Xiamen International Port : (1) DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY (2) PROPOSED ADJUSTMENT TO THE REGISTERED AMOUNT OF THE NEW SUPER SHORT-TERM NOTES AND (3) NOTICE OF THE SECOND EXTRAORDINARY GENERAL MEETING IN 2020

August 30, 2020 at 08:14 pm

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in doubt as to any aspect of this circular or as to the action to be taken, you should consult a licensed securities dealer or registered institution in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in Xiamen International Port Co., Ltd, you should at once hand this circular and the accompanying proxy form to the purchaser(s) or the transferee(s) or to the bank, the licensed securities dealer or registered institution or other agent through whom the sale or transfer was effected for transmission to the purchaser(s) or the transferee(s).

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 3378)

DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY
1. PROPOSED ADJUSTMENT TO THE REGISTERED AMOUNT

OF THE NEW SUPER SHORT-TERM NOTES

AND

(3) NOTICE OF THE SECOND EXTRAORDINARY GENERAL MEETING IN 2020

Independent Financial Adviser to the

Independent Board Committee and Independent Shareholders

Capitalised terms used in this cover page have the same meanings as those defined in this circular.

A letter from the Board is set out on pages 4 to 18 of this circular. A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on pages 19 to 20 of this circular. A letter from the Independent Financial Adviser, First Shanghai, containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 21 to 39 of this circular.

A notice dated 31 August 2020 convening the EGM to be held at 9:00 a.m. on Wednesday, 16 September 2020 at 23rd Floor, Conference Room, No. 31 Donggang North Road, Xiamen, the PRC is set out on pages EGM-1 to EGM-3 in this circular.

The proxy form for use at the EGM is enclosed with this circular and is also published on the website of the Stock Exchange (www.hkexnews.hk) and the website of the Company (www.xipc.com.cn). Whether or not you are able to attend the EGM, you are requested to complete and return as soon as possible the proxy form in accordance with the instructions printed thereon in any event not less than 24 hours before the time fixed for holding the EGM or any adjournment thereof (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting at the EGM or any adjournment thereof in person if you so wish.

31 August 2020

For identification purpose only

CONTENTS
	Pages
Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1
Letter from the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
(1) Discloseable Transactions and Connected Transactions in relation to the Proposed Capital
Increase into a Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
(2) Proposed Adjustment to the Registered Amount of the New Super Short-term Notes . . . . . . . .	17
EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
Additional Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18
Letter from the Independent Board Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19
Letter from the Independent Financial Adviser . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21
Appendix I-PropertyValuation Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	I-1
Appendix II-ValuationReport of the Target Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	II-1
Appendix III-ValuationReport of Xiamen Hailong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	III-1
Appendix IV-ValuationReport of Xiamen Haihong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	IV-1
Appendix V-GeneralInformation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	V-1
Notice of the EGM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	EGM-1

DEFINITIONS

In this circular, the following expressions have the meanings as set out below unless the context requires otherwise:

"associate(s)"

"Benchmark Assessment Date" "Board"

"Capital Contribution Transactions"

"Capital Increase Agreement"

"Company"

"Completion"

"Completion Date"

"connected person(s)" "connected subsidiary" "Consideration"

"controlling shareholder" "Director(s)" "Domestic Shares"

"EGM"

"Enlarged Target Group"

"Group"

"H Shares"

has the meaning ascribed thereto under the Listing Rules

31 December 2019

the board of Directors of the Company

the transactions contemplated under the Capital Increase Agreement to implement the contribution of additional capital into the Target Company by Xiamen Port Development and Xiamen Port Holding

the capital increase agreement dated 5 August 2020 entered into between Xiamen Port Development and Xiamen Port Holding in respect of their contribution of additional capital into the Target Company

Xiamen International Port Co., Ltd.* (廈門國際港務股份有限公司), a joint stock limited company established in the PRC, the H Shares of which are listed on the Stock Exchange

Completion of the Capital Contribution Transactions

the date of completion of the industrial and commercial registration changing procedures of the Target Company

has the meaning ascribed thereto under the Listing Rules

the total value agreed to be contributed to the Target Company as additional capital by Xiamen Port Development and Xiamen Port Holding pursuant to the Capital Increase Agreement

has the meaning ascribed thereto under the Listing Rules

the director(s) of the Company

ordinary shares of nominal value of RMB1.00 each in the share capital of the Company, which are subscribed for in Renminbi by the PRC nationals and/or PRC corporate entities

the second extraordinary general meeting of the Company in 2020 to be held on Wednesday, 16 September 2020 to consider and, if thought fit, among other matters, approve (i) the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder, and (ii) the proposed adjustment to the registered amount of the New Super Short-term Notes

the Target Company and its subsidiaries, including but not limited to Xiamen Hailong and Xiamen Haihong upon Completion

the Company and its subsidiaries

foreign invested shares of nominal value in RMB1.00 each in the share capital of the Company, which are listed on the Stock Exchange and denominated in HK dollars

	DEFINITIONS
"HK$" or "HK dollars"	Hong Kong dollar, the lawful currency of Hong Kong
"Hong Kong"	The Hong Kong Special Administrative Region of the PRC
"Independent Board Committee"	the independent committee of the Board comprising all of the
	independent non-executive Directors to advise the Independent
	Shareholders in respect of the Capital Increase Agreement and the
	Capital Contribution Transactions contemplated thereunder
"Independent Financial Adviser" or	First Shanghai Capital Limited, a corporation licensed to carry out
"First Shanghai"	Type 6 (advising on corporate finance) regulated activity under the
	SFO appointed by the Company to advise the Independent Board
	Committee and the Independent Shareholders in respect of the Capital
	Increase Agreement and the Capital Contribution Transactions
	contemplated thereunder
"Independent Shareholders"	Shareholders (other than Xiamen Port Holding and its associates) who
	are not interested or involved in the Capital Increase Agreement and
	the Capital Contribution Transactions contemplated thereunder
"Latest Practicable Date"	27 August 2020, being the latest practicable date prior to the printing
	of this circular for ascertaining certain information contained herein
"Listing Rules"	the Rules Governing the Listing of Securities on the Stock Exchange
"NAFMII"	National Association of Financial Market Institutional Investors * (中
	國銀行間市場交易商協會), a self-regulatory organisation to supervise
	the development of the PRC over-the-counter financial market
"New Super Short-term Notes"	the new super short-term notes proposed to be issued by the
	Company, details and original principal terms of which were set out
	in the announcement of the Company dated 27 March 2020
"PRC"	the People's Republic of China, and for the purpose of this circular,
	excludes Hong Kong, Macau and Taiwan
"PRC Qualified Valuer"	Fujian United Assets Evaluation & Land and Real Estate Appraisal
	Co., Ltd.* (福建聯合中和資產評估土地房地產估價有限公司), which is
	qualified to undertake asset appraisals in the PRC
"Proposed Adjustment"	the proposed adjustment to the aggregate registered maximum
	principal amount of the proposed issue of the New Super Short-term
	Notes from RMB4,000,000,000 to RMB8,000,000,000
"Relevant Ratios"	the five ratios as set out in Rule 14.07 of the Listing Rules
"RMB"	Renminbi, the lawful currency of the PRC
"SFO"	Securities and Futures Ordinance (Chapter 571 of the Laws of Hong
	Kong)
"Share(s)"	shares of nominal value RMB1.00 each in the share capital of the
	Company
"Shareholder(s)"	holder(s) of the Shares

DEFINITIONS

"Stock Exchange" "Supervisor(s)" "Target Company"

"Target Equity Interest"

"Target Group"

"Xiamen Haihong"

"Xiamen Hailong"

"Xiamen Port Development"

"Xiamen Port Holding"

"Xiamen SASAC"

"%"

*For identification purpose only

The Stock Exchange of Hong Kong Limited

the supervisor(s) of the Company

Xiamen Port Group Shihushan Terminal Co., Ltd.* (廈門港務集團石湖山碼頭有限公司), a limited liability company established in the

PRC

the 14.08% equity interest in the Target Company deemed to be acquired by Xiamen Port Development from Xiamen Port Holding as a result of the Capital Contribution Transactions

the Target Company and its subsidiaries as at the date of this circular

Xiamen Haihong Petrochemical Terminal Co., Ltd.* (廈門海鴻石化碼頭有限公司), a limited liability company established in the PRC and a wholly-owned subsidiary of Xiamen Port Holding as at the Latest Practicable Date

Xiamen Hailong Terminal Co., Ltd.* (廈門海隆碼頭有限公司), a limited liability company established in the PRC and a wholly-owned subsidiary of Xiamen Port Development as at the Latest Practicable Date

Xiamen Port Development Co., Ltd.* (廈門港務發展股份有限公司), a joint stock limited company established in the PRC, which is a non-wholly owned subsidiary of the Company, whose A shares are listed on the Shenzhen Stock Exchange since April 1999 and is held by the Company as to approximately 61.89% as at the Latest Practicable Date

Xiamen Port Holding Group Co., Ltd.* (廈門港務控股集團有限公司), a wholly state-owned company established in the PRC and the controlling shareholder of the Company holding approximately 68.32% equity interest in the Company as at the Latest Practicable Date

the State-ownedAssets Supervision and Administration Commission of Xiamen Municipal People's Government* (廈門市人民政府國有資產監督管理委員會)

per cent.

LETTER FROM THE BOARD

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

	(Stock Code: 3378)
Executive Directors:	Registered office:
Mr. Cai Liqun	No. 439 Gangnan Road
Mr. Chen Zhaohui	Haicang District
Mr. Lin Fuguang	Xiamen City
Mr. Chen Zhen	Fujian Province
	PRC

Non-executive Directors:	Principal place of business in Hong Kong:
Mr. Chen Zhiping	31/F, Tower Two
Mr. Fu Chengjing	Times Square
Mr. Huang Zirong	1 Matheson Street
Ms. Bai Xueqing	Causeway Bay
Independent non-executive Directors:	Hong Kong

Mr. Liu Feng
Mr. Lin Pengjiu
Mr. You Xianghua
Mr. Jin Tao
Mr. Ji Wenyuan
	31 August 2020
To the Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY

PROPOSED ADJUSTMENT TO THE REGISTERED AMOUNT OF THE NEW SUPER SHORT-TERM NOTES

AND

(3) NOTICE OF THE SECOND EXTRAORDINARY GENERAL MEETING IN 2020

INTRODUCTION

Reference is made to (i) the announcement of the Company dated 5 August 2020 in relation to, inter alia, the entering into of the Capital Increase Agreement in respect of the Capital Contribution Transactions for the contribution of additional capital into the Target Company by Xiamen Port Development and Xiamen Port Holding; and (ii) the announcement of the Company dated 5 August 2020 in relation to, inter alia, the proposed issue of the New Super Short-term Notes and the Proposed Adjustment.

* For identification purpose only

LETTER FROM THE BOARD

The purpose of this circular is to provide you with, among other things, (i) further information relating to the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder, which includes (a) a letter of recommendation from the Independent Board Committee to the Independent Shareholders regarding the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder; (b) a letter of advice by the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders regarding the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder; and (c) other information as required to be disclosed under the Listing Rules; (ii) information relating to the proposed issue of the New Super Short-term Notes (including, without limitation, the Proposed Adjustment); and (iii) the notice of the EGM.

DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY

Principal Terms and Conditions Precedent of the Capital Increase Agreement

Date	5 August 2020
Parties	(a)	Xiamen Port Development; and
	(b)	Xiamen Port Holding.
Subject matter	Xiamen Port Development and Xiamen Port Holding have agreed to
	contribute additional capital by the injection of the entire equity
	interest in (i) Xiamen Hailong by Xiamen Port Development; and
	(ii) Xiamen Haihong by Xiamen Port Holding into the Target
	Company, respectively. Upon completion, the equity interest of the
	Target Company will be held by Xiamen Port Development as to
	65.08% and Xiamen Port Holding as to 34.92%, pursuant to which, in
	operative terms, Xiamen Port Development will, by way of a deemed
	disposal of 34.92% effective equity interest in Xiamen Hailong to
	Xiamen Port Holding, in effect acquire from Xiamen Port Holding (i)
	14.08% equity interest in the Target Company (which is the Target
	Equity Interest); and (ii) 65.08% effective equity interest in Xiamen
	Haihong.
Consideration	The total value of the additional capital agreed to be contributed by
	Xiamen Port Development and Xiamen Port Holding into the Target
	Company amounts to approximately RMB1,526,273,200. Such total
	value and the equity interest in the Target Company held by the
	parties after Completion respectively was arrived at in good faith after
	arm's length negotiations with reference to the following factors:
	(i)	the appraised value of the Target Company's entire equity
		interest of approximately RMB1,529,890,200 as at the
		Benchmark Assessment Date appraised by the PRC Qualified
		Valuer as approved by the Xiamen SASAC, by adopting an
		asset-based approach;
	(ii)	the appraised value of Xiamen Hailong's entire equity interest of
		approximately RMB1,208,737,100 as at the Benchmark
		Assessment Date appraised by the PRC Qualified Valuer as
		approved by the Xiamen SASAC, by adopting an asset-based
		approach;

LETTER FROM THE BOARD

the appraised value of Xiamen Haihong's entire equity interest of approximately RMB317,536,100 as at the Benchmark Assessment Date appraised by the PRC Qualified Valuer as approved by the Xiamen SASAC, by adopting an asset-based valuation approach;
the corresponding Target Equity Interest of approximately RMB215,423,538 as at the Benchmark Assessment Date immediately upon Completion; and
the actual financing needs for the Target Company's long-term business operation and development.

The valuation reports of the Target Company, Xiamen Hailong and Xiamen Haihong are set out in Appendix II, Appendix III and Appendix IV to this circular, respectively.

As part of the Capital Contribution Transactions, (i) the appraised value of the 34.92% effective equity interest in Xiamen Hailong as at the Benchmark Assessment Date deemed to be disposed of by Xiamen Port Development to Xiamen Port Holding amounts to approximately RMB422,079,145; and (ii) the appraised value of the 65.08% effective equity interest in Xiamen Haihong as at the Benchmark Assessment Date deemed to be acquired by Xiamen Port Development from Xiamen Port Holding amounts to approximately RMB206,655,607.

In accordance with the requirements under the Law of the PRC on the State-owned Assets of Enterprises (《中華人民共和國企業國有資產法》), a minimum transfer price (or an equivalent monetary value) for each deemed transfer of equity interests pursuant to the Capital Increase Agreement shall be reasonably determined on the basis of the appraised values issued by the Xiamen SASAC as these transactions are regarded as transfers of State-owned Assets.

The respective capital contributions by Xiamen Port Development and Xiamen Port Holding are approximately RMB1,208,737,100 (equivalent to the appraised value of the entire equity interest of Xiamen Hailong as disclosed above) and approximately RMB317,536,100 (equivalent to the appraised value of the entire equity interest of Xiamen Haihong as disclosed above). Upon Completion, the respective additional capital contributed by Xiamen Port Development and Xiamen Port Holding will be split in the following manner:

Out of Xiamen Port Development's capital contribution at approximately RMB1,208,737,100, RMB597,869,300 and RMB610,867,800 will be applied to the registered capital and the capital reserve of the Target Company, respectively; and
Out of Xiamen Port Holding's capital contribution at approximately RMB317,536,100, RMB312,130,700 and RMB5,405,400 will be applied to the registered capital and the capital reserve of the Target Company, respectively.

LETTER FROM THE BOARD

In addition, any increase in or reduction of the corresponding owners' equity in the Target Company, Xiamen Hailong and Xiamen Haihong for the period between the Benchmark Assessment Date and the date on which their respective industrial and commercial registration changing procedures are completed (each "Relevant Registration Completion Date") (the "Relevant Period") shall belong to and be borne by the original shareholder(s). The parties have agreed that a special audit shall be conducted after each Relevant Registration Completion Date to ascertain any increase in or reduction of these owners' equity during the Relevant Period. In this regard, if a Relevant Registration Completion Date falls on a date which is on or before the 15th day of a calendar month, the audit benchmark date for the adjustment to the owners' equity during the Relevant Period shall end on the last day of the preceding month, and if a Relevant Registration Completion Date falls on a date which is on or after the 16th day of a calendar month, the audit benchmark date for the adjustment to the owners' equity during the Relevant Period shall end on the last day of that month. The parties shall within 10 working days from the issue of the last special audit report enter into a supplemental agreement in respect of any such adjustment and belonging to the owners' equity and carry out the settlements balance within 10 working days after the entering into of the said supplemental agreement in the following manner:

Xiamen Port Development should pay all increase in the corresponding owners' equity in the Target Company during the Relevant Period (if any) to Xiamen Port Holding, and Xiamen Port Holding shall pay all reduction in the corresponding owners' equity in the Target Company during the Relevant Period (if any) to Xiamen Port Development, such sum payable should be calculated as the amount of the increase in/reduction of the corresponding owners' equity in the Target Company during the Relevant Period, multiplied by 14.08% (being the percentage of the change of the equity interest in the Target Company before and after Completion as held by Xiamen Port Development or Xiamen Port Holding);
Xiamen Port Development should pay all increase in the corresponding owners' equity in Xiamen Haihong during the Relevant Period (if any) to Xiamen Port Holding, and Xiamen Port Holding shall pay all reduction in the corresponding owners' equity in Xiamen Haihong during the Relevant Period (if any) to Xiamen Port Development, such sum payable should be calculated as the amount of the increase in/reduction of the corresponding owners' equity in Xiamen Haihong during the Relevant Period, multiplied by 65.08% (being the percentage of the change of the effective equity interest in Xiamen Haihong before and after Completion as held by Xiamen Port Development or Xiamen Port Holding); and
Xiamen Port Holding should pay all increase in the corresponding owners' equity in Xiamen Hailong during the Relevant Period (if any) to Xiamen Port Development, and Xiamen Port Development shall pay all reduction in the corresponding owners' equity in Xiamen Hailong during the

LETTER FROM THE BOARD

		Relevant Period (if any) to Xiamen Port Holding, such sum
		payable should be calculated as the amount of the increase in/
		reduction of the corresponding owners' equity in Xiamen
		Hailong during the Relevant Period, multiplied by 34.92%
		(being the percentage of the change of the effective equity
		interest in Xiamen Hailong before and after Completion as held
		by Xiamen Port Development or Xiamen Port Holding).
Completion	The parties have agreed to procure and cooperate with the Target
	Company, Xiamen Hailong and Xiamen Haihong to carry out the
	necessary industrial and commercial registration changing procedures
	as a result of the implementation of the Capital Contribution
	Transactions within 30 days from the effective date of the Capital
	Increase Agreement. The Completion Date shall fall on the date of
	completion of the industrial and commercial registration changing
	procedures of the Target Company.
Post-Completion arrangements	Xiamen Port Holding should transfer (i) the land use rights of two
	agreed land parcels of berth no. 9 at the Haicang port area (the
	"Haicang Land Parcels"); and (ii) the right of use of the coastal
	basin thereof to Xiamen Haihong within 6 months from the date of
	the entering into of the Capital Increase Agreement. Xiamen Port
	Holding shall endeavour to procure and complete such relevant assets
	transfer registration and confirmation procedures as soon as
	practicable, whilst Xiamen Port Development should proactively
	cooperate with Xiamen Port Holding.
	In this connection, given that as at the Latest Practicable Date,
	Xiamen Port Holding does not hold the relevant housing use right
	certificates for certain building structures erected on the Haicang
	Land Parcels (the "Haicang Building Structures"), if Xiamen Port
	Holding is able to obtain, and transfer the abovementioned housing
	use right certificates to Xiamen Haihong within 6 months from the
	date of the entering into of the Capital Increase Agreement, Xiamen
	Port Development shall pay RMB2,082,115 in cash to Xiamen Port
	Holding, which is equivalent to the difference between the appraised
	values of the Haicang Building Structures with and without full
	housing use right certificates as at the Benchmark Assessment Date
	(i.e. RMB3,199,316) appraised by the PRC Qualified Valuer,
	multiplied by 65.08% (i.e. the effective equity interest in Xiamen
	Haihong to be held by Xiamen Port Development after Completion).
Conditions precedent and supplemental	The Capital Increase Agreement shall be conditional upon the
agreement	satisfaction of, among other things, the following conditions:
	(i) the approval by the internal decision making body of Xiamen
		Port Holding;
	(ii)	the approval by the board of directors and the shareholders of
		Xiamen Port Development at an extraordinary general meeting
		to be held by Xiamen Port Development;
	(iii)	the approval by the Board and the Independent Shareholders at
		the EGM; and

LETTER FROM THE BOARD

(iv) the granting of approval by or filing record with the relevant state-owned assets supervision and administration departments regarding matters in respect of the Capital Contribution Transactions, and/or the permission, approval or consent by

	other governmental departments with authority (if necessary).
	None of the above conditions precedent can be waived. As at the
	Latest Practicable Date, conditions numbered (i) and (iv) have been
	fulfilled.
	In addition, between the date of the entering into of the Capital
	Increase Agreement and the Completion Date, the parties may
	separately enter into supplemental agreement(s) in accordance with
	the actual circumstances for the need of executing the Capital
	Increase Agreement. The Company will promptly issue further
	announcement(s) as and when required pursuant to the Listing Rules
	in this regard.
Lock-up	The various equity interests deemed to be transferred pursuant to the
	Capital Increase Agreement are not subject to any lock-up restrictions
	and therefore the Group is entitled to dispose of any of the equity
	interests so acquired at any time after the Completion Date.

Information of the Target Group

The Target Company was established in the PRC in January 2002 and the Target Group is principally engaged in the loading and unloading of bulk cargos, such as coal and iron sand, storage and transportation agent for domestic cargo. The operational assets of the Target Group are primarily located at (i) berths no. 18 and no. 19 at the Dongdu port area, Xiamen; and (ii) berth no. 7 at the Haicang port area, Xiamen. As at the Latest Practicable Date, the equity interest of the Target Company is owned by Xiamen Port Development as to 51% and Xiamen Port Holding as to 49%.

According to the audited consolidated financial statements of the Target Group which were prepared pursuant to the Chinese Enterprises Accounting Standards, (i) the net asset value of the Target Group as at 31 December 2019 amounted to approximately RMB843,743,119; and (ii) the profits (both before and after taxation) of the Target Group for the two years ended 31 December 2018 and 2019 are as follows:

	For the year ended		For the year ended
	31 December 2018		31 December 2019
	(in RMB)		(in RMB)
Profits before taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	133,487,309	158,901,534
Profits after taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	109,763,348	130,585,283

Information of Xiamen Hailong

Xiamen Hailong was established in the PRC in September 2012 and is principally engaged in loading and unloading of bulk/general cargos and storage services (excluding storage and loading and unloading of dangerous chemical goods). As at the Latest Practicable Date, Xiamen Hailong is a wholly-owned subsidiary of Xiamen Port Development. The operational assets of Xiamen Hailong are primarily located at berth no. 20 and no. 21 at the Haicang port area, Xiamen.

