETS
The Group
As at
1 January
As at
31 December
As at
31 December
As at
31 December
As at
31 March
2022 2022 2023 2024 2025
RMB million RMB million RMB million RMB million RMB million
Contract assets arising from:
National NEV subsidies /H1118/H1118/H1118/H11181,520 1,249 479 – –
Impairment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(76) (62) (24) – –
Net carrying amount /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,444 1,187 455 – –
The movements in the loss allowance for impairment of contract assets are as follows:
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
At beginning of year/period /H1118/H1118/H1118/H1118/H1118/H111876 62 24 –
Impairment losses, net (note 6) /H1118/H1118/H1118/H1118 (14) (38) (24) –
At end of year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111862 24 – –
National subsidies receivable is related to sales of qualified new energy passenger vehicles, which were
settled after appropriate review and approval by government.
APPENDIX I ACCOUNTANTS’ REPORT
– I-84 –


--- page 580 ---
25. FINANCIAL ASSETS AT FAIR V ALUE THROUGH OTHER COMPREHENSIVE INCOME
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Bills receivables, at fair value /H1118/H1118/H1118/H11182,359 4,433 7,547 1,802
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Bills receivables, at fair value /H1118/H1118/H1118/H11181,903 1,338 4,557 1,291
The Group and the Company has classified bills receivables that are held both to collect cash flows and to sell
as financial assets at fair value through other comprehensive income under HKFRS 9. All these receivables at fair
value through other comprehensive income are aged within 6 months. The Group considers that there is no material
credit risk in the bank acceptance bills held by the Group.
26. CASH AND CASH EQUIV ALENTS, TIME DEPOSITS AND PLEDGED DEPOSITS
The Group
(a) Cash and cash equivalents
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,498
Denominated in:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,243 32,222 56,809 28,397
United States Dollar /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,922 1,265 2,098 4,770
Euro /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 1,234 1,587
Russian Ruble /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118166 830 776 835
Mexican Peso /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118156 141 502 266
Turkish Lira /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 345 613 613
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118182 245 661 1,030
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,686 35,048 62,693 37,498
The RMB is not freely convertible into other currencies, however, under Mainland China’s Foreign Exchange
Control Regulations and Administration of Settlement, and Sale and Payment of Foreign Exchange Regulations, the
Group is permitted to exchange RMB for other currencies through banks authorised to conduct foreign exchange
business. Cash at banks earns interest at floating rates based on daily bank deposit rates. Short term time deposits
are made depending on the immediate cash requirements of the Group and earn interest at the respective short term
time deposit rates. The bank balances are deposited with creditworthy banks with no recent history of default.
APPENDIX I ACCOUNTANTS’ REPORT
– I-85 –


--- page 581 ---
(b) Restricted bank deposits
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Restricted cash balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118932 587 75 2,303
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Pledged cash balances for bank
acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118797 581 45 73
Pledged cash balances for other
purpose /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118135 6 27 230
Funds on hold for the structured
deposit subscription /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,000
Pledged cash balances for bank
loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––3–
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118932 587 75 2,303
As at 31 March 2025, the Group committed funds of RMB2,000 million for purchases of structured deposit
with Industrial Bank Co., Ltd. Changshu Branch.
(c) Time deposits
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Short-term time deposits with
original maturities of over three
months and due within one year /H1118/H1118 3,373 2,188 7,319 16,204
Time deposits with original
maturities over one year /H1118/H1118/H1118/H1118/H1118/H1118/H11181,987 2,810 244 35
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,360 4,998 7,563 16,239
Denominated in:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,360 4,998 7,203 15,521
United States Dollar /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 360 718
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,360 4,998 7,563 16,239
APPENDIX I ACCOUNTANTS’ REPORT
– I-86 –


--- page 582 ---
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Pledged time deposits for bank
loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 200 200 –
Pledged time deposits for bank
acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,076 2,383 788 352
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,076 2,583 988 352
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group has time deposits at Chery HuiYin Motor
Finance Service Co., Ltd amounted to nil, nil, RMB5,400 million and RMB3,400 million, respectively.
The Company
(a) Cash and cash equivalents
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H11185,693 19,433 55,287 28,757
Denominated in:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,803 18,381 54,544 26,953
United States Dollar /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118879 1,052 442 1,502
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 – 301 302
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,693 19,433 55,287 28,757
(b) Restricted bank deposits
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Pledged cash balances for bank
acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118166 20 – –
Funds on hold for the structured
deposit subscription /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 2,000
Pledged cash balances for other
purpose /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 3 55––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118301 25 – 2,000
As at 31 March 2025, the Company committed funds of RMB2,000 million for purchases of structured deposit
with Industrial Bank Co., Ltd. Changshu Branch.
APPENDIX I ACCOUNTANTS’ REPORT
– I-87 –


--- page 583 ---
(c) Time deposits
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Short-term time deposits with
original maturities of over three
months and due within one year /H1118/H1118 503 1,657 5,914 13,721
Denominated in:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118503 1,657 5,554 13,577
United States Dollar /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 360 144
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118503 1,657 5,914 13,721
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Pledged time deposits for bank
acceptance bills /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 0 0–––
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Company has time deposits at Chery HuiYin
Motor Finance Service Co., Ltd amounted to nil, nil, RMB5,400 million and RMB3,400 million, respectively.
27. TRADE AND BILLS PAYABLES
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,421 71,547 99,771 95,477
Bills payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,287 2,861 1,725 6,926
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111851,708 74,408 101,496 102,403
An aging analysis of the trade and bills payables of the Group as at 31 December 2022, 2023, 2024 and 31
March 2025 based on the time of purchase, is as follows:
Trade payables As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111841,253 70,130 99,286 94,794
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118633 1,094 367 563
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118170 201 39 42
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118365 122 79 78
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111842,421 71,547 99,771 95,477
APPENDIX I ACCOUNTANTS’ REPORT
– I-88 –


--- page 584 ---
Bills payable As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,287 2,861 1,725 6,926
Included in the balances of trade and bills payables are the following balances with related parties:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,145 1,585 2,667 1,383
Luxshare Limited and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 105 1,181 844
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118795 1,261 1,761 1,849
Joint ventures and its subsidiaries /H1118/H1118 4 013 4 9
Associates and its subsidiaries /H1118/H1118/H1118/H11183,964 6,389 7,528 9,326
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,952 9,341 13,140 13,451
The trade payables are non-interest-bearing and are normally settled on 30-day to 180-day terms after
acceptance of invoices.
The balances of trade and bills payables with related parties are all trade in nature.
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Trade payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,490 44,439 78,972 75,128
Bills payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,298 320 808 5,590
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826,788 44,759 79,780 80,718
An aging analysis of the trade and bills payables of the Company as at 31 December 2022, 2023, 2024 and
31 March 2025, based on the time of purchase, is as follows:
Trade payables As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,619 43,449 78,798 74,852
1 to 2 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118358 592 94 190
2 to 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118151 244 12 20
Over 3 years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118362 154 68 66
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824,490 44,439 78,972 75,128
APPENDIX I ACCOUNTANTS’ REPORT
– I-89 –


--- page 585 ---
Bills payable As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within 1 year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,298 320 808 5,590
Included in the balances of trade and bills payables are the following balances with related parties:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Company’s subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,493 5,052 6,580 10,122
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118725 173 930 360
Luxshare Limited and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11188 65 334 248
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118191 499 1,322 1,465
Joint ventures and its subsidiaries /H1118/H1118 ––– 4 9
Associates and its subsidiaries /H1118/H1118/H1118/H11181,116 2,830 6,724 8,660
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,533 8,619 15,890 20,904
The balances of trade and bills payables with related parties are all trade in nature.
28. OTHER PAYABLES AND ACCRUALS
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-current portion
Other payables for additions of
property, plant and equipment /H1118/H1118/H1118 1,019 2,077 2,806 2,806
Equity repurchases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118282 804 836 843
Long-term payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,300 3,000 1,212 1,430
Total non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H11183,601 5,881 4,854 5,079
Current portion
Accrued salaries, bonuses and
benefits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,934 4,016 4,978 3,494
Other payables for additions of
property, plant and equipment /H1118/H1118/H1118 1,735 3,349 3,371 2,985
Other tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,250 1,573 1,917 2,601
Marketing and promotion expense
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118985 1,353 2,081 2,190
Deposit from suppliers and
distributors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118953 1,277 1,431 1,462
Transportation fee payables /H1118/H1118/H1118/H1118/H1118/H1118297 990 1,478 1,688
Other payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,074 6,401 7,181 5,750
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,228 18,959 22,437 20,170
Other payables in current portion are non-interest-bearing and the terms of repayment is within 12 months.
APPENDIX I ACCOUNTANTS’ REPORT
– I-90 –


--- page 586 ---
Included in the balances of other payables and accruals are the following balances with related parties:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118468 480 169 200
Associates and its subsidiaries /H1118/H1118/H1118/H11181,190 1,033 1,050 1,063
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118109 120 5 420
Ruichuang and its subsidiaries /H1118/H1118/H1118/H1118 – 5 430 1
Joint ventures and its subsidiaries /H1118/H1118 7 1 5––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,774 1,653 1,654 1,684
The balances of the Group’s other payables and accruals to the related parties are trade in nature.
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-current portion
Other payables for additions of
property, plant and equipment /H1118/H1118/H1118 839 1,995 2,727 2,723
Total non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118839 1,995 2,727 2,723
Current portion
Other payables for additions of
property, plant and equipment /H1118/H1118/H1118 1,536 2,524 2,206 1,922
Accrued salaries, bonuses and
benefits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,229 2,789 3,750 2,826
Other tax payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118507 1,053 1,061 1,289
Transportation fees payables /H1118/H1118/H1118/H1118/H1118140 176 377 608
Marketing and promotion expenses
payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828 69 165 179
Deposit from suppliers and
distributors /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 5 1 1 62 94 3
Other payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,960 20,972 40,319 43,071
Total current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,415 27,699 47,907 49,938
The amounts attributable to related parties included in above other payables and accruals are as follows:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries, joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118215 359 2 107
Company’s subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,438 19,236 36,998 40,078
Associates and its subsidiaries /H1118/H1118/H1118/H11181,186 983 1,038 992
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118105 112 3 418
Ruichuang and its subsidiaries /H1118/H1118/H1118/H1118 – 5 430 1
Joint ventures and its subsidiaries /H1118/H1118 7–––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,951 20,695 38,471 41,596
The balances of the Company’s other payables and accruals to the related parties are trade in nature.
APPENDIX I ACCOUNTANTS’ REPORT
– I-91 –


--- page 587 ---
29. DERIV ATIVE FINANCIAL INSTRUMENTS
The Group
As at 31 December 2022 As at 31 December 2023 As at 31 December 2024 As at 31 March 2025
Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities
RMB million RMB million RMB million RMB million RMB million RMB million RMB million RMB million
Forward exchange
contracts /H1118/H1118/H1118/H1118/H11182 4 1– 3 1 8 6––––
Interest rate swaps
contracts /H1118/H1118/H1118/H1118/H1118–3––––––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182 4 13 3 1 8 6––––
The forward exchange contracts and interest rate swaps contracts are not designated for hedging and are
measured at fair value through profit or loss. Changes in the fair value of forward exchange contracts and interest
rate swaps contracts amounting to RMB238 million, RMB(55) million, nil and nil were charged to the statement of
profit or loss for the Relevant Periods, respectively.
30. INTEREST-BEARING BANK LOANS AND OTHER BORROWINGS
The Group
As at 31 December 2022
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.02 2023 13,208
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.05 2023 1,857
Current portion of long term bank loans – unsecured /H1118 3.49 2023 1,989
Current portion of long term bank loans – secured /H1118/H1118/H1118 2.94 2023 1,752
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,806
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.49 2024-2027 8,064
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.94 2024-2026 6,253
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,317
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,123
As at 31 December 2023
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812.01 2024 21,277
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.95 2024 1,275
Current portion of long term bank loans – unsecured /H1118 2.94 2024 3,855
Current portion of long term bank loans – secured /H1118/H1118/H1118 2.76 2024 5,317
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,724
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.94 2025-2026 5,284
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.76 2025-2037 1,500
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,784
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,508
APPENDIX I ACCOUNTANTS’ REPORT
– I-92 –


--- page 588 ---
As at 31 December 2024
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187.23 2025 9,243
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111822.53 2025 1,545
Current portion of long term bank loans – unsecured /H1118 2.66 2025 9,149
Current portion of long term bank loans – secured /H1118/H1118/H1118 2.92 2025 131
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,068
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.56 2026-2027 2,750
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.12 2026-2033 348
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,098
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,166
As at 31 March 2025
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811.65 2025 8,720
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829.11 2025 1,249
Current portion of long term bank loans –unsecured /H1118/H1118 2.48 2025-2026 6,497
Current portion of long term bank loans – secured /H1118/H1118/H1118 3.50 2026 48
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,514
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.48 2026-2032 2,770
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.50 2026-2033 338
Other loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.05 2026-2029 2,008
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,116
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,630
The carrying amounts of borrowings are denominated in the following currencies.
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831,317 25,870 14,262 12,245
Russian Ruble /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118849 12,502 8,856 8,940
United States Dollar /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 5 7–––
Turkish Lira /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 136 48 275
Mexican Peso /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––– 1 7 0
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,123 38,508 23,166 21,630
APPENDIX I ACCOUNTANTS’ REPORT
– I-93 –


--- page 589 ---
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Analysed into:
Bank loans and other borrowings:
Within one year or on demand /H1118 18,806 31,724 20,068 16,514
In the second year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,687 4,332 1,705 1,898
In the third to fifth years,
inclusive /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,630 2,422 1,334 3,123
Beyond five years /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–3 05 99 5
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,123 38,508 23,166 21,630
(a) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group guaranteed by the Chery Holding Limited and its subsidiaries amounted to RMB4,799 million,
RMB2,175 million, nil and nil, respectively.
(b) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group guaranteed by Wuhu Investment Holding amounted to RMB2,500 million, RMB3,920 million, nil
and nil, respectively.
(c) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group guaranteed by certain third party companies amounted to RMB623 million, RMB1,016 million,
nil and nil, respectively.
(d) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group secured by mortgage of construction in progress, buildings and leasehold land amounted to nil,
RMB30 million, RMB148 million and RMB156 million respectively.
(e) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group secured by mortgage of patents, buildings, machineries, construction in progress and leasehold
land amounting to nil, RMB240 million, RMB230 million and RMB230 million, respectively.
(f) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group secured by pledge of certificates of deposit amounted to nil, RMB200 million, RMB195 million
and nil, respectively.
(g) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings
guaranteed by the Group’s subsidiaries amounted to RMB1,323 million, RMB450 million, RMB110
million and nil, respectively.
(h) As at 31 December 2022, 2023, 2024 and 31 March 2025, the amounts from discounted unmatured bills
receivables presented as borrowings were RMB617 million, RMB61 million, RMB43 million and nil,
respectively.
(i) As at 31 December 2022, 2023, 2024, and 31 March 2025, the outstanding balances of borrowings
guaranteed by inventory were nil, nil, RMB1,295 million and RMB1,246 million, respectively.
(j) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings
guaranteed by term deposit were nil, nil, RMB3 million and RMB3 million, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-94 –


--- page 590 ---
The Company
As at 31 December 2022
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.40 2023 7,851
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.67 2023 610
Current portion of long term bank loans – unsecured /H1118 3.63 2023 884
Current portion of long term bank loans – secured /H1118/H1118/H1118 2.73 2023 1,038
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,383
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.63 2024-2026 6,183
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.73 2024 4,564
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810,747
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,130
As at 31 December 2023
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183.23 2024 5,860
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.90 2024 300
Current portion of long term bank loans – unsecured /H1118 2.93 2024 3,298
Current portion of long term bank loans – secured /H1118/H1118/H1118 2.58 2024 3,921
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813,379
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.93 2025-2026 4,373
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.40 2026 1,030
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,403
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818,782
As at 31 December 2024
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.96 2025 1,096
Bank loans – secured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11180.17 2025 41
Current portion of long term bank loans – unsecured /H1118 2.50 2025 8,429
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,566
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.51 2026-2027 2,640
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,640
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,206
APPENDIX I ACCOUNTANTS’ REPORT
– I-95 –


--- page 591 ---
As at 31 March 2025
Weighted average
interest rate Maturity RMB million
(%)
Current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.59 2025-2026 480
Current portion of long term bank loans – unsecured /H1118 2.48 2025-2026 6,316
Total – current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,796
Non-current
Bank loans – unsecured /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182.44 2026-2027 2,640
Total – non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,640
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189,436
The carrying amounts of borrowings are denominated in the following currencies:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,130 18,782 12,206 9,436
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Analysed into:
Bank loans:
Within one year or on demand /H1118 10,383 13,379 9,566 6,796
In the second year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,822 4,817 1,530 1,530
In the third to fifth years,
inclusive /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,925 586 1,110 1,110
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,130 18,782 12,206 9,436
(a) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Company guaranteed by Chery Holding Company and its subsidiaries amounted to RMB3,098 million,
RMB1,030, nil, and nil, respectively.
(b) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Company guaranteed by Wuhu Investment Holding amounted to RMB2,500 million, RMB3,920 million,
nil, and nil, respectively.
(c) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Company guaranteed by certain third party companies amounted to nil, RMB300 million, nil, and nil,
respectively.
(d) As at 31 December 2022, 2023, 2024 and 31 March 2025, the amounts of discounted unmatured bills
receivables reclassified as borrowings were RMB610 million, nil, RMB41 million, and nil, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-96 –


--- page 592 ---
31. BONDS PAYABLE
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 2 5–––
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 1–––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 9 6–––
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Non-current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 2 5–––
Current /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187 1–––
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186 9 6–––
The bonds were issued in an aggregate principal amount of RMB700 million in September 2022, with a term
of three years, and bear an interest rate of 3.0% per annum. The bonds were fully prepaid in September 2023.
32. CONTRACT LIABILITIES
The Group
As at
1 January As at 31 December
As at
31 March
2022 2022 2023 2024 2025
RMB million RMB million RMB million RMB million RMB million
Advance payments from
customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,310 5,928 12,920 9,456 7,633
Sales rebate to customers /H1118 896 2,102 5,669 5,863 5,455
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,206 8,030 18,589 15,319 13,088
The Company
As at
1 January As at 31 December
As at
31 March
2022 2022 2023 2024 2025
RMB million RMB million RMB million RMB million RMB million
Advance payments from
customers /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,772 4,493 8,690 4,134 4,315
Sales rebate to customers /H1118 43 50 183 204 394
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,815 4,543 8,873 4,338 4,709
APPENDIX I ACCOUNTANTS’ REPORT
– I-97 –


--- page 593 ---
Included in the above balances are the following balances with related parties:
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Chery Holding Group Co., Ltd. and
its subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118104 493 63 56
Joint ventures and its subsidiaries /H1118/H1118 516 611 294 362
Associates and its subsidiaries /H1118/H1118/H1118/H1118 3415
Wuhu Investment Holding and its
subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–323
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118623 1,111 360 426
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Company’s subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,891 6,148 522 812
Chery Holding Group Co., Ltd. and
its subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 20 27 23
Joint ventures and its subsidiaries /H1118/H1118 516 611 288 358
Associates and its subsidiaries /H1118/H1118/H1118/H1118 3–13
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,434 6,779 838 1,196
The balances of contract liabilities with related parties are all trade in nature.
Contract liabilities of the Group mainly consist of advance payments made by customers for goods and sales
rebate payables to customers which will be normally settled for purchases of vehicles and components.
33. DEFERRED TAX
The Group
The movements in deferred tax assets of the Group during each of the Relevant Periods are as follows:
Impairment of
financial and
contract assets
and non-financial
assets
Accruals and
provisions Tax losses
Unrealized gains
or losses on
internal
transactions
Lease
liabilities Others Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118 395 400 3,375 13 31 10 4,224
Acquisition of a subsidiary /H1118/H1118/H1118/H1118 142 – 23 – – – 165
Deferred tax credited/(charged) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118 65 497 (210) 76 (1) 8 435
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118 602 897 3,188 89 30 18 4,824
Deferred tax credited/(charged) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118 (70) 888 (2,122) 405 10 9 (880)
APPENDIX I ACCOUNTANTS’ REPORT
– I-98 –


--- page 594 ---
Impairment of
financial and
contract assets
and non-financial
assets
Accruals and
provisions Tax losses
Unrealized gains
or losses on
internal
transactions
Lease
liabilities Others Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118 532 1,785 1,066 494 40 27 3,944
Acquisition of a subsidiary /H1118/H1118/H1118/H1118 – – 521 – 5 – 526
Transfer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(148) (103) (25) (9) (26) – (311)
Deferred tax credited/(charged) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118 378 1,429 (900) 43 298 1 1,249
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118 762 3,111 662 528 317 28 5,408
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118 – – (12) – (4) – (16)
Deferred tax credited/(charged) to
the statement of profit or loss
during the period (note 10) /H1118/H1118 (55) 53 (232) 69 (33) 1 (197)
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118 707 3,164 418 597 280 29 5,195
The movements in deferred tax liabilities of the Group during the Relevant Periods are as follows:
Changes in
fair value
Withholding
tax on
dividends
Right-of-use
assets Others Total
RMB million RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111868 1 31 48 148
Deferred tax charged/(credited) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118/H111814 140 (1) (17) 136
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111882 141 30 31 284
Deferred tax charged/(credited) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118/H1118(58) 101 25 4 72
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111824 242 55 35 356
Acquisition of a subsidiary /H1118/H1118/H1118/H1118 – – 5 133 138
Transfer /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (27) – (27)
Deferred tax charged/(credited) to
the statement of profit or loss
during the year (note 10) /H1118/H1118/H1118/H1118(5) (155) 216 (15) 41
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 87 249 153 508
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118– – (3) – (3)
Deferred tax charged/(credited) to
the statement of profit or loss
during the period (note 10) /H1118/H1118/H1118 (1) 4 6 7 16
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 91 252 160 521
APPENDIX I ACCOUNTANTS’ REPORT
– I-99 –


--- page 595 ---
For presentation purposes, certain deferred tax assets and liabilities have been offset in the statement of
financial position. The following is an analysis of the deferred tax balances of the Group for financial reporting
purposes:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Net deferred tax assets recognised in
the consolidated statement of
financial position /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,691 3,829 5,131 4,915
Net deferred tax liabilities
recognised in the consolidated
statement of financial position /H1118/H1118/H1118 151 241 231 241
Deferred tax assets have not been recognised in respect of the following items:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Tax losses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,841 6,414 12,655 16,974
Deductible temporary differences /H1118/H1118 7,094 13,311 14,575 12,436
The above tax losses are available for offsetting against future taxable profits of the companies in which the
losses arose. In PRC, the tax loss can be carried forward to 5 years, where the entity is recognized as HNTE, the tax
losses can be carried forward to 10 years. The majority of tax losses in overseas can be carried forward indefinitely.
Deferred tax assets have not been recognised in respect of the above items as it is not considered probable that
taxable profits will be available against which the above items can be utilised.
The Company
Deferred tax assets
The movements in deferred tax assets of the Company during the Relevant Periods are as follows:
Impairment
of financial
and contract
assets and
non-financial
assets
Accruals and
provisions
Fair value
adjustments Tax losses
Lease
liabilities Total
RMB million RMB million RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118330 376 3 2,893 2 3,604
Deferred tax credited/
(charged) to the statement
of profit or loss during
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(23) 206 2 (338) 1 (152)
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118307 582 5 2,555 3 3,452
Deferred tax credited/
(charged) to the statement
of profit or loss during
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111818 712 2 (2,069) (2) (1,339)
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118325 1,294 7 486 1 2,113
APPENDIX I ACCOUNTANTS’ REPORT
– I-100 –


--- page 596 ---
Impairment
of financial
and contract
assets and
non-financial
assets
Accruals and
provisions
Fair value
adjustments Tax losses
Lease
liabilities Total
RMB million RMB million RMB million RMB million RMB million RMB million
Deferred tax credited/
(charged) to the statement
of profit or loss during
the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11) 769 (5) (486) 247 514
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118314 2,063 2 – 248 2,627
Deferred tax
credited/(charged) to the
statement of profit or loss
during the period /H1118/H1118/H1118/H1118/H1118/H1118(36) 5 22–1 1 9
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118278 2,115 4 – 249 2,646
Deferred tax liabilities
The movements in deferred tax liabilities of the Company during each of the Relevant Periods are as follows:
Changes in
fair value
Depreciation of
fixed assets
Right-of-use
assets Total
RMB million RMB million RMB million RMB million
As at 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181–23
Deferred tax charged to the statement of
profit or loss during the year /H1118/H1118/H1118/H1118/H1118/H1118/H11185319
As at 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118633 1 2
Deferred tax credited to the statement of
profit or loss during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4) – (2) (6)
As at 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182316
Deferred tax charged to the statement of
profit or loss during the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11189 (2) 226 233
As at 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811 1 227 239
Deferred tax charged to the statement of
profit or loss during the period /H1118/H1118/H1118/H1118/H1118/H11186 – (3) 3
As at 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 1 224 242
For presentation purposes, certain deferred tax assets and liabilities have been offset in the statement of
financial position. The following is an analysis of the deferred tax balances of the Company for financial reporting
purposes:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Net deferred tax assets recognised in
the statement of financial
position /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,440 2,107 2,388 2,404
Net deferred tax liabilities
recognised in the statement of
financial position /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––
APPENDIX I ACCOUNTANTS’ REPORT
– I-101 –


--- page 597 ---
34. DEFERRED INCOME
The Group
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Government grant /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118569 1,279 5,463 5,065
Less: Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111854 102 180 886
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118515 1,177 5,283 4,179
The Company
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Government grant /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118195 725 5,092 4,891
Less: Current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 16 118 865
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118176 709 4,974 4,026
35. PROVISION
The Group
As at 31 December As at 31 March
Note 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Warranties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 2,643 5,623 9,498 10,850
Litigations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 55 169 263
2,648 5,678 9,667 11,113
Less: Current Portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118856 2,395 2,816 3,298
1,792 3,283 6,851 7,815
(a) Warranties
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
At beginning of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118891 2,643 5,623 9,498
Additional provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,858 5,213 7,477 2,046
Amounts utilized during the year/period /H1118/H1118 (1,101) (2,222) (3,504) (861)
Exchange realignment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5) (11) (98) 167
At the end of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,643 5,623 9,498 10,850
Less: current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118856 2,395 2,816 3,298
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,787 3,228 6,682 7,552
APPENDIX I ACCOUNTANTS’ REPORT
– I-102 –


--- page 598 ---
The Group provides for warranties in relation to the sales of passenger vehicles, automotive parts and
components. Provisions for warranties granted by the Group are initially recognised based on sales volume and past
experience of the level of repairs and returns. The estimation is reviewed on an ongoing basis and is revised when
appropriate.
The Company
As at 31 December As at 31 March
Note 2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Warranties /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(a) 2,088 4,334 7,638 8,190
Less: Current Portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118635 1,492 2,682 2,928
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,453 2,842 4,956 5,262
(a) Warranties
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
At beginning of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118680 2,088 4,334 7,638
Additional provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,398 3,569 5,164 1,068
Amounts utilized during the year/period /H1118/H1118 (990) (1,323) (1,860) (516)
At the end of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,088 4,334 7,638 8,190
Less: current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118635 1,492 2,682 2,928
Non-current portion /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,453 2,842 4,956 5,262
36. SHARE CAPITAL
Shares
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Issued and fully paid: /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,470 5,470 5,470 5,470
37. SHARE-BASED PAYMENT
The Company implemented share incentive plans for the Group’s management and employees in order to
recognize and reward their contribution for the growth and development of the Group, and retain eligible employees
for the continuous operation and development of the Group.
(a) Wuhu Ruichuang Platform
Wuhu Ruichuang Investment Co., Ltd.* (ʮ̡, “Ruichuang”), was established in PRC
in December 2004, as the Company’s incentive platform for management and key technical personnel, which holds
equity interests in the Company. Under the incentive plan (“legacy incentive plan”), shares of Ruichuang were
granted to certain employees of the Group, which is non-transferrable and is required to sell back to Ruichuang when
the participants leave the Group, retire, etc, at a price which is not linked to the fair value of the Company, and the
participants are not entitled to the changes in value of the Company’s shares, the Group considered the legacy
incentive plan is an employee profit-sharing plan.
Under the legacy incentive plan, the relevant employee benefit expenses were recognized in the consolidated
statements of profit or loss of the Group for the year end 31 December 2022 and 2023, respectively, which is credited
to other reserves in the consolidated statement of changes in equity of the Group.
APPENDIX I ACCOUNTANTS’ REPORT
– I-103 –


--- page 599 ---
According to resolution of the Shareholders’ Meeting of Ruichuang on 27 January, 2024 (“grant date”), the
restriction of non-transferrable of the shares and the requirements of sales back to Ruichuang is removed, to provide
additional incentives to the participants. And to ensure the stability of Group’s top management, certain top
management of the Company need to meet a three-years’ service period requirement since grant date. As such, the
share-based compensation expenses are amortized during the vesting period for the top managements with service
period requirement, and for others, the share-based compensation expenses are recognized at grant date, as no service
condition requirements attached.
The fair value of share-based compensations is measured by reference to the fair value of the shares less the
costs borne by the participants. The fair value of the shares on grant date is determined by an external valuer using
an adjusted form of the Black Scholes Model which takes into account the terms and conditions upon which the shares
were granted.
Share-based payment expenses of RMB1,663 million and RMB22 million under Ruichang platform scheme
were recognized in the consolidated statements of profit or loss of the Group for the year ended 31 December 2024
and the three months ended 31 March 2025.
(b) Zhenrui and Hengrui platforms
Wuhu Hengrui Equity Investment Partnership (Limited Partnership)* (ᛆҳ༟ΥྫΆุ(Υྫ),
“Hengrui”), and Wuhu Zhenrui Equity Investment Partnership (Limited Partnership)* ((ᛆҳ༟ΥྫΆุ
(Υྫ), “Zhenrui”) were established in PRC on February 26, 2024, as the Company’s incentive platform.
In March, 2024, for the purpose of employee incentives, the Company repurchased all of the Company’s shares
directly held by Ruichuang, representing a total of 6.74% equity interest of the Company, at nil consideration. The
Company further transferred all such repurchased shares to Hengrui and Zhenrui. Each of Hengrui and Zhenrui
subscribed for 3.37% equity interest of the Company at a consideration of RMB626,595,500.
In March 2024, via the above two incentive platforms, 351,104,500 of share awards were granted to the
eligible participants with subscription price of RMB3.40 per share. In February 2025, the Company further granted
25,264,900 shares to the eligible participants with subscription price of RMB4.39 per share. Each grant of share
awards needs to meet a service requirement from the date of grant to the later of (1) six years since the grant date
(the “Service Period”) and (2) the successful listing of the Company. After taking into consideration of the best
estimation of the listing date, the management determined the vesting period of the relevant restricted shares based
on the above service requirement. As such, the share-based payment expenses are amortized during the vesting
period.
The fair value of services received in return for a share award granted is measured by reference to the fair value
of the share award granted less the subscription price. The fair value of the share award granted is measured as the
market value at the grant date, determined by an external valuer using the discounted cash flows method which takes
into account the terms and conditions upon which the restricted shares were granted.
Set out below are details of the movements of the outstanding restricted shares granted via Hengrui and
Zhenrui for the year ended 31 December 2024 and the three months ended 31 March 2025.
As at 31 December As at 31 March
2024 2025
Number of shares
At the beginning of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 343,712,700
Granted during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118351,104,500 25,264,900
Forfeited during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(7,391,800) (2,463,600)
Exercised during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
Expired during the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––
At the end of the year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118343,712,700 366,514,000
During the year ended 31 December 2024 and the three months ended 31 March 2025, share-based
compensation expenses of RMB353 million and RMB109 million under Zhenrui and Hengrui platform scheme were
recognized in the consolidated statements of profit or loss.
* The English names of the PRC companies above represent management’s best efforts in translating the Chinese
names of these companies as no English names have been registered.
APPENDIX I ACCOUNTANTS’ REPORT
– I-104 –


--- page 600 ---
38. RESERVES
The Group
The amounts of the Group’s reserves and the movements therein are presented in the consolidated statement
of changes in equity in the Historical Financial Information.
(a) Other reserves
The other reserve comprises (i) the difference between proceeds from issuance of the company’s shares and
nominal value of the shares; (ii) the difference between cost of acquisition of minority interest of the Group’s
subsidiaries and the book value of net assets acquired; (iii) the difference between cost of acquisition of subsidiaries
under common control and the book value of the net assets acquired; and (iv) deemed contribution from shareholders.
In 2024, Wuhu Ruichuang Investment Co., Ltd., a shareholder of the Company, transferred its equity interests in 4
entities, including its 6.74% equity interest in the Company, to the Company at nil consideration. The impacts of the
transfers were credited to other reserves accordingly. For details on transfer of 6.74% equity interest of the Company,
refer to note 37.
(b) Surplus reserves
In accordance with the Company Law of the PRC, companies registered in the PRC are required to allocate
10% of the statutory after-tax profits to the surplus reserves until the cumulative total of the reserve reaches 50% of
the companies registered capital. Subject to approval from the relevant PRC authorities, the surplus reserves may be
used to offset any accumulated losses or increase the registered capital of the companies. The surplus reserves is not
available for dividend distribution to equity holders of the PRC companies.
The Company
The amounts of the Company’s reserves and the movements therein for the Relevant Periods are presented as
follows:
Y ear ended 31 December 2022
Share capital
Other
comprehensive
income
Other
reserves
Surplus
reserves
Accumulated
loss Total
RMB million RMB million RMB million RMB million RMB million RMB million
At 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H11185,470 (3) 16,123 519 (14,033) 8,076
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– 3,780 3,780
Other comprehensive income
for the year:
Change in fair value of
equity investments at fair
value through other
comprehensive income,
net of tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2 6––– 2 6
Share of other comprehensive
income of joint ventures
and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (2) – – – (2)
Total comprehensive income
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 24 – – 3,780 3,804
Transfer of other reserves
upon the disposal of equity
investments at fair value
through other
comprehensive income /H1118/H1118/H1118 – (36) – – 36 –
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2,128) – – (2,128)
Deemed contribution from
one shareholder /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 136 – – 136
Others /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 760 – – 760
At 31 December 2022 /H1118/H1118/H1118/H1118/H11185,470 (15) 14,891 519 (10,217) 10,648
APPENDIX I ACCOUNTANTS’ REPORT
– I-105 –


--- page 601 ---
Y ear ended 31 December 2023
Share capital
Other
comprehensive
income
Other
reserves
Surplus
reserves
(Accumulated
loss)/retained
earnings Total
RMB million RMB million RMB million RMB million RMB million RMB million
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H11185,470 (15) 14,891 519 (10,217) 10,648
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– 12,382 12,382
Other comprehensive income
for the year:
Change in fair value of
equity investments at fair
value through other
comprehensive income,
net of tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (10) – – – (10)
Share of other comprehensive
income of joint ventures
and associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (8) – – – (8)
Total comprehensive income
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (18) – – 12,382 12,364
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (2,609) – – (2,609)
Deemed contribution from
one shareholder /H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 1 1 8–– 1 1 8
Share of other reserves of
joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 1 8–– 1 8
Dividend declared /H1118/H1118/H1118/H1118/H1118/H1118/H1118–––– (1,094) (1,094)
At 31 December 2023 /H1118/H1118/H1118/H1118/H11185,470 (33) 12,418 519 1,071 19,445
Y ear ended 31 December 2024
Share capital
Other
comprehensive
income
Share-based
compensation
Other
reserves
Surplus
reserves
Retained
earnings Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H11185,470 (33) – 12,418 519 1,071 19,445
Profit for the year /H1118/H1118/H1118/H1118/H1118/H1118– –––– 18,568 18,568
Other comprehensive
income for the year: /H1118/H1118/H1118/H1118
Change in fair value of
equity investments at fair
value through other
comprehensive income,
net of tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 5 2–––– 5 2
Share of other
comprehensive income of
joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (14) –––– (14)
APPENDIX I ACCOUNTANTS’ REPORT
– I-106 –


--- page 602 ---
Share capital
Other
comprehensive
income
Share-based
compensation
Other
reserves
Surplus
reserves
Retained
earnings Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
Total comprehensive income
for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3 8––– 18,568 18,606
Transfer of other reserves
upon the disposal of
equity investments at fair
value through other
comprehensive income /H1118/H1118 – (30) – – – 30 –
Business combination under
common control /H1118/H1118/H1118/H1118/H1118/H1118– – – (5,949) – – (5,949)
Share-based compensation /H1118/H1118 – – 1,75 6––– 1,756
Deemed contribution from
one shareholder /H1118/H1118/H1118/H1118/H1118/H1118– – – 1,809 – – 1,809
Share of other reserves of
joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– –– 4 6–– 4 6
Transfer from retained
profits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – – 2,073 (2,073) –
Deemed contribution from a
subsidiary /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– –– 8 4–– 8 4
At 31 December 2024 /H1118/H1118/H1118/H11185,470 (25) 1,756 8,408 2,592 17,596 35,797
Three months ended 31 March 2025
Share capital
Other
comprehensive
income
Share-based
compensation
Other
reserves
Surplus
reserves
Retained
earnings Total
RMB million RMB million RMB million RMB million RMB million RMB million RMB million
At 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H11185,470 (25) 1,756 8,408 2,592 17,596 35,797
Profit for the period /H1118/H1118/H1118/H1118/H1118– –––– 4,876 4,876
Other comprehensive
income for the period:
Change in fair value of
equity investments at fair
value through other
comprehensive income,
net of tax /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–( 1 1 ) –––– ( 1 1 )
Share of other
comprehensive income of
joint ventures and
associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2–––– 2
Total comprehensive income
for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118– (9) – – – 4,876 4,867
Share-based compensation /H1118/H1118 – – 9 9––– 9 9
Transfer to safety
production reserve /H1118/H1118/H1118/H1118/H1118– – – 12 – (12) –
Dividend declared /H1118/H1118/H1118/H1118/H1118/H1118– –––– (3,993) (3,993)
At 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H11185,470 (34) 1,855 8,420 2,592 18,467 36,770
APPENDIX I ACCOUNTANTS’ REPORT
– I-107 –


--- page 603 ---
39. PARTLY-OWNED SUBSIDIARIES WITH MATERIAL NON-CONTROLLING INTERESTS
Details of the Group’s subsidiaries that have material non-controlling interests are set out below:
As at 31 December As at 31 March
2022 2023 2024 2025
Percentage of equity interest held by
non-controlling interests:
Chery New Energy Automobile
Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111859% 52% 52% 52%
Fuzhou Qingkou Holdings Co., Ltd.
ʮ̡ /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 30% 30%
Profit/(loss) for the year/period
allocated to
non-controlling interests:
Chery New Energy Automobile
Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(335) (1,238) (312) (219)
Fuzhou Qingkou Holdings Co., Ltd. /H1118 – – 521 260
Accumulated (deficits)/balances of
non-controlling interests:
Chery New Energy Automobile
Co., Ltd. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(359) (889) (1,162) (1,381)
Fuzhou Qingkou Holdings Co., Ltd. /H1118 – – 895 1,173
The following tables illustrate the summarised financial information of the above subsidiaries. The amounts
disclosed are before any inter-company eliminations:
Chery New Energy
Automobile Co., Ltd.
RMB million
31 December 2022
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,831
Total cost & expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(13,397)
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(566)
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(566)
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,065
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,422
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10,735)
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,408)
Net cash flows used in operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,250)
Net cash flows used in investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,252)
Net cash flows generated from financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,626
Net decrease in cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,876)
APPENDIX I ACCOUNTANTS’ REPORT
– I-108 –


--- page 604 ---
Chery New Energy
Automobile Co., Ltd.
RMB million
31 December 2023
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,883
Total cost & expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(8,020)
Loss for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,137)
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,126)
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,169
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,332
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(8,826)
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,408)
Net cash flows used in operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,570)
Net cash flows generated from investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,578
Net cash flows used in financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(508)
Net increase in cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118500
Chery New
Energy Automobile
Co., Ltd.
Fuzhou
Qingkou Holdings
Co., Ltd.
RMB million RMB million
31 December 2024
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111811,097 26,079
Total cost & expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(11,699) (24,342)
(Loss)/profit for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(602) 1,737
Total comprehensive income for the year /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(602) 1,737
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,766 14,079
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,347 2,888
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(9,268) (12,498)
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,085) (1,487)
Net cash flows generated from operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,449 891
Net cash flows used in investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(54) (657)
Net cash flows used in financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,127) (342)
Net increase/(decrease) in cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118 268 (108)
31 March 2025
Revenue /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,940 6,826
Total cost & expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(3,363) (5,960)
(Loss)/profit for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(423) 866
Total comprehensive income for the period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(423) 866
Current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,621 15,526
Non-current assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,212 2,912
Current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(8,465) (12,766)
Non-current liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,031) (1,762)
Net cash flows (used in)/generated from operating activities /H1118/H1118 (265) 289
Net cash flows used in investing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(46) (349)
Net cash flows used in financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(684) –
Net decrease in cash and cash equivalents /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(995) (60)
APPENDIX I ACCOUNTANTS’ REPORT
– I-109 –


--- page 605 ---
40. BUSINESS COMBINATION
(a) Wuhu Chery Technology Co., Ltd.
On 15 June 2022, the Group acquired a 51% interest in Wuhu Chery Technology Co., Ltd. from Chery Holding,
which is a business combination under common control. Wuhu Chery Technology Co., Ltd. is engaged in
manufacturing and sales of automotive parts and components. The acquisition was made as part of the Group’s
development strategy. The purchase consideration of RMB3,862 million was settled against the outstanding
receivables due from Chery Holding.
The book values of the assets and liabilities of Wuhu Chery Technology Co., Ltd. in the consolidated financial
statements of Chery Holding as at the date of acquisition were as follows:
Book value on
acquisition
RMB million
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118356
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118382
Investments in associates /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,911
Financial assets at fair value through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118175
Financial assets at fair value through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118288
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111847
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118214
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,151
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101
Prepayments and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,330
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,028
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(2,103)
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(79)
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(464)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(35)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(97)
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(107)
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(23)
Total net assets at book value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,075
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(352)
Recognised in other reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118139
Considerations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,862
(b) Wuhu Acteco Powertrain Co., Ltd.
On 31 December 2023, the Group acquired a 51% interest in Wuhu Acteco Powertrain Co., Ltd. from Chery
Holding, which is a business combination under common control. Wuhu Acteco Powertrain Co., Ltd. is engaged in
manufacturing and sales of automotive parts and components. The acquisition was made as part of the Group’s
development strategy. The purchase consideration for the acquisition was in the form of cash, with RMB3,344 million
paid in 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-110 –


--- page 606 ---
The book values of the assets and liabilities of Wuhu Acteco Powertrain Co., Ltd. in the consolidated financial
statements of Chery Holding as at the date of acquisition were as follows:
Book value on
acquisition
RMB million
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,242
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111850
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118167
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118243
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118385
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,398
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118430
Prepayments and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,492
Financial assets at fair value through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111831
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,438)
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(383)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4)
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(80)
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(161)
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(10)
Total net assets at book value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,357
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(149)
Recognised in other reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,136
Considerations /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,344
(c) Rejoin (Anhui) Supply Chain Technology Co., Ltd
On 31 December 2023, the Group acquired a 100% interest in Rejoin (Anhui) Supply Chain Technology Co.,
Ltd. from Chery Holding, which is a business combination under common control. Rejoin (Anhui) Supply Chain
Technology Co., Ltd. is engaged in the supply chain management. The acquisition was made as part of the Group’s
development strategy. The purchase consideration for the acquisition was in the form of cash, with RMB550 million
paid in 2023.
The book values of the assets and liabilities of Rejoin (Anhui) Supply Chain Technology Co., Ltd. in the
consolidated financial statements of Chery Holding as at the date of acquisition were as follows:
Book value on
acquisition
RMB million
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111813
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111828
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118786
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111899
Prepayments and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118200
Financial assets at fair value through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118732
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,093)
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(446)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(37)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(173)
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1)
Total net assets at book value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118115
Recognised in other reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118435
Consideration /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118550
APPENDIX I ACCOUNTANTS’ REPORT
– I-111 –


--- page 607 ---
(d) Jetour business
On 1 January 2024, the Group acquired Jetour business from Chery Commercial V ehicle (Anhui) Co., Ltd., a
subsidiary of Chery Holding, which is a business combination under common control, including acquisition of a
100% interest in Wuhu Jetour Automobile Sales Co., Ltd., acquisition of a 85% interest in Wuhu Ruiqing Enterprise
Management Co., Ltd., acquisition of certain assets and assumed certain liabilities related to Jetour business. The
acquisition was made as part of the Group’s development strategy. The purchase consideration of RMB7,320 million
for the acquisition was in the form of cash, with RMB7,003 million paid in 2023, and the remaining RMB317 million
paid in January 2025.
The book values of the acquired the assets and liabilities of Jetour business in the consolidated financial
statements of Chery Holding as at the date of acquisition were as follows:
Book value on
acquisition
RMB million
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118816
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118217
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118124
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118579
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,624
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,125
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,521
Contract assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812
Prepayments and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,162
Financial assets at fair value through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183,192
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118122
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(18,689)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6,996)
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,458)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(465)
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(486)
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(319)
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(157)
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1)
Deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(16)
Total net assets at book value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118907
Recognised in other reserves /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11186,413
Consideration satisfied by cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,320
(e) Fuzhou Qingkou Holdings Co., Ltd.
On 18 February 2024, the Group acquired a 100% interest in Fuzhou Qingkou Holdings Co., Ltd from Fuzhou
Zuohai Holding Group Ltd., Co., a third party. Fuzhou Qingkou Holdings Co., Ltd holds 70% interest is Soueast
Motor Corporation Ltd., which is engaged in the production and sales of passenger vehicles. The acquisition was
made as part of the Group’s development strategy. The purchase consideration for the acquisition was in the form of
cash, with RMB927 million paid in 2024.
APPENDIX I ACCOUNTANTS’ REPORT
– I-112 –


--- page 608 ---
The fair values of the acquired identifiable assets and liabilities of Fuzhou Qingkou Holdings Co., Ltd. as at
the date of acquisition were as follows:
Fair value recognised
on acquisition
RMB million
Property, plant and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,319
Right-of-use assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118359
Other intangible assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111826
Deferred tax assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118526
Inventories /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118492
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,917
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111847
Prepayments and other receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,027
Financial assets at fair value through other comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185
Cash and bank balances /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118127
Interest-bearing bank loans /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(379)
Contract liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(27)
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(5,596)
Other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,303)
Tax payable /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(6)
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(22)
Deferred tax liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(138)
Provision /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(39)
Total identifiable net assets at fair value /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,335
Non-controlling interests /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(400)
Recognised in other income and gains /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(8)
Consideration satisfied by cash /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118927
An analysis of the cash flows in respect of the acquisition of Fuzhou Qingkou Holdings Co., Ltd is as follows:
RMB million
Cash consideration paid /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(927)
Cash and bank balances acquired /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118127
Total net cash outflow /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(800)
Since the acquisition, Fuzhou Qingkou Holdings Co., Ltd contributed RMB26,079 million to the Group’s
revenue and RMB1,737 million to the consolidated profit for the year ended 31 December 2024.
Had the combination taken place at the beginning of the year, the revenue of the Group and the profit of the
Group for the year ended 31 December 2024 would have been RMB272,261 million and RMB14,509 million,
respectively.
41. TRANSFERS OF FINANCIAL ASSETS
Transferred financial assets that are not derecognised in their entirety
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group endorsed certain bills receivables
accepted by banks in Mainland China (the “Endorsed Bills”) with a carrying amount of RMB4,401 million,
RMB5,488 million, RMB292 million and RMB1,684 million to certain of its suppliers, respectively, in order to settle
the trade payables due to such suppliers (the “Endorsement”). In the opinion of the directors, the Group has retained
the substantial risks and rewards, which include default risks relating to such Endorsed Bills, and accordingly, it
continued to recognise the full carrying amounts of the Endorsed Bills and the associated trade payables settled.
Subsequent to the Endorsement, the Group did not retain any rights on the use of the Endorsed Bills, including the
sale, transfer or pledge of the Endorsed Billsto any other third parties. The aggregate carrying amount of the trade
payables settled by the Endorsed Bills to which the suppliers have recourse was RMB4,401 million, RMB5,488
million, RMB292 million and RMB1,684 million, as at 31 December 2022, 2023, 2024 and 31 March 2025,
respectively.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 609 ---
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group discounted certain bills receivables
accepted by banks in Mainland China (the “Discounted Bills”) with carrying amounts of RMB617 million, RMB61
million, RMB43 million and nil, respectively (the “Discounting”). In the opinion of the directors, the Group has
retained the substantial risks and rewards, which include default risks relating to such Discounted Bills, and
accordingly, it continued to recognize the full carrying amounts of the Discounted Bills and the associated bank
borrowings. Subsequent to the Discounting, the Group did not retain any rights on the use of the Discounted Bills,
including the sale, transfer or pledge of the Discounted Bills to any other third parties. The aggregate amounts of the
Discounted Bills to which the banks have recourse were RMB617 million, RMB61 million and RMB43 million and
nil as at 31 December 2022, 2023, 2024 and 31 March 2025, respectively.
Transferred financial assets that are derecognised in their entirety
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group endorsed certain bills receivables
accepted by banks in Mainland China (the “Derecognised Bills”) to certain of its suppliers in order to settle the trade
payables due to such suppliers with carrying amounts in aggregate of RMB13,110 million, RMB23,081 million,
RMB83,721 million and RMB30,554 million, respectively, and discounted certain bills receivables accepted by banks
in Mainland China (the “Derecognised Bills”) with a carrying amount in aggregate of RMB3,640 million, RMB559
million, RMB6,971 million and RMB471 million, respectively. The Derecognised Bills had a maturity of one to six
months at the end of the Relevant Periods. In accordance with the Law of Negotiable Instruments in the PRC, the
holders of the Derecognised Bills may exercise the right of recourse against any, several or all of the persons liable
for the Derecognised Bills, including the Group, in disregard of the order of precedence (the “Continuing
Involvement”). In the opinion of the directors, the risk of the Group being claimed by the holders of the Derecognised
Bills is remote in the absence of a default of the accepted banks. The Group has transferred substantially all risks
and rewards relating to the Derecognised Bills. Accordingly, it has derecognised the full carrying amounts of the
Derecognised Bills and the associated trade payables. The maximum exposure to loss from the Group’s Continuing
Involvement in the Derecognised Bills and the undiscounted cash flows to repurchase these Derecognised Bills is
equal to their carrying amounts. In the opinion of the directors, the fair values of the Group’s Continuing Involvement
in the Derecognised Bills are not significant.
During the years ended 31 December 2022, 2023, 2024 and the three months ended 31 March 2025, the Group
has recognized losses of RMB111 million, RMB57 million, RMB68 million and nil, respectively, on the date of
transfer of the Derecognized Bills.
42. NOTES TO THE CONSOLIDATED STATEMENT OF CASH FLOWS
(a) Major non-cash transactions
(1) For the year ended 31 December 2022, 2023, 2024, and for the three months ended 31 March 2024 and
2025, the Group had non-cash additions to right-of-use assets and lease liabilities of RMB72 million and
RMB72 million, RMB387 million and RMB387 million, RMB1,918 million and RMB1,918 million,
RMB1,589 million (unaudited) and RMB1,589 million (unaudited), and RMB6 million and RMB6
million respectively, in respect of lease arrangements for buildings, machinery and vehicles.
(2) As disclosed in note 40(a) to the Historical Financial Information, for the year ended 31 December 2022,
the considerations for certain acquisition of a subsidiary was not settled in cash.
(3) For the year ended 31 December 2023, the Group had non-cash additions to property, plant and
equipment and other payables and accruals of RMB1,158 million and RMB1,158 million in respect of
installment payment for buildings.
APPENDIX I ACCOUNTANTS’ REPORT
– I-114 –


--- page 610 ---
(b) Changes in liabilities arising from financing activities
As at 31 December 2022
Bank loans and
other borrowings Lease liabilities Bonds payables
Other payables
and accruals
RMB million RMB million RMB million RMB million
At 1 January 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,499 223 698 1,677
Changes from financing cash flows /H1118/H1118/H1118/H1118(2,662) (85) (2) 1,806
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 7 2––
Interest expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,243 9 – 153
Early cancellation of leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (8) – –
Effect of foreign exchange changes /H1118/H1118/H1118/H1118 4 3–––
At 31 December 2022 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,123 211 696 3,636
As at 31 December 2023
Bank loans and
other borrowings Lease liabilities Bonds payables
Other payables
and accruals
RMB million RMB million RMB million RMB million
At 1 January 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833,123 211 696 3,636
Changes from financing cash flows /H1118/H1118/H1118/H11184,666 (94) (696) 965
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3 8 7––
Addition of property, plant and
equipment through installment
payment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 1,158
Interest expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,375 21 – 221
Early cancellation of leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (1) – –
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1) – – –
Effect of foreign exchange changes /H1118/H1118/H1118/H1118(655) (3) – –
At 31 December 2023 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,508 521 – 5,980
As at 31 December 2024
Bank loans and
other borrowings Lease liabilities
Other payables
and accruals
RMB million RMB million RMB million
At 1 January 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111838,508 521 5,980
Changes from financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(15,866) (199) 1,071
Acquisition of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118379 22 835
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,918 –
Discounted amounts arising from other payables
and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (290)
Interest expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,919 101 290
Transfer to deferred income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (3,727)
Early cancellation of leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (10) –
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(20) (23) –
Effect of foreign exchange changes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(1,754) (11) –
At 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,166 2,319 4,159
APPENDIX I ACCOUNTANTS’ REPORT
– I-115 –


--- page 611 ---
As at 31 March 2025
Bank loans and
other borrowings Lease liabilities
Other payables
and accruals
RMB million RMB million RMB million
At 1 January 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,166 2,319 4,159
Changes from financing cash flows /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(4,072) (27) 202
New leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–6–
Discounted amounts arising from other
payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – (43)
Interest expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118787 25 60
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118(276) (15) –
Early cancellation of leases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (3) –
Effect of foreign exchange changes /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,025 (19) –
At 31 March 2025 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,630 2,286 4,378
(c) Total cash outflow for leases
The total cash outflow for leases included in the statement of cash flows is as follows:
Y ear ended 31 December
Three months
ended 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Within operating activities /H1118/H1118/H1118/H1118/H1118/H1118/H111876 108 151 43
Within financing activities /H1118/H1118/H1118/H1118/H1118/H1118/H111885 94 199 27
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118161 202 350 70
43. CONTINGENT LIABILITIES
As of the end of each of the Relevant Periods, the Group did not have any material contingent liabilities.
44. PLEDGE OF ASSETS
Details of the Group’s assets pledged for the Group’s bank borrowings are included in notes 13, 14, 15, 21,
23 and 26, respectively, to the Historical Financial Information.
45. COMMITMENTS
(a) The Group had the following contractual commitments as at 31 December 2022, 2023, 2024 and 31 March
2025:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Contracted, but not provided for:
Property, plant and equipment /H1118/H1118/H1118 1,896 3,435 2,519 2,462
Investment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 3 1 7––
APPENDIX I ACCOUNTANTS’ REPORT
– I-116 –


--- page 612 ---
46. RELATED PARTY TRANSACTIONS
(a) The Group had the following transactions with related parties during the Relevant Periods and the three months
ended 31 March 2024:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Associates and its subsidiaries:
Sales of products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118345 751 438 93 179
Sales of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182––––
Purchases of products /H1118/H1118/H1118/H1118/H1118/H11188,106 12,621 16,729 3,192 4,529
Purchases of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893 325 379 120 145
Rendering of services /H1118/H1118/H1118/H1118/H1118/H111810 14 34 – 13
Receipt of service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111873332
Lease expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111810 10 10 3 –
Joint ventures and its
subsidiaries:
Sales of products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,738 2,520 3,314 637 1,404
Purchases of products /H1118/H1118/H1118/H1118/H1118/H111835 – 12 – 71
Placement of time deposits /H1118/H1118/H1118 – – 5,400 2,000 –
Maturity of time deposits /H1118/H1118/H1118/H1118 –––– (2,000)
Interest income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–– 8 14 2 2
Chery Holding Group Co., Ltd.
and its subsidiaries, joint
ventures and associates:
Sales of products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181,302 1,907 2,883 1,242 109
Sales of property, plant and
equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 2 6 28–1
Purchases of products /H1118/H1118/H1118/H1118/H1118/H11183,560 3,965 3,949 1,012 741
Purchases of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111861 168 32 21 5
Lease expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111825 20 18 9 4
Rendering of service /H1118/H1118/H1118/H1118/H1118/H1118/H111818 19 63 3 58
Receipt of service /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111817 3 17 – 162
Acquisition of subsidiaries /H1118/H1118/H11183,862 4,050 7,320 7,320 –
Disposal of subsidiaries /H1118/H1118/H1118/H1118/H11181 17–––
Luxshare Limited and its
subsidiaries:
Purchases of products /H1118/H1118/H1118/H1118/H1118/H111832 161 2,134 187 513
Purchases of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––3––
Sales of products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118––––2
Wuhu Investment Holding and its
subsidiaries:
Purchases of products /H1118/H1118/H1118/H1118/H1118/H11181,740 2,530 3,799 694 952
Purchases of property, plant
and equipment /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819 35 32 5 12
Sales of products /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 109 157 11 62
Ruichuang and its subsidiaries:
Lease expense /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185641–
Note:
The above transactions were conducted in accordance with the terms and conditions mutually agreed by the
parties involved.
APPENDIX I ACCOUNTANTS’ REPORT
– I-117 –


--- page 613 ---
(b) Other transactions with related parties:
(i) As at 31 December 2022, 2023, 2024 and 31 March 2025, the outstanding balances of borrowings of the
Group guaranteed by the Chery Holding Limited and its subsidiaries amounted to RMB4,799 million,
RMB2,175 million, nil and nil, respectively.
(ii) As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group provided guarantee to an associate
of the Group for its bank borrowing amounting to RMB67 million, RMB227 million, RMB197 million
and RMB194 million, respectively.
(c) Compensation of key management personnel of the Group:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB thousand RMB thousand RMB thousand RMB thousand RMB thousand
(unaudited)
Fee /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118952 924 834 231 191
Salaries, allowances, bonuses and
benefits in kind (including
contributions to pension plans) /H1118 53,654 54,139 59,627 20,430 27,519
Share-based compensation
expenses /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 83,361 14,989 22,371
Total compensation paid to key
management personnel /H1118/H1118/H1118/H1118/H1118/H111854,606 55,063 143,822 35,650 50,081
Further details of directors’ and the supervisors’ emoluments are included in note 8 to the Historical Financial
Information.
The outstanding balances with related parties are included in notes 14(b), 19, 22, 26, 27, 28, 32 to the
Historical Financial Information.
47. FINANCIAL INSTRUMENTS BY CATEGORY
The carrying amounts of each of the categories of financial instruments as at 31 December 2022, 2023, 2024
and 31 March 2025 are as follows:
As at 31 December 2022
Financial assets
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Equity investments designated
at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– – 349 – 349
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 9,521 9,521
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,167 6,167
Financial assets included in
prepayments, other
receivables and other assets /H1118/H1118 – – – 22,960 22,960
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H111813,93 1––– 13,931
APPENDIX I ACCOUNTANTS’ REPORT
– I-118 –


--- page 614 ---
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Financial assets at fair
value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– 2,359 – – 2,359
Derivative financial instruments /H1118 2 4 1––– 2 4 1
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 5,360 5,360
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118– – – 932 932
Cash and cash equivalents /H1118/H1118/H1118/H1118 – – – 12,686 12,686
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111814,172 2,359 349 57,626 74,506
Financial liabilities
Financial
liabilities at fair
value through
profit or loss
Held for trading
Financial liabilities
at amortised cost Total
RMB million RMB million RMB million
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 51,708 51,708
Financial liabilities included in other payables
and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 12,645 12,645
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183–3
Interest-bearing bank loans and other borrowings /H1118 – 33,123 33,123
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 696 696
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11183 98,172 98,175
As at 31 December 2023
Financial assets
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Equity investments designated
at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– – 323 – 323
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 11,268 11,268
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 10,805 10,805
Financial assets included in
prepayments, other
receivables and other assets /H1118/H1118 – – – 16,903 16,903
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H111812,00 6––– 12,006
Financial assets at fair
value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– 4,433 – – 4,433
APPENDIX I ACCOUNTANTS’ REPORT
– I-119 –


--- page 615 ---
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Derivative financial instruments /H1118 3 1––– 3 1
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 4,998 4,998
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118– – – 587 587
Cash and cash equivalents /H1118/H1118/H1118/H1118 – – – 35,048 35,048
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111812,037 4,433 323 79,609 96,402
Financial liabilities
Financial
liabilities at fair
value through
profit or loss
Held for trading
Financial liabilities
at amortised cost Total
RMB million RMB million RMB million
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 74,408 74,408
Financial liabilities included in other payables
and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 19,251 19,251
Derivative financial instruments /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111886 – 86
Interest-bearing bank loans and other borrowings /H1118 – 38,508 38,508
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111886 132,167 132,253
As at 31 December 2024
Financial assets
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Equity investments designated
at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– – 313 – 313
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 17,423 17,423
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 774 774
Financial assets included in
prepayments, other
receivables and other assets /H1118/H1118 – – – 1,915 1,915
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H111819,64 0––– 19,640
Financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 7,547 – – 7,547
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 7,563 7,563
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118– – – 75 75
Cash and cash equivalents /H1118/H1118/H1118/H1118 – – – 62,693 62,693
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,640 7,547 313 90,443 117,943
APPENDIX I ACCOUNTANTS’ REPORT
– I-120 –


--- page 616 ---
Financial liabilities
Financial liabilities
at amortised cost
RMB million
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118101,496
Financial liabilities included in other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111820,396
Interest-bearing bank loans and other borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111823,166
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118145,058
As at 31 March 2025
Financial assets
Financial
assets at fair
value through
profit or loss
Financial assets at
fair value through other
comprehensive income
Mandatorily
designated
as such
Debt
investments
Equity
investments
Financial
assets at
amortised cost Total
RMB million RMB million RMB million RMB million RMB million
Equity investments designated
at fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118– – 282 – 282
Trade receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 21,270 21,270
Bills receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 330 330
Financial assets included in
prepayments, other
receivables and other assets /H1118/H1118 – – – 2,154 2,154
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H111829,33 6––– 29,336
Financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,802 – – 1,802
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 16,239 16,239
Restricted bank deposits /H1118/H1118/H1118/H1118/H1118– – – 2,303 2,303
Cash and cash equivalents /H1118/H1118/H1118/H1118 – – – 37,498 37,498
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111829,336 1,802 282 79,794 111,214
Financial liabilities
Financial liabilities
at amortised cost
RMB million
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118102,403
Financial liabilities included in other payables and accruals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,152
Interest-bearing bank loans and other borrowings /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,630
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118143,185
APPENDIX I ACCOUNTANTS’ REPORT
– I-121 –


--- page 617 ---
48. FAIR V ALUE AND FAIR V ALUE HIERARCHY OF FINANCIAL INSTRUMENTS
Management has assessed that the fair values of cash and cash equivalents, restricted bank deposits, the current
portion of time deposit, trade and bill receivables, trade and bills payables, financial assets included in prepayments,
other receivables and other assets, the current portion of financial liabilities included in other payables and accruals,
approximate to their carrying amounts largely due to the short term maturities of these instruments.
The Group’s corporate finance team is responsible for determining the policies and procedures for the fair
value management of financial instruments. The corporate finance team reports directly to the chief financial officer
and the board of directors. At the end of each of the Relevant Periods, the corporate finance team analysed the
movements in the values of financial instruments and determined the major inputs applied in the valuation. The
valuation was reviewed and approved by the chief financial officer.
The fair values of the financial assets and liabilities are included at the amount at which the instrument could
be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. The following
methods and assumptions were used to estimate the fair values:
The fair values of the bills receivable classified as financial assets at fair value through other comprehensive
income have been calculated by discounting the expected future cash flows. In addition, the bills receivable will
mature within one year, and thus their fair values approximate to their carrying values.
The Group invests in unlisted investments, which represent structured deposit, wealth management products
issued by banks in Chinese Mainland. The Group has estimated the fair value of structured deposit by using a
discounted cash flow valuation approach, and estimated the fair value of wealth management products based on the
valuation report released by the wealth management product manager where available and consider liquidity discount
where applicable.
Derivative financial instruments, including forward currency contracts, interest rate swaps are measured using
valuation techniques similar to forward pricing and swap models, using present value calculations. The models
incorporate various market observable inputs including the credit quality of counterparties, foreign exchange spot and
forward rates and interest rate curves.
For the fair value of the unlisted equity investments at fair value through other comprehensive income,
management applies valuation techniques mainly comprise discounted cash flow approach and market comparable
company approach to determine fair value. The sensitivity of fair values has been assessed that changes in
unobservable inputs which reflect reasonable alternative assumptions would not result in significant changes in fair
values.
The fair values of the non-current portion of time deposits, interest-bearing bank borrowings, long-term
receivable, debt investment and long-term payables included in other payables and accruals have been calculated by
discounting the expected future cash flows using rates currently available for instruments with similar terms, credit
risk and remaining maturities. The fair values have been assessed to be approximate to their carrying amounts.
APPENDIX I ACCOUNTANTS’ REPORT
– I-122 –


--- page 618 ---
Fair value hierarchy
The following tables illustrate the fair value measurement hierarchy of the Group’s financial instruments:
Assets measured at fair value:
As at 31 December 2022
Fair value measurement using
Quoted prices
in active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Equity investments designated at
fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111889 – 260 349
Bills receivables included in
financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 2,359 – 2,359
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118106 13,792 33 13,931
Derivative financial instruments /H1118/H1118/H1118 – 241 – 241
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118195 16,392 293 16,880
As at 31 December 2023
Fair value measurement using
Quoted prices
in active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Equity investments designated at
fair value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111861 – 262 323
Bills receivables included in
financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 4,433 – 4,433
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 11,961 45 12,006
Derivative financial instruments /H1118/H1118/H1118 –3 1 –3 1
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111861 16,425 307 16,793
APPENDIX I ACCOUNTANTS’ REPORT
– I-123 –