According to the audited consolidated financial statements of Xiamen Hailong which were prepared pursuant to the Chinese Enterprises Accounting Standards, (i) the net asset value of Xiamen

LETTER FROM THE BOARD

Hailong as at 31 December 2019 amounted to approximately RMB783,205,842; and (ii) the losses (both before and after taxation) of Xiamen Hailong for the two years ended 31 December 2018 and

2019 are as follows:

	For the year ended		For the year ended
	31 December 2018		31 December 2019
	(in RMB)		(in RMB)
Loss before taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(102,995,064)	(80,251,184)
Loss after taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(100,894,176)	(77,557,897)

Information of Xiamen Haihong

Xiamen Haihong was established in the PRC in December 2006 and is principally engaged in terminal and other port facilities services, loading and unloading of petrochemical products, storage services, vessels-related port services, as well as sewage treatment and recycling. As at the Latest Practicable Date, Xiamen Haihong is a wholly-owned subsidiary of Xiamen Port Holding. The operational assets of Xiamen Haihong are primarily located at berth no. 9 at the Haicang port area, Xiamen.

According to the audited consolidated financial statements of Xiamen Haihong which were prepared pursuant to the Chinese Enterprises Accounting Standards, (i) the net asset value of Xiamen Haihong as at 31 December 2019 amounted to approximately RMB211,293,324; and (ii) the losses (both before and after taxation) of Xiamen Haihong for the two years ended 31 December 2018 and

2019 are as follows:

	For the year ended		For the year ended
	31 December 2018		31 December 2019
	(in RMB)		(in RMB)
Loss before taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(5,268,302)	(4,225,862)
Loss after taxation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	(3,630,036)	(2,790,777)

The original cost of the Target Equity Interest amounts to 14.08% of the aggregate capital contributions made into the Target Group by Xiamen Port Holding since the establishment of the Target Company, which was approximately RMB76,304,505.

The original cost of the Xiamen Port Development's acquisition of the 65.08% effective equity interest in Xiamen Haihong as a result of the Capital Contribution Transactions amounts to 65.08% of the aggregate capital contributions made by Xiamen Port Holding since the establishment of Xiamen Haihong, which was approximately RMB151,249,255.

The Board is of the view that the original costs incurred by Xiamen Port Holding in respect of the Target Equity Interest and Xiamen Haihong have no relevancy to the determination of the Consideration.

Properties

The valuation of the properties held by or to be transferred to the Target Group (the "Enlarged Target Group Properties") as conducted by the PRC Qualified Valuer was approximately RMB3,500,000,000 as at 31 December 2019. Such valuation is different from the valuation of RMB3,453,400,000 as at 31 May 2020 conducted by Savills Valuation and Professional Services Limited ("Savills"), a qualified independent professional valuer, mainly as Savills has assigned no

LETTER FROM THE BOARD

commercial value to certain properties of the Enlarged Target Group with title defects with a total gross floor area of 27,572.65 square metre (the "Defective Enlarged Target Group Properties"), while, given the undertaking from Xiamen Port Holding to rectify the title defects on the Defective Enlarged Target Group Properties, the PRC Qualified Valuer assumed that the title defects of the Defective Enlarged Target Group Properties have been rectified or would have no material legal obstacle to be rectified.

Below is the ownership structure of the Defective Enlarged Target Group Properties. Further details of the Defective Enlarged Target Group Properties are contained in the Property Valuation Report as set out in Appendix I:

						Depreciated
						replacement cost
						in existing state
					Gross floor area	as at 31 May
	Property		(square metre)		2020 (in RMB)	Owner
	At berth No. 7 at the Haicang port area
1.	Repair workshop	337.00	530,000		The Target Group
	At berth No. 9 at the Haicang port area
2.	Multi-functional building	4,306.41	9,600,000		Xiamen Haihong
3.	Boiler room	424.39	730,000		Xiamen Haihong
4.	Control room of oil transfer arm	32.00	60,000		Xiamen Haihong
5.	Power control room	294.00	470,000		Xiamen Haihong
6.	Power substation and pump house	1,221.00	2,310,000		Xiamen Haihong
7.	Front power substation	1,162.00	1,850,000		Xiamen Haihong
8.	Sewage treatment house	667.00	1,150,000		Xiamen Haihong
9.	Guard room	18.00	30,000		Xiamen Haihong
	At berth No. 19 at the Dongdu port area
10.	Parking workshop No. 19	900.00	1,350,000		The Target Group
11.	Hoist room No. 1	39.69	50,000		The Target Group
	At berths Nos. 20 and 21 at the Haicang port area
12.	Warehouses Nos. 4 and 5	17,966.60	42,700,000		Xiamen Hailong
	Sanming houses
13.	Rooms Nos. 401 and 402	204.56	200,000		The Target Group
			Total:	27,572.65	61,030,000

The reason for the difference in the assumptions between Savills and the PRC Qualified Valuer is that Savills prepared the property valuation report for the purpose of fulfilling the relevant requirements of the Listing Rules in which the definition of "Market Value" shall be strictly followed. Thus no commercial value was assigned to the Defective Enlarged Target Group Properties as these could not be freely disposed of in the market due to the lack of building ownership certificates as at the date of valuation (which is 31 May 2020). Such valuation approach adopted by Savills complies with the Listing Rules and market conventions in Hong Kong. However, solely for reference purposes, the

LETTER FROM THE BOARD

depreciated replacement cost of the Defective Enlarged Target Group Properties as at the valuation date (which is 31 May 2020) was RMB61,030,000. On the other hand, the PRC Qualified Valuer conducted its valuation on the Enlarged Target Group Properties in accordance with the relevant rules and regulations in the PRC regarding the valuation of state-owned assets, which are solely for the purpose of providing a reference for determining the Contribution. As a result, its valuation on the Enlarged Target Group Properties is made under the assumption that the Enlarged Target Group Properties are in good title to reflect their actual value.

Pursuant to the undertaking given by Xiamen Port Holding under the Capital Injection Agreement in relation to the rectification of the title defects of the Defective Enlarged Target Group Properties (see below), the PRC Qualified Valuer assumed that the Defective Enlarged Target Group Properties shall be treated with legal titles and hence, the PRC Qualified Valuer has assigned commercial values to the Defective Enlarged Target Group Properties and valued such Defective Enlarged Target Group Properties by assuming that the land grant formalities were completed and the land use right certificates and building ownership certificates were obtained.

In view of the above, despite the insignificant difference between the valuations conducted by the PRC Qualified Valuer and Savills, the Board considers that the assumption of "Perfect Title" and valuation methodology adopted by the PRC Qualified Valuer is appropriate as such approach (i) is able to provide a meaningful assessment and embodiment of the actual full functional value of the Defective Enlarged Target Group Properties which can precisely and objectively reflect the fact that these properties have been occupying and being in use during the course of the normal business operations of the Target Group or Xiamen Haihong (as the case may be) without any interruption regardless of the incompleteness of the title documents (see below) so that a reference price can be formed as a basis for determining the Consideration; and (ii) is in compliance with the relevant provisions set out in the Guiding Opinions on Legal Ownership of the Subjects of Valuation (Zhong Ping Xie [2017] No. 48)* (《資產評估對象法律權屬指導意見》(中評協 [2017] 48號)) and consistent with the current market practice in the PRC as to valuation of properties with title defects. In addition, the Consideration determined based on the valuation conducted by PRC Qualified Valuer is fair and reasonable and is in the interest of the Company and its Shareholders as a whole as the Board is of the view that (i) the abovementioned insignificant valuation difference is not material; and (ii) the property with title defects which carries the highest depreciated replacement cost (which is the warehouses nos. 4 and 5 at berths nos. 20 and 21 at the Haicang port area) of RMB42,700,000, representing approximately 70% of the total depreciated replacement cost of the Defective Enlarged Target Group Properties, is currently owned by Xiamen Hailong and therefore the inclusion of which in the valuations has been implicitly deemed as a greater capital contribution by Xiamen Port Development and accordingly is arithmetically beneficial to the Group as to the determination of the Consideration.

As disclosed above, the Defective Enlarged Target Group Properties have been occupying and using during the course of the normal business operations of the Target Group or Xiamen Haihong (as the case may be) without any interruption regardless of the incompleteness of the title documents. To the best of the Directors' knowledge, information and belief, having made all reasonable enquiries, as at the Latest Practicable Date, (i) there has not been any dispute with or any title claim by any third party due to the Defective Enlarged Target Group Properties to any material extent; and (ii) neither Xiamen Port Holding nor the Target Group has received from any governmental authorities any order of penalty, removal or dismantle relating to the Defective Enlarged Target Group Properties which may affect the de facto occupation and use of the Defective Enlarged Target Group Properties by the Enlarged Target Group. In this regard, substantive and continuing progress have been made before the

LETTER FROM THE BOARD

entering into of the Capital Increase Agreement in obtaining valid title documents for the Defective Enlarged Target Group Properties and the Group will, in joint effort with Xiamen Port Holding, continue to use all reasonable endeavours to liaise with the relevant government authorities and other stakeholders and take proactive actions as and when appropriate (i) to minimise and alleviate any material legal impediment that may arise when rectifying the title defects in respect of the Defective Enlarged Target Group Properties; and (ii) to identify, mediate and settle any potential, possible or threatened title dispute or claim by any third party in respect of the Defective Enlarged Target Group Properties which have been made known to the Group and/or Xiamen Port Holding as soon as practicable so as to ensure that the normal business operations of the Enlarged Target Group can be conducted smoothly after Completion. In fact, according to the Board's latest assessment, at present there is no realistic or foreseeable reasonable ground that any such third party title dispute or claim would arise as all of the Defective Enlarged Target Group Properties are merely ancillary infrastructure or fixtures which in effect can only be suitable and exclusively used for the business operations of the Enlarged Target Group at the various berths or port areas. In addition, Xiamen Port Holding has further undertaken to proactively take effective measures (including, without limitation, provision of properties in identical or substantial similar conditions for the operation of the Target Group and/or cash compensation) to compensate and indemnify Xiamen Port Development for any loss arising from or caused by any title defects on the Defective Enlarged Target Group Properties in order to procure that the Enlarged Target Group can continue to normally conduct its business operations. Furthermore, the Defective Enlarged Target Group Properties are only ancillary facilities and have no material effect on the Enlarged Target Group's business operations. Accordingly, in view of the above, the Board considers that the normal business operations of the Enlarged Target Group would not be affected without such land use right certificates and building ownership certificates in respect of the Defective Enlarged Target Group Properties.

Financial Effect of the Capital Contribution Transactions

Upon Completion, (i) the equity interest of the Target Company will be owned by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%; (ii) the Target Company will continue to be an indirect non-wholly owned subsidiary of the Company; (iii) Xiamen Hailong will become a direct wholly-owned subsidiary of the Target Company and continue to be an indirect subsidiary of the Company with its effective equity interest to be held by Xiamen Port Development as to 65.08% (which the Board has no intention to sell or dispose of as at the Latest Practicable Date) and Xiamen Port Holding as to 34.92%; and (iv) Xiamen Haihong will become a direct wholly-owned subsidiary of the Target Company and an indirect subsidiary of the Company with its effective equity interest to be held by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%.