--- page 619 ---
As at 31 December 2024
Fair value measurement using
Quoted prices
in active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Equity investments designated at fair
value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 313 313
Bills receivables included in
financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 7,547 – 7,547
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 19,579 61 19,640
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 27,126 374 27,500
As at 31 March 2025
Fair value measurement using
Quoted prices
in active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Equity investments designated at fair
value through other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – 282 282
Bills receivables included in
financial assets at fair value
through other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 1,802 – 1,802
Financial assets at fair value through
profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 29,278 58 29,336
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– 31,080 340 31,420
The movements in fair value measurements within Level 3 during the Relevant Periods are as follows:
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Equity investments at fair value
through other comprehensive
income
At the beginning of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118243 260 262 262 313
Total gains recognised in other
comprehensive income /H1118/H1118/H1118/H1118/H1118/H11182 107 51 (3) (31)
Purchases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11181 5 2 5–––
Disposals /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– (130) – – –
At the end of the year/period /H1118/H1118/H1118 260 262 313 259 282
APPENDIX I ACCOUNTANTS’ REPORT
– I-124 –


--- page 620 ---
Y ear ended 31 December Three months ended 31 March
2022 2023 2024 2024 2025
RMB million RMB million RMB million RMB million RMB million
(unaudited)
Financial assets at fair value
through profit or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118
At the beginning of the
year/period /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111833 33 45 45 61
Total gains recognised in profit
or loss /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–212 ( 3 )
Purchases /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118–1 01 5 – –
At the end of the year/period /H1118/H1118/H1118 33 45 61 47 58
Liabilities measured at fair value:
As at 31 December 2022
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Derivative financial instruments /H1118/H1118/H1118 –3–3
As at 31 December 2023
Fair value measurement using
Quoted prices in
active markets
(Level 1)
Significant
observable inputs
(Level 2)
Significant
unobservable
inputs
(Level 3) Total
RMB million RMB million RMB million RMB million
Derivative financial instruments /H1118/H1118/H1118 –8 6 –8 6
During the Relevant Periods, there were no transfers of fair value measurements between Level 1 and Level
2 and no transfers into or out of Level 3 for both financial assets and financial liabilities.
49. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group’s principal financial instruments, other than derivatives, comprise bank loans, other interest-bearing
loans and cash and deposits. The main purpose of these financial instruments is to raise finance for the Group’s
operations. The Group has various other financial assets and liabilities such as trade receivables and trade payables,
which arise directly from its operations.
The main risks arising from the Group’s financial instruments are interest rate risk, foreign currency risk,
credit risk and liquidity risk. The directors meet periodically to analyse and formulate measures to manage the
Group’s exposure to these risks. Generally, the Group introduces conservative strategies on its risk management. The
directors review and agree policies for managing each of these risks and they are summarised below:
(a) Interest rate risk
The Group’s exposure to the risk of changes in market interest rates relates primarily to the Group’s long term
interest-bearing bank borrowings with a floating interest rate. The Group’s policy is to manage its interest cost using
a mix of fixed and variable rate debts. As of 31 December 2022, 2023, 2024 and 31 March 2025, approximately 86%,
73%, 59% and 92% of the Group’s interest-bearing borrowings bore interest at fixed rates.
APPENDIX I ACCOUNTANTS’ REPORT
– I-125 –


--- page 621 ---
If the interest rate of bank borrowings had increased/decreased in 10 basis points and all other variables were
held constant, the profit before tax of the Group, through the impact on floating rate borrowings, would have
decreased/increased by approximately RMB5 million, RMB10 million, RMB9 million and nil for the years ended 31
December 2022, 2023, 2024 and the three months ended 31 March 2025, respectively.
(b) Foreign currency risk
The Group is exposed to transactional exchange rate risk. Such risks arise from transactions conducted by an
operating entity in a currency other than its functional currency. To ensure the currency risk exposure of the Group
is kept to an acceptable level and seeks to minimise the gap between assets and liabilities in the same currency. The
Group has used the foreign currency forward contracts to manage foreign currency risk associated with foreign
currency-denominated assets and liabilities.
The following table shows the sensitivity analysis of exchange rate risk, reflecting the impact of reasonable
and possible changes in foreign currency exchange rate on profit before tax under the assumption that other variables
remain unchanged:
Increase/(decrease) in
exchange rates
Increase/(decrease) in
profit before tax
% RMB million
As at 31 December 2022
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 215
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (215)
As at 31 December 2024 /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 100
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (100)
If the RUB strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 463
If the RUB weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (463)
As at 31 March 2025
If the USD strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 584
If the USD weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (584)
If the RUB strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 490
If the RUB weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (490)
If the EUR strengthens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 181
If the EUR weakens against the RMB /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185 (181)
Due to the utilization of foreign currency forward contracts, as at 31 December 2023, the Group is not exposed
to material foreign currency risks.
(c) Credit risk
The Group trades only with recognised and creditworthy third parties. It is the Group’s policy that all
customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivable
balances are monitored on an ongoing basis and the Group’s exposure to bad debts is not significant.
As at 31 December 2022, 2023, 2024 and 31 March 2025, the Group had certain concentrations of credit risk
as 18%, 24%, 30% and nil of the Group’s trade receivables were due from the Group’s largest customer, and 22%,
38%, 51% and 34% of the Group’s trade receivables were due from the Group’s five largest customers, respectively.
The Group seeks to maintain strict control over its outstanding receivables and has a credit control department to
minimize credit risk.
APPENDIX I ACCOUNTANTS’ REPORT
– I-126 –


--- page 622 ---
Maximum exposure and year-end staging
The tables below show the credit quality and the maximum exposure to credit risk based on the Group’s credit
policy, which is mainly based on past due information unless other information is available without undue cost or
effort, and year-end staging classification as at the end of the reporting period. The amounts presented are gross
carrying amounts for financial assets.
As at 31 December 2022
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB million RMB million RMB million RMB million RMB million
Financial assets at fair
value through other
comprehensive income /H1118/H1118 – – – 2,359 2,359
Contract assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 1,187 1,187
Trade receivables* /H1118/H1118/H1118/H1118/H1118– – – 10,794 10,794
Bill receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 6,167 6,167
Financial assets included
in prepayments, other
receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
– Normal** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111815,203 – 10,771 – 25,974
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11185,36 0––– 5,360
Pledged deposits
– Not yet past due /H1118/H1118/H1118/H11189 3 2––– 9 3 2
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H111812,68 6––– 12,686
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,181 – 10,771 20,507 65,459
As at 31 December 2023
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB million RMB million RMB million RMB million RMB million
Financial assets at fair
value through other
comprehensive income /H1118/H1118 – – – 4,433 4,433
Contract assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 455 455
Trade receivables* /H1118/H1118/H1118/H1118/H1118– – – 12,621 12,621
Bill receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 10,805 10,805
Financial assets included
in prepayments, other
receivables and other
assets
– Normal** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,403 – 15,412 – 19,815
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11184,99 8––– 4,998
Pledged deposits
– Not yet past due /H1118/H1118/H1118/H11185 8 7––– 5 8 7
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H111835,04 8––– 35,048
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111845,036 – 15,412 28,314 88,762
APPENDIX I ACCOUNTANTS’ REPORT
– I-127 –


--- page 623 ---
As at 31 December 2024
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB million RMB million RMB million RMB million RMB million
Financial assets at fair
value through /H1118/H1118/H1118/H1118/H1118/H1118/H1118
other comprehensive
income /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 7,547 7,547
Trade receivables* /H1118/H1118/H1118/H1118/H1118– – – 18,488 18,488
Bill receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 774 774
Financial assets included
in prepayments, other
receivables and other
assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
– Normal** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,157 – 1,771 – 3,928
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11187,56 3––– 7,563
Pledged deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118
– Not yet past due /H1118/H1118/H1118/H1118 7 5––– 7 5
Cash and cash equivalents /H1118
– Not yet past due /H1118/H1118/H1118/H111862,69 3––– 62,693
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111872,488 – 1,771 26,809 101,068
As at 31 March 2025
12-month ECLs Lifetime ECLs
Stage 1 Stage 2 Stage 3
Simplified
approach Total
RMB million RMB million RMB million RMB million RMB million
Financial assets at fair
value through other
comprehensive income /H1118/H1118 – – – 1,802 1,802
Trade receivables* /H1118/H1118/H1118/H1118/H1118– – – 22,338 22,338
Bill receivables /H1118/H1118/H1118/H1118/H1118/H1118/H1118– – – 330 330
Financial assets included
in prepayments, other
receivables and other
assets
– Normal** /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H11182,373 – 1,770 – 4,143
Time deposits /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,23 9––– 16,239
Pledged deposits
– Not yet past due /H1118/H1118/H1118/H11182,30 3––– 2,303
Cash and cash equivalents
– Not yet past due /H1118/H1118/H1118/H111837,49 8––– 37,498
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111858,413 – 1,770 24,470 84,653
* For trade receivables to which the Group applies the simplified approach for impairment, information
based on the provision matrix is disclosed in note 22 to the Historical Financial Information.
** The credit quality of the financial assets included in prepayments, other receivables and other assets is
considered to be “normal” when they are not past due and there is no information indicating that the
financial assets had a significant increase in credit risk since initial recognition. Otherwise, the credit
quality of the financial assets is considered to be “doubtful”.
Further quantitative data in respect of the Group’s exposure to credit risk arising from trade receivables are
disclosed in note 22 to the Historical Financial Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-128 –


--- page 624 ---
(d) Liquidity risk
The Group’s objective is to maintain a balance between continuity of funding and flexibility through the use
of interest-bearing bank loans, and other available sources of financing.
The maturity profile of the Group’s financial liabilities as at the end of the each of the Relevant Periods, based
on the contractual undiscounted payments, is as follows:
Group
As at 31 December 2022
Within
one year or
on demand
In the
second year
In the third to
fifth year
Beyond
five years Total
RMB million RMB million RMB million RMB million RMB million
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111846 46 142 – 234
Interest-bearing bank loans and
other borrowings (excluding
lease liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111819,327 12,536 2,094 – 33,957
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H111851,708 – – – 51,708
Bonds payables /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111891 655 – – 746
Other payables and accruals /H1118/H1118/H1118/H11189,326 110 220 5,163 14,819
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111880,498 13,347 2,456 5,163 101,464
As at 31 December 2023
Within
one year or
on demand
In the
second year
In the third to
fifth year
Beyond
five years Total
RMB million RMB million RMB million RMB million RMB million
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118154 154 185 92 585
Interest-bearing bank loans and
other borrowings (excluding
lease liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111834,832 3,755 3,216 31 41,834
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H111874,408 – – – 74,408
Other payables and accruals /H1118/H1118/H1118/H111814,174 110 220 5,753 20,257
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118123,568 4,019 3,621 5,876 137,084
As at 31 December 2024
Within
one year or
on demand
In the
second year
In the third to
fifth year
Beyond
five years Total
RMB million RMB million RMB million RMB million RMB million
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118517 355 620 1,514 3,006
Interest-bearing bank loans and
other borrowings (excluding
lease liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111821,062 1,760 2,548 63 25,433
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118101,496 – – – 101,496
Other payables and accruals /H1118/H1118/H1118/H111816,778 400 1,091 3,484 21,753
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118139,853 2,515 4,259 5,061 151,688
APPENDIX I ACCOUNTANTS’ REPORT
– I-129 –


--- page 625 ---
As at 31 March 2025
Within
one year or
on demand
In the
second year
In the third to
fifth year
Beyond
five years Total
RMB million RMB million RMB million RMB million RMB million
Lease liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118593 272 572 1,483 2,920
Interest-bearing bank loans and
other borrowings (excluding
lease liabilities) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111816,835 2,909 3,833 193 23,770
Trade and bills payables /H1118/H1118/H1118/H1118/H1118/H1118102,403 – – – 102,403
Other payables and accruals /H1118/H1118/H1118/H111814,249 1,268 1,275 3,936 20,728
Total /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118134,080 4,449 5,680 5,612 149,821
(e) Capital management
The primary objectives of the Group’s capital management are to safeguard the Group’s ability to continue as
a going concern and to maintain healthy capital ratios in order to support its business and maximise shareholders’
value.
The Group manages its capital structure and makes adjustments to it in light of changes in economic
conditions. To maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders,
return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes for
managing capital during the years ended 31 December 2022, 2023, 2024 and the three months ended 31 March 2025.
The Group monitors capital using an asset-liability ratio, which is total liabilities divided by total assets. The
asset-liability ratio as at the end of the reporting period was as follows:
As at 31 December As at 31 March
2022 2023 2024 2025
RMB million RMB million RMB million RMB million
Total assets /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118121,960 179,434 213,996 210,478
Total liabilities /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118113,545 164,853 188,072 184,683
Asset-liability ratio /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H111893% 92% 88% 88%
50. EVENTS AFTER THE RELEV ANT PERIODS
On 28 April 2025, JSC Chery Automobile RUS (“Chery RUS”), a wholly-owned subsidiary of the Group which
primarily engaged in the sales of passenger vehicles in Russia, entered into agreements with three independent
third-party companies in Russia. Pursuant to the agreements, Chery RUS agreed to transfer its inventories, related
warranty obligations, and the local distribution network. Upon completion of the transaction, the Group was to
recognize a disposal gain, primarily attributable to the disposal of its distributor network in Russia.
51. SUBSEQUENT FINANCIAL STATEMENTS
No audited financial statements have been prepared by the Company, the Group or any of the companies
comprising the Group in respect of any period subsequent to 31 March 2025.
APPENDIX I ACCOUNTANTS’ REPORT
– I-130 –


--- page 626 ---
The following information does not form part of the Accountants’ Report from Ernst &
Young, Certified Public Accountants, Hong Kong, the Company’ s reporting accountants, as set
out in Appendix I to this prospectus, and is included herein for information purposes only. The
unaudited pro forma financial information should be read in conjunction with “Financial
Information” and the Accountants’ Report set out in Appendix I to this prospectus.
A. UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma adjusted consolidated net tangible assets attributable
to the owners of the Company has been prepared in accordance with Rule 4.29 of the Rules
Governing the Listing of Securities on the Stock Exchange of Hong Kong Limited 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 to illustrate the effect of the Global Offering on our consolidated net tangible
assets attributable to owners of the Company as at 31 March 2025 as if the Global Offering had
taken place on 31 March 2025.
The unaudited pro forma statement of adjusted consolidated net tangible assets
attributable to owners of the Company has been prepared for illustrative purposes only and
because of its hypothetical nature, it may not give a true picture of the financial position of the
Group as at 31 March 2025 or any future dates following the Global Offering.
Consolidated net
tangible assets
attributable to
owners of the
Company as at
31 March 2025
Estimated net
proceeds
from the
Global
Offering
Unaudited pro
forma adjusted
consolidated net
tangible assets
Unaudited pro forma
adjusted consolidated
net tangible assets
attributable to owners
of the Company per
Share
RMB million RMB million RMB million RMB HK$
(Note 1) (Note 2) (Note 3) (Note 4)
Based on an Offer Price of
HK$27.75 per Share /H1118/H1118/H1118/H1118/H1118/H1118 24,195 7,337 31,532 5.47 5.99
Based on an Offer Price of
HK$29.25 per Share /H1118/H1118/H1118/H1118/H1118/H1118 24,195 7,737 31,932 5.54 6.07
Based on an Offer Price of
HK$30.75 per Share /H1118/H1118/H1118/H1118/H1118/H1118 24,195 8,136 32,331 5.61 6.15
Notes:
(1) The consolidated net tangible assets attributable to the owners of the Company as at 31 March 2025 is
calculated based on the consolidated net assets attributable to the shareholders of the Company as at 31 March
2025 of RMB26.595 billion less other intangible assets of RMB2.4 billion as at the same date.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 627 ---
(2) The estimated net proceeds from the Global Offering are based on the Offer Price of HK$27.75 per Share,
HK$29.25 per Share, or HK$30.75 per Share, after deduction of the underwriting fees and other related
expenses payable by the Company (excluding the listing expense that have been charged to profit or loss during
the Track Record Period) and does not take into account of any Shares which may be issued upon the exercise
of the Over-allotment Option.
(3) The unaudited pro forma adjusted consolidated net tangible assets per Share is calculated based on total
5,767,228,633 Shares expected to be in issue immediately upon completion of the Global Offering and does
not take into account of any Shares which may be issued upon the exercise of the Over-allotment Option.
(4) For the purpose of this unaudited pro forma statement of adjusted consolidated net tangible assets, the balances
stated in Renminbi are converted into Hong Kong dollars at an exchange rate of HK$1 to RMB0.91226. No
representation is made that the Hong Kong dollar amounts have been, could have been or may be converted
to Renminbi, or vice versa, at that rate or any other rates or at all.
(5) No adjustment has been made to reflect any trading results or open transactions of the Group entered into
subsequent to 31 March 2025.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 628 ---
⭰㰟㛪姯⸒Ṳ⋀㈧
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Tel 曢婘: +852 2846 9888
Fax ₚ䜆: +852 2868 4432
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Ernst & Young
27/F, One Taikoo Place
979 King’s Road
Quarry Bay, Hon
g Kong
B. INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
To the Directors of Chery Automobile Co., Ltd.
We have completed our assurance engagement to report on the compilation of unaudited pro
forma financial information of Chery Automobile Co., Ltd. (the “Company”) and its
subsidiaries (hereinafter collectively referred to as the “Group”) by the directors of the
Company (the “Directors”) for illustrative purposes only. The unaudited pro forma financial
information consists of the unaudited pro forma consolidated net tangible assets as at 31 March
2025, and related notes as set out on pages II-1 and II-2 of the prospectus dated 17 September
2025 issued by the Company (the “Unaudited Pro Forma Financial Information”). The
applicable criteria on the basis of which the Directors have compiled the Unaudited Pro Forma
Financial Information are described in note Appendix II(A).
The Unaudited Pro Forma Financial Information has been compiled by the Directors to
illustrate the impact of the global offering of shares of the Company on the Group’s financial
position as at 31 March 2025 as if the transaction had taken place at 31 March 2025. As part
of this process, information about the Group’s financial position has been extracted by the
Directors from the Group’s financial statements for the period ended 31 March 2025, on which
an accountants’ report has been published.
Directors’ responsibility for the Unaudited Pro Forma Financial Information
The Directors are responsible for compiling the Unaudited Pro Forma Financial
Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities
on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and with reference to
Accounting Guideline (“AG”) 7 Preparation of Pro Forma Financial Information for Inclusion
in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants (the
“HKICPA”).
Our independence and quality management
We have complied with the independence and other ethical requirements of the Code of
Ethics for Professional Accountants issued by the HKICPA, which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
Our firm applies Hong Kong Standard on Quality Management 1 Quality Management for
Firms that Perform Audits or Reviews of Financial Statements, or Other Assurance or Related
Services Engagements which requires the firm to design, implement and operate a system of
quality management including policies or procedures regarding compliance with ethical
requirements, professional standards and applicable legal and regulatory requirements.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 629 ---
Reporting accountants’ responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the
Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to
you. We do not accept any responsibility for any reports previously given by us on any
financial information used in the compilation of the Unaudited Pro Forma Financial
Information beyond that owed to those to whom those reports were addressed by us at the dates
of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance
Engagements 3420 Assurance Engagements to Report on the Compilation of Pro Forma
Financial Information Included in a Prospectus issued by the HKICPA. This standard requires
that the reporting accountants plan and perform procedures to obtain reasonable assurance
about whether the Directors have compiled the Unaudited Pro Forma Financial Information in
accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the
HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any
reports or opinions on any historical financial information used in compiling the Unaudited Pro
Forma Financial Information, nor have we, in the course of this engagement, performed an
audit or review of the financial information used in compiling the Unaudited Pro Forma
Financial Information.
The purpose of the Unaudited Pro Forma Financial Information included in the
Prospectus is solely to illustrate the impact of the global offering of shares of the Company on
unadjusted financial information of the Group as if the transaction had been undertaken at an
earlier date selected for purposes of the illustration. Accordingly, we do not provide any
assurance that the actual outcome of the transaction would have been as presented.
A reasonable assurance engagement to report on whether the Unaudited Pro Forma
Financial Information has been properly compiled on the basis of the applicable criteria
involves performing procedures to assess whether the applicable criteria used by the Directors
in the compilation of the Unaudited Pro Forma Financial Information provide a reasonable
basis for presenting the significant effects directly attributable to the transaction, and to obtain
sufficient appropriate evidence about whether:
 the related pro forma adjustments give appropriate effect to those criteria; and
 the Unaudited Pro Forma Financial Information reflects the proper application of
those adjustments to the unadjusted financial information.
The procedures selected depend on the reporting accountants’ judgment, having regard to
the reporting accountants’ understanding of the nature of the Group, the transaction in respect
of which the Unaudited Pro Forma Financial Information has been compiled, and other relevant
engagement circumstances.
The engagement also involves evaluating the overall presentation of the Unaudited Pro
Forma Financial Information.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 630 ---
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion:
(a) the Unaudited Pro Forma Financial Information has been properly compiled on the
basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purpose of the Unaudited Pro Forma
Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing
Rules.
Ernst & Y oung
Certified Public Accountants
Hong Kong
17 September 2025
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 631 ---
TAXES FOR SECURITIES HOLDERS
The income tax and the tax on capital gains for holders of H Shares shall be subject to
the laws and practices of PRC and the jurisdictions in which the holders of H Shares are
residents or subject to taxes for other reasons. The following summary of certain relevant tax
provisions is based on current laws and practices, subject to change and not intended to be legal
or tax advice. The discussion is not intended to cover all the possible tax consequences of the
investment in H Shares, nor does it take into account the particular circumstances of any
individual investor, some of which may be subject to special rules. Therefore, you should
consult a tax advisor for advice on the tax consequences of the investment in H Shares. The
discussion is based on the laws and related interpretations in force as of the date of this
prospectus, which are subject to change and may have retroactive effect.
The discussion does not address any PRC tax issues other than income tax, capital tax,
value-added tax, stamp duty and estate duty. Prospective investors are advised to consult their
financial advisers regarding the PRC and other tax consequences of owning and disposing of
H Shares.
Taxation Regarding Dividends
Individual investor
Pursuant to the latest amended Individual Income Tax Law of the People’s Republic of
China () (the “ IIT Law ”) on August 31, 2018 and the latest
Regulations for the Implementation of the Individual Income Tax Law of the People’s Republic
of China (ૢԷ) amended on December 18, 2018,
dividend distributions by Chinese enterprises are subject to a PRC withholding tax at a flat rate
of 20%. For foreign individuals who are not Chinese residents, dividends received from
Chinese enterprises are generally subject to a tax rate of 20%, unless specifically exempted by
the tax authorities of the State Council or exempted or reduced under an applicable tax treaty.
According to the Circular of State Administration of Taxation on Matters Concerning the
Levy and Administration of Individual Income Tax After the Repeal of Guo Shui Fa [1993] No.
045 (਷೼೯[1993]045)
issued by the SA T on June 28, 2011, domestic non-foreign invested enterprises with shares
issued in Hong Kong are allowed to withhold individual income tax at a rate of 10% on
dividend distributions. For individual holders of H shares who receive dividends and are
residents of countries with which the PRC has entered into tax treaties with a tax rate of less
than 10%, a non-foreign invested enterprise whose shares are listed in Hong Kong may apply
on behalf of such holders for the right to enjoy the preferential treatment of lower tax rate, and
once approved by the tax authorities, any over-payment of the withholding tax will be
refunded. For individual holders of H shares who receive dividends and are residents of
countries with which China has entered into a tax treaty with a tax rate higher than 10% but
lower than 20%, the non-foreign invested enterprises are required to withhold tax according to
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 632 ---
the agreed tax rate of the treaty without the need to file an application. For individual holders
of H shares who receive dividends and are residents of countries with which China has not
entered into a tax treaty, the non-foreign invested enterprises are required to withhold tax at a
rate of 20%.
Corporate investor
Pursuant to the Enterprise Income Tax Law of the People’s Republic of China ( ʕശɛ
) promulgated by the National People’s Congress on March 16, 2007
and last amended on December 29, 2018 and the Regulations for the Implementation of the
Enterprise Income Tax Law of the People’s Republic of China (੻೼
ૢԷ) promulgated by the State Council on December 6, 2007, which became
effective on January 1, 2008 and was last amended on January 20, 2025, the enterprise income
tax rate will be 25%. A non-resident enterprise that does not have an establishment or premise
in China, or that has an establishment or premise in China but its income from sources in China
is not physically connected with its establishment or premise, is generally subject to an
enterprise income tax rate of 10% on its income from sources in China (including dividends
received from a PRC resident enterprise). The foregoing income tax payable by non-resident
enterprises is subject to withholding at source, in which the payer of the income is required to
withhold it from payments due to the non-resident enterprise.
As further clarified in the Circular of the State Administration of Taxation on Issues
Relating to the Withholding and Payment of the Enterprise Income Tax on Dividends
Distributed by Chinese Resident Enterprises to Overseas Non-Resident Enterprise
Shareholders of H Shares (͏ΆุΣྤ̮H೯
) issued and implemented by the SA T on
November 6, 2008, Chinese resident enterprises shall withhold and pay the enterprise income
tax at a uniform rate of 10% on behalf of the overseas non-resident enterprise holders of H
shares when distributing dividends for 2008 and subsequent years.
Pursuant to the Arrangement between the Mainland and the Hong Kong Special
Administrative Region on the Avoidance of Double Taxation and the Prevention of Fiscal
Evasion (τર) (the
“Arrangement ”), which was signed on August 21, 2006, the Chinese Government may levy
taxes on the dividends paid by a PRC-resident enterprise to Hong Kong residents (including
natural persons and legal entities) in an amount not exceeding 10% of the total dividends
payable by the PRC-resident enterprise unless a Hong Kong resident directly holds 25% or
more of the equity interest in a PRC-resident enterprise, then such tax shall not exceed 5% of
the total dividends payable by such PRC-resident enterprise. The Fifth Protocol of the
Arrangement between the Mainland of China and the Hong Kong Special Administrative
Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion ( <ʫή
τર>), which came
into effect on December 6, 2019, adds a criteria for the qualification of entitlement to enjoy
treaty benefits. Although there may be other provisions under the Arrangement, the treaty
benefits under the criteria shall not be granted in the circumstance where relevant gains, after
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 633 ---
taking into account all relevant facts and conditions, are reasonably deemed to be one of the
main purposes for the arrangement or transactions which will bring any direct or indirect
benefits under this Arrangement, except when the grant of benefits under such circumstance is
consistent with relevant objective and goal under the Arrangement. The application of the
dividend clause of tax agreements is subject to the requirements of PRC tax law and regulation,
such as the Notice of the SA T on the Issues Concerning the Application of the Dividend
Clauses of Tax Agreements ().
Tax treaty
Non-resident investors living in jurisdictions that have entered into treaties with China on
the avoidance of double taxation or made relevant adjustments shall be entitled to the relief
from the enterprise income tax on dividends received from Chinese resident companies. China
has entered into treaties or arrangements on the avoidance of double taxation with a number
of countries and regions, including Hong Kong, the Macao Special Administrative Region,
Australia, Canada, France, Germany, Japan, Malaysia, the Netherlands, Singapore, the United
Kingdom, and the United States. Non-Chinese resident enterprises entitled to preferential tax
rates under the relevant tax treaties or arrangements shall apply to the Chinese tax authorities
for a refund of the enterprise income tax in excess of the agreed rate, and the refund application
shall be approved by the Chinese tax authorities.
Taxation Regarding Share Transfer
V alue added tax and local surtax
Pursuant to the Circular on Comprehensive Launch of Pilot Replacement of Business Tax
with V alue-added Tax () (the “ Circular 36 ”),
which was implemented on May 1, 2016, entities and individuals engaging in the sale of
services within the PRC are subject to V A T, and “engaging in the sale of services within the
PRC” means that the seller or buyer of taxable services is located in China. Circular 36 also
provides that, for general or foreign V A T payers, transfers of financial products (including
transfers of ownership of marketable securities) are subject to 6% V A T on the taxable income
(i.e., the balance of the sale price less the purchase price). However, the transfer of financial
products by individuals is exempted from V A T, as stipulated in the Circular of the Ministry of
Finance and the State Administration of Taxation on Certain Exemptions from Business Tax on
the Sale and Purchase of Financial Commodities by Individuals (೼ਕᐼ҅ᗫ
), which came into effect on January 1,
2009, and the Provisions on Transitional Policies of the Pilot Program for the Change from
Business Tax to V alue-added Tax (), which was
promulgated by the Ministry of Finance and the State Administration of Taxation and came into
effect on May 1, 2016 and partly invalid on July 1, 2017 and January 1, 2018. Pursuant to these
provisions, the sale or disposal of H Shares is exempt from PRC value-added tax if the holder
is a non-resident individual.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-3 –