LETTER FROM THE BOARD

The shareholding structure of the Target Group before and after the completion of the Capital Contribution Transactions is illustrated below:

Before completion of the Capital Contribution Transactions

Xiamen Port Holding

68.32%
The Company
61.89%	49%	100%

Xiamen Port Development

100%51%

Xiamen Hailong		Target Company		Xiamen Haihong

After completion of the Capital Contribution Transactions

		Xiamen Port Holding

68.32%

	The Company

61.89%				34.92%

	Xiamen Port Development

65.08%

			Target Company

100%				100%

	Xiamen Hailong	Xiamen Haihong

The Group does not expect to recognise any immediate disposal gain/loss as a result of its deemed disposal of 34.92% equity interest in Xiamen Hailong to Xiamen Port Holding pursuant to the

LETTER FROM THE BOARD

Capital Increase Agreement as the value of the additional capital to be contributed into the Target Company by Xiamen Port Development (which is the entire equity interest in Xiamen Hailong) is higher than that to be contributed by Xiamen Port Holding (which is the entire equity interest in Xiamen Haihong), which will be resulting in the Group's increase in the proportion of equity holding in the Target Company from 51% to 65.08% upon Completion and hence would eliminate the difference in the abovementioned additional capital contributions so that neither party thereto would record a gain nor suffer a loss in the Capital Contribution Transactions. In addition, no cash consideration will be received or receivable by Xiamen Port Development as a result of the Capital Increase Agreement.

Reasons for and benefits of the entering into of the Capital Increase Agreement

The Board is of the view that the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder are beneficial to the Group and the Shareholders as a whole as Xiamen Port Development and Xiamen Port Holding intend to utilise the Target Company as a unified platform to integrate their respective internal bulk/general cargo terminal resources for improving overall operating efficiency and for managing their business operation, in particular during the market cultivation period. The Group could (i) take advantage of the sound, valuable and local hands-on business operation experience of the Enlarged Target Group to fully promote synergy effects internally as the Enlarged Target Group will continue to be principally engaged in bulk/general cargo loading and unloading business in Xiamen after Completion, which could be tied up to the Group's existing principal business operation and its long-term development strategy and commercial interest; and (ii) enhance its overall competitiveness externally by solidifying its position as a leading port terminal operator in Xiamen through expansion of customer base, increase of market share and penetration, as well as optimisation of business and operation structure via reasonable resources integration and deployment among the various berths of the Enlarged Target Group to deliver efficient, cost-effective and quality services in the local market of Xiamen Port and the regional markets in the Southeast coastal regions. In addition, by developing Xiamen Port Development into the Group's bulk/general cargo terminal investment and operation platform, the Group is expected to further optimise its asset and business structure to enhance its overall business size and hence its level of revenue and profits by saving of management costs.

The Directors (including all the independent non-executive Directors) have approved the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder. They have considered the terms of the Capital Increase Agreement are on normal commercial terms, concluded in the ordinary and usual course of business of the Group, and fair and reasonable and are in the interests of the Group and the Shareholders as a whole.

Since (i) Mr. Cai Liqun and Mr. Chen Zhaohui, each being a deputy general manager of Xiamen Port Holding; (ii) Mr. Chen Zhiping, being the chairman of Xiamen Port Holding; (iii) Mr. Fu Chengjing, being a deputy general manager and the chief accountant of Xiamen Port Holding;

Mr. Huang Zirong, being the chief engineer of Xiamen Port Holding, and (v) Ms. Bai Xueqing, being a deputy general manager of Xiamen Port Holding, are considered to have a material interest in the Capital Increase Agreement, each of them is required to abstain, and has abstained, from voting on the resolutions passed by the Board for approving the Capital Increase Agreement and the Capital Contribution Transactions thereunder as required under the Listing Rules and the applicable rules and regulations.

LETTER FROM THE BOARD

Listing Rules implications

Since (i) Xiamen Port Holding is the controlling shareholder and a connected person of the Company under the Listing Rules; (ii) the Target Company is a connected subsidiary of the Company pursuant to Rule 14A.16 of the Listing Rules; and (iii) the highest applicable Relevant Ratio in respect of the Capital Contribution Transactions is more than 5% but less than 25%, the Capital Contribution Transactions constitute (i) discloseable transactions of the Company and are subject to the requirements for notification and announcement under Chapter 14 of the Listing Rules; and

connected transactions of the Company and are subject to the requirements for notification, announcement and approval by the Independent Shareholders at the EGM.

Information of the parties

The Group is the largest port terminal operator in Xiamen, the PRC, and is also the only group providing full-scale port integrated logistics services in Xiamen. The Group is principally engaged in, inter alia, (i) container loading and unloading and storage for international and domestic trade;

bulk/general cargo loading and unloading and storage for international and domestic trade; and
port integrated logistics services, which mainly include shipping agency, tallying, tugboat-assisted berthing and unberthing and port-related logistics in Xiamen.

Xiamen Port Development is principally engaged in the provision of the loading/unloading and storage of bulk/general cargo, port integrated logistics services (including shipping agency, tugboat services, transportation services, tallying services and other ancillary logistics services), trading services of commodities, as well as the sale of building materials in Xiamen.

Xiamen Port Holding is the controlling shareholder of the Company. It is principally engaged in, inter alia, (i) management and operation of certain state-owned assets; (ii) investment in different areas such as port, terminal, logistics, information, real estate, hotel, property, tourism and trading; (iii) providing financing; (iv) investment in financial institutions; (v) port development;

environmental consultancy services in respect of sea pollution; (vii) information products development; and (viii) providing other port-related services. To the best of the Board's knowledge, information and belief, having made all reasonable enquiries, the ultimate beneficial owner of Xiamen Port Holding is the Xiamen SASAC, which is the authority for supervision and administration of State- owned assets in Xiamen.

Independent Board Committee and the Independent Financial Adviser

The Board has established the Independent Board Committee comprising all the independent non-executive Directors to consider and advise the Independent Shareholders as to whether the Capital Contribution Transactions are conducted in the ordinary and usual course of business of the Company, and whether the terms of the Capital Increase Agreement and the Capital Contribution Transactions are on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole. A letter from the Independent Board Committee containing its recommendation to the Independent Shareholders is set out on pages 19 to 20 of this circular.

The Board has appointed First Shanghai as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders as to whether the Capital Contribution Transactions are conducted in the ordinary and usual course of business of the Company, and whether the terms of the Capital Increase Agreement and the Capital Contribution Transactions are

LETTER FROM THE BOARD

on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole. A letter from First Shanghai containing its advice to the Independent Board Committee and the Independent Shareholders is set out on pages 21 to 39 of this circular.

PROPOSED ADJUSTMENT TO THE REGISTERED AMOUNT OF THE NEW SUPER SHORT-TERM NOTES

The Board proposes to seek approval from the Shareholders by way of a special resolution at the EGM to authorise the Company to apply to the NAFMII for the registration of the issue of the New Super Short-term Notes of an aggregate registered maximum principal amount proposed to be adjusted from RMB4,000,000,000 to RMB8,000,000,000 on a rolling basis for a valid period of two years from completion of the registration at the NAFMII, with a view to optimise the debt capital structure, lower the financing cost and satisfy the working capital requirements of the Group in the foreseeable future.

Proposed revised principal terms of the proposed issue of the New Super Short-term Notes are as follows:

Issuer:	Xiamen International Port Co., Ltd
Revised registered amount:	Maximum aggregate principal amount shall not be
	more than RMB8,000,000,000 in either one or
	multiple tranches
Place of issue:	The PRC
Maturity:	Not more than 270 days from the date of each tranche
	of issue
Target investors:	To domestic institutional investors of the PRC inter-
	bank bond market only (other than those who are
	prohibited from participation in accordance with the
	laws and regulations of the PRC)
Underwriter:	To be determined by the Board in accordance with
	the Company's needs and prevailing market
	condition
Interest rate:	To be determined by reference to the condition of the
	inter-bank bond market at the time of issue of each
	tranche through bookbuilding processes
Intended use of net	To be used principally for supplementing the Group's
proceeds:	liquidity and repayment of its interest-bearing debts
	so as to satisfy the working capital requirements and
	lower the financing cost of the Group

In addition to the approval of the Shareholders obtained at the EGM, the proposed issue of the New Super Short-term Notes based on the abovementioned revised principal terms (including, without limitation, the Proposed Adjustment) is also subject to, inter alia, (i) the approval of the NAFMII; and (ii) the completion of the relevant registration procedures with NAFMII.

Furthermore, in order to expedite the proposed issue of the New Super Short-term Notes and the Proposed Adjustment, the Board also proposes to seek approval from the Shareholders at the EGM

LETTER FROM THE BOARD

to authorise one or more of the Directors to, inter alia, determine the specific terms and conditions and other matters in relation to the proposed issue of the New Super Short-term Notes (including, without limitation, the timing of issue, the principal amount and interest rate of each tranche of issue, the underwriters as well as the number of tranches of issue).

EGM

A notice convening the EGM to be held at 9:00 a.m. on Wednesday, 16 September 2020 at 23rd Floor, Conference Room, No. 31 Donggang North Road, Xiamen, the PRC together with the proxy form were issued and despatched to the Shareholders in accordance with the Listing Rules. At the EGM, among other things, resolutions will be proposed to consider, and if thought fit, the Capital Increase Agreement and the Capital Contribution Transactions. Pursuant to Rule 13.39(4) of the Listing Rules, voting at the EGM will be conducted by poll. In addition, pursuant to Rule 14A.36 of the Listing Rules, Xiamen Port Holding and its close associates, which in aggregate hold approximately 68.32% of the total issued Shares as at the Latest Practicable Date, will abstain from voting on the relevant resolution(s) at the EGM.

A notice convening the EGM is set out in this circular.

The proxy form for use at the EGM is enclosed herewith. Whether or not you are able to attend the EGM, you are requested to complete and return as soon as possible the proxy form in accordance with the instructions printed thereon but in any event no later than 24 hours before the time fixed for holding the EGM or any adjournment thereof (as the case may be). Completion and return of the proxy form will not preclude you from attending and voting in person at the EGM or any adjournment thereof should you so wish and in such event, the instrument appointing a proxy shall be deemed to be revoked.

RECOMMENDATION

The Directors (including the independent non-executive Directors) consider that (i) the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder, and (ii) the proposed issue of the New Super Short-term Notes and the Proposed Adjustment are in the best interest of the Company and the Shareholders as a whole. Accordingly, the Directors (including the independent non-executive Directors) recommend the Shareholders to vote in favour of the relevant resolutions as set out in the notice of the EGM.

ADDITIONAL INFORMATION

Your attention is drawn to the additional information set out in the appendices to this circular.

Yours faithfully,

By order of the Board

Xiamen International Port Co., Ltd

Cai Changzhen

Company Secretary

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 3378)

31 August 2020

To the Independent Shareholders

Dear Sir or Madam,

DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS

IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY

We refer to the circular of the Company dated 31 August 2020 (the "Circular") of which this letter forms part. Capitalised terms defined in this letter shall have the same meaning as those defined in the Circular unless otherwise specified.

We have been appointed by the Board to form the Independent Board Committee to consider the terms of the Capital Increase Agreement and advise the Independent Shareholders whether, in our opinion, the terms of the Capital Increase Agreement are fair and reasonable and are in the interests of the Company and the Shareholders as a whole. First Shanghai has been appointed as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in this regard.

We wish to draw your attention to (i) the "Letter from the Board" set out on pages 4 to 18 of the Circular which contains, among others, information about the Capital Increase Agreement; (ii) the letter from First Shanghai set out on pages 21 to 39 of the Circular to the Independent Board Committee and the Independent Shareholders which contains its advice to us in relation to the Capital Increase Agreement and the Capital Contribution Transactions; and (iii) additional information set out in the appendices to the Circular.