--- page 634 ---
In addition, V A T payers are also subject to urban maintenance and construction tax,
education surtax and local education surtax (collectively the “ local surtax ”), which is usually
12% of the actual V A T, business tax and consumption tax (if any) payable in urban areas in
China.
Income Tax
Individual investor
Under the Individual Income Tax Law, gains from the transfer of equity interests in
Chinese resident enterprises shall be subject to a 20% individual income tax. According to the
Circular on Continued Temporary Exemption of Individual Income Tax on Income from
Transfer of Stocks () promulgated
by the MOF and the SA T on March 30, 1998, individuals shall continue to be temporarily
exempted from the individual income tax on the income from the transfer of shares in listed
companies from January 1, 1997.
According to the Circular on the Issues Relating to the Collection of Individual Income
Tax on Individuals’ Income from the Transfer of Restricted Shares of Listed Companies ( ᗫ
) jointly promulgated by
the MOF, the SA T and the CSRC on December 31, 2009, which came into effect on the same
date, individuals shall continue to be exempted from the individual income tax on the income
from the transfer of listed shares acquired from the public offering of listed companies and the
transfer market on the Shanghai Stock Exchange and the Shenzhen Stock Exchange, with the
exception of the relevant restricted shares as defined in the above Circular and the
Supplementary Circular on the Issues Relating to the Collection of Individual Income Tax on
Individuals’ Income from the Transfer of Restricted Shares of Listed Companies (ɛ
), which was jointly
promulgated and enforced by the MOF, the SA T and the CSRC on November 10, 2010. As of
the Latest Practicable Date, the above provisions did not expressly provide for imposition of
the individual income tax on the transfer of shares of Chinese resident enterprises listed on
overseas stock exchanges by non-Chinese resident individuals.
Corporate investor
According to the Enterprise Income Tax Law, if a non-resident enterprise does not have
an institution or premise in China, or has an institution or premise in China but its income
derived from China is not actually related to the above-mentioned Chinese institution or
premise, it is generally required to pay a 10% enterprise income tax on its income derived from
China (including proceeds from sales of equity interest of a Chinese resident enterprise). The
enterprise income tax payable by a non-resident enterprise shall be withheld at source, and the
payer of the income shall withhold the income tax from the amount to be paid to the
non-resident enterprise. The tax may be reduced or exempted under tax treaties or
arrangements for the avoidance of double taxation.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 635 ---
Stamp duty
According to the Stamp Tax Law of the People’s Republic of China ( ʕശɛ͏΍ձ਷
), which was promulgated on June 10, 2021 and became effective on July 1, 2022,
all the entities and individuals that enter into taxable documents and engage in securities
transactions within China shall be taxpayers of stamp duty and shall pay stamp duty in
accordance with the provisions of the Stamp Duty Law of the People’s Republic of China.
Therefore, the provisions on the stamp duty levied on the transfer of shares of listed companies
in China do not apply to the purchase and disposal of H shares by non-Chinese investors
outside China.
Estate duty
As of the date of this prospectus, no estate duty has been imposed on the Company in the
PRC under PRC law.
Shanghai-Hong Kong Stock Connect Taxation Policy and Shenzhen-Hong Kong Stock Connect
Taxation Policy
On October 31, 2014 and November 5, 2016, the Ministry of Finance, the SA T and the
CSRC jointly issued the Circular on the Relevant Taxation Policy regarding the Pilot
Inter-connected Mechanism for Trading on the Shanghai Stock Market and the Hong Kong
Stock Market () and the
Circular on the Relevant Taxation Policy regarding the Pilot Inter-connected Mechanism for
Trading on the Shenzhen Stock Market and the Hong Kong Stock Market (ୃ̹
), pursuant to which, the income from transfer
differences and dividend and bonus income derived by PRC enterprise investors from investing
in stocks listed on the Hong Kong Stock Exchange through Shanghai-Hong Kong Stock
Connect or Shenzhen-Hong Kong Stock Connect shall be included in their total income and
subject to enterprise income tax in accordance with the law. In particular, the dividend and
bonus income derived by PRC resident enterprises which hold H shares for at least 12
consecutive months shall be exempted from enterprise income tax according to law. The
H-share companies do not need to withhold tax on the income from dividends and bonus
obtained by PRC enterprise investors. The tax payable shall be declared and paid by the
enterprises themselves.
For dividends and bonuses received by PRC individual investors investing in H shares
listed on the Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect and
Shenzhen-Hong Kong Stock Connect, H-share companies shall submit an application to China
Securities Depository and Clearing Corporation Limited (the “ CSDC ”), which shall provide
H-share companies with a register of PRC individual investors. H-share companies shall
withhold individual income tax at a rate of 20%. Individual investors who have paid
withholding tax outside the PRC may apply for tax credits at the competent tax authorities of
the CSDC with valid tax deduction certificates. Individual income tax is levied on dividend and
bonus income derived by PRC security investment funds from investing in stocks listed on the
Hong Kong Stock Exchange through Shanghai-Hong Kong Stock Connect or Shenzhen-Hong
Kong Stock Connect in accordance with the above provisions.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 636 ---
Hong Kong Taxation
Dividend Taxation
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is
payable in Hong Kong in respect of dividends paid by us.
Capital Gains and Profit Tax
No tax is imposed in Hong Kong in respect of capital gains from the sale of H Shares
effected on the Stock Exchange.
Capital gains from the sale of H Shares that are derived from outside Hong Kong but
received in Hong Kong by a member of a MNE Group (as defined under the Inland Revenue
Ordinance (Cap. 112) (“ IRO”) carrying on a trade, profession or business in Hong Kong, may
be chargeable to Hong Kong profits tax if the member does not carry on specified economic
activities (as defined under the IRO) in Hong Kong. Tax exemption and relief for foreign tax
imposed on the gain may apply where specific conditions are met.
Trading gains from the sale of the H Shares by persons carrying on a trade, profession or
business in Hong Kong, where such gains are derived from or arise in Hong Kong from such
trade, profession or business will be subject to Hong Kong profits tax, which is currently
imposed at the maximum rate of 16.5% on corporations and at the maximum rate of 15% on
unincorporated businesses. A concessionary tax rate at half of the applicable tax rate may apply
to the first $2 million of assessable profits of corporations or unincorporated businesses.
Certain categories of taxpayers (for example, financial institutions, insurance companies and
securities dealers) are likely to be regarded as deriving trading gains rather than capital gains
unless these taxpayers can prove that the investment securities are held for long-term
investment purposes.
Trading gains from sales of H Shares effected on the Stock Exchange will be considered
to be derived from or arise in Hong Kong. Liability for Hong Kong profits tax would thus arise
in respect of trading gains from sales of H Shares effected on the Stock Exchange realized by
persons carrying on a business of trading or dealing in securities in Hong Kong.
Hong Kong has also introduced the Inland Revenue (Amendment) (Minimum Tax for
Multinational Enterprise Groups) Bill 2024 to implement a domestic minimum top-up tax. For
all fiscal years commencing on or after 1 January 2025, income of a constituent entity of an
in-scope MNE group that is located in Hong Kong may also be subject to top-up tax.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 637 ---
Stamp Duty
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.10% on the higher
of the consideration for or the market value of the H Shares, will be payable by the purchaser
on every purchase and by the seller on every sale of the Hong Kong securities, including H
Shares (in other words, a total of 0.20% is currently payable on a typical sale and purchase
transaction involving H Shares). In addition, a fixed duty of HK$5.00 is currently payable on
any instrument of transfer of H Shares. Where one of the parties is a resident outside Hong
Kong and does not pay the ad valorem duty due by it, the duty not paid will be assessed on the
instrument of transfer (if any) and will be payable by the transferee. If no stamp duty is paid
on or before the due date, a penalty of up to ten times the duty payable may be imposed.
Estate Duty
Pursuant to the Revenue (Abolition of Estate Duty) Ordinance 2005, estate duty ceased
to be chargeable in Hong Kong in respect of the estates of persons dying on or after February
11, 2006.
MAIN TAXES OF THE COMPANY IN CHINA
Please refer to the chapter titled “Regulatory Overview” of this prospectus.
FOREIGN EXCHANGE
Renminbi (the “ RMB”), the legal tender of China, is subject to foreign exchange control
and cannot be freely convertible into foreign currencies. The State Administration of Foreign
Exchange (the “ SAFE ”) under the People’s Bank of China (the “ PBOC ”) is responsible for all
matters related to foreign exchange, including the implementation of foreign exchange control
regulations.
According to the Regulations on Foreign Exchange Control of the People’s Republic of
China ( ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ) promulgated by the State Council on January 29,
1996, implemented on April 1, 1996, and last revised on August 5, 2008 (the “ Regulations on
Foreign Exchange Control ”), all international payments and transfers shall be classified into
the current account and capital account. The current account shall be subject to the reasonable
examination of the authenticity of transaction documents and their consistency with foreign
exchange receipts and payments by the financial institutions engaging in the business of
foreign exchange settlement and sales, and shall be subject to the supervision and inspection
by the foreign exchange administrative authorities. With regard to the capital account, foreign
organizations and individuals making direct investments in China shall, upon approval by the
competent authorities concerned, register with the foreign exchange administrative authorities.
The foreign exchange income obtained from abroad may be repatriated or deposited abroad.
Foreign exchange funds and foreign exchange settlement funds under the capital account shall
be used for the purposes approved by the relevant competent authorities and the foreign
exchange administrative authorities. When there is or may be a serious imbalance in the
balance of payments, or when there is or may be a serious crisis in the national economy, the
State may take measures necessary to guarantee and control the balance of payments.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 638 ---
The Regulations on Administration of Settlement, Sale and Payment of Foreign Exchange
(), promulgated by the PBOC on June 20, 1996 and
implemented on July 1, 1996, have abrogated other restrictions on foreign exchange under the
current account, but imposed existing restrictions on foreign exchange transactions under the
capital account.
According to the Announcement on Improving the Reform of the RMB Exchange Rate
Formation Mechanism (ʮѓ) promulgated and
implemented by the PBOC on July 21, 2005, China began to implement a managed floating
exchange rate system, with the exchange rate adjusted according to market supply and demand
and with reference to a basket of currencies on July 21, 2005. Therefore, the RMB exchange
rate is no longer linked to the US dollar. The PBOC shall announce, after the market closes on
each working day, the closing price of the exchange rate of the US dollar and other currencies
traded in the interbank foreign exchange market against RMB on that day, which serves as the
median price for transactions of that currency against RMB on the following working day.
According to China’s relevant laws and regulations, when Chinese enterprises (including
foreign-invested enterprises) require foreign exchange for current account transactions, they
may make payments through foreign exchange accounts opened in designated foreign exchange
banks without the approval of foreign exchange control agencies, but valid transaction receipts
and vouchers shall be provided. If a foreign-invested enterprise needs to distribute profits to
its shareholders through foreign exchange, and a Chinese enterprise (such as the Company)
needs to pay dividends to its shareholders through foreign exchange according to relevant
regulations, it may make payments from the foreign exchange account of a designated foreign
exchange bank or make exchanges and payments at a designated foreign exchange bank
according to the resolution of the Board or the general meeting on profit distribution.
According to the Decision of the State Council on the Cancellation and Adjustment of a
Batch of Items Requiring Government Review and Approval (՟ऊձሜ዆ɓҭБ
) issued by the State Council on October 23, 2014, it decided to
cancel the examination and approval requirements of the SAFE and its branches for the
remittance and settlement of proceeds raised from the overseas listing of overseas shares into
domestic accounts in RMB.
According to the Circular of the State Administration of Foreign Exchange on Issues
Relating to Foreign Exchange Administration of Overseas Listing (ྤ̮
) issued and implemented by the SAFE on December 26, 2014,
a domestic company shall, within 15 business days from the date of closing of overseas listing,
apply for the registration of overseas listing with the local branch of the SAFE at the place of
its incorporation. Proceeds from the overseas listing of the domestic company may be
repatriated to a domestic account or deposited in an overseas account, provided that the use of
the proceeds is consistent with the contents set out in this document and other disclosure
documents.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-8 –


--- page 639 ---
Pursuant to the Provisions on Foreign Exchange Administration for Direct Investment by
Foreign Investors in China (), which were
promulgated on May 10, 2013, became effective on May 13, 2013, were amended on October
10, 2018 and were partially repealed on December 30, 2019, the administration of direct
investment by foreign investors in the PRC by the SAFE or its local branches is required to be
carried out by means of registration, and banks are required to process foreign exchange
transactions relating to direct investment in the PRC on the basis of the registration information
provided by the SAFE and its branches.
In accordance with the Circular of the State Administration of Foreign Exchange on
Further Simplifying and Improving the Policy on Foreign Exchange Management of
Direct Investment (ஷ
), which was promulgated by the SAFE on February 13, 2015, came into effect on June
1, 2015 and was partially repealed on December 30, 2019, foreign exchange registration for
domestic direct investment and overseas direct investment will be directly reviewed and
processed by banks, while the SAFE and its branches shall indirectly supervise the foreign
exchange registration through banks.
A foreign-funded enterprise may, based on its operating needs, voluntarily settle the
foreign exchange capital, pursuant to the Circular of the State Administration of Foreign
Exchange Concerning Reform of the Administrative Approaches to Settlement of Foreign
Exchange Capital of Foreign-invested Enterprises (̮ਠҳ༟Άุ
), which was promulgated on March 30, 2015, validated on
June 1, 2015, abolished in part on December 30, 2019 and amended in part on March 23, 2023.
Foreign-invested enterprises shall not use foreign exchange capital funds settled in RMB for
(a) any expenditure outside the scope of business of the foreign-invested enterprise or
prohibited by laws and regulations; (b) direct or indirect investment in securities; (c) issuance
of entrusted loans (except for those permitted by the scope of business), repayment of
inter-enterprise loans (including advances by third parties) or repayment of RMB bank loans
that have been transferred to third parties; and (d) purchase of real estate that is not for its own
use (except for real estate enterprises).
According to the Circular of the State Administration of Foreign Exchange on Reforming
and Standardizing the Policy on Settlement Management of Capital Accounts (̮ි၍
) promulgated and implemented by the
SAFE on June 9, 2016, which was amended in part on December 4, 2023, relevant policies
have made it clear that domestic institutions may settle their foreign exchange incomes under
the capital account (including funds raised from the overseas listing), which are subject to
discretional settlement, with banks as actually needed for business operation. The proportion
of foreign exchange income under capital account that domestic institutions intend to settle is
tentatively set at 100%, provided that the SAFE may adjust the relevant proportion according
to the international payment balance status in good time.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-9 –


--- page 640 ---
This Appendix contains a summary of laws and regulations on companies and securities
in the PRC. The principal objective of this summary is to provide potential investors with an
overview of the principal laws and regulations applicable to us. This summary is with no
intention to include all the information which may be important to the potential investors. For
discussion of laws and regulations specifically governing the business of the Company, please
see section entitled “Regulatory Overview” in this prospectus.
PRC LEGAL SYSTEM
The PRC legal system is based on the Constitution of the PRC ()
(the “ Constitution ”) and is made up of written laws, administrative regulations, local
regulations, separate regulations, autonomous regulations, rules and regulations of
departments, rules and regulations of local governments, international treaties of which the
PRC government is a signatory, and other regulatory documents. Court verdicts do not
constitute binding precedents. However, they may be used as judicial reference and guidance.
According to the Constitution and the Legislation Law of the PRC (2023 Amendment)
(جج2023ࠈࡌ)) (the “ Legislation Law ”), the NPC and the
Standing Committee of the NPC are empowered to exercise the legislative power of the State.
The NPC has the power to formulate and amend basic laws governing civil and criminal
matters, state organs and other matters. The Standing Committee of the NPC is empowered to
formulate and amend laws other than those required to be enacted by the NPC and to
supplement and amend any parts of laws enacted by the NPC during the adjournment of the
NPC, provided that such supplements and amendments are not in conflict with the basic
principles of such laws.
The State Council is the highest organ of the PRC administration and has the power to
formulate administrative regulations based on the Constitution and laws.
The people’s congresses of provinces, autonomous regions and municipalities and their
respective standing committees may formulate local regulations based on the specific
circumstances and actual requirements of their own respective administrative areas, provided
that such local regulations do not contravene any provision of the Constitution, laws or
administrative regulations.
The ministries and commissions of the State Council, PBOC, the State Audit
Administration as well as the other organs endowed with administrative functions directly
under the State Council may, in accordance with the laws as well as the administrative
regulations, decisions and orders of the State Council and within the limits of their power,
formulate rules.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-1 –


--- page 641 ---
The people’s congresses of cities divided into districts and their respective standing
committees may formulate local regulations in terms of urban and rural development and
management, environmental protection, and historical and cultural protection based on the
specific circumstances and actual requirements of such cities, which will become enforceable
after being reported to and approved by the standing committees of the people’s congresses of
the relevant provinces or autonomous regions but such local regulations shall conform with the
Constitution, laws, administrative regulations, and the relevant local regulations of the relevant
provinces or autonomous regions. People’s congresses of national autonomous areas have the
power to enact autonomous regulations and separate regulations in light of the political,
economic and cultural characteristics of the nationality (nationalities) in the areas concerned.
The people’s governments of the provinces, autonomous regions, and municipalities
directly under the central government and the cities divided into districts or autonomous
prefectures may enact rules, in accordance with laws, administrative regulations and the local
regulations of their respective provinces, autonomous regions or municipalities.
The Constitution has supreme legal authority and no laws, administrative regulations,
local regulations, autonomous regulations or separate regulations may contravene the
Constitution. The authority of laws is greater than that of administrative regulations, local
regulations and rules. The authority of administrative regulations is greater than that of local
regulations and rules. The authority of local regulations is greater than that of the rules of the
local governments at or below the corresponding level. The authority of the rules enacted by
the people’s governments of the provinces or autonomous regions is greater than that of the
rules enacted by the people’s governments of the city divided into districts or autonomous
prefecture within the administrative areas of the provinces and the autonomous regions.
The NPC has the power to alter or annul any inappropriate laws enacted by its Standing
Committee, and to annul any autonomous regulations or separate regulations which have been
approved by its Standing Committee but which contravene the Constitution or the Legislation
Law. The Standing Committee of the NPC has the power to annul any administrative
regulations that contravene the Constitution and laws, to annul any local regulations that
contravene the Constitution, laws or administrative regulations, and to annul any autonomous
regulations or local regulations which have been approved by the standing committees of the
people’s congresses of the relevant provinces, autonomous regions or municipalities directly
under the central government, but which contravene the Constitution and the Legislation Law.
The State Council has the power to alter or annul any inappropriate ministerial rules and rules
of local governments. The people’s congresses of provinces, autonomous regions or
municipalities directly under the central government have the power to alter or annul any
inappropriate local regulations enacted or approved by their respective standing committees.
The people’s governments of provinces and autonomous regions have the power to alter or
annul any inappropriate rules enacted by the people’s governments at a lower level.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-2 –


--- page 642 ---
According to the Constitution and the Legislation Law, the power to interpret laws is
vested in the Standing Committee of the NPC. According to the Decision of the Standing
Committee of the NPC Regarding the Strengthening of Interpretation of Laws ( Ό਷ɛ͏˾
Ӕᙄ) passed on June 10, 1981, the Supreme
People’s Court of the PRC (the “ Supreme People’s Court ”) has the power to give general
interpretation on questions involving the specific application of laws and decrees in court
trials. The State Council and its ministries and commissions are also vested with the power to
give interpretation of the administrative regulations and department rules which they have
promulgated. At the regional level, the power to give interpretations of the local laws and
regulations as well as administrative rules is vested in the regional legislative and
administrative organs which promulgate such laws, regulations and rules.
PRC JUDICIAL SYSTEM
Under the Constitution and the PRC Law on the Organization of the People’s Courts
(2018 revision) (ج2018ࠈࡌ)), the PRC judicial system
is made up of the Supreme People’s Court, the local people’s courts and special people’s courts.
The local people’s courts are comprised of the primary people’s courts, the intermediate
people’s courts and the higher people’s courts. The higher people’s courts supervise the
primary and intermediate people’s courts. The people’s procuratorates also have the right to
exercise legal supervision over the civil proceedings of people’s courts of the same level and
lower levels. The Supreme People’s Court is the highest judicial body in the PRC. It supervises
the judicial administration of the people’s courts at all levels and special people’s courts.
The people’s courts apply a two-tier appellate system. A party may appeal against a
judgment or order of a local people’s court to the people’s court at the next higher level. Second
judgments or orders given at the next higher level are final. First judgments or orders of the
Supreme People’s Court are also final. However, if the Supreme People’s Court or a people’s
court at a higher level finds an error in a judgment or an order which has been given in any
people’s court at a lower level, or the presiding judge of a people’s court finds an error in a
judgment which has been given in the court over which he presides, the case may then be
retried according to the judicial supervision procedures.
The Civil Procedure Law of the PRC (2023 revision) (ج
2023͍)) (the “ Civil Procedure Law ”), which was adopted in 1991 and amended in 2007,
2012, 2017 and 2023, sets forth the criteria for instituting a civil action, the jurisdiction of the
people’s courts, the procedures to be followed for conducting a civil action and the procedures
for enforcement of a civil judgment or order. All parties to a civil action conducted within the
PRC must comply with the Civil Procedure Law. Generally, a civil case is initially heard by
a local court of the municipality or province in which the defendant resides. The parties to a
contract may, by express agreement, select a judicial court where civil actions may be brought,
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provided that the judicial court is either the plaintiff’s or the defendant’s domicile, the place
of execution or implementation of the contract or the place of the object of the action, provided
that the provisions of this law regarding the level of jurisdiction and exclusive jurisdiction shall
not be violated.
A foreign national or enterprise generally has the same litigation rights and obligations as
a citizen or legal person of the PRC. If a foreign country’s judicial system limits the litigation
rights of PRC citizens and enterprises, the PRC courts may apply the same limitations to the
citizens and enterprises of that foreign country within the PRC. If any party to a civil action
refuses to comply with a judgment or ruling made by a people’s court or an award made by an
arbitration panel in the PRC, the other party may apply to the people’s court for the
enforcement of the same. There are time limits of two years imposed on the right to apply for
such enforcement. If a person fails to satisfy a judgment made by the court within the stipulated
time, the court will, upon application by either party, enforce the judgment in accordance with
the law.
Where a party applies for enforcement of judgment or ruling of a people’s court against
a party who is not personally or whose property is not within the PRC may apply to a foreign
court with jurisdiction over the case for recognition and enforcement of the judgment or ruling.
A foreign judgment or ruling may also be recognized and enforced by the people’s court
according to PRC enforcement procedures if the PRC has entered into or acceded to an
international treaty with the relevant foreign country, which provides for such recognition and
enforcement, or if the judgment or ruling satisfies the court’s examination according to the
principle of reciprocity, unless the people’s court finds that the recognition or enforcement of
such judgment or ruling will result in a violation of the basic legal principles of the PRC, its
sovereignty or security or against social and public interest.
THE COMPANY LA W AND ADMINISTRATIVE MEASURES
A joint stock limited company which was incorporated in the PRC and seeking a listing
on the Hong Kong Stock Exchange is mainly subject to the following three laws and
regulations in the PRC:
 The PRC Company Law (2023 Amendment) (ج2023ࡌ
͍)) which was promulgated by the Standing Committee of the NPC on December
29, 1993, came into effect on July 1, 1994, amended on December 25, 1999, August
28, 2004, October 27, 2005, December 28, 2013, October 26, 2018 and December
29, 2023 respectively and the latest amendment of which was implemented on July
1, 2024;
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 Trial Administrative Measures of Overseas Securities Offering and Listing by
Domestic Companies () (the “ Trial
Measures ”) which were promulgated by the China Securities Regulatory
Commission (the “ CSRC ”) on February 17, 2023, came into effect on March 31,
2023, applicable to the overseas share subscription and listing of joint stock limited
companies;
 The Guidelines for Articles of Association of Listed Companies (ܸ
ˏ) (the “ Guidance for Articles of Association ”) which was latest amended and
came into effect on March 28, 2025 by the CSRC.
Set out below is a summary of the major provisions of the Company Law and the Trial
Measures applicable to the Company.
General
A joint stock limited company refers to an enterprise legal person incorporated under the
Company Law with its registered capital divided into shares of equal par value. The liability
of its shareholders is limited to the amount of shares held by them and the company is liable
to its creditors for an amount equal to the total value of its assets.
A joint stock limited company shall conduct its business in accordance with laws and
administrative regulations. It may invest in other limited liability companies and joint stock
limited companies and its liabilities with respect to such invested companies are limited to the
amount invested. Where any laws stipulate that a joint stock limited company may not be a
contributor that undertakes joint and several liabilities for the debts of the invested companies,
such requirements shall prevail.
Incorporation
A joint stock limited company may be incorporated by promotion or public subscription.
A joint stock limited company may be incorporated by a minimum of one but not more
than 200 promoters, and at least half of the promoters must have residence within the PRC. The
promoters shall pay the subscription monies in full for the shares they have subscribed for
before the company is incorporated.
The convening and voting procedures of the establishment meeting of a joint-stock
company established by way of promotion shall be stipulated in the company’s articles of
association or the agreement between the promoters. The sponsors who raise funds to establish
a joint-stock company shall preside over and convene the establishment meeting of the
company within thirty days from the date of full payment of the shares that should be issued
when the company is established, and notify all subscribers or announce the date of the meeting
15 days prior to the date of the establishment meeting. The inaugural meeting may be convened
only with the presence of promoters or subscribers representing at least half of the shares in
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the company. At the inaugural meeting, matters including the report on organization of the
company, the adoption of articles of association and the election of members of the board of
directors and members of the board of supervisors of the company will be dealt with. All
resolutions of the meeting require the approval of subscribers with more than half of the voting
rights present at the meeting.
Within 30 days after the conclusion of the inaugural meeting, the board of directors must
authorize a representative to apply to the registration authority for registration of the
establishment of the joint stock limited company. A company is formally established, and has
the status of a legal person, after the business license has been issued by the relevant
registration authority.
Share Capital
The promoters of a company can make capital contributions in cash or in kind, which can
be valued in currency and transferable according to law such as intellectual property rights or
land use rights based on their appraised value.
If capital contribution is made other than in cash, valuation and verification of the
property contributed must be carried out and converted into shares.
A company shall issue registered share.
Under the Trial Measures, if a domestic enterprise issues shares overseas, it may raise
funds and dividend distributions in foreign currency or Renminbi.
Allotment and Issue of Shares
All issue of shares of a joint stock limited company shall be based on the principles of
equality and fairness. The same class of shares must carry equal rights. Shares issued at the
same time and within the same class must be issued on the same conditions and at the same
price. The same price per share shall be paid by any subscriber.
To issue shares overseas, the domestic enterprise shall report the application documents
for issuance and listing to the CSRC for record-filing within three working days after
submission of the application documents for issuance and listing overseas.
Pursuant to the PRC Company Law, a company may, according to its articles of
association, issue the following classified shares, which have different rights from those of the
common shares: (i) shares with priority or inferior rights to profits or remaining property in
distribution; (ii) shares with more or less voting rights per share than those of the common
shares; (iii) shares whose transfer is subject to the consent of the company and other
restrictions; (iv) other classified shares provided by the State Council. A company making a
public offering of shares shall not issue any of the classified shares as prescribed on items (ii)
and (iii), except those issued prior to the public offering.
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Registered Shares
Under the Company Law, the shareholders may make capital contributions in cash, or
alternatively may make capital contributions with such valuated non-monetary property as
physical items, intellectual property rights, and land-use rights that may be valued in monetary
term and may be transferred in accordance with the law.
Under the Company Law, a joint-stock company shall maintain a register of members
which shall be kept at the company and set forth the following matters:
 the name and domicile of each shareholder;
 the class and number of shares held by each shareholder;
 the serial numbers of shares held by each shareholder if the shares are issued in
paper form; and
 the date on which each shareholder acquired the shares.
Increase of Share Capital
According to the Company Law, when the joint stock limited company issues new shares,
resolutions shall be passed by a shareholders’ general meeting, approving the class and number
of the new shares, the issue price of the new shares, the commencement and end of the new
share issuance and the class and amount of new shares to be issued to existing shareholders.
Where a company raises shares from the public, it shall register with the security regulatory
organization under the State Council and announce the prospectus. After the new share
issuance has been paid up, an announcement shall be made.
Reduction of Share Capital
A company may reduce its registered capital in accordance with the following procedures
prescribed by the Company Law:
 it shall prepare a balance sheet and a property list;
 the reduction of registered capital shall be approved by a shareholders’ general
meeting;
 it shall inform its creditors of the reduction in capital within 10 days and publish an
announcement of the reduction in the newspaper or on the National Enterprise
Credit Information Publicity System within 30 days after the resolution approving
the reduction has been passed;
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 creditors may within 30 days after receiving the notice, or within 45 days of the
public announcement if no notice has been received, require the company to pay its
debts or provide guarantees covering the debts;
 it shall apply to the relevant administration of registration for the registration of the
reduction in registered capital.
Repurchase of Shares
According to the Company Law, a joint stock limited company may not purchase its
shares other than for one of the following purposes: (i) to reduce its registered capital; (ii) to
merge with another company that holds its shares; (iii) to grant its shares for carrying out an
employee stock ownership plan or equity incentive plan; (iv) to purchase its shares from
shareholders who are against the resolution regarding the merger or division with other
companies at a shareholders’ general meeting; (v) use of shares for conversion of convertible
corporate bonds issued by the company; and (vi) the share buyback is necessary for a listed
company to maintain its company value and protect its shareholders’ equity.
The purchase of shares on the grounds set out in (i) and (ii) above shall require approval
by way of a resolution passed by the shareholders’ general meeting. For a company’s share
buyback under any of the circumstances stipulated in (iii), (v) or (vi) above, a resolution of the
company’s board of directors shall be made by a two-third majority of directors attending the
meeting according to the provisions of the company’s articles of association or as authorized
by the shareholders’ meeting.
Following the purchase of shares in accordance with (i), such shares shall be canceled
within 10 days from the date of purchase. The shares shall be assigned or deregistered within
six months if the share buyback is made under the circumstances stipulated in either (ii) or (iv).
The shares held in total by a company after a share buyback under any of the circumstances
stipulated in (iii), (v) or (vi) shall not exceed 10% of the company’s total outstanding shares,
and shall be assigned or deregistered within three years.
Listed companies making a share buyback shall perform their obligation of information
disclosure according to the provisions of the Securities Law. If the share buyback is made
under any of the circumstances stipulated in (iii), (v) or (vi) hereof, centralized trading shall
be adopted publicly.
Transfer of Shares
Shares held by shareholders of a joint-stock company may be transferred to other
shareholders or to persons other than shareholders; if the company’s articles of association
impose restrictions on the transfer of shares, such transfer shall be effected in accordance with
the provisions of the company’s articles of association. Pursuant to the Company Law, transfer
of shares by shareholders shall be carried out at a legally established securities exchange or in
other ways stipulated by the State Council. Transfer of shares may be carried out by
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endorsement of shareholders or in other manner specified by laws and administrative
regulations. Following the transfer, the company shall enter the names and addresses of the
transferees into its register of members. No modifications of registration in the share register
caused by transfer of registered shares shall be carried out within 20 days prior to the
convening of shareholder’s general meeting or five days prior to the base date for
determination of dividend distributions. However, where there are separate provisions relevant
laws, administrative regulations, or the requirements of the securities regulatory authority on
alternation of registration in the share register of listed companies, those provisions shall
prevail.
Under the Company law, shares issued prior to the public issuance of shares shall not be
transferred within one year from the date of the joint stock limited company’s listing on a stock
exchange. Where laws, administrative regulations or the securities regulatory authority of the
State Council have other provisions on the transfer of shares held by shareholders or de facto
controllers of listed companies, such provisions shall prevail. Directors, supervisors and the
senior management shall declare to the company their shareholdings in the company and any
changes of such shareholdings. They shall not transfer more than 25% of all the shares they
hold in the company annually during their tenure. They shall not transfer the shares they hold
within one year from the date on which the company’s shares are listed and commenced trading
on a stock exchange, nor within six months after their resignation from their positions with the
company. The articles of association may set out other restrictive provisions in respect of the
transfer of shares in the company held by its directors, supervisors and the senior management.
Shareholders
Under the Company Law, the rights of holders of ordinary shares of a joint stock limited
company include:
 the right to attend or appoint a proxy to attend shareholders’ meetings and to vote
thereat;
 the right to transfer shares in accordance with laws, administrative regulations and
provisions of the articles of association;
 the right to inspect and copy the company’s articles of association, share register,
minutes of shareholder’s general meetings, resolutions of meetings of the board of
directors, resolutions of meetings of the board of supervisors and financial and
accounting reports and to make proposals or enquiries on the company’s operations;
 the right to bring an action in the people’s court to rescind resolutions passed by
shareholder’s general meetings and board of directors where the articles of
association is violated by the above resolutions;
 the right to receive dividends and other types of interest distributed in proportion to
the number of shares held;
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 in the event of the termination or liquidation of the company, the right to participate
in the distribution of residual properties of the company in proportion to the number
of shares held; and
 other rights granted by laws, administrative regulations, other regulatory documents
and the company’s articles of association.
The obligations of a shareholder include the obligation to abide by the Company’s articles
of association, to pay the subscription moneys in respect of the shares subscribed for and in
accordance with the form of making capital contributions, to be liable for the company’s debts
and liabilities to the extent of the amount of his or her subscribed shares and any other
shareholders’ obligation specified in the company’s articles of association.
Shareholders’ Meetings
The shareholders’ general meeting is the organ of authority of the company, which
exercises its powers in accordance with the Company Law.
Under the Company Law, the shareholders’ general meeting exercises the following
principal powers:
 to elect or remove the directors and supervisors and to decide on matters relating to
the remuneration of directors and supervisors;
 to examine and approve reports of the board of directors;
 to examine and approve reports of the board of supervisors;
 to examine and approve the company’s proposals for profit distribution plans and
loss recovery plans;
 to decide on any increase or reduction of the company’s registered capital;
 to decide on the issue of bonds by the company;
 to decide on issues such as merger, division, dissolution and liquidation of the
company and other matters;
 to amend the company’s articles of association; and
 other powers as provided for in the articles of association.
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Shareholders’ annual general meetings are required to be held once every year. Under the
Company Law, an extraordinary shareholders’ general meeting is required to be held within
two months after the occurrence of any of the following:
 the number of directors is less than the number stipulated by the law or less than two
thirds of the number specified in the articles of association;
 the aggregate losses of the company which are not recovered reach one-third of the
company’s total paid-in share capital;
 when shareholders alone or in aggregate holding 10% or more of the company’s
shares request the convening of an extraordinary general meeting;
 whenever the board of directors deems necessary;
 when the board of supervisors so requests; or
 other circumstances as provided for in the articles of associations.
Under the Company Law, shareholders’ meetings shall be convened by the board of
directors, and presided over by the chairman of the board of directors. In the event that the
chairman is incapable of performing or does not perform his duties, the meeting shall be
presided over by the vice chairman. In the event that the vice chairman is incapable of
performing or not performing his duties, a director nominated by more than half of directors
shall preside over the meeting.
Where the board of directors is incapable of performing or not performing its duties of
convening the shareholders’ general meeting, the board of supervisors shall convene and
preside over such meeting in a timely manner. In case the board of supervisors fails to convene
and preside over such meeting, shareholders alone or in aggregate holding more than 10% of
the company’s shares for more than 90 days consecutively may unilaterally convene and
preside over such meeting.
Under the Company Law, notice of shareholders’ general meeting shall state the time and
venue of and matters to be considered at the meeting and shall be given to all shareholders 20
days before the meeting. Notice of extraordinary shareholder’s general meetings shall be given
to all shareholders 15 days prior to the meeting.
There is no specific provision in the Company Law regarding the number of shareholders
constituting a quorum in a shareholders’ meeting. Under the Company Law, shareholders
present at shareholders’ general meeting have one vote for each share they hold, except for
class shareholders. Shares held by the company are not entitled to any voting rights.
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Pursuant to the provisions of the articles of association or a resolution of the
shareholders’ general meeting, the accumulative voting system may be adopted for the election
of directors and supervisors at the shareholders’ general meeting. Under the accumulative
voting system, each share shall be entitled to vote equivalent to the number of directors or
supervisors to be elected at the shareholders’ general meeting and shareholders may
consolidate their voting rights when casting a vote.
Pursuant to the Company Law, resolutions of the shareholders’ general meeting shall be
adopted by more than half of the voting rights held by the shareholders present at the meeting.
However, resolutions of the shareholders’ general meeting regarding the following matters
shall be adopted by more than two-thirds of the voting rights held by the shareholders present
at the meeting: (i) amendments to the articles of association; (ii) the increase or decrease of
registered capital; (iii) the merger, division, dissolution, liquidation or change in the form of
the company; (iv) other matters considered by the shareholders’ general meeting, by way of an
ordinary resolution, to be of a nature which may have a material impact on the company and
should be adopted by a special resolution.
Under the Company Law, meeting minutes shall be prepared in respect of decisions on
matters discussed at the shareholders’ general meeting. The chairman of the meeting and
directors attending the meeting shall sign to endorse such minutes. The minutes shall be kept
together with the shareholders’ attendance register and the proxy forms.
Board of Directors
Under the Company Law, a joint stock limited company shall have a board of directors.
If the board of directors has more than three members, it may include an employees’
representative of the company. Where a company has 300 or more employees, the board of
directors shall include the employees’ representatives of the company unless the board of
supervisors has been established and includes employees’ representatives of the company
according to law. The employees’ representatives in the board of directors shall be
democratically elected by the employees through the employees’ representative congress,
employees’ congress or by other means. The term of a director shall be stipulated in the articles
of association, but no term of office shall last for more than three years. Directors may serve
consecutive terms if re-elected. A director shall continue to perform his duties in accordance
with the laws, administrative regulations and articles of association until a duly re-elected
director takes office, if re-election is not conducted in a timely manner upon the expiry of his
term of office, or if the resignation of a director during his term of office results in the number
of directors being less than the quorum. If a director resigns, he shall notify the company in
writing and the resignation shall take effect on the date of receipt of the notification by the
company; however, if the circumstances stipulated in the preceding paragraph exist, the
director shall continue to perform his duties.
Under the Company Law, the board of directors mainly exercises the following powers:
 to convene the shareholders’ meetings and report on its work to the shareholders’
meetings;
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 to implement the resolutions passed in shareholders’ meetings;
 to decide on the company’s business plans and investment proposals;
 to formulate the company’s proposed annual financial budget and final accounts;
 to formulate the company’s profit distribution proposals and loss recovery
proposals;
 to formulate proposals for the increase or reduction of the company’s registered
capital and the issuance of corporate bonds;
 to prepare plans for the merger, division, dissolution and change in the form of the
company;
 to formulate the company’s basic management system; and
 to exercise any other power under the articles of association or authorized by the
shareholders’ meeting.
Board Meetings
Under the Company Law, meetings of the board of directors of a joint stock limited
company shall be convened at least twice a year. Notice of meeting shall be given to all
directors and supervisors 10 days before the meeting. Interim board meetings may be proposed
to be convened by shareholders representing more than 10% of voting rights, more than
one-third of the directors or the board of supervisors. The chairman of the board of directors
shall convene and preside over such meeting within 10 days after receiving such proposal.
Meetings of the board of directors shall be held only if half or more of the directors are present.
Resolutions of the board of directors shall be passed by more than half of all directors. Each
director shall have one vote for resolutions to be approved by the board of directors. Directors
shall attend board meetings in person. If a director is unable to attend a board meeting, he may
appoint another director by a written power of attorney specifying the scope of the
authorization to attend the meeting on his behalf.
If a resolution of the board of directors violates the laws, administrative regulations or the
articles of association, and as a result of which the company sustains serious losses, the
directors participating in the resolution are liable to compensate the company. However, if it
can be proved that a director expressly objected to the resolution when the resolution was voted
on, and that such objection was recorded in the minutes of the meeting, such director may be
released from that liability.
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Chairman of the Board
Under the Company Law, the board of directors shall appoint a chairman and may appoint
the vice chairman. The chairman and the vice chairman are elected with approval of more than
half of all the directors. The chairman shall convene and preside over board meetings and
examine the implementation of board resolutions. The vice chairman shall assist the work of
the chairman. In the event that the chairman is incapable of performing or not performing his
duties, the duties shall be performed by the vice chairman. In the event that the vice chairman
is incapable of performing or not performing his duties, a director nominated by more than half
of the directors shall perform his duties.
Qualification of Directors
The Company Law provides that the following persons may not serve as a director:
 a person who is unable or has limited ability to undertake any civil liabilities;
 a person who has been convicted of an offense of bribery, corruption, embezzlement
or misappropriation of property, or the destruction of socialist market economy
order; or who has been deprived of his political rights due to his crimes, in each case
where less than five years have elapsed since the date of completion of the sentence,
and in case of a suspended sentence, not more than two years have elapsed since the
date of expiry of the probationary period;
 a person who has been a former director, factory manager or manager of a company
or an enterprise that has entered into insolvent liquidation and who was personally
liable for the insolvency of such company or enterprise, where less than three years
have elapsed since the date of the completion of the bankruptcy and liquidation of
the company or enterprise;
 a person who has been a legal representative of a company or an enterprise that has
had its business license revoked due to violations of the law and has been ordered
to close down by law and the person was personally responsible, where less than
three years have elapsed since the date of such revocation or the order for closure;
or
 a person who is liable for a relatively large amount of debts that are overdue and
being listed as a dishonest person subject to enforcement by the people’s court.
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Board of Supervisors
A joint stock limited company has a board of supervisors composed of not less than three
members. The board of supervisors is made up of representatives of the shareholders and an
appropriate proportion of representatives of the employees of the company. The actual
proportion shall be stipulated in the articles of association, provided that the proportion of
representatives of the employees shall not be less than one third of the supervisors.
Representatives of the employees of the company in the board of supervisors shall be
democratically elected by the employees at the employees’ representative assembly,
employees’ general meeting or otherwise.
The directors and senior management may not act concurrently as supervisors.
The board of supervisors shall appoint a chairman and may appoint a vice chairman. The
chairman and the vice chairman of the board of supervisors are elected with approval of more
than half of all the supervisors. The chairman of the board of supervisors shall convene and
preside over the meetings of the board of supervisors. In the event that the chairman of the
board of supervisors is incapable of performing or not performing his duties, the vice chairman
of the board of supervisors shall convene and preside over the meetings of the board of
supervisors. In the event that the vice chairman of the board of supervisors is incapable of
performing or not performing his duties, a supervisor nominated by more than half of the
supervisors shall convene and preside over the meetings of the board of supervisors.
Each term of office of a supervisor is three years and he or she may serve consecutive
terms if re-elected. A supervisor shall continue to perform his duties in accordance with the
laws, administrative regulations and articles of association until a duly re-elected supervisor
takes office, if re-election is not conducted in a timely manner upon the expiry of his term of
office, or if the resignation of a supervisor during his term of office results in the number of
supervisors being less than the quorum.
The board of supervisors of a company shall hold at least one meeting every six months.
According to the Company Law, a resolution of the board of supervisors shall be passed by
more than half of all the supervisors.
The board of supervisors exercises the following powers:
 to review the company’s financial position;
 to supervise the directors and senior management in their performance of their
duties and to propose the removal of directors and senior management who have
violated laws, regulations, the articles of association or the resolutions of
shareholders’ meeting;
 when the acts of directors and senior management are harmful to the company’s
interests, to require correction of those acts;
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 to propose the convening of extraordinary shareholders’ meetings and to convene
and preside over shareholders’ meetings when the board of directors fails to perform
the duty of convening and presiding over shareholders’ general meeting under this
law;
 to initiate proposals for resolutions to shareholders’ general meeting;
 to initiate proceedings against directors and senior management;
 other powers specified in the articles of association; and
 Supervisors may attend board meetings and make enquiries or proposals in respect
of board resolutions. The board of supervisors may initiate investigations into any
irregularities identified in the operation of the company and, where necessary, may
engage an accounting firm to assist their work at the company’s expense.
A joint stock limited company may, under the articles of association, set up an audit
committee composed of directors in the board of directors, which shall exercise the functions
and powers of the board of supervisors as provided for in this Law. It may not have a board
of supervisors or supervisors. The audit committee shall be composed of at least 3 members,
and more than half of the members shall not assume any position other than the director in the
company and shall not have any relationship with the company that may affect their
independent and objective judgments. Among the members of the board of directors of the
company, an employees’ representative may become a member of the audit committee. A
resolution made by the audit committee shall be adopted by more than half of the members
thereof. For voting on a resolution of the audit committee, each member shall have one vote.
The discussion methods and voting procedures of the audit committee shall be prescribed in the
articles of association, unless it is otherwise provided for by this Law.
Manager and Senior Management
Under the Company Law, a company shall have a manager who shall be appointed or
dismissed by the board of directors.
The manager shall be responsible to the board of directors and shall exercise his duties
and powers in accordance with the provisions of the company’s articles of association or the
authorization of the board of directors. The manager shall attend board meetings.
According to the Company Law, senior management shall mean the manager, deputy
manager(s), person-in-charge of finance, board secretary (in case of a listed company) of a
company and other personnel as stipulated in the articles of association.
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Duties of Directors, Supervisors and Senior Management
Directors, supervisors and senior management of the company are required under the
Company Law to comply with the relevant laws, regulations and the articles of association, and
have fiduciary and diligent duties to the company. Directors, supervisors and senior
management shall take measures to avoid conflicts between their own interests and the
interests of the company, and shall not make use of their positions to gain undue advantage.
They shall also owe a duty of diligence to the company and shall perform their duties with the
reasonable care normally expected of a person in management position in the best interests of
the company. Directors and senior management are prohibited from:
 embezzlement of company properties and misappropriation of the company’s
capital;
 depositing the company’s capital into accounts under his own name or the name of
other individuals;
 utilising power to accept bribe or accept other illegal income;
 accept and possess commissions paid by a third party for transactions conducted
with the company;
 unauthorized divulgence of confidential business information of the company; or
 other acts in violation of their duty of loyalty to the company.
A director, supervisor or senior management who contravenes any law, regulation or the
company’s articles of association in the performance of his duties resulting in any loss to the
company shall be personally liable to the company.
Where a director, supervisor or senior management is required to attend a shareholders’
meeting, such director, supervisor or senior management shall attend the meeting and answer
the inquiries from shareholders. Directors and senior management shall furnish all true
information and data to the supervisory board, without impeding the discharge of duties by the
supervisory board or supervisors.
Finance and Accounting
Under the Company Law, a company shall establish financial and accounting systems
according to laws, administrative regulations and the regulations of the financial department of
the State Council and shall at the end of each financial year prepare a financial and accounting
report which shall be audited by an accounting firm as required by law. The company’s
financial and accounting report shall be prepared in accordance with provisions of the laws,
administrative regulations and the regulations of the financial department of the State Council.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-17 –