Having considered, among other matters, the advice of First Shanghai as stated in its letter of advice, we are of the view that (a) the Capital Contribution Transactions are conducted in the ordinary and usual course of business of the Group; and (b) the terms of the Capital Increase Agreement and the Capital Contribution Transactions are on normal commercial terms, fair and reasonable and in the interests of the Company and the Shareholders as a whole.

LETTER FROM THE INDEPENDENT BOARD COMMITTEE

Accordingly, we recommend the Independent Shareholders to vote in favour of the ordinary resolution(s) to be proposed at the EGM to approve the Capital Increase Agreement and the Capital Contribution Transactions.

Yours faithfully,

For and on behalf of

The Independent Board Committee

Liu Feng	Lin Pengjiu	You Xianghua	Jin Tao	Ji Wenyuan
Independent	Independent	Independent	Independent	Independent
non-executive	non-executive	non-executive	non-executive	non-executive
Director	Director	Director	Director	Director

For identification purpose only

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The following is the full text of the letter to the Independent Board Committee and the Independent Shareholders from First Shanghai dated 31 August 2020 setting out their opinion regarding the proposed Capital Contribution Transactions pursuant to the Capital Increase Agreement for the purpose of inclusion in this circular.

First Shanghai Capital Limited

19th Floor

Wing On House

71 Des Voeux Road Central

Hong Kong

31 August 2020

To the Independent Board Committee and

the Independent Shareholders

Xiamen International Port Co., Ltd.

No. 439, Gangnan Road

Haicang District

Xiamen City

Fujian Province

China

Dear Sirs,

DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS

IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY

INTRODUCTION

We refer to our engagement as the Independent Financial Adviser to advise the Independent Board Committee and the Independent Shareholders in respect of the proposed Capital Contribution Transactions pursuant to the Capital Increase Agreement, details of which are set out in a circular dated 31 August 2020 (the "Circular") to the Shareholders, of which this letter forms part. Terms used in this letter shall have the same meanings as those defined in the Circular unless the context requires otherwise.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Holding amounts to approximately RMB1,526,273,200, of which the value of the entire equity interest of Xiamen Hailong and Xiamen Haihong amount to approximately RMB1,208,737,100 and RMB317,536,100, respectively.

As at the Latest Practicable Date, the equity interest of the Target Company is owned by Xiamen Port Development as to 51% and Xiamen Port Holding as to 49%. Upon Completion, the equity interest of the Enlarged Target Group will be owned by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%, comprising 100% equity interest of each of Xiamen Hailong and Xiamen Haihong thereunder.

LISTING RULES IMPLICATIONS

Since (i) Xiamen Port Holding is the controlling shareholder and a connected person of the Company under the Listing Rules; (ii) the Target Company is a connected subsidiary of the Company pursuant to Rule 14A.16 of the Listing Rules; and (iii) the highest applicable Relevant Ratio in respect of the Capital Contribution Transactions is more than 5% but less than 25%, the Capital Contribution Transactions constitute (a) discloseable transactions of the Company and are subject to the requirements for notification and announcement under Chapter 14 of the Listing Rules; and

connected transactions of the Company and are subject to the requirements for notification, announcement and approval by the Independent Shareholders at the EGM.

The Company is going to convene an EGM to consider and, if thought fit, to approve (by way of ordinary resolution(s) and voting will be by way of poll) the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder. Pursuant to Rule 14A.36 of the Listing Rules, Xiamen Port Holding and its associates, which in aggregate hold approximately 68.32% of the total issued Shares as at the Latest Practicable Date, will abstain from voting on the relevant resolution(s) at the EGM.

THE INDEPENDENT BOARD COMMITTEE

The Independent Board Committee, comprising the five independent non-executive Directors, namely Mr. Liu Feng, Mr. Lin Pengjiu, Mr. You Xianghua, Mr. Jin Tao and Mr. Ji Wenyuan, has been established to consider the Capital Increase Agreement and the transactions contemplated thereunder and to advise the Independent Shareholders on the fairness and reasonableness in relation to the terms of the Capital Contribution Transactions pursuant to the Capital Increase Agreement and the transactions contemplated thereunder.

As the Independent Financial Adviser to the Independent Board Committee and the Independent Shareholders, our role is to give an independent opinion to the Independent Board Committee and the Independent Shareholders as to (i) whether or not the Capital Contribution Transactions pursuant to the Capital Increase Agreement are conducted in the ordinary and usual course of business of the Group; (ii) whether or not the terms of the Capital Increase Agreement are on normal commercial terms, in the interests of the Company and the Shareholders as a whole, and fair and reasonable so far as the Independent Shareholders are concerned; and (iii) how the Independent Shareholders should vote in relation to the ordinary resolution(s) to be proposed for approving the Capital Increase Agreement and the transactions contemplated thereunder at the EGM.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

OUR INDEPENDENCE

Independent Shareholders should note that, within the past two years prior to the Latest Practicable Date, we were engaged as the independent financial adviser by the Company to provide independent financial advice to the then Independent Board Committee and the Independent Shareholders for one occasion regarding the renewal of continuing connected transactions of the Company as detailed in the circular of the Company dated 13 November 2018.

Given (i) our independent role in that previous engagement; (ii) none of the members of our parent group is a direct party to the Capital Increase Agreement; and (iii) our independent financial advisory fees for this present engagement in addition to the previous engagement represented an insignificant percentage of revenue of our parent group, we consider that the previous engagement would not affect our independence to form our opinion in respect of these discloseable transactions and connected transactions to be contemplated under the Capital Increase Agreement.

BASIS OF OUR ADVICE

In formulating our opinion, we have relied on the information, facts and representations contained or referred to in the Circular and the information, facts and representations provided by, and the opinions expressed by the Directors, the Company and the management of the Group (the "Management"). We have assumed that all statements, information, facts, opinions and representations made or referred to in the Circular were true, accurate and complete at the time they were made and continued to be true, accurate and complete as at the date of the Circular.

We consider that we have (i) obtained all information and documents of the Group, the Target Company, Xiamen Hailong and Xiamen Haihong relevant to an assessment of the fairness and reasonableness of the terms of the Capital Contribution Transactions ; (ii) researched the relevant market and other conditions and trends relevant to the pricing of the Capital Contribution Transactions;

reviewed the fairness, reasonableness and completeness of any assumptions or projections relevant to the Capital Contribution Transactions; and (iv) reviewed the opinions and valuations relevant to the Capital Contribution Transactions provided by (a) Savills Valuation and Professional Services Limited ("Savills"), who is a qualified and registered professional surveyor in Hong Kong, in respect of the land and properties held by the Enlarged Target Group as at 31 May 2020 (the "Valuation Report") as set out in Appendix I to the Circular, as well as (b) the PRC Qualified Valuer, namely 福建聯合中和資產評估土地房地產估價有限公司 (Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd.) (who being a qualified and independent expert to undertake the asset appraisal works in the PRC, in respect of the appraised value attributable to the Enlarged Target Group ("Appraisal Value") as at 31 December 2019 (the "Appraisal Report(s)"), the summary of which is set out in Appendices II to IV to the Circular, including reviewing the terms of engagement (having particular regard to the scope of work, whether the scope of work is appropriate to the opinion required to be given and any limitations on the scope of work which might adversely impact on the degree of assurance given by the experts' reports, opinions or statements). Based on the foregoing, we confirm that we have taken all reasonable steps, which are applicable to the Capital Contribution Transactions, as referred to in Rule 13.80 of the Listing Rules (including the notes thereto).

We consider that we have reviewed sufficient information, including financial information of the Target Company, Xiamen Hailong and Xiamen Haihong that is to be ultimately acquired by the Group, to reach an informed view and to justify reliance on the accuracy of the information contained in the Circular and to provide a reasonable basis for our recommendation. We have no reason to doubt

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

the truth, accuracy and completeness of the statements, information, facts, opinions and representations provided to us by the Directors, the Company and the Management. The Directors have confirmed to us that no material facts have been omitted from the information supplied and opinions expressed and we have no reason to doubt that any relevant material facts have been withheld or omitted from the information provided and referred to in the Circular, or the reasonableness of the opinions and representations provided to us by the Group. All the Directors jointly and severally accept full responsibility for the accuracy of the information contained in the Circular and confirm, having made all reasonable enquiries, that, to the best of their knowledge, opinions expressed in the Circular have been arrived at after due and careful consideration and that there are no other facts not contained in the Circular the omission of which would make any statement in the Circular misleading. We have relied on such information and opinions and have not however, conducted any independent investigation into the business, financial conditions and affairs or the future prospects of the Group, the Target Group, Xiamen Hailong, Xiamen Haihong and Xiamen Port Holding.

PRINCIPAL FACTORS AND REASONS CONSIDERED

In arriving at our opinion and recommendation in relation to the Capital Contribution Transactions pursuant to the Capital Increase Agreement, we have considered the following principal factors and reasons:

1. Background of the Group

The Group is the largest port terminal operator in Xiamen City, Fujian Province, the PRC. It is also the only group providing full-scale port integrated logistics services in Xiamen City. The Group is principally engaged in, inter alia, (i) container loading and unloading and storage for international and domestic trade; (ii) bulk/ general cargo loading and unloading and storage for international and domestic trade; (iii) port integrated logistics services, including shipping agency, tallying, tugboat- assisted berthing and unberthing and port-related logistics; as well as (iv) the manufacturing, processing and selling of building materials and the trading of merchandise, in Xiamen City. The H Shares have been listed on the Main Board of the Stock Exchange since 19 December 2005.

Xiamen Port Development is a joint stock limited company established in the PRC, whose A shares are listed on the Shenzhen Stock Exchange since April 1999 and is currently held as to 61.89% by the Company as at the Latest Practicable Date. It is principally engaged in the provision of the loading/unloading and storage of bulk/general cargo, port integrated logistics services (including shipping agency, tugboat services, transportation services, tallying services and other ancillary extended services), trading services of commodities, as well as the sale of building materials in Xiamen City.

The Group currently operates (i) six container terminals, namely the Haitian Container Terminal, Xiamen International Container Terminal, Hairun Terminal, Xiamen Haicang International Container Terminal, Songyu Terminal and Xinhaida Terminal; as well as (ii) the ITG Terminal, Shihushan Terminal, Haiyi Terminal, Haiyu Terminal, Hailong Terminal and Huajin Terminal located at Quanzhou port, which operating bulk/general cargo business in respect of both international and domestic trade. The Group currently operates a total of 33 berths, the aforesaid terminal berths are capable of accommodating the largest container vessels in the world. Shipping routes can reach domestic major ports, as well as major ports including Europe, the United States of America, the Mediterranean Sea, Australia, Southeast Asia and Japan.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

In addition, the Group has leased (i) Haicang berth No. 8 and Songyu berths No. 4 to No. 6 in the Haicang port area of Xiamen port for operation; (ii) berths No. 6 to No. 8 in the Liuwudian southern port area of Xiamen port for operation; and (iii) berth No. 8 in the Qingzhou Operating Area of Mawei port area, Fuzhou City for operation, so as to meet the needs of its business development. The Group's container handling throughput has continuously been enhancing by a series of merger and acquisition activities over the years.

In respect of financial performance of the Group, the Group's revenue amounted to approximately RMB13,933.1 million for the financial year ended 31 December ("FY(s)") 2019, representing an increase of approximately 7.9% as compared to that of approximately RMB12,916.8 million in the FY 2018; while its net profit amounted to approximately RMB668.8 million for the FY 2019, representing an increase of approximately 20.6% as compared to that of approximately RMB554.4 million in the FY 2018. The profit attributable to owners of the Company amounted to approximately RMB279.7 million for the FY 2019, representing an increase of approximately 14.3% as compared to that of approximately RMB244.8 million in the FY 2018 mainly due to the increase in revenue from its merchandise trading business.