--- page 657 ---
Pursuant to the Company Law, the company shall deliver its financial and accounting
reports to all shareholders within the time limit stipulated in the articles of association and
make its financial and accounting reports available at the company for inspection by the
shareholders at least 20 days before the convening of an annual general meeting of
shareholders. It must also publish its financial and accounting reports.
When distributing each year’s after-tax profits, it shall set aside 10% of its after-tax
profits into a statutory common reserve fund (except where the fund has reached 50% of its
registered capital).
If its statutory common reserve fund is not sufficient to make up losses of the previous
year, profits of the current year shall be applied to make up losses before allocation is made
to the statutory common reserve fund pursuant to the above provisions.
After allocation of the statutory common reserve fund from after-tax profits, it may, upon
a resolution passed at the shareholders’ general meeting, allocate discretionary common
reserve fund from after-tax profits.
The remaining after-tax profits after making up losses and allocation of common reserve
fund shall be distributed in proportion to the number of shares held by the shareholders, unless
otherwise stipulated in the articles of association.
Shares held by the Company shall not be entitled to any distribution of profit.
The premium received through issuance of shares at prices above par value and other
incomes required by the financial department of the State Council to be allocated to the capital
reserve fund shall be allocated to the company’s capital reserve fund.
The Company’s reserve fund shall be applied to make up losses of the company, expand
its business operations or be converted to increase the registered capital of the company. When
utilizing reserve funds to make up for a company’s losses, the discretionary reserve fund and
statutory reserve fund should be used first; if the losses still cannot be made up, the capital
reserve fund may be used in accordance with regulations. Upon the conversion of statutory
common reserve fund into increasing the registered capital, the balance of the statutory
common reserve fund shall not be less than 25% of the registered capital of the company before
such conversion.
The Company shall have no other accounting books except the statutory accounting
books. Its assets shall not be deposited in any accounts opened in the name of any individual.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-18 –


--- page 658 ---
Appointment and Dismissal of Accounting Firms
Pursuant to the Company Law, the appointment or dismissal of accounting firms
responsible for the auditing of the company shall be determined by shareholders’ general
meeting, board of directors or board of supervisors in accordance with provisions of articles
of association. The accounting firm should be allowed to make representations when the
shareholders’ general meeting, board of directors or board of supervisors conducts a vote on
the dismissal of the accounting firm. The company should provide true and complete
accounting evidences, books, financial and accounting reports and other accounting data to the
accounting firm it employs without any refusal, withholding and misrepresentation.
The Guidance for Articles of Association provide that the company guarantees to provide
true and complete accounting vouchers, accounting books, financial accounting reports and
other accounting materials to the employed accounting firm, and shall not refuse, conceal or
falsely report. And the audit fee of the accounting firm shall be decided by the general meeting
of shareholders.
Distribution of Profits
According to the Company Law, a company shall not distribute profits before losses are
covered and the statutory common reserve is drawn.
Amendments to Articles of Association
Any amendments to the company’s articles of association must be made in accordance
with the procedures set out in the company’s articles of association. In relation to matters
involving the company’s registration, its registration with the authority must also be changed.
Dissolution and Liquidation
According to the Company Law, a company shall be dissolved by reason of the following:
(i) the term of its operations set down in the articles of association has expired or other events
of dissolution specified in the articles of association have occurred; (ii) the shareholders’
general meeting have resolved to dissolve the company; (iii) the company is dissolved by
reason of merger or division; (iv) the business license is revoked; the company is ordered to
close down or be revoked; or (v) the company is dissolved by the people’s court in response
to the request of shareholders holding shares that represent more than 10% of the voting rights
of all its shareholders, on the grounds that the company suffers significant hardship in its
operation and management and the ongoing existence of the company would bring significant
losses for shareholders that cannot be resolved through other means.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-19 –


--- page 659 ---
In the event of (i) or (ii) above and in case that no assets have been distributed to
shareholders, it may carry on its existence by amending its articles of association or by a
resolution of shareholders’ meeting. The amendment of the articles of association or by a
resolution of shareholders’ meeting in accordance with provisions set out above shall require
approval of more than two thirds of voting rights of shareholders attending a shareholders’
general meeting.
Where the company is dissolved in the circumstances described in items (i), (ii), (iv), or
(v) above, a liquidation group shall be established and the liquidation process shall commence
within 15 days after the occurrence of an event of dissolution.
The liquidation committee shall be composed of directors, unless the company’s articles
of association provide otherwise or the shareholders’ meeting resolves to elect someone else.
If the liquidation obligator fails to fulfill its liquidation obligations in a timely manner and
causes losses to the company or creditors, it shall be liable for compensation. If a liquidation
committee is not established within the stipulated period or if the liquidation is not carried out
after the establishment of the liquidation committee, the interested parties may apply with the
people’s court for setting up a liquidation committee with designated relevant personnel to
conduct the liquidation. The people’s court should accept such application and form a
liquidation committee to conduct liquidation in a timely manner.
The liquidation group shall exercise the following powers during the liquidation period:
 to handle the company’s assets and to prepare a balance sheet and an inventory of
the assets;
 to notify creditors through notice or public announcement;
 to deal with the company’s outstanding businesses related to liquidation;
 to pay any tax overdue as well as tax amounts arising from the process of
liquidation;
 to claim credits and pay off debts;
 to distribute the company’s remaining assets after its debts have been paid off; and
 to represent the company in civil lawsuits.
The liquidation group shall notify the company’s creditors within 10 days after its
establishment and issue public notices in newspapers or on the National Enterprise Credit
Information Publicity System within 60 days. A creditor shall lodge his claim with the
liquidation group within 30 days after receiving notification, or within 45 days of the public
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-20 –


--- page 660 ---
notice if he did not receive any notification. A creditor shall state all matters relevant to his
creditor rights in making his claim and furnish evidence. The liquidation group shall register
such creditor rights. The liquidation group shall not make any debt settlement to creditors
during the period of claim.
Upon liquidation of properties and the preparation of the balance sheet and inventory of
assets, the liquidation group shall draw up a liquidation plan to be submitted to the
shareholders’ general meeting or people’s court for confirmation.
The company’s remaining assets after payment of liquidation expenses, wages, social
insurance expenses and statutory compensation, outstanding taxes and debts shall be
distributed to shareholders according to their shareholding proportion. It shall continue to exist
during the liquidation period, although it can only engage in any operating activities that are
related to the liquidation. The company’s properties shall not be distributed to the shareholders
before repayments are made in accordance to the foregoing provisions.
Upon liquidation of the company’s properties and the preparation of the balance sheet and
inventory of assets, if the liquidation group becomes aware that the company does not have
sufficient assets to meet its liabilities, it must apply to the people’s court for a declaration for
bankruptcy liquidation.
Following the acceptance of application for bankruptcy by the People’s Court, the
liquidation committee shall hand over the liquidation affairs to the bankruptcy administrator
appointed by the people’s court.
Upon completion of the liquidation, the liquidation group shall submit a liquidation report
to the shareholders’ general meeting or the people’s court for verification and the report shall
be submitted to the registration authority of the company in order to cancel the company’s
registration. When performing the duties in relation to the liquidation, members of the
liquidation committee shall bear the duties of loyalty and diligence.
If members of the liquidation committee are reluctant in performing their liquidation
duties and cause losses to the company, they shall be liable for compensation. A member of the
liquidation group is liable to indemnify the company and its creditors in respect of any loss
arising from his intentional or gross negligence.
Overseas Listing
According to the Trial Measures, the domestic enterprise shall report the application
documents for issuance and listing to the CSRC for record-filing within three working days
after submission of the application documents for issuance and listing overseas.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-21 –


--- page 661 ---
Loss of Share Certificates
If a registered share certificate is lost, stolen or destroyed, the relevant shareholder may
apply, in accordance with the relevant provisions set out in the Civil Procedure Law, to a
people’s court to declare such certificate invalid. After the people’s court declares the
invalidity of such certificate, the shareholder may apply to the company for a replacement
share certificate.
Suspension and Termination of Listing
The Company Law has deleted provisions governing suspension and termination of
listing. The PRC Securities Law (2019 revision) ((2019ࠈࡌ))
has also deleted provisions regarding suspension of listing. Where listed securities fall under
the delisting circumstances stipulated by the stock exchange, the stock exchange shall
terminate its listing and trading in accordance with the business rules.
Where the stock exchange decides on delisting of securities, it shall promptly announce
and file records with the securities regulatory authority of the State Council.
Merger and Demerger
Companies may merge through merger by absorption or through the establishment of a
newly merged entity. If it merges by absorption, the company which is absorbed shall be
dissolved. If it merges by forming a new corporation, both companies will be dissolved.
SECURITIES LA W AND REGULATIONS
The PRC has promulgated a number of regulations that relate to the issue and trading of
shares and disclosure of information. In October 1992, the State Council established the
Securities Committee and the CSRC. The Securities Committee is responsible for coordinating
the drafting of securities regulations, formulating securities-related policies, planning the
development of securities markets, directing, coordinating and supervising all securities-
related institutions in the PRC and administering the CSRC. The CSRC is the regulatory arm
of the Securities Committee and is responsible for the drafting of regulatory provisions of
securities markets, supervising securities companies, regulating public offers of securities by
PRC companies in the PRC or overseas, regulating the trading of securities, compiling
securities related statistics and undertaking relevant research and analysis. In April 1998, the
State Council consolidated the two departments and reformed the CSRC.
The Interim Provisional Regulations on the Administration of Share Issuance and Trading
(၍ଣᅲБૢԷ), promulgated and implemented by the State Council on
April 22,1993, deals with the application and approval procedures for public offerings of
equity securities, trading in equity securities, the acquisition of listed companies, deposit,
clearing and transfer of listed equity securities, the disclosure of information with respect to
a listed company, investigation, penalties and dispute settlement.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-22 –


--- page 662 ---
On December 25, 1995, the State Council promulgated and implemented the Regulations
of the State Council Concerning Domestic Listed Foreign Shares of Joint Stock Limited
Companies (). These regulations deal
mainly with the issue, subscription, trading and declaration of dividends and other distributions
of domestic listed and foreign invested shares and disclosure of information of joint stock
limited companies having domestic listed and foreign invested shares.
The PRC Securities Law took effect on July 1, 1999 and was revised on August 28, 2004,
October 27, 2005, June 29, 2013, August 31, 2014 and December 28, 2019, respectively. This
is the first national securities law in the PRC, which is divided into 14 chapters and 226 articles
regulating, among other things, the issue and trading of securities, takeovers by listed
companies, securities exchanges, securities companies and the duties and responsibilities of the
State Council’s securities regulatory authorities. The PRC Securities Law comprehensively
regulates activities in the PRC securities market. Article 224 of the PRC Securities Law
provides that domestic enterprises shall comply with the relevant provisions of the State
Council for listing its shares outside the PRC. Currently, the issue and trading of foreign issued
shares (including H shares) are mainly governed by the rules and regulations promulgated by
the State Council and the CSRC.
ARBITRATION AND ENFORCEMENT OF ARBITRAL A W ARDS
The Arbitration Law of the PRC () (the “Arbitration Law”)
was passed by the Standing Committee of the NPC on August 31, 1994, became effective on
September 1, 1995 and was amended on August 27, 2009 and September 1, 2017. Under the
Arbitration Law, an arbitration committee may, before the promulgation by the PRC Arbitration
Association of arbitration regulations, formulate interim arbitration rules in accordance with
the Arbitration Law and the Civil Procedure Law. Where the parties have by agreement
provided arbitration as the method for dispute resolution and one party filed a lawsuit with the
people’s court, the people’s court will refuse to handle the case except when the arbitration
agreement is declared invalid.
Under the Arbitration Law and the Civil Procedure Law, an arbitral award is final and
binding on the parties. If a party fails to comply with an award, the other party to the award
may apply to the people’s court for enforcement. A people’s court may refuse to enforce an
arbitral award made by an arbitration commission if there is any irregularity on the procedures
or composition of arbitrators specified by law or the award exceeds the scope of the arbitration
agreement or is outside the jurisdiction of the arbitration commission.
A party seeking to enforce an arbitral award made by the PRC arbitration panel against
a party who, or whose property, is not within the PRC, may apply to a foreign court with
jurisdiction over the case for enforcement. Similarly, an arbitral award made by a foreign
arbitration body may be recognized and enforced by the PRC courts in accordance with the
principles of reciprocity or any international treaty concluded or acceded to by the PRC. The
PRC acceded to the Convention on the Recognition and Enforcement of Foreign Arbitral
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-23 –


--- page 663 ---
Awards () (the “ New Y ork Convention ”) adopted on June
10, 1958 pursuant to a resolution of the Standing Committee of the NPC passed on December
2, 1986. The New Y ork Convention provides that all arbitral awards made in a state which is
a party to the New Y ork Convention shall be recognized and enforced by all other parties to
the New Y ork Convention, subject to their right to refuse enforcement under certain
circumstances, including where the enforcement of the arbitral award is against the public
policy of the state to which the application for enforcement is made. It was declared by the
Standing Committee of the NPC simultaneously with the accession of the PRC that (i) the PRC
will only recognize and enforce foreign arbitral awards on the principle of reciprocity and (ii)
the PRC will only apply the New Y ork Convention in disputes considered under PRC laws to
arise from contractual and non-contractual mercantile legal relations.
An arrangement was reached between Hong Kong and the Supreme People’s Court for the
mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court adopted
the Arrangement on Mutual Enforcement of Arbitral Awards between Mainland China and
Hong Kong (τર), which became
effective on February 1, 2000 and was amended by the Supplemental Arrangement of the
Supreme People’s Court for the Mutual Enforcement of Arbitral Awards between the Mainland
and the Hong Kong Special Administrative Region (2020) (ಥत
໾̂τર(2020) ). In accordance with this arrangement,
awards made by PRC arbitral authorities under the Arbitration Law can be enforced in Hong
Kong, and Hong Kong arbitration awards are also enforceable in the PRC.
Judicial judgment and its enforcement
According to the Arrangement on Mutual Recognition and Enforcement of Judgments in
Civil and Commercial Matters by the Courts of the Mainland China and of the Hong Kong
Special Administrative Region Pursuant to Agreed Jurisdiction by Parties Concerned ( ௰৷
΁кӔ
τર) (the “ Old Arrangement ”) promulgated by the Supreme People’s Court on July 3,
2008 and implemented on August 1, 2008, which was expired, in the case of final judgment,
defined with payment amount and enforcement power, made between the court of China and
the court of the Hong Kong Special Administrative Region in a civil and commercial case with
written jurisdiction agreement, any party concerned may apply to the People’s Court of China
or the court of the Hong Kong Special Administrative Region for recognition and enforcement
based on this arrangement. “Choice of court agreement in written” refers to a written
agreement defining the exclusive jurisdiction of either the People’s Court of China or the court
of the Hong Kong Special Administrative Region in order to resolve dispute with particular
legal relation occurred or likely to occur by the party concerned. Therefore, the party
concerned may apply to the Court of China or the court of the Hong Kong Special
Administrative Region to recognize and enforce the final judgment made in China or Hong
Kong that meet certain conditions of the aforementioned regulations.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-24 –


--- page 664 ---
On January 18, 2019, the PRC Supreme Court and the Hong Kong government signed the
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 (ٙ
τર) (the “ New Arrangement ”), which replaces the Old Arrangement and seeks to establish
a mechanism with greater clarity and certainty for recognition and enforcement of judgments
in wider range of civil and commercial matters between Hong Kong and the PRC. The New
Arrangement discontinued the requirement for a choice of court agreement for bilateral
recognition and enforcement. The New Arrangement came into effect on January 29, 2024.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS
– IV-25 –


--- page 665 ---
This appendix contains a summary of the principal provisions of the Company’s Articles
of Association, which will take effect on the date when the Company’s H shares are listed on
the Hong Kong Stock Exchange. This appendix is primarily intended to provide potential
investors with an overview of the Company’s Articles of Association. Therefore, it may not
contain all the information that is important to potential investors.
SHARES AND REGISTERED CAPITAL
The Shares shall be presented by share certificates. The Shares issued by the Company
shall be denominated in RMB. The par value per Share is RMB1.
The Shares shall be issued in a transparent, fair and just manner, and shall rank pari passu
in all respects with the Shares of the same class. The terms and price of each of the Share of
the same class in the same issuance shall be the same, and every Share subscribed by
subscribers in the same issuance shall have the same price.
The shares of the Company listed on the Hong Kong Stock Exchange are known as “H
shares”, which are authorized to be listed on the Hong Kong Stock Exchange, with nominal
value denominated in Renminbi and subscribed and traded in Hong Kong dollars.
Subject to the approval and filing by the security regulatory authority under the State
Council and the consent of the Stock Exchange of Hong Kong, all or part of the Company’s
domestic unlisted shares may be converted into overseas listed shares, and the converted
overseas listed shares may be listed and traded on overseas stock exchanges.
INCREASE, DECREASE AND REPURCHASE OF SHARES
(1) Increase of Shares
In accordance with laws and regulations, the Company may, based on its operating and
development needs and the resolution of a Shareholders’ general meeting, increase its capital
in the following manners:
(1) issuance of Shares to Non-Specific Target investors;
(2) issuance of Shares to Specific Target investors;
(3) bonus issue of Shares to existing Shareholders;
(4) transfer of reserve fund into capital;
(5) adopting any other means stipulated in the laws and administrative regulations and
approved by China Securities Regulatory Commission and Hong Kong Stock
Exchange.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-1 –


--- page 666 ---
(2) Decrease of Shares
The Company may reduce its registered capital. The Company’s reduction of registered
capital shall be conducted in accordance with the procedures stipulated in the Company Law
and other relevant regulations, regulatory rules of the places where the shares of Company are
listed, other securities regulatory rules and the Articles of Association.
(3) Repurchase of Shares
Except under the following circumstances, the Company may not repurchase its Shares:
(1) to reduce the registered capital of the Company;
(2) to merger with other companies that hold shares of the Company;
(3) to grant the shares for employee shareholding scheme or as equity incentive;
(4) where shareholders require the Company to purchase their shares due to their
disagreement on the merger or division resolution passed by a shareholders’ general
meeting;
(5) to use the shares in the conversion of the convertible corporate bonds issued by the
listed Company;
(6) to preserve the Company’s value and Shareholders’ interests as necessary;
(7) in other circumstances as stipulated by laws, administrative regulations and
regulatory rules of the stock exchange(s) of the places where the Company’s shares
are listed.
The Company may acquire its own Shares through open and centralized trading, or in any
other manner permitted by laws, administrative regulations, the CSRC and the Stock Exchange.
Where the Company acquires its own Shares under the circumstances set forth in sub-
paragraphs (3), (5) and (6) above, it shall do so through open and centralized trading.
Any acquisition by the Company of its shares under any of the circumstances set forth in
sub-paragraphs (1) and (2) shall be subject to a resolution of a Shareholders’ general meeting;
while any acquisition by the Company of its shares under the circumstances set forth in
sub-paragraphs (3), (5) and (6) shall, pursuant to the Articles of Association or the
authorization of a Shareholders’ general meeting, be subject to a resolution of a meeting of the
Board of Directors at which two-thirds or more of the Directors are present.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-2 –


--- page 667 ---
The Shares acquired by the Company shall, under the circumstance set forth in
sub-paragraph (1), be cancelled within 10 days from the date of acquisition; while under the
circumstances set forth in sub-paragraph (2) or (4) shall be disposed of or cancelled within six
months; and while under the circumstances set forth in sub-paragraph (3), (5) or (6),
aggregately not exceed 10% of its total issued shares and shall be disposed of or cancelled
within three years.
(4) Transfer of Shares
The Company’s shares may be transferred in accordance with the law.
The Company shall not accept its shares as the subject of a pledge.
The shares of the Company issued prior to the Company’s public offering of shares shall
not be transferred within 1 year from the date the shares of the Company being listed and traded
on the stock exchange(s).
The Directors, Supervisors and senior management of the Company shall report to the
Company the shares held by them and the changes thereof. During the term of their office as
determined when they assume the posts, the shares transferred by any of them each year shall
not exceed 25% of the total number of shares of the same class of the Company that he holds.
The shares of the Company held by the aforesaid persons shall not be transferred within one
year from the date when the shares of the Company are listed and traded in a stock exchange.
If any of the aforesaid persons leaves from his post, he shall not transfer the shares of the
Company that he holds within six months from such departure.
If the shares are pledged within the term of limited transfer prescribed by relevant laws
and administrative regulations, the pledgee may not exercise the pledge right within the term
of limited transfer.
SHAREHOLDERS AND SHAREHOLDERS’ MEETING
(1) Register of Shareholders
The Company shall establish a register of Shareholders based on the certificates provided
by the securities registrar, and the register of shareholders shall be sufficient evidence of the
Shareholders’ shareholdings in the Company.
When the Company convenes a general meeting, distributes dividends, commences
liquidation or engages in other acts that require the identification of Shareholders, the Board
or the convener of the general meeting shall determine the record date of the Shareholders’
registration. The Shareholders whose names appear on the register of Shareholders after the
close of market trading on the record date shall be the Shareholder entitled to the relevant
rights and interests.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-3 –


--- page 668 ---
(2) Rights and Obligations of Shareholders
The Shareholders of the Company shall enjoy the following rights:
(1) to receive dividends and other distributions in proportion to their shareholdings;
(2) to request, convene preside over, attend or appoint a Shareholder’s proxy to attend
the general meeting of Shareholders and to exercise voting rights;
(3) to supervise the Company’s operations, to present proposals and to raise enquiries;
(4) to transfer, grant or pledge shares held by them in accordance with the laws,
administrative regulations as well as the Articles of Association;
(5) to access and copy Articles of Association, register of shareholders, meeting minutes
of the shareholders’ general meeting, resolutions of meetings of the Board of
Directors, resolutions of meetings of the Board of Supervisors, and financial and
accounting reports, Shareholders who meet the requirements may inspect the
company’s accounting books and vouchers;
(6) in the event of the termination or liquidation of the Company, to participate in the
distribution of remaining assets of the Company in accordance with the
shareholdings;
(7) with respect to Shareholders who vote against any resolution adopted at the general
meeting on the merger or division of the Company, the right to demand the Company
to buy back their Shares;
(8) any other rights conferred by laws, administrative regulations, departmental rules,
other securities regulatory rules of the places where the Company’s shares are listed
or the Articles of Association.
The Shareholders of the Company shall assume the following obligations:
(1) to abide by laws, administrative regulations, the departmental regulation, other
securities regulatory rules of the places where the Company’s shares are listed and
the Articles of Association;
(2) to pay subscription money according to the number of shares subscribed and the
method of subscription;
(3) not to withdraw their shares except as otherwise provided by laws and regulations;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-4 –


--- page 669 ---
(4) not to abuse their shareholder rights to jeopardize the interests of the Company or
other shareholders; and not to abuse the independent status of the Company as a
legal entity and the limited liabilities of shareholders to jeopardize the interests of
the Company’s creditors;
(5) any other obligations imposed by laws, administrative regulations, other securities
regulatory rules of the places where the Company’s shares are listed or the Articles
of Association.
The Shareholders of the Company who abuse their shareholder rights to cause losses to
the Company or other shareholders shall be liable for compensation in accordance with the
laws.
The Shareholders of the Company who abuse the independent status of the Company as
a legal entity and the limited liabilities of shareholders to evade debts and seriously jeopardize
the interests of the Company’s creditors shall be jointly and severally liable for the debts of the
Company.
The Shareholders holding 5% or more of the Company’s Shares with voting rights shall,
in the event of a pledge of the Shares held by them, report to the Company in writing from the
date of occurrence of such fact.
(3) General Rules for the Shareholders’ General Meeting
The Shareholders’ general meeting is the organ of authority of the Company, which may
exercise the following functions and powers in accordance with the law:
(1) to elect or change the Directors and Supervisors and to decide on the matters relating
to the remuneration of the Directors and Supervisors;
(2) to consider and approve the reports of the Board of the Directors;
(3) to consider and approve the reports of the Board of the Supervisors;
(4) to consider and approve the Company’s profit distribution proposals and loss
recovery proposals;
(5) to decide on any increase or reduction of the Company’s registered capital;
(6) to decide on the issue of corporate bonds;
(7) to decide on merger, division, dissolution or liquidation of the Company, or change
of the corporate form of the Company;
(8) to amend the Articles of Association;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-5 –


--- page 670 ---
(9) to decide the appointment and dismissal of the accounting firms;
(10) to consider and approve the transaction matters as stipulated in Article 44, the
financial assistance matters as stipulated in Article 45, the guarantee matters as
stipulated in Article 46;
(11) to consider matters that the Company purchased or sold or guaranteed major assets
within one year exceeding 30% of the Company’s latest audited total assets;
(12) to consider related (connected) transactions that should be considered by the
shareholders’ meeting as stipulated in the Company’s system of related (connected)
transactions;
(13) to consider and approve the change in the use of proceeds from raising;
(14) to consider the share incentive schemes and employee shareholding scheme;
(15) to consider and approve other matters which are required to be determined at the
shareholders’ meeting as required by laws, administrative regulations, departmental
rules, the Hong Kong Listing Rules, other securities regulatory rules of the places
where the Company’s shares are listed or the Articles of Association.
General meetings consist of annual general meetings and extraordinary general meetings.
The annual general meeting shall be held once every financial year within six months after the
end of the previous financial year.
Extraordinary meetings shall be held from time to time, and the Company shall convene
an extraordinary general meeting within two months from the occurrence of any of the
following events:
(1) when the number of Directors is less than the quorum specified in the PRC Company
Law or two-thirds of the total number specified in the Articles of Association;
(2) the unrecovered losses of the Company amount to one third of the total amount of
its paid-up share capital;
(3) when Shareholder(s) severally or jointly holding 10% or more of the Company’s
shares request(s) to convene such meeting in writing;
(4) when deemed necessary by the Board of Directors;
(5) when proposed by the Board of Supervisors;
(6) other circumstances stipulated in the laws, administrative regulations, departmental
rules, the Hong Kong Listing Rules, other regulatory rules of the places where the
Company’s shares are listed or the Articles of Association.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-6 –


--- page 671 ---
(4) Convening of General Meeting
General meetings shall be convened by the Board of Directors in accordance with the
laws.
A majority of independent directors have the right to propose to the Board of Directors
to convene an extraordinary shareholders’ meeting. In response to a proposal from independent
directors that request to convene an extraordinary shareholders’ meeting, the Board of
Directors shall, in accordance with the provisions of laws, administrative regulations and the
Articles of Association, give written feedback on whether it agrees or disagrees with the
convening of the extraordinary shareholders’ meeting within 10 days upon receipt of the
proposal.
If the Board of Directors agrees to convene an extraordinary shareholders’ meeting, the
Board of Directors will issue a notice of convening the extraordinary shareholders’ meeting
within 5 days after the Board of Directors’ resolution is made; if the Board of Directors
disagrees to convene an extraordinary shareholders’ meeting, it will state the reasons and make
an announcement.
The Board of Supervisors have the right to propose to the Board of Directors to convene
an extraordinary shareholders’ meeting and shall submit such request to the Board of Directors
in writing. The Board of Directors shall, in accordance with the provisions of laws,
administrative regulations, the Hong Kong Listing Rules, other regulatory rules of the places
where the Company’s shares are listed and the Articles of Association, give written feedback
on whether it agrees or disagrees with the convening of the extraordinary shareholders’ meeting
within 10 days upon receipt of the proposal.
If the Board of Directors agrees to convene an extraordinary shareholders’ meeting, the
Board of Directors will issue a notice of convening the extraordinary shareholders’ meeting
within 5 days after the Board of Directors’ resolution is made, and any changes to the original
proposal contained in the notice shall be approved by the Board of Supervisors.
If the Board of Directors disagrees to convene an extraordinary shareholders’ meeting or
fails to provide feedback within 10 days upon receipt of the proposal, it shall be deemed that
the Board of Directors is unable to perform or fails to perform its duty to convene the
shareholders’ meeting, and the Board of Supervisors shall convene and preside over the
extraordinary shareholders’ meeting of its own accord.
Shareholders individually or jointly holding 10% or more of the Company’s shares have
the right to request the Board of Directors to convene an extraordinary shareholders’ meeting,
and shall submit such request to the Board of Directors in writing. The Board of Directors
shall, in accordance with the provisions of laws, administrative regulations, the Hong Kong
Listing Rules, other regulatory rules of the places where the Company’s shares are listed and
the Articles of Association, give written feedback on whether it agrees or disagrees with the
convening of the extraordinary shareholders’ meeting within 10 days upon receipt of the
request.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-7 –


--- page 672 ---
If the Board of Directors agrees to convene an extraordinary shareholders’ meeting, the
Board of Directors will issue a notice of convening the extraordinary shareholders’ meeting
within five days after the Board of Directors’ resolution is made, and any changes to the
original request contained in the notice shall be approved by the shareholders concerned.
If the Board of Directors disagrees to convene an extraordinary shareholders’ meeting or
fails to provide feedback within 10 days upon receipt of the request, shareholders individually
or jointly holding 10% or more of the Company’s shares shall have the right to propose to the
Board of Supervisors to convene an extraordinary shareholders’ meeting and shall submit such
request to the Board of Supervisors in writing.
If the Board of Supervisors agrees to convene an extraordinary shareholders’ meeting, the
Board of Auditors will issue a notice of convening the extraordinary shareholders’ meeting
within five days upon receipt of the request, and any changes to the original request contained
in the notice shall be approved by the shareholders concerned.
If the Board of Supervisors fails to send a notice of general meeting before deadline, the
Board of Supervisors shall be deemed to be unable to convene and preside over the meeting,
the Shareholder(s) holding 10% or more of the voting Shares of the Company separately or in
aggregate for 90 or more consecutive days may convene and preside over a meeting on its/their
own.
(5) Proposals and Notices of General Meeting
At the general meeting, the Board of Directors, the Board of Supervisors and the
Shareholder(s) individually or jointly holding at least 1% Shares of the Company may propose
a proposal to the Company.
Shareholders who individually or collectively hold at least 1% of the Company’s Shares
may put forward a provisional proposal and submit it in writing to the convenor ten days prior
to the convening of the Shareholders’ meeting. Provisional proposals should have a clear topic
and a specific resolution. The convenor shall issue a supplementary notice of the general
meeting with the contents of the provisional proposal within two days after receiving the
proposal and submit the provisional proposal to the general meeting for consideration.
However, that the provisional proposal shall be in compliance with the provisions of the laws,
administrative regulations, the Hong Kong Listing Rules, other regulatory rules of the places
where the Company’s shares are listed and the Articles of Association or shall fall within the
scope of functions and powers of the shareholders’ meeting.
Subject to the above provisions, the convener after sending a notice of meeting shall not
modify the motion listed in the notice of meeting or add a new motion.
The convener shall notify all shareholders at least 21 days prior to the convening of the
annual general meetings by publishing an announcement, at least 15 days prior to the
convening of the extraordinary general meetings by publishing an announcement.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-8 –


--- page 673 ---
(6) Convention of General Meeting
All shareholders whose names appear on the register of shareholders on the registration
date or their proxies shall be entitled to attend the general meeting, and exercise their voting
rights pursuant to the relevant laws, regulations, regulatory rules of the stock exchange where
the shares of the Company are listed and the Articles of Association. Shareholders may attend
in person or appoint proxies to attend and vote at general meetings on their behalf.
Where a shareholder is a legal person or other institution, its legal
representative/managing partner or a proxy authorized by the legal representative/managing
partner shall be entitled to attend the shareholders’ meeting of the Company. The legal
representative/managing partner attending the meeting shall present his/her own identity card
and valid proof that can indicate his/her qualification as the legal representative/managing
partner. If the legal representative/managing partner authorizes a proxy to attend the meeting,
the proxy attending the meeting shall present his/her own identity card and the power of
attorney issued by the legal representative/managing partner of the shareholder as a legal
person or other institution in accordance with the law and exercise the voting right within the
scope of authorization.
The proxy form issued by a Shareholder for a general meeting shall specify:
(1) the name of the principal, class and number of shares of the Company held by the
principal;
(2) the name of the proxy;
(3) the specific instructions for voting for, against or abstaining from voting on each
matter to be considered on the agenda of the general meeting;
(4) the date and validity of the proxy form;
(5) the signature (or seal) of the appointing Shareholder; if the appointing Shareholder
is a legal person/other organization, the seal of the legal person/other organization
shall be affixed.
The proxy form shall contain a statement that in the absence of instructions from the
Shareholder, his/her proxy may vote at his/her discretion.
If the power of attorney authorizing voting rights is authorized by the principal to be
signed by others, the power of attorney signed under authorization or other authorization
documents shall be notarized. The notarized power of attorney or other authorization
documents, and the voting proxy form shall be kept at the Company’s domicile or at other
places as may be specified in the notice of convening the meeting.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-9 –


--- page 674 ---
If the appointing Shareholder is a legal person or other institution, then its proxy to attend
the general meeting shall be the legal representative (person in charge)/managing partner, or
any other person authorized by the Board of Directors or other decision-making body.
A shareholders’ meeting shall be presided by the chairman of the Board of Directors. If
the chairman of the Board of Directors is unable or fails to perform his/her duties, a director
jointly elected by a majority of the directors shall preside over the meeting.
A shareholders’ meeting convened by the Board of Supervisors of its own accord shall be
presided over by the chairman of the Board of Supervisors. If the chairman of the Board of
Supervisors is unable or fails to perform his/her duties, a supervisor jointly elected by a
majority of the supervisor shall preside over the meeting.
The shareholders’ meeting convened by shareholders of their own accord shall be
presided over by the convener or a representative elected by the convener.
When a shareholders’ meeting is held and the chairman violates the rules of procedure in
a way that makes it difficult for the shareholders’ meeting to continue, a person may be elected
at the shareholders’ meeting to act as the chairman so as to carry on with the meeting, subject
to the approval of a majority of the attending shareholders holding voting rights.
The shareholders’ meeting has meeting minutes, which shall be taken by the secretary to
the Board of Directors, and include the following contents:
(1) Date, location, agenda, and name of the convener of the meeting;
(2) The name of the meeting chairman, the directors, the supervisors and other senior
management officers attending or attending the meeting as non-voting participants;
(3) Number of shareholders and proxies attending the meeting, the total number of
shares with voting rights held by such shareholders, and the proportion over total
shares of the Company;
(4) Consideration and approval process, key points of discussion, and voting results for
each proposal;
(5) Shareholders’ inquiries or suggestions and corresponding responses or explanations;
(6) Names of lawyers and tellers and scrutineers;
(7) Other contents that shall be recorded in the meeting minutes in accordance with the
Articles of Association.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-10 –


--- page 675 ---
(7) Voting and Resolutions of General Meeting
Resolutions of Shareholders at the general meeting shall take the forms of ordinary
resolutions and special resolutions.
Ordinary resolution at a general meeting shall be adopted by an attending Shareholders
(including their proxies) holding a majority vote of the voting rights.
Special resolution at a general meeting shall be adopted by attending Shareholders
(including their proxies) holding at least two-thirds of the voting rights.
The following matters shall be passed by an ordinary resolution at a general meeting of
Shareholders:
(1) reports on the work of the Board of Directors and the Board of Supervisors;
(2) profit distribution plans and loss recovery plans drawn up by the Board of Directors;
(3) the appointment and removal of members of the Board of Directors and the Board
of Supervisors and the method of their remuneration and payment;
(4) any other matters not otherwise required by the laws, administrative regulations, the
Hong Kong Listing Rules, other regulatory rules of the places where the Company’s
shares are listed or the Articles of Association to be passed by special resolution.
The following matters shall be passed by a special resolution at a general meeting:
(1) the increase or reduction of the Company’s registered capital;
(2) the separation, division, merger, division, dissolution and liquidation of the
Company;
(3) amendments to the Articles of Association of the Company;
(4) the purchase or sale of material asset(s) or the provision of guarantee(s) by the
Company within one year with amount(s) exceeding 30% of the Company’s latest
audited total assets;
(5) equity incentive plans;
(6) Any other matters prescribed by the laws, administrative regulations, the Hong
Kong Listing Rules or the Articles of Association, and those matters approved by
ordinary resolution at a shareholders’ meeting as having a material impact on the
Company and are required to be approved by a special resolution.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-11 –


--- page 676 ---
No voting rights shall be attached to the shares held by the Company, and such shares
shall not be counted among the total number of voting shares held by the Shareholders present
at a general meeting.
BOARD OF DIRECTORS
(1) Directors
Directors of the Company shall be natural persons. A natural person who falls into any of
the following circumstances shall not serve as director of the Company:
(1) a person who suffers from any incapacity or restricted capacity from undertaking
civil liabilities;
(2) a person who has been convicted of and sentenced for offences relating to
corruption, bribery, trespass to assets, misappropriation of assets or causing socialist
market economy disorder and a period of 5 years has not elapsed since the
completion of the term of the sentence or deprivation or who has been deprived of
his political rights and imposed a suspended sentence as a result of he/she having
committed an offence and a period of 2 years has not elapsed since the completion
of the term of the suspended sentence;
(3) a person who is a director or factory manager or manager of a company or enterprise
which has become insolvent and liquidated and who incurs personal liability for the
insolvency of that company or enterprise, and a period of 3 years has not elapsed
since the date of completion of insolvent liquidation of that company or enterprise;
(4) a person who is a legal representative of a company or enterprise, the business
license of which is revoked and ordered to close down on the grounds of
contravention of law, and who incur personal liability therefor, and a period of 3
years has not elapsed since the date of revocation of the business license of that
company or enterprise or that company or enterprise being ordered to close down;
(5) a person who has been as a dishonest party by the People’s Court due to with
comparatively large debts that have fallen due but have not been settled;
(6) a person who is currently being prohibited from participating in securities market by
the CSRC and who has been publicly determined by a stock exchange to be not
suitable to act as a director of the Company, where the term has not yet expired;
(7) other matters stipulated by laws, administrative regulations, departmental rules, the
Hong Kong Listing Rules or regulatory rules of the stock exchange(s) where the
shares of the Company are listed.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-12 –


--- page 677 ---
For any election and appointment of a Director in contravention of the provisions
prescribed by this Article, such election, appointment or employment shall be void and null.
Where a Director falls into any of the aforesaid circumstances in his term of office, the Director
shall be removed from office.
Directors shall be elected and removed by a general meeting and may be dismissed by
general meeting before the expiry of their term. Directors shall have a term of three years,
which can be renewable upon expiry if re-elected.
The tenure of office of a director shall be calculated from the date of appointment until
the expiry of the current term of the Board of Directors. If the tenure of office of a director
expires but re-election is not made in a timely manner, the said director shall continue to
perform the duties as a director in accordance with the provisions of laws, administrative
regulations, departmental rules and the Articles of Association until the re-elected director
assumes office. The directors shall comply with the provisions of laws, administrative
regulations, departmental rules, regulatory rules of the stock exchange(s) where the shares of
the Company are listed and the Articles of Association.
A director may concurrently hold the position of the senior management officer. However,
the total number of directors who also hold positions as senior management officer and who
are employee representatives shall not exceed half of the total number of directors of the
Company.
If any director fails to attend in person or appoint other directors as his/her representative
to attend meetings of the Board of Directors for two consecutive times, such director shall be
deemed to have failed to perform his duties, and the Board of Directors shall propose to replace
such director at the shareholders’ meeting.
The directors may, prior to expiration of their terms of office, resign and submit their
resignation report in writing to the Board of Directors and resignation is effective on the date
of receipt of the resignation report by the Company.
If any directors resign such that the membership of the Board of Directors of the
Company falls short of the number of directors required, such director shall continue to fulfil
his/her duties as director pursuant to laws, administrative regulations, departmental rules,
regulatory rules of the stock exchange(s) where the shares of the Company are listed and the
Articles of Association until a new director is elected.
The Articles of Association do not specifically provide for the manner in which directors
may own or exercise borrowing rights, but in connection with the issuance of corporate bonds,
the Articles of Association contain an understanding that (1) the Board of Directors will
formulate a plan for the issuance of corporate bonds, and (2) the issuance of corporate bonds
will be authorised by a resolution of the general meeting.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-13 –


--- page 678 ---
(2) Board of Directors
The Board of Directors shall exercise the following functions and powers:
(1) to convene general meetings and to report on its work at the general meetings;
(2) to implement resolutions of the general meetings;
(3) to decide on the business plans and investment proposals of the Company;
(4) to prepare proposals for profit distribution and for making up accrued losses of the
Company;
(5) to prepare proposals for the increase or reduction of share capital and the issue of
bonds of the Company or other securities and listing plans;
(6) to formulate proposals for major acquisitions, purchase of the Company’s shares or
the merger, demerger, dissolution or change in the form of the Company, subject to
compliance with the provisions of the regulatory rules of the stock exchange(s)
where the shares of the Company are listed;
(7) to decide on external investment, acquisition and disposal of assets, asset mortgage,
external guarantee, consigned financial management, connected transactions,
donations, etc. of the Company within the scope authorized by the general meetings;
(8) to decide on the establishment of internal management organization of the
Company;
(9) to appoint or dismiss the president, secretary to the Board of Directors and other
senior management members of the Company and at the recommendation of the
president, to appoint or dismiss the standing vice president, executive vice
president, chief financial officer and other senior management members of the
Company, and to determine matters relating to their remuneration, rewards and
punishments;
(10) to formulate the basic management system of the Company;
(11) to prepare proposals for the amendment of the Company’s Articles of Association;
(12) to manage disclosure of information concerning the Company;
(13) to propose to general meeting for the engagement or change of the accounting firm
that provides audit for the Company;
(14) to receive reports and examine the work of the president of the Company;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-14 –


--- page 679 ---
(15) such other functions and power as authorized by the laws, administrative regulations
and departmental rules, the Hong Kong Listing Rules, regulatory rules of the place
where the Company’s shares are listed or the Articles of Association.
The Board of Directors shall have a chairman. The chairman of the Board of Directors
shall be elected by a majority of all directors of the Board of Directors.
The chairman of the Board of Directors shall exercise the following functions and powers:
(1) to preside over the shareholders’ meeting and to convene and preside over the
meetings of the Board of Directors;
(2) to supervise and inspect the implementation of resolutions of the Board of Directors;
(3) to sign material documents of the Board of Directors;
(4) in the event of force majeure emergencies, such as a major natural disaster, to
exercise special disposition powers in relation to the Company’s affairs in
compliance with legal requirements and the interests of the Company. and
subsequently report such activities to the Board of Directors and the shareholders’
meeting of the Company;
(5) to exercise any other functions and powers conferred by the Board of Directors.
The board meetings include regular meetings and extraordinary meetings. No less than
four (4) regular board meetings shall be held each year. Such regular meetings shall be
convened by the chairman of the board or a authorized person, with the notice thereof being
given in writing to all directors fourteen (14) days prior to the meeting date.
A meeting of the Board of Directors shall be held with the attendance of a majority of the
Directors. Resolutions made by the Board of Directors shall be passed by a majority of all
Directors.
When voting on the resolutions of the Board of Directors, each director shall have one
vote.
(3) Special Committees under the Board of Directors
The Company’s Board of Directors has established a Risk Control and Audit Committee
(“Audit Committee”) and performs its duties in accordance with the Company’s Articles of
Association, the working rules of the Audit Committee and the authorization of the Board of
Directors.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-15 –


--- page 680 ---
The Audit Committee meets at least once a quarter. An interim meeting may be convened
upon the proposal of two or more members, or when the convenor deems it necessary. A
meeting of the Audit Committee shall be held with the attendance of more than two-thirds of
the members.
Resolutions made by the Audit Committee shall be passed by a majority of the members
of the Audit Committee.
V oting on the resolutions of the Audit Committee shall be by one person, one vote.
Meeting minutes shall be prepared for resolutions of the Audit Committee in accordance
with the relevant regulations, and the members of the Audit Committee present at the meeting
shall sign the minutes of the meeting.
The Board of Directors is responsible for establishing the Audit Committee’s working
procedures.
The Company’s Board of Directors has established a Strategic and Sustainable
Development Committee and a Nomination and Remuneration Appraisal Committee, which
shall perform duties pursuant to Articles of Association and as authorized by the Board of
Directors. Proposals of specialized committees shall be submitted to the Board of Directors for
deliberation and decision. The Board of Directors is responsible for formulation of working
procedures for specialized committees.
SENIOR MANAGEMENT OFFICERS
The Company shall have a president, a standing vice president and several executive vice
presidents, who are appointed or dismissed by the Board of Directors.
The term of office of the president shall be three years and may be reappointed upon
re-election.
The president is accountable to the Board of Directors and exercises the following
functions and powers:
(1) to be in charge of the production, operation and management of the Company, to
organize and implement the resolutions of the Board of Directors, and to report to
the Board of Directors;
(2) to organize the implementation of the Company’s annual business plans and
investment plans;
(3) to formulate plans for the establishment of the Company’s internal management
institutions;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-16 –


--- page 681 ---
(4) to formulate plans for the establishment of the Company’s basic management
system;
(5) to formulate the rules and regulations of the Company;
(6) to propose to the Board of Directors the appointment and dismissal of the standing
vice president, executive vice president and chief financial officer;
(7) to decide on the appointment and dismissal of the management officers other than
those required to be employed or dismissed by the Board of Directors;
(8) within the scope of authorization by the Board of Directors, to decide on matters
such as foreign investment, acquisition and sale of assets, financing, pledge of
assets, external guarantee matters, and connected transactions, etc. of the Company,
except for normal sales and purchases of the Company;
(9) to exercise other functions and powers conferred by the Articles of Association and
the Board of Directors.
The president may attend meetings of the Board of Directors as a non-voting participant.
The standing vice president and executive vice president are responsible for assisting the
president to carry out the production and operation management of the Company.
The Company shall appoint a secretary to the Board of Directors, who is responsible for
the preparation of the Company’s shareholders’ meeting and meetings of the Board of
Directors, the custody of documents as well as the management of the information of the
Company’s shareholders, and the disclosure of information.
The secretary to the Board of Directors shall comply with the relevant provisions of laws,
administrative regulations, departmental rules and the Articles of Association.
BOARD OF SUPERVISORS
(1) Supervisors
The circumstances in which a person shall not be appointed as a director provided by the
Articles of Association shall be applicable to the supervisory.
Directors and senior management shall not act concurrently as supervisors.
The supervisors shall abide by the laws, administrative rules, the listing rules of the stock
exchange(s) where the Shares are listed and the Articles of Association and perform the
obligations faithfully and diligently. They shall not abuse their authority of office to obtain
bribes or other illegal income and not to misappropriate the property of the Company.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-17 –


--- page 682 ---
The provisions relating to the director’s duty of loyalty and diligence as stipulated in the
Articles of Association shall also apply to the supervisors.
Each supervisor shall serve for a term of three years. The term is renewable upon
re-election and re-appointment.
If re-election of a supervisor has not taken place prior to the end of the appointment term,
or a supervisor has resigned during his appointment term resulting in the board of supervisors
members to be less than quorum, before the re-elected supervisor takes office, the outgoing
supervisor shall nevertheless perform his duties as a supervisor in accordance with the law,
administrative rules and the Articles of Association.
The supervisors may attend Board meetings as non-voting participants, and deliver
enquiry or suggestion regarding resolutions at Board meetings.
The supervisors shall not use their connected relationship to prejudice the Company’s
interests and shall be liable for compensation to any loss caused to the Company.
Any supervisor who violates any laws, administrative regulations, departmental rules, the
listing rules of the place where the Shares are listed or the Articles of Association during the
course of performing his/her duties and causes losses to the Company shall be liable for
compensation to any loss caused to the Company.
(2) Board of Supervisors
The Company shall have the Board of Supervisors, which consists of three members. The
Board of Supervisors has a chairman who shall be elected by a majority of all supervisors. The
chairman of the Board of Supervisors shall convene and preside over the meetings of the Board
of Supervisors; if the chairman of the Board of Supervisors is unable to perform his duties or
fails to perform his duties, a supervisor selected by more than one-half of the supervisors shall
convene and preside over the meetings of the Board of Supervisors.
The Board of Supervisors shall include representatives of Shareholders and an
appropriate proportion of the employee representatives, of which not less than one-third shall
be employee representatives of the Company. The Board of Supervisors includes an employee
representative, who is elected by the employees of the Company through a democratic election
such as an employee representative meeting.
The board of supervisors shall perform the following duties:
(1) to review and provide written comments on the Company’s periodic reports prepared
by the Board of Directors;
(2) to inspect the Company’s financial position;
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-18 –


--- page 683 ---
(3) to supervise the behaviours of the Directors and senior management members in
performing their duties, and to advise on dismissal of any Directors and senior
management members who are in breach of laws, administrative regulations and the
Articles of Association;
(4) to demand the Directors and senior management members to rectify their errors if
they have acted in a harmful manner to the Company’s interest;
(5) to propose to convene an extraordinary general meeting, and where the Board fails
to perform the duties in relation to convening or presiding over a general meeting
as required by the Company Law, to convene and preside over the general meeting;
(6) to propose motions in a general meeting;
(7) to take legal actions against Directors and senior management members in
accordance with Article 189 of the Company Law;
(8) to conduct investigations whenever unusual conditions of operation of the Company
arise and if necessary, to engage professional institutions such as firms of
accountants and lawyers to assist in the investigations. Any costs arising therefore
shall be borne by the Company;
(9) to require directors and senior management to submit reports on the execution of
their duties;
(10) other powers and functions stipulated in the articles of association or granted by the
shareholders’ meeting.
The Board of Supervisors shall meet at least once every six months. Supervisors may
propose the convening of an interim the Board of Supervisors meeting, which shall be
convened by the Chairman of the Board of Supervisors within five days of receipt of the
proposal.
When the Board of Supervisors convenes a meeting, it shall notify all Supervisors five
days before the meeting. If the situation is urgent and it is necessary to convene an interim
meeting of the Board of Supervisors as soon as possible, notice of the meeting may be given
verbally or by telephone at any time, but the convenor shall make an explanation at the
meeting.
A meeting of the Board of Supervisors shall be held with the presence of a majority of
the Supervisors. Resolutions of the Board of Supervisors shall be adopted by a majority of all
Supervisors.
V oting on resolutions of the Board of Supervisors shall be on a one-person-one-vote basis.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-19 –


--- page 684 ---
FINANCIAL AND ACCOUNTING SYSTEMS, PROFIT DISTRIBUTION AND
AUDITING
(1) Financial and Accounting Systems
The Company shall establish its financial and accounting system in accordance with the
law, administrative regulations and the provisions stipulated by the relevant authorities of the
People’s Republic of China. If the financial and accounting system is otherwise provided in the
Hong Kong Listing Rules or relevant regulatory rules of the places where the Company’s
shares are listed, such regulatory rules shall prevail.
The accounting year of the Company shall be consistent with the Gregorian calendar year,
i.e. from 1 January to 31 December on the Gregorian calendar.
The Company shall not maintain books of accounts other than those provided for by law.
No assets of the Company shall be deposited into any account opened in the name of any
individual.
In distributing the after-tax profits in the current year, the Company shall allocate 10%
of such profits into its statutory reserve fund. When the aggregate amount of the statutory
reserve fund of the Company is 50% or more of its registered capital, further allocations are
not required.
Where the statutory reserve fund of the Company is insufficient to make up for the losses
of the previous year, the profits of the current year shall be used to make up for such losses
before making allocation to its statutory reserve fund in accordance with the preceding
paragraph.
After allocation of its after-tax profits to its statutory reserve fund, the Company may,
subject to the approval by resolutions of the shareholders’ meeting, allocate its after-tax profits
to its discretionary reserve fund.
After making up for the losses and making allocations to the reserve fund, any remaining
after-tax profits shall be distributed by the Company to its shareholders in proportion to their
respective shareholdings unless it is stipulated that such distribution shall not be made in
proportion to the shareholdings pursuant to the Articles of Association.
If the shareholders’ meeting has, in violation of the provision of the preceding paragraph,
distributed profits to shareholders before the Company has made up for its losses and made
allocations to its statutory reserve fund, the shareholders shall return to the Company the profit
distributed in violation of the provision. If the Company incurs losses due to such distribution,
the shareholders and the directors, supervisors, and senior management officers who are held
accountable shall be liable for compensation.
The Company’s shares held by the Company are not entitled to any profit distribution.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-20 –


--- page 685 ---
The reserve funds of the Company may be applied for making up for losses of the
Company, expansion of the Company’s production and operation or increase the capital of the
Company. When applying the reserve funds to make up for the Company’s losses, the
discretionary reserve fund and the statutory reserve fund shall be used first; if such funds are
still insufficient to make up for losses, the capital reserve fund may be applied in accordance
with relevant provisions.
Where the statutory reserve fund is converted into capital, the balance of the reserve fund
shall not fall below 25% of the Company’s registered capital prior to such conversion.
The Company may distribute dividends in the form of cash or shares.
The Company implements a continuous and stable dividend distribution policy every
year, taking into full consideration the interests of shareholders in accordance with the
operating conditions and market environment.
When the Company realizes profits in the year and meets the conditions for profit
distribution, the Board of Directors of the Company shall formulate a profit distribution plan
based on the Company’s specific operating conditions and submit it to the shareholders’
meeting for approval before implementation.
(2) Internal Auditing
The Company shall adopt an internal audit system, clarifying the leadership system,
responsibilities, authority, staffing, financial security, use of audit results and accountability
for internal audit work.
The internal audit system of the Company shall be implemented upon approval by the
Board of Directors and disclosed to the public.
The internal audit institution of the company shall supervise and inspect the business
activities, risk management, internal control and financial information of the company.
The internal audit institution of the Company shall be responsible to the Board of
Directors.
(3) Appointment of Accountant Firm
The Company shall appoint an accounting firm that complies with the provisions of the
Securities Law, the Hong Kong Listing Rules and other securities regulatory rules of the places
where the Company’s shares are listed to conduct audits of accounting statements, verification
of net assets, and other related consulting services, etc., with a term of one year, which is
renewable.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-21 –


--- page 686 ---
The engagement and dismissal of the accounting firm by the Company shall be approved
by more than half of the members of the Audit Committee, submitted to the Board for
consideration and approval and shall be decided at the Shareholders’ meeting. The Board of
Directors shall not appoint an accounting firm prior to the decision made by the shareholders’
meeting.
The Company shall ensure the provision of true and complete accounting vouchers,
accounting books, financial and accounting reports and other accounting information to the
appointed accounting firm without any refusal, concealment or misrepresentation.
The audit fees of the accounting firm shall be determined by the shareholders’ meeting.
When the Company removes or does not renew the appointment of the accounting firm,
it shall notify the accounting firm 5 days in advance, and the accounting firm shall be allowed
to state its opinions when the Company’s shareholders’ meeting votes on the removal of the
accounting firm.
If the accounting firm resigns, it shall make clear to the shareholders’ meeting whether
there is any impropriety on the part of the Company.
NOTICE AND ANNOUNCEMENT
Notices of the Company may be delivered through the following means:
(1) by hand;
(2) by mail;
(3) by email;
(4) by way of announcement;
(5) by other forms recognized by the regulator of the place where the Company’s shares
are listed or as provided for in the Articles of Association.
Notices given by the Company by way of announcements shall be deemed to be received
by all parties concerned once published.
For a notice of the Company delivered by hand, the notice shall be deemed to have been
received upon signing (or affixing the seal) by the recipient on the note of receipt and the
receipt date shall be the date of delivery. If the notice is delivered by post, it shall be deemed
to have been received on the third working day from the date upon which the post office
receives the notice. If the notice is delivered by email, it shall be deemed to have been received
on the date the e-mail arrives at the information system of the person to be served. If the notice
is delivered by way of announcement, it shall be deemed to have been received by all relevant
persons on the date on which the announcement is published.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-22 –


--- page 687 ---
The accidental omission to give a meeting notice to, or the failure of receipt of the
meeting notice by, a person entitled to receive notice shall not invalidate any meeting and any
resolution passed thereat.
Announcements of the Company are published on the Hong Kong Stock Exchange and/or
the Company’s website in accordance with the relevant provisions of the Hong Kong Listing
Rules. The Board of Directors has the right to decide and adjust the determined media for
disclosure of the Company’s information, but shall ensure that the relevant media for
disclosure of information complies with the relevant laws and regulations and the regulatory
rules of the places where the shares of Company are listed.
MERGER, DIVISION, INCREASE AND DECREASE OF CAPITAL, DISSOLUTION
AND LIQUIDATION
(1) Merger, Demerger, Capital Increase and Reduction
The merger of the Company may take the form of either merger by absorption or merger
by establishment of a new entity.
Merger by absorption refers to the merger realized by a company through the absorption
of other companies, in which case the absorbed companies are dissolved. Merger by the
establishment of a new entity refers to the merger of two or more companies to create a new
company, in which case the merging parties are dissolved.
In the event of a division of the Company, its properties shall be divided up accordingly.
In the event of a division, the Company shall prepare balance sheets and inventories of
properties. The Company shall notify its creditors within 10 days from the date on which a
resolution is adopted in favor of the division and shall publish an announcement in a newspaper
or in the National Enterprise Credit Information Publicity System within 30 days from the date
of such resolution.
Unless otherwise agreed in writing between the Company and its creditors in relation to
the repayment of debts before the division, the surviving companies after the division shall be
jointly and severally liable for the debts of the Company which have been incurred before such
division.
The Company shall prepare balance sheets and inventories of properties when it reduces
its registered capital.
The Company shall notify its creditors within 10 days from the date on which a resolution
to reduce the registered capital is adopted and shall publish an announcement in a newspaper
or in the National Enterprise Credit Information Publicity System within 30 days from the date
of such resolution. A creditor has the right to require the Company to repay its debts or to
provide a corresponding guarantee for such debts within 30 days from the date it receives the
relevant notice or, in the case of a creditor who did not receive such notice, within 45 days from
the date of the relevant announcement.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-23 –