2. Background of Xiamen Port Holding

Xiamen Port Holding is a wholly State-owned enterprise established in the PRC, and the controlling shareholder of the Company holding approximately 68.32% shareholding interest in the Company.

It is principally engaged in, inter alia, (i) management and operation of certain State-owned assets; (ii) investment in different areas such as port, terminal, logistics, information, real estate, hotel, property, tourism and trading; (iii) providing financing; (iv) investment in financial institutions;

(v) port development; (vi) environmental consultancy services in respect of sea pollution; (vii) information products development; and (viii) providing other port-related services.

To the best of the Board's knowledge, information and belief, having made all reasonable enquiries, the ultimate beneficial owner of Xiamen Port Holding is the Xiamen SASAC, which is the authority for supervision and administration of State-owned assets in Xiamen City, Fujian Province, the PRC.

3. Overview of the port industry in the Fujian Province and Xiamen City

In 2019, Fujian Province actively responded to economic and trade frictions and accelerated the implementation of policies and measures to stabilize and promote foreign economic and trade development. Its economy continued to operate within a reasonable range, keeping its overall stable and progressive development trend. Its main economic indicators increased at a high rate in terms of China's overall level, and the scale of foreign trade imports ranked seventh in the country. According to the Fujian Provincial Government, the gross domestic product ("GDP") of Fujian Province in 2019 was approximately RMB4.2395 trillion (the audited GDP of Fujian Province in 2018 was RMB3.86878 trillion), representing a year-on-year growth of approximately 7.6%. The total export and import amount of foreign trade was approximately RMB1.3307 trillion, representing a year-on-year increase of approximately 7.8%, among which, the export of goods for the whole province was approximately RMB827.8 billion, representing a year-on-year increase of approximately 8.7%, while the import of goods was approximately RMB502.9 billion, representing a year-on-year increase of

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

approximately 6.3%. The port cargo throughput amounted to approximately 595 million tonnes, representing a year-on-year increase of approximately 6.6%, and the container throughput was approximately 17.26 million TEUs, representing a year-on-year increase of approximately 4.8%.

In 2019, Xiamen expanded economic and trade cooperation, actively deepened the China (Fujian) Pilot Free Trade Zone and other reform pilots, actively expanded the "Silk Road for Shipping" route and strengthened its collaboration with ports along the "One Belt, One Road" to accelerate the promotion of the construction of Xiamen port-type national logistics hub city, whose business environment ranked first in the assessment for nation's top ten shipping container ports. In 2019, the total import and export amount of foreign trade in Xiamen City was approximately RMB641.29 billion, representing a year-on-year increase of approximately 6.9%, of which the export of goods was approximately RMB352.87 billion and the import of goods was approximately RMB288.42 billion, representing a year-on-year increase of approximately 5.7% and 8.3%, respectively. The total container throughput of Xiamen port was approximately 11.122 million TEUs, representing an increase of approximately 3.9% over 2018, its container throughput continuously ranked seventh among the ports in Mainland China and fourteenth among container ports in the world, accounting for approximately 64.4% of the total container throughput in Fujian Province.

4. Reasons for and benefits of entering into the Capital Increase Agreement

As mentioned in the "Letter from the Board" of the Circular (the "Board Letter"), the Board is of the view that the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder are beneficial to the Group and the Shareholders as a whole, as Xiamen Port Development and Xiamen Port Holding intend to utilise the Target Company as a unified platform to integrate their respective internal bulk/ general cargo terminal resources for improving overall operating efficiency and for managing their business operation, in particular during the market cultivation period. The Group could (i) take advantage of the sound, valuable and local hands-on business operation experience of the Enlarged Target Group to fully promote synergy effects internally as the Enlarged Target Group will continue to be principally engaged in bulk/general cargo loading and unloading business in Xiamen after Completion, which could be tied up to the Group's existing principal business operation and its long-term development strategy and commercial interests; and

enhance its overall competitiveness externally by solidifying its position as a leading port terminal operator in Xiamen through expansion of customer base, increase of market share and penetration, as well as optimisation of business and operation structure via reasonable resources integration and deployment among the various berths of the Enlarged Target Group to deliver efficient, cost-effective and quality services in the local market of Xiamen Port and the regional markets in the Southeast coastal regions. In addition, by developing Xiamen Port Development into the Group's bulk/ general cargo terminal investment and operation platform, the Group is expected to further optimise its asset and business structure to enhance its overall business size and hence its level of revenue and profits by saving of management costs.

The Directors (including all the independent non-executive Directors) have approved the entering into of the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder. They have considered that the terms of the Capital Increase Agreement are on normal commercial terms, conducted in the ordinary and usual course of business of the Group, and fair and reasonable and in the interests of the Group and the Shareholders as a whole.

Based on our independent review of the annual reports of the Company (the "Annual Report(s)") for the FYs 2017 to 2019, we noted that the Group's business segment of bulk/ general

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

cargo loading and unloading business in terms of revenue growth had generally well-performed than its other business segments, which amounted to approximately RMB598.8 million, RMB699.6 million and RMB788.1 million for each of the three FYs from 2017 to 2019, respectively, representing a compound annual growth rate of about 14.7% during the three FYs.

Based on the above background information, we are of the view that there is strong commercial rationale for conducting the Capital Contribution Transactions by way of corporate re-organisation among the Enlarged Target Group, which is in line with the business development strategy of the Group, and therefore ancillary to its ordinary and usual course of business by integrating their respective bulk/ general cargo terminal resources in order to promote synergy effects and competitiveness so as to enhance its operational management efficiency/ flexibility and operating capability for long-term business development, and in the interests of the Group and the Shareholders as a whole.

5. Background of the Enlarged Target Group comprising the Target Group, Xiamen Hailong and Xiamen Haihong

The Target Group

The Target Company, namely Xiamen Port Group Shihushan Terminal Company Limited* (廈門港務集團石湖山碼頭有限公司), is established in the PRC and is a non-wholly-owned subsidiary of held by the Company and Xiamen Port Holding as to 51% and 49%, respectively, as at the Latest Practicable Date. There are three wholly-owned subsidiaries of the Target Company in operation, namely, Xiamen Port Haiyu Terminal Company Limited* (廈門港務海宇碼頭有限公司), Xiamen Port Haiyi Terminal Company Limited* (廈門港務海億碼頭有限公司) and Xiamen Shihushan Terminal Labour Service Company Limited* (廈門石湖山碼頭勞動服務有限公司).

Set out below is the background information of the each of the member companies comprising the Enlarged Target Group:

Subject companies			The Target Company		Xiamen Hailong		Xiamen Haihong
Date of establishment	:	14 January 2002		3 September 2012		12 December 2006
Principal business activities	:	loading and		loading and		provision of terminal
			unloading of bulk		unloading of bulk/		and other port
			cargos, such as coal		general cargos and		facilities services,
			and iron sand,		storage services		loading and
			storage and		(excluding storage		unloading of
			transportation		and loading and		petrochemical
			agency for domestic		unloading of		products, storage
			cargo		chemical dangerous		services, vessels-
					goods)		related port services,
							as well as sewage
							treatment and
							recycling

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Subject companies

The Target Company

Xiamen Hailong

Xiamen Haihong

Major operational assets directly or	: (i)	berth nos. 18	berths nos. 20 and
indirectly held		and 19 at the	21 at the Haicang
		Dongdu port	port area, Xiamen
		area,
		Xiamen; and

berth no. 9 at the Haicang port area, Xiamen

		(ii)	berth no. 7 at
			the Haicang
			port area,
			Xiamen
Equity-holding structure prior to the	:	•	51% by	•	100% owned by	•	100% owned by
Capital Contribution Transactions			Xiamen Port		Xiamen Port		Xiamen Port
			Development;		Development		Holding
			and
		•	49% by
			Xiamen Port
			Holding
Equity-holding structure immediately	:	•	65.08% by	•	100% owned by	•	100% owned by
upon Completion			Xiamen Port		the Target		the Target
			Development;		Company		Company
			and
		•	34.92% by
			Xiamen Port
			Holding

Audited profit/ (loss) before taxation

for the FYs (in RMB)
2018	:	133,487,309	(102,995,064)	(5,268,302)
2019	:	158,901,534	(80,251,184)	(4,225,862)
Audited profit/ (loss) after taxation for
the FYs (in RMB)
2018	:	109,763,348	(100,894,176)	(3,630,036)
2019	:	130,585,283	(77,557,897)	(2,790,777)
Audited net asset value as at
31	December of the FYs (in RMB)
2018	:	814,011,321	860,355,271	214,089,240
2019	:	843,743,119	783,205,842	211,293,324

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Subject companies			The Target Company		Xiamen Hailong	Xiamen Haihong
Appraisal Value concluded in the	:	1,529,890,200	1,208,737,100	317,536,100
respective Appraisal Reports as at
31 December 2019 (in RMB)
Gain on revaluation arisen between the	:	686,147,081	425,531,258	106,242,776
Appraisal Value and the net asset		(81.3%)	(54.3%)	(50.3%)
value as at 31 December 2019 (in
RMB)

As (i) Xiamen Port Holding is a wholly stated-owned enterprise established in the PRC;

Xiamen Port Development is stated-owned enterprise established in the PRC; and (iii) the transfers of the equity interests in each of the companies comprising the Enlarged Target Group pursuant to the Capital Increase Agreement have constituted transfers of state-owned assets, Xiamen Port Holding (as the transferor) and Xiamen Port Development (as the transferee), when transferring the Target Equity Interest, Xiamen Haihong's equity interest and Xiamen Hailong's equity interest are subject to the requirements under the Law of the PRC on the State-Owned Assets of Enterprises (《中華人民共和國企業國有資產法》), pursuant to which, a minimum transfer price shall be reasonably determined on the basis that the consideration/ price shall be legally appraised for the transfer of state-owned assets. Given the Appraisal Report for each of the Target Group, Xiamen Hailong and Xiamen Haihong is legally and compulsorily required to be prepared for providing reference when determining Consideration for the proposed Capital Contribution Transactions between Xiamen Port Holding and Xiamen Port Development; while the PRC Qualified Valuer has the requisite professional qualifications and experience in valuing assets similar to that of the Enlarged Target Group, we consider that the basis for determination of the Consideration based on the three Appraisal Reports is fair and reasonable, even though the respective Appraisal Value/ Consideration of RMB1,529,890,200, RMB1,208,737,100 and RMB317,536,100 for the Enlarged Target Group are considerably higher than their respective net asset values as at 31 December 2019, mainly due to the greater appreciation of property market value (i.e. the land parcels and the ancillary building structures located at the six respective berth nos. 18 to 19 at Dongdu port area; and berth nos. 7, 9, 20 and 21 at Haicang port area) attributable to the Enlarged Target Group, but which had not yet been fairly reflected in their respective accounting records and/or financial statements prepared on historical cost basis.

6. Principal terms and conditions of the Capital Increase Agreement

On 5 August 2020, Xiamen Port Development (a non-wholly owned subsidiary of the Company) has entered into the Capital Increase Agreement with Xiamen Port Holding, pursuant to which Xiamen Port Development and Xiamen Port Holding have agreed to contribute additional capital by injection of the entire equity interest in (i) Xiamen Hailong by Xiamen Port Development; and (ii) Xiamen Haihong by Xiamen Port Holding, into the Target Company, respectively, pursuant to which, in operative terms, Xiamen Port Development will, by way of a deemed disposal of 34.92% effective equity interest in Xiamen Hailong to Xiamen Port Holding, in effect acquire from Xiamen Port Holding (i) 14.08% equity interest in the Target Company (i.e. the Target Equity Interest); and (ii) 65.08% effective equity interest in Xiamen Haihong.

Upon Completion, the equity interest of the Target Company will be held by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Consideration under the Capital Increase Agreement

The total value of the additional capital agreed to be contributed by Xiamen Port Development and Xiamen Port Holding into the Target Company amounts to approximately RMB1,526,273,200. Such total value and the equity interest in the Target Company held by the parties after the Completion respectively was arrived at in good faith after arm's length negotiations with reference to the following factors:

the appraised value of the Target Company's entire equity interest of approximately RMB1,529,890,200 as at the Benchmark Assessment Date appraised by the PRC Qualified Valuer as approved by the Xiamen SASAC, by adopting an asset-based approach;
the appraised value of Xiamen Hailong's entire equity interest of approximately RMB1,208,737,100 as at the Benchmark Assessment Date appraised by the PRC Qualified Valuer as approved by the Xiamen SASAC, by adopting an asset-based approach;
the appraised value of Xiamen Haihong's entire equity interest of approximately RMB317,536,100 as at the Benchmark Assessment Date appraised by the PRC Qualified Valuer as approved by the Xiamen SASAC, by adopting an asset-based approach;
the corresponding value of the Target Equity Interest of approximately RMB215,423,538 as at the Benchmark Assessment Date immediately upon Completion; and
the actual financing needs for the Target Company's long-term business operation and development.

the appraised value of the 65.08% effective equity interest in Xiamen Haihong as at the Benchmark Assessment Date deemed to be acquired by Xiamen Port Development from Xiamen Port Holding amounts to approximately RMB206,655,607.

In accordance with the requirements under the Law of the PRC on the State-owned Assets of Enterprises (《中華人民共和國企業國有資產法》), a minimum transfer price (or an equivalent monetary value) for each deemed transfer of equity interests pursuant to the Capital Increase Agreement shall be reasonably determined on the basis of the appraised values approved by the Xiamen SASAC as these transactions are regarded as transfers of State-owned Assets.

The respective capital contributions by Xiamen Port Development and Xiamen Port Holding are approximately RMB1,208,737,100 and RMB317,536,100, which is equivalent to the respective appraised value of the entire equity interest of Xiamen Haihong and Xiamen Haihong as disclosed above. Upon Completion, the respective additional capital contributed by Xiamen Port Development and Xiamen Port Holding will be split into the following manner:

out of Xiamen Port Development's capital contribution at approximately RMB1,208,737,100, RMB597,869,300 and RMB610,867,800 will be applied to the registered capital and the capital reserve of the Target Company, respectively; and
out of Xiamen Port Holding's capital contribution at approximately RMB317,536,100, RMB312,130,700 and RMB5,405,400 will be applied to the registered capital and the capital reserve of the Target Company, respectively.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Xiamen Port Development should pay all increase in the corresponding owners' equity in the Target Company during the Relevant Period (if any) to Xiamen Port Holding, and Xiamen Port Holding shall pay all reduction in the corresponding owners' equity in the Target Company during the Relevant Period (if any) to Xiamen Port Development, such sum payable should be calculated as the amount of the increase in/ reduction of the corresponding owners' equity in the Target Company during the Relevant Period, multiplied by 14.08% (being the percentage of the change of the equity interest in the Target Company before and after Completion as held by Xiamen Port Development or Xiamen Port Holding);
Xiamen Port Development should pay all increase in the corresponding owners' equity in Xiamen Haihong during the Relevant Period (if any) to Xiamen Port Holding, and Xiamen Port Holding shall pay all reduction in the corresponding owners' equity in Xiamen Haihong during the Relevant Period (if any) to Xiamen Port Development, such sum payable should be calculated as the amount of the increase in/ reduction of the corresponding owners' equity in Xiamen Haihong during the Relevant Period, multiplied by 65.08% (being the percentage of the change of the effective equity interest in Xiamen Haihong before and after Completion as held by Xiamen Port Development or Xiamen Port Holding); and
Xiamen Port Holding should pay all increase in the corresponding owners' equity in Xiamen Hailong during the Relevant Period (if any) to Xiamen Port Development, and Xiamen Port Development shall pay all reduction in the corresponding owners' equity in Xiamen Hailong during the Relevant Period (if any) to Xiamen Port Holding, such sum payable should be calculated as the amount of the increase in/ reduction of the corresponding owners' equity in Xiamen Hailong during the Relevant Period, multiplied by 34.92% (being the percentage of the change of the effective equity interest in Xiamen Hailong before and after Completion as held by Xiamen Port Development or Xiamen Port Holding).

We consider that the above arrangement is to set out a clear cut-off line to determine pre-acquisition and post-acquisition profit or loss to be enjoyed/ borne by Xiamen Port Holding and Xiamen Port Development, as the case maybe, which is a fair and equitable treatment in usual merger and acquisition activities, and therefore is fair and reasonable, in the interests of Group and the Shareholders as a whole.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Basis for determination of the Consideration

The Consideration contributed for the Capital Contribution Transactions by each of Xiamen Port Development and Xiamen Port Holding of approximately RMB1,208,737,100 and RMB317,536,100, respectively, was determined by the parties to the Capital Increase Agreement after arm-length's negotiations between Xiamen Port Development and Xiamen Port Holding with reference to, inter alia, the Appraised Value of each of the Target Group, Xiamen Hailong and Xiamen Haihong as at 31 December 2019 as shown in the respective Appraisal Reports thereon as prepared and issued by the PRC Qualified Valuer, a PRC qualified appraisal firm independent from each of the Group and Xiamen Port Holding. The respective Appraisal Reports for each of the Target Company, Xiamen Hailong and Xiamen Haihong had been verified and duly approved by the Xiamen SASAC on 4 August 2020 so as the respective Appraisal Values therein are finally determined. The following summary sets out the capital contributions to be made by, and resulting proportion of equity interest attributable to, each of the contracting parties pursuant to the Capital Increase Agreement:

		Xiamen Port	Xiamen Port
Subject companies	Development	Holding	Total
		RMB		RMB		RMB
The Target Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	780,244,002		749,646,198		1,529,890,200
Equity proportion before Completion . . . . . . . . . . . . . . . . . . . .	51%	49%	100%
Xiamen Hailong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,208,737,100		-	1,208,737,100
Equity proportion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	100%	0%	100%
Xiamen Haihong . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-	317,536,100		317,536,100
Equity proportion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	0%	100%	100%
The Enlarged Target Group . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,988,981,102		1,067,182,298		3,056,163,400
Equity proportion after Completion . . . . . . . . . . . . . . . . . . . . . .	65.08%	34.92%	100%

As at the Latest Practicable Date, the equity interest of the Target Company is owned by Xiamen Port Development as to 51% and Xiamen Port Holding as to 49%. Upon the Completion, the structure of the Enlarged Target Group will be as follow:

the equity interest of the Target Company will be owned by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%;
the Target Company will continue to be an indirect non-wholly owned subsidiary of the Company;
Xiamen Hailong will become a direct wholly-owned subsidiary of the Target Company and continue to be an indirect non-wholly owned subsidiary of the Company with its effective equity interest to be held by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%; and
Xiamen Haihong will become a direct wholly-owned subsidiary of the Target Company and an indirect non-wholly owned subsidiary of the Company with its effective equity interest to be held by Xiamen Port Development as to 65.08% and Xiamen Port Holding as to 34.92%.

Based on our independent research from the public website of 中國證券監督管理委員會 (China Securities Regulatory Commission of the PRC) (the "CSRC") at http://www.csrc.gov.cn, we have noted that the PRC Qualified Valuer is one of the 70 qualified asset appraisal firms authorised by the CSRC and 中華人民共和國財政部 (the Ministry of Finance of the PRC) to perform asset appraisal works in the PRC. It has possessed sufficient qualifications and experience in valuing assets similar to that of the Enlarged Target Group for listed companies in the PRC and Hong Kong over the years.

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

The Appraised Value was finally calculated and arrived at based on the asset-based approach and the general industry standards recognised and adopted nationally, which was further verified and approved by the 廈門市人民政府國有資產監督管理委員會 (State-owned Assets Supervision and Administration Commission of Xiamen City Government). The PRC Qualified Valuer has considered, but finally did not adopt, the market approach for evaluating the value of the Enlarged Target Group in view of its business nature and asset-based in company value of the Enlarged Target Group. As such, we consider that the asset-based approach is an appropriate methodology used in the appraisal for the Enlarged Target Group on the basis that the selection of appraisal technology is consistent with the Group's precedent cases for transfer of terminal assets completed over the years, and the PRC Qualified Valuer has the requisite experience and expertise to conduct the appraisal for the Enlarged Target Group.

We have independently reviewed each of the Appraisal Reports on the Enlarged Target Group and understood from the PRC Qualified Valuer regarding, among other things, the basis and assumptions made and the methodology adopted by the PRC Qualified Valuer in conducting the appraisal for the major assets and properties of the Enlarged Target Group. We understand that the PRC Qualified Valuer has finally adopted the asset-based approach for the appraisal of major assets of the Enlarged Target Group due to unavailability of relevant market comparables, in terms of the port infrastructure and its terminal assets. Under that approach, the major assets of the Enlarged Target Group, in particular the port infrastructure and its terminal assets, were valued on the basis of their depreciated replacement cost, which were then based on market value estimate for the existing use of such assets, plus the current cost of replacement (reproduction) for the improvements, less deductions for physical deterioration and all relevant forms of obsolescence and optimisation.

We have also reviewed the Valuation Report and made necessary enquiry with Savills. We understand that Savills carried out physical site inspection of the six major properties as listed in the Valuation Report in May 2020, and has obtained PRC legal opinion on the titles of the properties. In valuing the properties, which are mainly held for owner occupation by the Enlarged Target Group in the PRC, due to the specific purpose for which the properties have been constructed, there are no readily available market comparables and thus the properties cannot be valued on the basis of direct comparison. They have been valued by the depreciated replacement cost approach. Depreciated replacement cost approach is based on an estimate of the market value for the existing use of the land plus the current replacement costs of the buildings and structures, from which deductions are then made to allow for physical deterioration and all relevant forms of obsolescence and optimization. The depreciated replacement cost approach is subject to adequate potential profitability of the business. The Valuation applies to the whole of the complex or development as a unique interest, and no piecemeal transaction of the complex or development is assumed. We have reviewed and analysed Savills' working schedule with supporting documents of arriving at the Valuation of RMB3,453.4 million, where Savills has made reference to three comparable land sales transactions that were transacted during the past few months from January to April 2020 for the valuation of land portion, when was close to the benchmark valuation date as at 31 May 2020; and the average land value adopted in the Valuation was comparable to the transacted unit sales prices thereof which are now being used for determining the land value under the Valuation, which we consider to representative samples being referred to/ relied on for reaching the present Valuation. We have further independently (i) crossed referred to the relevant public website for ascertaining the relevant information including but not limited to site area, locations (i.e. at Jiangxi Province, Hainan Province and Zhejiang Province), transfer consideration (within a range of approximately RMB27.6 million, RMB60.9 million and RMB117.2 million respectively) and other relevant factors of such comparables so as arriving at their

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

estimated land value of a range of RMB909 to RMB1,427 per square metre (after making appropriate adjustments), which were then applied by Savills for consideration in determining the Valuation;

reviewed the calculation basis for the Valuation results; (iii) compared the bases and assumptions for reaching the end results between the asset appraisal and the Valuation; and (iv) reviewed and considered the appropriateness of adjustments made thereon, where we did not find any anomaly and therefore consider to be fair and reasonable. As confirmed by Savills, such valuation approach with comparable land price after making appropriate adjustment(s) is commonly adopted for valuation of properties in the PRC and is also consistent with the usual market practice.