--- page 688 ---
(2) Dissolution and Liquidation
The Company shall be dissolved in any of the following circumstances:
(1) The business period specified in the Articles of Association is expired or other
causes of dissolution specified therein take place;
(2) The shareholders’ meeting resolves to dissolve the Company;
(3) Dissolution is necessary due to a merger or demerger of the Company;
(4) The business license is revoked, or the company is ordered to close or be shut down
according to law;
(5) Where the Company has experienced material difficulties in operation and
management, and the continuous operation would lead to substantial losses to the
interests of its shareholders and there are no other solutions to resolve the matters,
shareholders holding 10% or more of the total voting rights of the Company may
appeal to the People’s Court for dissolution of the Company.
When causes for the dissolution as stipulated in the preceding paragraph occur, it shall
disclose the reasons for dissolution through the National Enterprise Credit Information
Publicity System within ten days.
Where the Company is in the situation described in items (1) and (2) above and has not
distributed any property to shareholders, it may continue to exist by amending the Articles of
Association or a resolution passed by the general meeting.
The amendments to the Articles of Association in accordance with the provisions in the
preceding article shall require the approval of at least two-thirds of the voting rights held by
Shareholders attending the general meeting.
The liquidation committee shall notify all creditors within 10 days after its establishment
and shall publish at least three announcements in newspapers within 60 days in a regional or
national newspaper designated by the liquidation committee or recognized by the company
registration authority or the National Enterprise Credit Information Publicity System. The
creditors shall declare their claims to the liquidation committee within 30 days from the date
of receipt of the notice or within 45 days from the date of the announcement if they have not
received the notice.
A creditor declaring a claim shall state the matters to which the claim relates and provide
supporting documents. The liquidation committee shall register the claim.
During the period of declaration of claims, the liquidation group shall not make any
settlement to the creditors.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-24 –


--- page 689 ---
The liquidation committee shall formulate a liquidation plan after dealing with the
Company’s assets and compiling a balance sheet and a list of assets, and report it to a general
meeting or the people’s court for confirmation.
The remaining assets of the Company after paying the liquidation expenses, employees’
wages, social insurance costs and statutory compensation, paying the outstanding taxes and
settling the Company’s debts respectively, shall be distributed to the shareholders of the
Company in proportion to their shareholding.
During the liquidation period, the Company shall exist, but cannot engage in operating
activities that are not related to the liquidation. The assets of the Company shall not be
distributed to the shareholders until it has been liquidated in accordance with the preceding
paragraph.
If the liquidation committee, after examining the assets of the Company and preparing the
balance sheet and a list of assets, finds that the assets of the Company is insufficient to satisfy
its debts, it shall, in accordance with the law, apply to the People’s Court to declare the
Company’s bankruptcy.
Following a ruling by the people’s court that the Company is declared bankrupt, the
liquidation committee shall hand over all matters relating to the liquidation to the bankruptcy
administrator appointed by the people’s court.
Following the completion of the liquidation of the Company, the liquidation committee
shall make a liquidation report, report to the general meeting of or the People’s Court for
confirmation, and submit it to the company registration authority, apply for cancellation of the
company registration.
Liquidation of a company declared bankrupt in accordance with the laws shall be
processed in accordance with the laws of corporate bankruptcy.
AMENDMENT TO THE ARTICLES OF ASSOCIATION
The Company shall amend its articles of association in one of the following
circumstances:
(1) Subsequent to the amendment of the Company Law or relevant laws and
administrative regulations, the Hong Kong Listing Rules and other securities
regulatory rules of the places where the Company’s shares are listed, the matters
stipulated in the Articles of Association are in conflict with the provisions of the
amended laws, administrative regulations and the Hong Kong Listing Rules;
(2) The Company has experienced changes, resulting in matters inconsistent with those
recorded in the Articles of Association;
(3) The shareholders’ meeting decides to amend the Articles of Association.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-25 –


--- page 690 ---
Matters of amendment of the Articles of Association adopted by resolution of the general
meeting shall be submitted to the competent authorities for approval; if they involve matters
of the Company’s registration, the registration of the changes shall be made in accordance with
the law.
The Board of Directors shall amend the Articles of Association in accordance with the
resolution of the general meeting to amend the Articles of Association and the approval of the
relevant competent authorities.
Matters of amendment of the Articles of Association are information required to be
disclosed by laws and regulations and shall be announced in accordance with the regulations.
APPENDIX V SUMMARY OF ARTICLES OF ASSOCIATION
– V-26 –


--- page 691 ---
A. FURTHER INFORMATION ABOUT OUR GROUP
1. Incorporation of our Company
Our Company was incorporated in the PRC under the PRC Company Law as a limited
liability company on January 8, 1997 and then converted into a joint stock limited liability
company on March 24, 2008. Our registered office is at No. 8 Changchun Road, Economic and
Technological Development Zone, Wuhu, Anhui Province, the PRC. We have established a
place of business in Hong Kong at 31/F, Tower Two, Times Square, 1 Matheson Street,
Causeway Bay, Hong Kong. Our Company was registered with the Companies Registry in
Hong Kong as a non-Hong Kong company under Part 16 of Companies Ordinance of Hong
Kong on March 25, 2025. Ms. Y u Wing Sze has been appointed as the authorized representative
of our Company for the acceptance of service of process in Hong Kong. The address for service
of process on our Company in Hong Kong is the same as its principal place of business in Hong
Kong set out above.
As our Company was incorporated in the PRC, our operation, corporate structure and the
Articles of Association are subject to the relevant laws and regulations of the PRC. A summary
of certain aspects of the relevant laws and regulations of the PRC, and a summary of certain
aspect of our Articles of Association are set out, respectively, in Appendix IV and Appendix V
to this prospectus.
2. Change in share capital of our Company
Our registered capital as at the date of our incorporation was RMB1,680,000,000, which
has been fully paid up. On March 24, 2008, our Company was converted into a joint stock
limited company, and the registered capital of our Company was RMB3,200,000,000 divided
into 3,200,000,000 Shares with a nominal value of RMB1.00 each. As at the Latest Practicable
Date, our share capital was RMB5,469,831,633.
Immediately following the completion of the Global Offering and the conversion of
Domestic Unlisted Shares into H Shares, assuming the Over-allotment Option is not exercised,
the share capital of our Company will be RMB5,767,228,633 divided into 3,453,832,559
Unlisted Shares and 2,313,396,074 H Shares.
Save as disclosed above in this appendix, there has been no alteration in the share capital
of our Company within the two years immediately preceding the date of this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-1 –


--- page 692 ---
3. The extraordinary general meeting of our Company held on February 15, 2025
Pursuant to the extraordinary general meeting of our Company held on February 15, 2025,
the following resolutions, among other resolutions, were duly passed:
(a) the issue by our Company of the H Shares with a nominal value of RMB1.00 each,
representing up to 15% of the total share capital of our Company upon completion
of the Global Offering (before the exercise of the Over-allotment Option) and such
H Shares being listed on the Stock Exchange;
(b) the granting of the Over-allotment Option in respect of no more than 15% of the
number of H Shares issued as mentioned above;
(c) subject to the completion of the filing with the CSRC, upon completion of the
Global Offering, 2,015,999,074 Domestic Unlisted Shares held by certain existing
Shareholders will be converted into H Shares on a one-for-one basis;
(d) subject to the completion of the Global Offering, the Articles of Association have
been approved and adopted which will become effective from the Listing Date, and
the Board and person(s) authorized by the Board have been authorized to amend the
Articles of Association in accordance with any comments from the Stock Exchange
and the relevant PRC regulatory authorities; and
(e) approving the Board and person(s) authorized by the Board to handle all matters
relating to, among other things, the issue and the Listing of H Shares on the Stock
Exchange.
4. Changes in share capital of our subsidiaries
The following sets out the changes of the share capital of our subsidiaries as at the end
of the Track Record Period within the two years immediately preceding the date of this
prospectus:
On June 21, 2023, the registered capital of Chery Auto Malaysia Sdn. Bhd. increased from
RM1 to RM1,000,001.
On August 30, 2023, the registered capital of Hefei Ruituo Microelectronics Co., Ltd.*
(ʮ̡) decreased from RMB50,000,000 to RMB25,000,000.
On November 7, 2023, the registered capital of Chery New Energy increased from
RMB900,000,000 to RMB1,033,689,839.
On June 14, 2024, the registered capital of Yingfeng Investment Co., Ltd.* (ᔮҳ༟Ϟ
ʮ̡) increased from RMB60,000,000 to RMB120,000,000.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-2 –


--- page 693 ---
On June 21, 2024, the registered capital of Wuhu Aiman Equipment Engineering Co.,
Ltd.* (ʮ̡) increased from RMB2,353,000 to RMB10,000,000.
On June 25, 2024, Omoda & Jaecoo (Thailand) Co., Ltd. was established in Thailand with
a registered capital of THB1,000,000, and on July 31, 2024, the registered capital of Omoda
& Jaecoo (Thailand) Co., Ltd. increased to THB101,000,000.
On July 3, 2024, the issued share capital of O&J (Hongkong) Automobile Investment Co.,
Limited ( ᆄ௫(ಥ)ʮ̡) increased from US$61,000,000 to US$136,000,000,
and further increased to US$181,000,000 on December 5, 2024.
On July 11, 2024, the registered capital of Wuhu Qida Power Battery Systems Co., Ltd.*
(ʮ̡) increased from RMB28,980,000 to RMB228,980,000.
On August 30, 2024, the registered capital of Guizhou Yingfeng Southwest Sales Service
Co., Ltd.* (ʮ̡) increased from RMB3,000,000 to
RMB10,000,000.
On September 23, 2024, the registered capital of Jiangsu Ailios Technology Co., Ltd.* ( Ϫ
ʮ̡) increased from RMB50,000,000 to RMB100,000,000.
On October 14, 2024, the registered capital of Anhui Fuzhen Automotive Power System
Co., Ltd.* (ʮ̡) decreased from RMB920,000,000 to
RMB890,000,000.
On December 4, 2024, the registered capital of Wuhu Laite Sichuang Automotive Parts
Co., Ltd.* (ʮ̡) increased from RMB50,000,000 to
RMB100,000,000.
On March 24, 2025, the registered share capital of Anhui Yineng Automotive Technology
Co., Ltd.* (ʮ̡) increased from RMB100,000,000 to
RMB109,291,700.
On June 13, 2025, the registered capital of Jetour Sales increased from RMB500,000,000
to RMB2,000,000,000.
On July 12, 2025, the registered capital of OMODA & JAECOO BRAZIL AUTOMOBILE
LTDA increased from BRL8,743,100 to BRL292,687,099.
Save as disclosed above in this appendix, there has been no alteration in the share capital
of our subsidiaries within the two years immediately preceding the date of this prospectus.
5. Restrictions of share repurchase
For details of the restrictions on the share repurchase by our Company, please refer to the
sections headed “Appendix IV — Summary of Principal Legal and Regulatory Provisions” and
“Appendix V — Summary of Articles of Association” to this prospectus.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-3 –


--- page 694 ---
B. FURTHER INFORMATION ABOUT OUR BUSINESS
1. Summary of material contracts
The following contracts (not being contracts in the ordinary course of business) were
entered into by us or any of our subsidiaries within the two years preceding the date of this
prospectus and are or may be material:
(a) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, JSC International Investment Fund SPC (acting for and on behalf of
ShanRui SP), China International Capital Corporation Hong Kong Securities
Limited, Huatai Financial Holdings (Hong Kong) Limited, GF Capital (Hong Kong)
Limited, GF Securities (Hong Kong) Brokerage Limited and CLSA Limited,
pursuant to which JSC International Investment Fund SPC (acting for and on behalf
of ShanRui SP) agreed to subscribe for H Shares at the Offer Price in the aggregate
amount of HK$1,480.00 million;
(b) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, HHLR Advisors, Ltd., China International Capital Corporation Hong
Kong Securities Limited, Huatai Financial Holdings (Hong Kong) Limited, GF
Capital (Hong Kong) Limited, GF Securities (Hong Kong) Brokerage Limited and
CLSA Limited, pursuant to which HHLR Advisors, Ltd. agreed to subscribe for H
Shares at the Offer Price in the aggregate amount of Hong Kong dollar equivalent
of US$60.00 million;
(c) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, CICC Financial Trading Limited, China International Capital
Corporation Hong Kong Securities Limited, Huatai Financial Holdings (Hong
Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities (Hong Kong)
Brokerage Limited and CLSA Limited, pursuant to which CICC Financial Trading
Limited agreed to subscribe for H Shares at the Offer Price in the aggregate amount
of Hong Kong dollar equivalent of US$55.00 million and hold such H Shares on a
non-discretionary basis to hedge a series of cross-border delta-one OTC swap
transactions entered into by CICC Financial Trading Limited, China International
Capital Corporation Limited and certain domestic private funds managed by
Shanghai Greenwoods Asset Management Co., Ltd. (ʮ̡);
(d) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Greenwoods Asset Management Hong Kong Limited, China
International Capital Corporation Hong Kong Securities Limited, Huatai Financial
Holdings (Hong Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities
(Hong Kong) Brokerage Limited and CLSA Limited, pursuant to which Greenwoods
Asset Management Hong Kong Limited agreed to subscribe for H Shares at the Offer
Price in the aggregate amount of Hong Kong dollar equivalent of US$5.00 million;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-4 –


--- page 695 ---
(e) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Huangshan Construction Investment (Hong Kong) International
Limited (ҳ(ಥ)ʮ̡), Huangshan Construction Investment
Private Equity Fund Management Co., Ltd.* (ʮ̡),
China International Capital Corporation Hong Kong Securities Limited, Huatai
Financial Holdings (Hong Kong) Limited, GF Capital (Hong Kong) Limited, GF
Securities (Hong Kong) Brokerage Limited and CLSA Limited, pursuant to which
Huangshan Construction Investment (Hong Kong) International Limited agreed to
subscribe for H Shares at the Offer Price in the aggregate amount of Hong Kong
dollar equivalent of US$41.00 million;
(f) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Jinghui Ruiying (Hong Kong) Limited (ޮ(ಥ)ʮ̡),
Hefei Jinghui Ruiying Enterprise Management Consulting Partnership Enterprise
(Limited Partnership)* (Άุ၍ଣፔ༔ΥྫΆุ(Υྫ)), China
International Capital Corporation Hong Kong Securities Limited, Huatai Financial
Holdings (Hong Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities
(Hong Kong) Brokerage Limited and CLSA Limited, pursuant to which Jinghui
Ruiying (Hong Kong) Limited agreed to subscribe for H Shares at the Offer Price
in the aggregate amount of Hong Kong dollar equivalent of US$41.00 million;
(g) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Horizon Together Holding Ltd., China International Capital
Corporation Hong Kong Securities Limited, Huatai Financial Holdings (Hong
Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities (Hong Kong)
Brokerage Limited and CLSA Limited, pursuant to which Horizon Together Holding
Ltd. agreed to subscribe for H Shares at the Offer Price in the aggregate amount of
Hong Kong dollar equivalent of US$40.00 million;
(h) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Dajia Life Insurance Co., Ltd.* (ʮ̡), China
International Capital Corporation Hong Kong Securities Limited, Huatai Financial
Holdings (Hong Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities
(Hong Kong) Brokerage Limited and CLSA Limited, pursuant to which Dajia Life
Insurance Co., Ltd. agreed to subscribe for H Shares at the Offer Price in the
aggregate amount of Hong Kong dollar equivalent of US$33.00 million;
(i) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Martis Fund, L.P ., China International Capital Corporation Hong
Kong Securities Limited, Huatai Financial Holdings (Hong Kong) Limited, GF
Capital (Hong Kong) Limited, GF Securities (Hong Kong) Brokerage Limited and
CLSA Limited, pursuant to which Martis Fund, L.P . agreed to subscribe for H Shares
at the Offer Price in the aggregate amount of Hong Kong dollar equivalent of
US$33.00 million;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-5 –


--- page 696 ---
(j) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, GOTION HIGH-TECH (HK) LIMITED (߅(ಥ)ʮ̡),
Gotion High-tech Co., Ltd.* (ʮ̡), China International Capital
Corporation Hong Kong Securities Limited, Huatai Financial Holdings (Hong
Kong) Limited, GF Capital (Hong Kong) Limited, GF Securities (Hong Kong)
Brokerage Limited and CLSA Limited, pursuant to which GOTION HIGH-TECH
(HK) LIMITED agreed to subscribe for H Shares at the Offer Price in the aggregate
amount of Hong Kong dollar equivalent of US$29.00 million;
(k) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Hefei Jianhui Zhanxin Cornerstone Investment Company Limited ( Υ
ʮ̡), Hefei Jianhui Zhanxin Equity Investment Fund
Partnership Enterprise (Limited Partnership)* (ΥྫΆ
ุ(Υྫ)), China International Capital Corporation Hong Kong Securities
Limited, Huatai Financial Holdings (Hong Kong) Limited, GF Capital (Hong Kong)
Limited, GF Securities (Hong Kong) Brokerage Limited and CLSA Limited,
pursuant to which Hefei Jianhui Zhanxin Cornerstone Investment Company Limited
agreed to subscribe for H Shares at the Offer Price in the aggregate amount of Hong
Kong dollar equivalent of US$20.00 million;
(l) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, PSBC Wealth Management Co., Ltd.* (ப΂ʮ̡),
China International Capital Corporation Hong Kong Securities Limited, Huatai
Financial Holdings (Hong Kong) Limited, GF Capital (Hong Kong) Limited, GF
Securities (Hong Kong) Brokerage Limited and CLSA Limited, pursuant to which
PSBC Wealth Management Co., Ltd. agreed to subscribe for H Shares at the Offer
Price in the aggregate amount of Hong Kong dollar equivalent of US$20.00 million;
(m) the cornerstone investment agreement dated September 13, 2025 entered into among
our Company, Xingyu Automotive Lighting (Hong Kong) Company Limited (ρ
ԓዱ(ಥ)ʮ̡), China International Capital Corporation Hong Kong
Securities Limited, Huatai Financial Holdings (Hong Kong) Limited, GF Capital
(Hong Kong) Limited, GF Securities (Hong Kong) Brokerage Limited and CLSA
Limited, pursuant to which Xingyu Automotive Lighting (Hong Kong) Company
Limited agreed to subscribe for H Shares at the Offer Price in the aggregate amount
of Hong Kong dollar equivalent of US$20.00 million; and
(n) the Hong Kong Underwriting Agreement.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-6 –


--- page 697 ---
2. Intellectual property rights
(a) Trademarks
As at the Latest Practicable Date, we have registered the following trademarks which are
material to our Group’s business:
No. Trademark
Registration
number
Registered
owner
Place of
registration Class Expiration date
1 /H1118/H1118
 1436407 Our Company PRC 12 August 20, 2030
2 /H1118/H1118
 1566119 Our Company PRC 12 May 6, 2031
3 /H1118/H1118
 3942392 Our Company PRC 12 June 27, 2026
4 /H1118/H1118CHERY 40547375 Our Company PRC 12 May 13, 2030
5 /H1118/H1118
 4855639 Our Company PRC 12 July 27, 2028
6 /H1118/H1118
 24948034 Our Company PRC 12 July 20, 2028
7 /H1118/H1118
 66599776 Our Company PRC 12 May 6, 2034
8 /H1118/H1118
 27319464 Our Company PRC 12 November 6,
2028
9 /H1118/H1118
 65325179 Our Company PRC 12 July 27, 2033
10 /H1118
 12010303 Our Company PRC 12 June 27, 2034
11 /H1118
 72832754 Our Company PRC 12 January 13, 2034
12 /H1118ޢ40826374 Our Company PRC 12 April 20, 2030
13 /H1118 iCAR 16721425A Chery New
Energy
PRC 12 June 20, 2026
14 /H1118
 12593193 Our Company PRC 12 October 13, 2034
15 /H1118
 12593171 Our Company PRC 12 October 13, 2034
16 /H1118
 4507285 Our Company PRC 12 November 20,
2027
17 /H1118
 4523626 Our Company PRC 12 November 20,
2027
18 /H1118
 74652993 Our Company PRC 12 April 13, 2034
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-7 –


--- page 698 ---
No. Trademark
Registration
number
Registered
owner
Place of
registration Class Expiration date
19 /H1118
 368010 Our Company United Arab
Emirates
12 December 30,
2031
20 /H1118
 187534 Our Company Jordan 12 November 27,
2032
21 /H1118
 30 2022 111 570 Our Company Germany 12 July 18, 2032
22 /H1118
 927373874 Our Company Brazil 12 November 14,
2033
23 /H1118
 301069 Our Company Peru 12 December 9, 2030
24 /H1118
 302603376 Our Company Hong Kong 12 May 8, 2033
25 /H1118
 1057459 Our Company Chile 12 November 15,
2033
26 /H1118
 1443017396 Our Company Saudi Arabia 12 September 30,
2031
27 /H1118
 1443019457 Our Company Saudi Arabia 12 September 30,
2031
28 /H1118
 306792652 Our Company Hong Kong 12,
37
January 21, 2035
29 /H1118
 306727465 Our Company Hong Kong 12,
37
November 14,
2034
30 /H1118
 306727456 Our Company Hong Kong 12,
37
November 14,
2034
31 /H1118
 306727410 Our Company Hong Kong 12,
37
November 14,
2034
32 /H1118
 306727429 Our Company Hong Kong 12,
37
November 14,
2034
33. /H1118
 306794245 Our Company Hong Kong 12,
37
January 22, 2035
34. /H1118
 306794254 Our Company Hong Kong 12,
37
January 22, 2035
35. /H1118
 306727447 Our Company Hong Kong 12,
37
November 14,
2034
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-8 –


--- page 699 ---
(b) Patents
As at the Latest Practicable Date, we have registered the following patents which are
material to our Group’s business:
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
1 /H1118/H1118Miller cycle gasoline
engine
(೯ਗ
ዚ)
CN202010965048.1 Our Company PRC Invention September 15,
2020
December 28,
2021
2 /H1118/H1118A split type new
energy vehicle body
structure and
assembly method ( ɓ
၇ʱ᜗όอঐ๕ӛԓ
ԓԒഐ࿴ʿՉଡ଼ༀ˙
ج)
CN202210778623.6 Our Company PRC Invention June 30, 2022 October 31, 2023
3 /H1118/H1118Dual motor torque
distribution method
and device ( ᕐཥዚҩ
ձༀໄ)
CN202011546896.5 Our Company PRC Invention December 24,
2020
July 8, 2022
4 /H1118/H1118Display device and
vehicle
(ᜑͪༀໄձԓሿ)
CN202210425564.4 Wuhu Automotive
Forward
Technology
Research Institute
Co., Ltd., Our
Company
PRC Invention April 21, 2022 March 29, 2024
5 /H1118/H1118Front body structure
and car
(௅ഐ࿴ձӛ
ԓ)
CN202011357273.3 Our Company PRC Invention November 27,
2020
July 12, 2022
6 /H1118/H1118Automatic parking
fault handling
method, device and
vehicle
(ღஈଣ
eༀໄʿԓሿ)
CN202011566036.8 Dazuo Intelligent
Technology Co.,
Ltd., Dazhuo
Quxing Intelligent
Technology
(Shanghai) Co.,
Ltd.
PRC Invention December 25,
2020
July 15, 2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-9 –


--- page 700 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
7 /H1118/H1118Test method, device,
equipment and
storage medium for
electric vehicle
driving range ( ཥਗӛ
಻༊˙
eༀໄeண௪ձπ
Ꮇʧሯ)
CN202210615056.2 Our Company PRC Invention May 31, 2022 November 24,
2023
8 /H1118/H1118Head-up displays and
systems (᎘ᜑͪኜ
ձӻ୕)
CN202111403888.X Wuhu Automotive
Forward
Technology
Research Institute
Co., Ltd., our
Company
PRC Invention November 24,
2021
April 14, 2023
9 /H1118/H1118Automotive thermal
management systems,
methods and devices
(ᆠ၍ଣӻ୕e
ձༀໄ)
CN202110858397.8 Our Company PRC Invention July 28, 2021 January 3, 2023
10 /H1118/H1118An automotive engine
compartment
structure and an
automotive ( ɓ၇ӛԓ
೯ਗዚጵഐ࿴ʿӛԓ)
CN202211306292.2 Our Company PRC Invention October 25, 2022 March 1, 2024
11 /H1118/H1118An electric vehicle
energy recovery
method and device
(ཥਗӛԓঐඎΫϗ˙
ʿༀໄ)
CN201910613463.8 Chery New
Energy
PRC Invention July 9, 2019 April 12, 2022
12 /H1118/H1118An exhaust gas
turbocharger pressure
control method and
device a coating
modification ( ᄻंಶ
ᏀɢછՓ
ʿༀໄ)
CN201911064920.9 Our Company PRC Invention November 4,
2019
May 3, 2022
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-10 –


--- page 701 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
13 /H1118/H1118Sodium ion layer
cathode material and
preparation method
thereof ( ɓ၇̍ᔧҷ
͍฽ҿ
ج)
CN202310326147.9 Anhui Deyi
Energy
Technology Co.,
Ltd.
PRC Invention March 29, 2023 April 2, 2024
14 /H1118/H1118Hydraulic supply
system, a control
method, and an
automobile ( ૰ᏀԶഗ
ʿӛ
ԓ)
CN201910680738.X Our Company PRC Invention July 26, 2019 July 30, 2021
15 /H1118/H1118Thermal energy
consumption
evaluation method,
device and a vehicle
having the same ( ԓ
ᆠঐঃ൙ᄆ˙
ٙ
ԓሿ)
CN202011504804.7 Our Company PRC Invention December 18,
2020
April 9, 2024
16 /H1118/H1118Message transmission
method and device
(ʿༀ
ໄ)
CN201410586534.7 Our Company PRC Invention October 28, 2014 January 25, 2019
17 /H1118/H1118A system and a
method for obtaining
vehicle information
(ٙࢹڦ
eӛԓ)
CN202011329712.X Our Company PRC Invention November 24,
2020
August 31, 2021
18 /H1118/H1118Hybrid power system
(૿Υਗɢӻ୕)
CN202111232576.7 Our Company PRC Invention October 22, 2021 September 26,
2023
19 /H1118/H1118Wake-up method,
device and storage
medium of vehicle
communication
controller (ڦ
e
ༀໄʿπᎷʧሯ)
CN201810528636.1 Our Company PRC Invention May 29, 2018 October 9, 2020
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-11 –


--- page 702 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
20 /H1118/H1118Regenerative braking
system of electric
vehicle and its
control method ( ཥਗ
ӛԓΎ͛Փਗӻ୕ʿ
ج)
CN201510834747.1 Our Company PRC Invention November 24,
2015
June 26, 2018
21 /H1118/H1118A collapsible anti-
falling energy-
absorbing automobile
steering column ( ɓ၇
̙ᆖᐵԣ୭ໝіঐό
ݒ)
CN201610518022.6 Our Company PRC Invention July 4, 2016 August 14, 2018
22 /H1118/H1118Hybrid powertrain,
control method and
automobile ( ૿Υਗɢ
ج
ʿӛԓ)
CN201811355029.6 Our Company PRC Invention November 14,
2018
April 27, 2021
23 /H1118/H1118Response strategy of
electric power
steering system to
torque request of lane
keeping system ( ཥਗ
пɢᔷΣӻ୕࿁ԓ༸
ٙ
ᚤᏐഄଫ)
CN201910367062.9 Our Company PRC Invention May 5, 2019 April 27, 2021
24 /H1118/H1118A method for
modeling one-
dimensional thermal
models of battery
packs using 3D and
1D coupling
calibration ( ɓ၇л͜
3Dձ1Dཥ
ᅼ
ج)
CN201911322362.1 Our Company PRC Invention December 20,
2019
March 28, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-12 –


--- page 703 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
25 /H1118/H1118A structure of a
longitudinal beam
wheel cover area for
improving front
impact performance
(ٙ
ഐ࿴)
CN202011098336.8 Our Company PRC Invention October 14, 2020 April 8, 2022
26 /H1118/H1118Method of starting
lane keeping
function, device and
computer storage
medium (̌
eༀໄ
ၑዚπᎷʧሯ)
CN202110035470.1 Our Company PRC Invention January 12, 2021 July 12, 2022
27 /H1118/H1118Supercharged engine
intake system and
supercharged engine
(ᄣᏀ೯ਗዚආंӻ୕
ʿᄣᏀ೯ਗዚ)
CN202111086329.0 Our Company PRC Invention September 16,
2021
September 16,
2022
28 /H1118/H1118Hybrid power system
and control method
(૿Υਗɢӻ୕ʿછՓ
ج)
CN201810861961.X Our Company PRC Invention August 1, 2018 May 28, 2021
29 /H1118/H1118A braking energy
recovery control
method ( ɓ၇Փਗঐ
ج)
CN201410634945.9 Our Company PRC Invention November 13,
2014
March 22, 2017
30 /H1118/H1118A control system for
the recovery of
automotive braking
energy (ӛԓ
છՓ
ӻ୕)
CN201510257668.9 Our Company PRC Invention May 19, 2015 October 20, 2017
31 /H1118/H1118A control method of
an automobile active
collision avoidance
system ( ɓ၇ӛԓ˴ਗ
ج)
CN201510295286.5 Our Company PRC Invention June 3, 2015 May 10, 2017
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-13 –


--- page 704 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
32 /H1118/H1118An energy recovery
system and method
for electric vehicle
based on line control
motion ( ɓ၇ཥਗӛ
ঐ
ج)
CN201710207434.2 Our Company PRC Invention March 31, 2017 March 24, 2020
33 /H1118/H1118A sequential control
method for power-on
and power-off of a
plug-in hybrid vehicle
(ɓ၇ౢཥό૿Υਗɢ
ҏછՓ
ج)
CN201710391112.8 Our Company PRC Invention May 27, 2017 April 7, 2020
34 /H1118/H1118Fatigue driving
reminder method,
device and storage
medium ( ह௶ቷት౤
eༀໄʿπᎷ
ʧሯ)
CN201810811476.1 Our Company PRC Invention July 23, 2018 February 2, 2021
35 /H1118/H1118V ehicle human-
computer interaction
method and system
(ʿ
ӻ୕)
CN201810811473.8 Our Company PRC Invention July 23, 2018 November 2,
2021
36 /H1118/H1118Parking control
method, device and
storage medium (ԓ
eༀໄʿπ
Ꮇʧሯ)
CN201811049913.7 Our Company PRC Invention September 10,
2018
September 16,
2022
37 /H1118/H1118An automobile
application software
management system
and a method thereof
(ɓ၇ӛԓᏐ͜ழ΁၍
eӛԓ)
CN202011329711.5 Our Company PRC Invention November 24,
2020
April 18, 2023
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-14 –


--- page 705 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
38 /H1118/H1118Thermal management
systems for plug-in
hybrid electric
vehicles and plug-in
hybrid electric
vehicles ( ౢཥό૿Υ
ᆠ၍ଣӻ
୕ʿౢཥό૿Υਗɢ
ӛԓ)
CN202111013433.7 Our Company PRC Invention August 31, 2021 May 26, 2023
39 /H1118/H1118Method, device and
storage medium for
determining
calibration parameters
of head-up display
(֛
eༀໄʿ
πᎷʧሯ)
CN202210332609.3 Our Company PRC Invention March 30, 2022 March 28, 2023
40 /H1118/H1118A system, a method
and vehicle for
obtaining vehicle
information ( ᐏ՟ԓ
ج
ʿԓሿ)
2023/04614 Our Company South Africa Invention September 27,
2021
December 20,
2023
41 /H1118/H1118Methods of vehicle
and device location
(˙
ج)
2023/04392 Our Company South Africa Invention October 9, 2021 December 20,
2023
42 /H1118/H1118Methods of vehicle
and device location
(˙
ج)
523440324 Our Company Saudi Arabia Invention October 9, 2021 April 22, 2024
43 /H1118/H1118Message transmission
method and device
(ʿༀ
ໄ)
US15521709 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
USA Invention September 29,
2015
August 20, 2019
44 /H1118/H1118An automobile battery
protection structure
(ᚐഐ
࿴)
US15515285 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
USA Invention October 19, 2015 April 17, 2018
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-15 –


--- page 706 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
45 /H1118/H1118A battery voltage and
temperature
monitoring device ( ɓ
္
಻ༀໄ)
US13128070 Our Company USA Invention November 18,
2009
June 10, 2014
46 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
US12997971 Our Company USA Invention June 12, 2009 April 22, 2014
47 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
EP09765385 Our Company Italy Invention June 12, 2009 January 2, 2013
48 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
EP09765385 Our Company Britain Invention June 12, 2009 January 2, 2013
49 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
EP09765385 Our Company France Invention June 12, 2009 January 2, 2013
50 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
EP09765385 Our Company EPO Invention June 12, 2009 January 2, 2013
51 /H1118/H1118A variable valve lift
mechanism for an
internal combustion
engine ( ɓ၇ʫዷዚ̙
ʺ೻ዚ࿴)
EP09765385 Our Company Germany Invention June 12, 2009 January 2, 2013
52 /H1118/H1118A dual-clutch
Transmission ( ɓ၇ᕐ
ᕎΥኜᜊ஺ኜ)
US14410867 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
USA Invention August 5, 2013 April 11, 2017
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-16 –


--- page 707 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
53 /H1118/H1118A dual-clutch
component, Hybrid
power system and
vehicle ( ᕐᕎΥኜଡ଼
΁e૿Υਗɢӻ୕ձ
ԓሿ)
2024/02748 Our Company South Africa Invention April 25, 2022 December 18,
2024
54 /H1118/H1118A method for judging
the anti-theft
configuration of an
engine ( ɓ၇кᓙ೯ਗ
ج)
002767-2016/DIN Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
Peru Invention September 29,
2015
April 9, 2021
55 /H1118/H1118A method for judging
the anti-theft
configuration of an
engine ( ɓ၇кᓙ೯ਗ
ج)
2017-1210 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
Chile Invention September 29,
2015
May 6, 2021
56 /H1118/H1118Method and device
for obtaining altitude
correction coefficient
(͍ӻᅰᐏ՟˙
ձༀໄ)
US15105953 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
USA Invention November 24,
2014
February 26, 2019
57 /H1118/H1118Method and device
for obtaining altitude
correction coefficient
(͍ӻᅰᐏ՟˙
ձༀໄ)
BR112016013742 Our Company,
Wuhu Puwei
Technology
Research Co., Ltd.
Brazil Invention November 24,
2014
May 17, 2022
58 /H1118/H1118A protection method
for limited
charging/discharging
current of hybrid
electric vehicle
battery and a device
and a system thereof
(૿Υਗɢӛԓཥϫ̂
ᚐ˙
eༀໄʿӻ୕)
US12743549 Our Company USA Invention December 24,
2008
April 16, 2013
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-17 –


--- page 708 ---
No. Patent name Patent number Registered owner
Place of
registration Type Application date Grant date
59 /H1118/H1118A protection method
for limited
charging/discharging
current of hybrid
electric vehicle
battery and a device
and a system thereof
(૿Υਗɢӛԓཥϫ̂
ᚐ˙
eༀໄʿӻ୕)
EP08870669 Our Company Britain Invention December 24,
2008
October 12, 2016
60 /H1118/H1118A protection method
for limited
charging/discharging
current of hybrid
electric vehicle
battery and a device
and a system thereof
(૿Υਗɢӛԓཥϫ̂
ᚐ˙
eༀໄʿӻ୕)
EP08870669 Our Company EPO Invention December 24,
2008
October 12, 2016
61 /H1118/H1118A protection method
for limited
charging/discharging
current of hybrid
electric vehicle
battery and a device
and a system thereof
(૿Υਗɢӛԓཥϫ̂
ᚐ˙
eༀໄʿӻ୕)
EP08870669 Our Company Germany Invention December 24,
2008
October 12, 2016
62 /H1118/H1118A motor torque
managing method for
hybrid power ( ɓ၇૿
Υਗɢཥዚҩॉ၍ଣ
ج)
US12680778 Our Company USA Invention September 27,
2008
August 20, 2013
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-18 –


--- page 709 ---
(c) Software copyrights
As at the Latest Practicable Date, we have registered the following software copyrights
which are material to our Group’s business:
No. Software name Registered owner
Place of
registration Registration date
1 /H1118/H1118Finite Element Mesh Multi-Point
Constraint Conversion Program
Software V1.0 (ߒ
Ҽᔷ౬೻ҏழ΁ V1.0)
Our Company PRC June 23, 2008
2 /H1118/H1118Embedded Toolchain Design
Software (ழ΁)
Our Company PRC March 10, 2009
3 /H1118/H1118Automotive Personalization
Platform (Փ̨̻)
Our Company PRC September 23,
2011
4 /H1118/H1118Chery Whole V ehicle Weight
Convolution and Comparison Tool
Software (ඎ՜ጐձ࿁
ˢʈՈழ΁)
Our Company PRC August 20, 2019
5 /H1118/H1118Chery V ehicle Mode Switching
Algorithm Control Software ( փ๿
છՓழ΁)
Our Company PRC July 28, 2022
6 /H1118/H1118Chery V ehicle Performance
Management System (׌
ঐ၍ଣӻ୕)
Our Company PRC January 15,
2023
7 /H1118/H1118Chery Process Configuration
Information Generation System
(͛ϓӻ୕)
Our Company PRC February 1,
2023
8 /H1118/H1118Digital Attack Based Simulation
Test System for Autonomous
Driving Obstacle Detection (׵
Ꮸ಻ͷ
ॆ಻༊ӻ୕)
Our Company PRC February 2,
2024
9 /H1118/H1118Physical Attack Based Simulation
Test System for Autonomous
Driving Obstacle Detection (׵
Ꮸ಻ͷ
ॆ಻༊ӻ୕)
Our Company PRC February 4,
2024
10 /H1118Graph Neural Network-based AI
Automobile Wind Resistance
Prediction System (ྡग़຾ၣ
ٙAIཫ಻ӻ୕)
Our Company PRC September 4,
2024
11 /H1118V ehicle Intelligent Monitoring and
Analysis Platform ( ԓሿ౽ঐ္಻
̨̻)
Our Company PRC September 5,
2024
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-19 –


--- page 710 ---
No. Software name Registered owner
Place of
registration Registration date
12 /H1118Lion SmartCloud Telematics
System In-vehicle Application
Management Platform ( ඪ๸౽ථ
ԓᑌၣӻ୕ԓ༱Ꮠ͜၍ଣ̨̻)
Xiongshi
Automotive
Technology
(Nanjing) Co.,
Ltd.
PRC June 16, 2021
13 /H1118LionSmart Cloud Telematics
System Fast Application Platform
(ඪ๸౽ථԓᑌၣӻ୕ҞᏐ̨̻͜)
Xiongshi
Automotive
Technology
(Nanjing) Co.,
Ltd.
PRC June 16, 2021
14 /H1118Lion SmartCloud Telematics
System Audiobook News
Application Software ( ඪ๸౽ථԓ
ᑌၣӻ୕ϞᑊอၲᏐ͜ழ΁)
Xiongshi
Automotive
Technology
(Nanjing) Co.,
Ltd.
PRC June 16, 2021
15 /H1118Lion Listen In-vehicle Application
Software ( ඪ๸࿫ᛓԓ༱Ꮠ͜ழ΁)
Xiongshi
Automotive
Technology
(Nanjing) Co.,
Ltd. eWuhu
Xiongshi
Automotive
Technology Co.,
Ltd.
PRC November 12,
2021
(d) Domain names
As at the Latest Practicable Date, we have registered the following domain names which
are material to our Group’s business:
No. Domain name Registered owner Place of registration
1 /H1118/H1118mychery.com Our Company PRC
2 /H1118/H1118cheryinternational.com Our Company PRC
3 /H1118/H1118mychery.net Our Company PRC
4 /H1118/H1118chery.cn Our Company PRC
5 /H1118/H1118cherydata.com Our Company PRC
6 /H1118/H1118exeedcars.com Our Company PRC
7 /H1118/H1118omodaglobal.com Our Company PRC
8 /H1118/H1118cherygpt.com Our Company PRC
9 /H1118/H1118chery-auto.com Our Company PRC
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-20 –


--- page 711 ---
C. FURTHER INFORMATION ABOUT DIRECTORS, SUPERVISORS, CHIEF
EXECUTIVE AND SUBSTANTIAL SHAREHOLDERS
1. Particulars of Directors’ and Supervisors’ Contracts
We have entered into a contract with each of Directors and Supervisors in respect of,
among other things, (i) the term of office, and (ii) termination provisions.
Save as disclosed above, none of our Directors or Supervisors has or is proposed to enter
into a service contract with any member of our Company other than contracts expiring or
determinable by the relevant employer within one year without the payment of compensation
(other than statutory compensation).
2. Remuneration of Directors and Supervisors
Save as disclosed in the section headed “Directors, Supervisors and Senior Management
— Compensation of Directors, Supervisors and Senior Management” in this prospectus, none
of our Directors or Supervisors received other remuneration from our Company for each of the
three years ended December 31, 2024 and the three months ended March 31, 2025.
3. Agency Fees or Commissions Received
Save in connection with the Underwriting Agreements, none of our Directors,
Supervisors, promoters nor any of the persons whose names are listed in “— E. Other
Information — 7. Qualification of experts” in this appendix had received any commissions,
discounts, agency fee, brokerages or other special terms in connection with the issue or sale of
any capital of any member of our Group within the two years prior to the date of this
prospectus.
4. Disclosure of Interests of Directors, Supervisors and Chief Executive
Immediately following the completion of the Global Offering, save as disclosed in the
following table, none of our Director, Supervisor or chief executive will have any interest
and/or short position in the Shares, underlying Shares and debentures of our Company or our
associated corporations (within the meaning of Part XV of the SFO):
(a) 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 interest or short
position which they were taken or deemed to have under such provisions of the SFO)
or which will be required, pursuant to section 352 of Part XV of the SFO, to be
entered in the register referred to therein;
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-21 –


--- page 712 ---
(b) which will be required, pursuant to the Model Code for Securities Transactions by
Directors of Listed Issuers as set out in Appendix C3 to the Listing Rules, to be
notified to our Company and the Stock Exchange, once the H Shares are listed:
Name Position Nature of interest
Description
of Shares
Number
of Shares
Approximate
percentage of
interest in the
Unlisted Shares/
H Shares upon
completion of the
Global Offering
(assuming the Over-
allotment Option
is not exercised) (1)
Approximate
percentage of
interest in the
total share capital
of our Company upon
completion of the
Global Offering
(assuming the Over-
allotment Option
is not exercised) (1)
Chairman Yin /H1118/H1118/H1118Chairman, Executive
Director, President
Interest in controlled
corporations (2)
Domestic
Unlisted Shares
604,072,938 17.49% 10.47%
H Shares 394,182,869 17.04% 6.83%
Total 998,255,807 17.31%
Notes:
(1) The calculation is based on the total number of 3,453,832,559 Unlisted Shares and 2,313,396,074 H Shares in
issue upon Listing comprising (i) an aggregate of 2,015,999,074 H Shares to be converted from the Domestic
Unlisted Shares and (ii) 297,397,000 H Shares to be issued pursuant to the Global Offering (without taking into
account the H Shares which may be issued upon exercise of the Over-allotment Option).
(2) Chairman Yin is deemed to be interested in the 604,072,938 Domestic Unlisted Shares and 394,182,869 H
Shares to be converted from the Domestic Unlisted Shares held by the Management and Employee Stock
Ownership Platforms, comprising (i) 419,780,138 Domestic Unlisted Shares and 209,890,069 H Shares to be
converted from the Domestic Unlisted Shares held by Ruichuang, (ii) 92,146,400 Domestic Unlisted Shares
and 92,146,400 H Shares to be converted from the Domestic Unlisted Shares held by Hengrui, and (iii)
92,146,400 Domestic Unlisted Shares and 92,146,400 H Shares to be converted from the Domestic Unlisted
Shares held by Zhenrui. For the avoidance of doubt, the above statistical interests of Chairman Yin are deemed
interests for the purpose of the SFO, which does not imply that Chairman Yin actually owns such interests. At
the level of Hengrui and Zhenrui, the general partner of Hengrui and Zhen Rui, Chaiman Yin only holds equity
interests as a shareholder of Wuhu Y ongrui, the general partner of Hengrui and Zhenrui, with very low
shareholding percentages in Hengrui and Zhenrui , and the actual interests held through Hengrui and Zhenrui
in the Company are negligible. On a see-through basis, Chairman Yin only holds interests in the Company
through Ruichuang, and the percentage of interests actually held by Chairman Yin in the Company is less than
5%.
5. Disclosure of Interests of Substantial Shareholders
(a) Interest in the Shares of our Company
Save as disclosed in the section headed “Substantial Shareholders” in this prospectus, our
Directors are not aware of any person who will, immediately following completion of the
Global Offering, have an interest or short position in the Shares or underlying Shares, which
would be required to be disclosed to our Company and the Stock Exchange under the
provisions of Divisions 2 and 3 of Part XV of the SFO, or, directly or indirectly, be interested
in 10% or more of the nominal value of any class of share capital carrying rights to vote in all
circumstances at our general meetings.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-22 –


--- page 713 ---
(b) Interest in our Company’s subsidiaries
Save as disclosed in the following table, our Directors are not aware of any person who
will, immediately following the completion of the Global Offering, be interested in 10% or
more of the nominal value of any class of share capital carrying rights to vote in all
circumstances at general meetings of the members of our Group (other than our Company) as
at the end of the Track Record Period:
Our subsidiaries
Parties with 10% or
more equity interest
Approximate
percentage of
shareholding
(%)
Chery New Energy /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Shijiazhuang State-owned Capital
Investment and Operation
Group Co., Ltd.* (୿਷Ϟ
ப΂ʮ
̡)
13.16
Soueast Motor /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Fujian Motor Industry Group
Co., Ltd.* (ӛԓʈุණ
ʮ̡)
14.19
Anhui Qiying Intelligent
Technology Co., Ltd.*
(ʮ̡) /H1118/H1118
InBev Supercomputing (Nanjing)
Technology Co., Ltd.* (௹൴
ၑ(ԯ)ʮ̡)
35.00
Anhui Ruizhi Propulsion
Technologies Co., Ltd.*
(ʮ̡) /H1118/H1118
Y askawa Electric Corporation*
(τʇཥዚ)
28.79
Y askawa ELECTRIC (China)
Co., Ltd.* ( τʇཥዚ(ʕ਷)Ϟ
ʮ̡)
16.69
Wuhu Qirui Automotive
Investment Co., Ltd.* ( ጾಳփ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Changshu Economic
Development Group Co., Ltd.*
(ʮ̡)
46.52
Wuhu Chery Armoured Science
and Technology Co., Ltd.* ( ጾ
ʮ̡)/H1118/H1118/H1118
pilban s.a 30.00
Wuhu Aike Power System Co.,
Ltd.* (ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Fanchang Chungu
Industrial Investment Fund
Co., Ltd.* (ᇅପ
ʮ̡)
27.78
Wuhu Aike Drive Technology
Co., Ltd.* (Ҧ
ʮ̡)/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Fanchang District
Xingnong Industry Investment
Fund Co., Ltd.* (ਜ
ʮ̡)
27.78
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-23 –


--- page 714 ---
Our subsidiaries
Parties with 10% or
more equity interest
Approximate
percentage of
shareholding
(%)
Anhui Deeiot Energy Technology
Co., Ltd.* (Ҧ
ʮ̡)/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Zongyang Hengyue New Energy
Industry Investment Center
(Limited Partnership)* ( ᆁජ㛬
൳อঐ๕ପุҳ༟ʕː(Υ
ྫ))
22.22
Wuhu Seismic Enterprise
Management Center (Limited
Partnership)* ( ጾಳቤ͜Άุ၍
ଣʕː(Υྫ))
11.11
Wuhu Aiman Equipment
Engineering Co., Ltd.* ( ጾಳЎ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Ruichi Intelligent
Equipment Institute (Limited
Partnership)* ( ጾಳ๿ཱུ౽ঐༀ
௪৫(Υྫ))
25.00
Wuhu Feichi Automotive Parts
Technology Co., Ltd.* (࠭
ʮ̡)/H1118/H1118/H1118
Anhui Jiukong State Owned
Capital Investment Group Co.,
Ltd.* ( τᏏཹછ਷Ϟ༟͉ҳ༟
ʮ̡)
33.33
Wuhu Laite Sichuang Automotive
Parts Co., Ltd.* (௴
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Borong Automotive Parts
Partnership Enterprise (Limited
Partnership)* ( ጾಳ̹Ь࿲ӛԓ
ཧ௅΁ΥྫΆุ(Υྫ))
16.00
Wuhu Zhihe Automotive Parts
Partnership Enterprise (Limited
Partnership)* ( ጾಳ̹౽Υӛԓ
ཧ௅΁ΥྫΆุ(Υྫ))
10.00
Hefei Ruituo Microelectronics
Co., Ltd.* (ฆཥɿϞ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Ruite Micro Information
Technology Center (Limited
Partnership)* (ࢹڦ
Ҧʕː(Υྫ))
30.00
Chery (Dalian) Auto Parts
Industrial Park Co., Ltd.* ( փ
๿(ɽஹ)ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Dalian Huayi Investment
Holdings Co., Ltd.* ( ɽஹശሒ
ʮ̡)
20.00
Anhui Zhuodun Security
Technology Co., Ltd.* (ק
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Shanghai Zhuodun Future
Security Technology Co., Ltd.*
(ʮ
̡)
25.50
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-24 –


--- page 715 ---
Our subsidiaries
Parties with 10% or
more equity interest
Approximate
percentage of
shareholding
(%)
Anhui Yineng Automotive
Technology Co., Ltd.* ( τᏏఠ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Jiangsu Jiahe Thermal Systems
Inc.* (΅Ϟ
ʮ̡)
31.11
Wuhu Shengyu Enterprise
Management Partnership
(Limited Partnership)* ( ጾಳ᳅
ਹΆุ၍ଣΥྫΆุ(Υ
ྫ))
13.72
Ruiqing Automotive Engine
Technology Co., Ltd. ( ๿ᅅӛ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Ruiqing Investment Co.,
Ltd.* (ʮ̡)
51.89
Anhui Aili Aosi Technology Co.,
Ltd.* (ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Y angzhou Jeffrey Enterprise
Management Partnership
(Limited Partnership)* ( ౮ψ௫
̿๿Άุ၍ଣΥྫΆุ(Υ
ྫ))
10.00
Wuhu Fuzhen Investment
Management Center (Limited
Partnership)* ( ጾಳѿ၄ҳ༟၍
ଣʕː(Υྫ)) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Wuhu Fanchang Chungu
Industrial Investment Fund
Co., Ltd.* (ԋପ
ʮ̡)
49.18
Anhui Instic Intelligent
Technology Co., Ltd.* (ߵ
ʮ̡) /H1118/H1118/H1118/H1118
Wuhu Laigaode Enterprise
Management Center (Limited
Partnership)* ( ጾಳഺ৷ᅃΆุ
၍ଣʕː(Υྫ))
20.00
Deeiot Energy Technology
(Tongling) Co., Ltd.* ( ੻ఠঐ
Ҧ(ზ௒)ப΂ʮ̡) /H1118/H1118/H1118
Zongyang Hengyue New Energy
Industry Investment Center
(Limited Partnership)* ( ᆁජ㛬
൳อঐ๕ପุҳ༟ʕː(Υ
ྫ))
49.02
Dazhuo Intelligent Technology
Co., Ltd.* (ࠢ
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Shanghai Junming Technology
Partnership (Limited
Partnership)* (ҦΥ
ྫΆุ(Υྫ))
20.00
Chery (Qingdao) International
Trade Co., Ltd.* ( փ๿(ࢥڡ)਷
ʮ̡) /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Qingdao Chengxin Holding
Group Co., Ltd.* (㒥છ
ʮ̡)
65.00
Changshu Qizhi R&D Partnership
(Limited Partnership)* ( ੬ᆞփ
೯ΥྫΆุ(Υྫ)) /H1118/H1118/H1118
Suzhou Suchang Zhixing
Technology Partnership
(Limited Partnership)* ( ᘽψᘽ
ҦΥྫΆุ(Υ
ྫ))
75.00
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-25 –


--- page 716 ---
6. Disclaimers
Save as disclosed in this prospectus:
(a) none of our Directors or Supervisors nor any of the parties listed in the section
headed “— E. Other Information — 7. Qualification of experts” of this appendix has
any direct or indirect interest in the promotion of our Company, or in any assets
which have been, within the two years immediately preceding the date of this
prospectus, acquired or disposed of by or leased to our Company, or are proposed
to be acquired or disposed of by or leased to our Company;
(b) none of our Directors or Supervisors is materially interested in any contract or
arrangement subsisting at the date of this prospectus which is significant in relation
to the business of our Company taken as a whole;
(c) without taking into account any H Shares which may be taken up under the Global
Offering, none of our Directors or Supervisors is aware of any person (not being a
Director or chief executive of our Company) who will, immediately following
completion of the Global Offering, have an interest or short position in the Shares
or underlying Shares which would fall to be disclosed to our Company under the
provisions of Divisions 2 and 3 of Part XV of the SFO;
(d) so far as is known to our Directors, none of our Directors, their respective close
associates (as defined under the Listing Rules) or the Shareholders who are
interested in more than 5% of the issued share capital of our Company has any
interests in the five largest customers or the five largest suppliers of our Company;
(e) save as disclosed in this appendix and the section headed “Directors, Supervisors
and Senior Management” in this prospectus, none of our Directors or Supervisors is
a director or employee of a company that has an interest in the share capital of our
Company which would have to be disclosed pursuant to Divisions 2 and 3 of Part
XV of the SFO.
D. EQUITY INCENTIVE SCHEMES
2024 Equity Incentive Scheme
The following is a summary of the principal terms of the equity incentive scheme (“ 2024
Equity Incentive Scheme ”) approved and adopted by our Company on March 30, 2024. The
terms of the 2024 Equity Incentive Scheme are not subject to the provisions of Chapter 17 of
the Listing Rules as it does not involve the grant of share options or awards by our Company
after Listing. Given the Shares underlying all the Awards (as defined below) under the 2024
Equity Incentive Scheme have already been issued to Hengrui and Zhenrui as at the date of this
prospectus, there will not be any dilutive effect to the issued Shares as a result of the operation
of the 2024 Equity Incentive Scheme.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-26 –


--- page 717 ---
As at the date of this prospectus, there were two employee stock ownership platforms for
the 2024 Equity Incentive Scheme, namely Hengrui and Zhenrui, each of which held
184,292,800 Shares, representing 3.37% of the share capital in issue of our Company as at the
Latest Practicable Date. For more details, see “History, Development and Corporate Structure
— Management and Employee Stock Ownership Platforms”.
(a) Purpose
The purposes of the 2024 Equity Incentive Scheme are to recognise the contribution from
our key employees and to incentivise them, fostering shared interests between our
Shareholders, our Company and our employees, thereby promoting the sustainable and healthy
development of our Company.
(b) Types of awards
Under the 2024 Equity Incentive Scheme, eligible participants are granted partnership
interests in employee stock ownership platforms (“ Restricted Shares ”).
(c) Participants
Participants of the 2024 Equity Incentive Scheme include the middle and senior
management, core and backbone employees of our Company and/or our holding subsidiaries,
and other employees whom our Board considers appropriate.
(d) Maximum number of Shares
The maximum number of Shares underlying the 2024 Equity Incentive Scheme is
368,585,600 Shares, representing approximately 6.74% of the share capital in issue of our
Company as at the Latest Practicable Date. No further Awards will be granted under the Equity
Incentive Scheme after the Listing.
(e) Scheme administration
The 2024 Equity Incentive Scheme is managed by our Board, who has the power, among
other things, (i) to formulate, revise and implementation of the 2024 Equity Incentive Scheme,
and (ii) to determine the grant plan, including the selection of grantees, the number of
Restricted Shares to be granted, the grant price, the grant date, etc.
(f) Lock-up of Restricted Shares
The Restricted Shares granted under the 2024 Equity Incentive Scheme shall be unlocked
until (whichever is later): (a) six years from the grant date, or (b) the Shares of our Company
are listed on a domestic or overseas stock exchange and allowed to be disposed of after the
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-27 –


--- page 718 ---
expiry of the lock-up period as stipulated by applicable laws and regulations. During the
lock-up period, the Restricted Shares granted to the participants under the 2024 Equity
Incentive Scheme shall not be transferred, used as security, guarantee or for repayment of
debts.
(g) Withdrawal mechanism
In the event of resignation, dismissal, retirement, death, disability, or other change in
circumstances, our Board or its authorized administrator shall have the right to request the
grantee to transfer any awards granted to a designated third-party employee, or settle the
economic benefits with the grantee by way of selling the underlying Shares held by the
employee stock ownership platforms in the open market, in accordance with the terms of the
2024 Equity Incentive Scheme.
(h) Term
Subject to any early termination due to, among others, the change of control, merger or
separation, or cessation of business of our Company, the 2024 Equity Incentive Scheme shall
be valid and effective for 10 years commencing on the adoption date of the scheme until all
the Restricted Shares are repurchased or sold.
E. OTHER INFORMATION
1. Estate Duty
Our Directors have been advised that no material liability for estate duty that is likely to
be imposed on our Company.
2. Litigation
Save as disclosed in this prospectus, no member of our Group was engaged in any
litigation, arbitration or claim of material importance, and no litigation, arbitration or claim of
material importance is known to our Directors to be pending or threatened against any member
of our Group that could have a material adverse effect on our business, financial condition and
results of operations as at the Latest Practicable Date.
3. Joint Sponsors
Each of the Joint Sponsors satisfies the criteria of independence applicable to sponsors set
out in Rule 3A.07 of the Listing Rules.
The Joint Sponsors have made an application on our behalf to the Stock Exchange for a
listing of, and permission to deal in, the H Shares to be issued as mentioned in this prospectus.
Our Company has agreed to pay each of the Joint Sponsors a fee of HK$1,333,300 to act as
a sponsor in connection with the Listing.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-28 –


--- page 719 ---
4. Promoters
The promoters of our Company are Ruichuang, Wuhu Investment Holding, Anhui Credit
Guaranty, Anhui Investment Holding, Wuhu Construction Corporation, Tonghua V enture and
Hushan Investment. For details of the promoters of our Company, please refer to the section
headed “History, Development and Corporate Structure” in this prospectus.
Save for the Global Offering and as disclosed in this prospectus, within the two years
immediately preceding the date of this prospectus, no cash, securities, amount or benefit has
been paid, allotted or given, or has been proposed to be paid, allotted or given, to any of the
promoters named above in connection with the Global Offering or the related transactions
described in this prospectus.
5. Compliance Adviser
Our Company has appointed China International Capital Corporation Hong Kong
Securities Limited as the compliance adviser upon Listing in compliance with Rule 3A.19 of
the Listing Rules.
6. Preliminary Expenses
We have not incurred any material preliminary expenses.
7. Qualification of Experts
The qualifications of the experts, as defined under the Listing Rules, who have given
opinions in this prospectus, are as follows:
Name Qualification
China International Capital
Corporation Hong Kong
Securities Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Licensed to conduct Type 1 (dealing in
securities), Type 2 (dealing in futures
contracts), Type 4 (advising on securities),
Type 5 (advising on futures contracts) and
Type 6 (advising on corporate finance)
regulated activities under the SFO
Huatai Financial Holdings
(Hong Kong) Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
A licensed corporation to conduct Type 1
(dealing in securities), Type 2 (dealing in
futures contracts), Type 3 (leveraged foreign
exchange trading), Type 4 (advising on
securities), Type 6 (advising on corporate
finance), Type 7 (providing automated trading
services) and Type 9 (asset management)
regulated activities under the SFO
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-29 –


--- page 720 ---
Name Qualification
GF Capital (Hong Kong) Limited /H1118/H1118/H1118A licensed corporation to conduct Type 6
(advising on corporate finance) regulated
activity under the SFO
Ernst & Y oung /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Certified Public Accountants and Registered
Public Interest Entity Auditor
Jingtian & Gongcheng /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal advisers to our Company as to PRC
laws
Zhong Lun Law Firm /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal advisers to our Company as to PRC
data compliance laws
Frost & Sullivan (Beijing) Inc.,
Shanghai Branch Co. /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Independent industry consultant
Hogan Lovells /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118Legal advisers to our Company as to
International Sanctions laws
Pillsbury Winthrop Shaw
Pittman LLP /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Legal advisers to our Company as to U.S.
Outbound Investment Rule
Ernst & Y oung (China) Advisory
Limited /H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118/H1118
Tax advisor to our Company with respect to
transfer pricing arrangement of our Group
8. Consents of experts
Each of the experts as referred to in the paragraph headed “— E. Other Information —
7. Qualification of experts” in this appendix has given and has not withdrawn their respective
written consents to the issue of this prospectus with the inclusion of their reports and/or letters
the references to its name included herein in the form and context in which it is respectively
included.
None of the experts named above has any shareholding interests in any member of our
Company or the right (whether legally enforceable or not) to subscribe for or to nominate
persons to subscribe for securities in any member of our Company.
9. Binding effect
This prospectus shall have the effect, if an application is made in pursuance hereof, 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 (Cap. 32) so far as applicable.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-30 –


--- page 721 ---
10. No material adverse change
Save as disclosed in this prospectus, our Directors confirm that there has been no material
adverse change in the financial or trading position of our Company since March 31, 2025
(being the latest balance sheet date of our consolidated financial statements as set out in the
Accountants’ Report).
11. Miscellaneous
Save as disclosed in this prospectus:
(a) within the two years immediately preceding the date of this prospectus:
(i) no share or loan capital of our Company has been issued or agreed to be issued
or is proposed to be fully or partly paid either for cash or a consideration other
than cash;
(ii) no share or loan capital of our Company is under option or is agreed
conditionally or unconditionally to be put under option; and
(iii) no commission has been paid or is payable for subscription, agreeing to
subscribe, procuring subscription or agreeing to procure subscription for any
share in or debentures of our Company;
(b) there are no founder, management or deferred shares or any debentures in our
Company;
(c) there has not been any interruption in the business of our Company which may have
or has had a significant effect on the financial position of our Company in the 12
months preceding the date of this prospectus;
(d) our Company has no outstanding convertible debt securities or debentures;
(e) there is no arrangement under which future dividends are waived or agreed to be
waived;
(f) no part of the equity or debt securities of our Company, if any, is currently listed on
or dealt in on any stock exchange or trading system, and no such listing or
permission to list on any stock exchange other than the Stock Exchange is currently
being or agreed to be sought;
(g) our Company is a joint stock limited liability company and subject to the Company
Law of the PRC.
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-31 –


--- page 722 ---
12. Bilingual prospectus
The English language and Chinese language versions of this prospectus 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).
APPENDIX VI STATUTORY AND GENERAL INFORMATION
– VI-32 –


--- page 723 ---
DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG KONG
The documents attached to the copy of this prospectus delivered to the Registrar of
Companies in Hong Kong for registration were, among other documents:
(a) copies of the material contracts referred to under “Statutory and General
Information — B. Further Information about Our Business — 1. Summary of
Material Contracts” in Appendix VI to this prospectus; and
(b) the written consents referred to under “Statutory and General Information — E.
Other Information — 7. Qualifications of Experts” and “Statutory and General
Information — E. Other information — 8. Consents of Experts” in Appendix VI to
this prospectus.
DOCUMENTS ON DISPLAY
Copies of the following documents will be available on display on the website of the
Stock Exchange at www.hkexnews.hk and our Company’s website at www.chery-auto.com up
to and including the date which is 14 days from the date of this prospectus:
(a) our Articles of Association;
(b) the Accountant’s Report of our Group from Ernst & Y oung, the texts of which is set
out in Appendix I to this prospectus;
(c) the report on the unaudited pro forma financial information of our Group from Ernst
& Y oung, the texts of which is set out in Appendix II to this prospectus;
(d) the audited consolidated financial statements of our Group for the years ended
December 31, 2022, 2023 and 2024 and the three months ended March 31, 2025;
(e) the legal opinions issued by Jingtian & Gongcheng, our legal advisers as to PRC
laws, in respect of certain general corporate matters and property interests of our
Group;
(f) the legal opinion issued by Zhong Lun Law Firm, our legal advisers as to PRC data
protection laws, in respect of certain data protection, data compliance and cyber
security matters of our Group;
(g) the report issued by Frost & Sullivan, the summary of which is set forth in “Industry
Overview” in this prospectus;
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
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(h) the material contracts referred to under “Statutory and General Information — B.
Further Information about Our Business — 1. Summary of Material Contracts” in
Appendix VI to this prospectus;
(i) the written consents referred to under “Statutory and General Information — E.
Other information — 7. Qualifications of Experts” and “Statutory and General
Information — E. Other information — 8. Consents of Experts” in Appendix VI to
this prospectus;
(j) the service contracts with our Directors and Supervisors referred to in “Statutory and
General Information — C. Further Information about Directors, Supervisors, Chief
Executive and Substantial Shareholders — 1. Particulars of Directors’ and
Supervisors’ Contracts” in Appendix VI to this prospectus;
(k) the PRC Company Law, the PRC Securities Law and the Trial Administrative
Measures of Overseas Securities Offering and Listing by Domestic Companies
together with their unofficial English translations;
(l) the memorandum issued by Hogan Lovells, our legal advisers as to International
Sanctions laws;
(m) the legal opinion issued by Pillsbury Winthrop Shaw Pittman LLP , our legal advisers
as to U.S. Outbound Investment Rule; and
(n) the terms of the 2024 Equity Incentive Scheme.
APPENDIX VII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VII-2 –


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