Furthermore, as part of our due diligence concerning the competence of Savills, we have conducted independent research from the websites of Savills and the Stock Exchange regarding its professional qualifications, experience and expertise, we understand that Savills is a global real estate services provider with an international network of more than 650 offices and associates in 70 countries around the world. In fact, we also have past experience working with Savills, and accordingly consider that Savills is a well-qualified and renowned professional valuation firm in Hong Kong with extensive experience in the valuation of properties in Hong Kong and the PRC. Based on the above understanding and our due diligence enquiry with Savills, we have no reason to doubt the fairness and appropriateness of the valuation of the land use rights of the various land parcels and the ancillary buildings structures under the Capital Contribution Transactions prepared by Savills. Based on our further enquiry with the PRC Qualified Valuer and Savills, there was merely very slight deviation (i.e. 1.3%) of the end appraisal/ valuation results between that of the PRC Qualified Valuer and Savills on the land parcels and properties attributable to the Enlarged Target Group, mainly because Savills has assigned no commercial value to certain properties thereof with title defects which has a total gross floor area of 27,572.65 square metre, more details of which are set out in the Board Letter and the Valuation Report.

As mentioned in the Board Letter, the Board does not consider the relevant title defects that would adversely affect the Capital Contribution Transactions and subsequent operations after Completion in material respects on the basis that (i) there has not been any dispute with or any title claim by any third party due to the Defective Enlarged Target Group Properties (as defined in the Board Letter) to any material extent; and (ii) neither Xiamen Port Holding nor the Target Group has received from any governmental authorities any order of penalty, removal or dismantle relating to the Defective Enlarged Target Group Properties which may affect the de facto occupation and use of the Defective Enlarged Target Group Properties by the Enlarged Target Group. In this regard, substantive and continuing progress have been made before the entering into of the Capital Increase Agreement in obtaining valid title documents for the Defective Enlarged Target Group Properties and the Group will, in joint effort with Xiamen Port Holding, continue to use all reasonable endeavours to liaise with the relevant government authorities and other stakeholders and take proactive actions as and when appropriate (i) to minimise and alleviate any material legal impediment that may arise when rectifying the title defects in respect of the Defective Enlarged Target Group Properties; and (ii) to identify, mediate and settle any potential, possible or threatened title dispute or claim by any third party in respect of the Defective Enlarged Target Group Properties which have been made known to the Group and/or Xiamen Port Holding as soon as practicable so as to ensure that the normal business operations of the Enlarged Target Group can be conducted smoothly after Completion. In fact, according to the Board's latest assessment, at present there is no realistic or foreseeable reasonable ground that any such third party title dispute or claim would arise as all of the Defective Enlarged Target Group Properties are merely ancillary infrastructure or fixtures which in effect can only be suitable and exclusively used for the business operations of the Enlarged Target Group at the various berths or port

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

areas. In addition, Xiamen Port Holding has further undertaken to proactively take effective measures (including, without limitation, provision of properties in identical or substantial similar conditions for the operation of the Target Group and/ or cash compensation) to compensate and indemnify Xiamen Port Development for any loss arising from or caused by any title defects on the Defective Enlarged Target Group Properties in order to procure that the Enlarged Target Group can continue to normally conduct its business operations. Furthermore, the Defective Enlarged Target Group Properties are only ancillary facilities and have no material effect on the Enlarged Target Group's business operations. Accordingly, in view of the above, the Board considers that the normal business operations of the Enlarged Target Group would not be affected without such land use right certificates and building ownership certificates in respect of the Defective Enlarged Target Group Properties. Based on such consideration, we concur with the Directors' view in this regard. In addition, (i) as the Consideration determined based on the Appraisal Value concluded by PRC Qualified Valuer is fair and reasonable and is in the interests of the Company and the Shareholders as a whole despite of the immaterial valuation differences of end results between the Appraisal Reports and the Valuation Report; and

the property with title defects which carries the highest depreciated replacement cost (which is the warehouse nos. 4 and 5 at berths nos. 20 and 21 at the Haicang port area) of RMB42,700,000, representing approximately 70% of the total depreciated replacement cost of the Defective Enlarged Target Group Properties, is currently owned by Xiamen Hailong and therefore the inclusion of which in the valuations has been implicitly deemed as a greater capital contribution by Xiamen Port Development whilst they would have no material adverse impact to future business operation of the Enlarged Target Group after Completion, we consider that the immaterial property title defects are even arithmetically beneficial to the Group as to the determination of the Consideration.

During the course of our independent review on the Appraisal Reports as well as the Valuation Report and further understanding from/ enquiry with the PRC Qualified and/or Savills, we have not identified any major factors which cause us to doubt the fairness and reasonableness of the principal bases and assumptions adopted for the asset appraisal and property valuation works in relation to the Appraisal Reports and Valuation Report, respectively.

Comparison with other companies in the similar industry

Based on our understanding from the Management, the subject matter of the Capital Contribution Transactions, in substance, are to integrate their respective internal bulk/ general cargo terminal resources for improving overall operating efficiency and for managing their business operation for long-term business development so as to optimise the Enlarged Target Group's asset and business structure to enhance its overall business size and hence its level of revenue and profits by saving of management costs.

Since both Xiamen Hailong and Xiamen Haihong are principally operating the various berths in their respective port area and holding the land sites and their ancillary building structures; whilst the subject matter of the Capital Contribution Transactions, in substance, are the terminal assets themselves and their future development potential. Furthermore, both Xiamen Hailong and Xiamen Haihong's have been loss-making for a number of years, we accordingly consider that direct comparison in terms of price-to-earnings ratio and/or price-to-book ratio with other port-related operation companies listed on the Stock Exchange with much larger operating scale would not be meaningful, or even misleading, on the grounds that both Xiamen Hailong and Xiamen Haihong's scale of operation are relatively limited, which we consider them not directly comparable with other sizeable listed port-related operation companies with profitable track record. Based on such

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

consideration, we are of the view that determination of the Consideration for the Capital Contribution Transactions by making reference to the Appraised Value is an appropriate and reliable appraisal basis for the Enlarged Target Group.

Conditions precedent and approvals

The Capital Increase Agreement shall be conditional upon the satisfaction of, among other things, the following conditions:

the approval by the internal decision making body of Xiamen Port Holding;
the approval by the board of directors and the shareholders of Xiamen Port Development at an extraordinary general meeting to be held by Xiamen Port Development;
the approval by the Board and the Independent Shareholders at the EGM; and
the granting of approval by or filing record with the relevant State-owned assets supervision and administration departments regarding the matters in respect of the Capital Contribution Transactions (in particular, the appraised value of the equity interest in the Target Company, Xiamen Hailong and Xiamen Haihong respectively), and/or the permission, approval or consent by other governmental departments with authority (if necessary).

In addition, between the date of the entering into of the Capital Increase Agreement and the Completion Date, the parties may separately enter into supplemental agreement(s) in accordance with the actual circumstances for the need of executing the Capital Increase Agreement. The Company will promptly issue further announcement(s) as and when required pursuant to the Listing Rules in this regard.

None of the above conditions precedent can be waived. As at the Latest Practicable Date, conditions numbered (i) and (iv) have been fulfilled.

Completion

The parties have agreed to procure and cooperate with the Target Company, Xiamen Hailong and Xiamen Haihong to carry out the necessary industrial and commercial registration changing procedures as a result of the implementation of the Capital Contribution Transactions within 30 days from the effective date of the Capital Increase Agreement. The Completion Date shall fall on the date of completion of the industrial and commercial registration changing procedures of the Target Company.

Post-Completion arrangements

Xiamen Port Holding should transfer (i) the land use rights of two agreed land parcels of berth no. 9 at the Haicang port area (the "Haicang Land Parcels"); and (ii) the right of use of the coastal basin thereof to Xiamen Haihong within six months from the date of the entering into of the Capital Increase Agreement. Xiamen Port Holding shall endeavour to procure and complete such assets transfer registration and confirmation procedures as soon as practicable, whilst Xiamen Port Development should proactively cooperate with Xiamen Port Holding.

In this connection, given that as at the Latest Practicable Date, Xiamen Port Holding does not hold the relevant housing use right certificates for certain building structures erected on the Haicang

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

Land Parcels (the "Haicang Building Structures"), if Xiamen Port Holding is able to obtain, and transfer the abovementioned housing use right certificates to Xiamen Haihong within six months from the date of the entering into of the Capital Increase Agreement, Xiamen Port Development shall pay RMB2,082,115 in cash to Xiamen Port Holding, which is equivalent to the difference between the appraised values of the Haicang Building Structures with and without full housing use right certificates as at the Benchmark Assessment Date (i.e. RMB3,199,316) appraised by the PRC Qualified Valuer, multiplied by 65.08% (i.e. the effective equity interest in Xiamen Haihong to be held by Xiamen Port Development after Completion).

We consider that the above arrangement is to set out clear obligations between the parties to the Capital Increase Agreement that to be properly followed up and/or compensated by determining pre-acquisition and post-acquisition appraised asset value to be enjoyed/ borne by Xiamen Port Holding and Xiamen Port Development, as the case maybe, which is a fair and equitable treatment in usual merger and acquisition activities, and therefore is fair and reasonable, in the interests of Group and the Shareholders as a whole.

Based on the above analysis and consideration, we are of the view that the Capital Increase Agreement and the Capital Contribution Transactions contemplated thereunder are on normal commercial terms, fair and reasonable so far as the Independent Shareholders are concerned and is in the interests of the Company and the Shareholders as a whole.

7. Possible financial effects of the Capital Contribution Transactions on the Group

In operative terms, Xiamen Port Development will, by way of a deemed disposal of 34.92% effective equity interest in Xiamen Hailong to Xiamen Port Holding, in effect acquire from Xiamen Port Holding (i) 14.08% equity interest in the Target Company; and (ii) 65.08% effective equity interest in Xiamen Haihong.

Upon the Completion, 100% equity interest in both of Xiamen Hailong and Xiamen Haihong will be disposed of by Xiamen Port Development and Xiamen Port Holding, respectively, to the Target Company; while at the same time the Group's equity-holding in the Target Group will increase by 14.08% from 51% to 65.08%, and therefore the financial performance and position of the Target Group (with an additional member company of Xiamen Haihong thereunder) will continue to be consolidated into the Group under acquisition accounting method; whilst the non-controlling interests therein (including Xiamen Hailong) attributable to Xiamen Port Holding will correspondingly decrease by 14.08% from 49% to 34.92%.

Earnings

Upon the Completion, other than the immaterial legal and professional fees to be directly incurred in the Capital Contribution Transactions, there is no immediate material impact on earnings of the Group by the only reason of the Capital Contribution Transactions on the grounds that the greater amount of capital contribution (i.e. RMB1,208,737,100 in Xiamen Hailong) into the Target Company to be made by Xiamen Port Development than that (i.e. RMB317,536,100 in Xiamen Haihong) by Xiamen Port Holding will be resulting in the Group's increase in proportion of equity holding in the Target Group from original 51.0% to 65.08% (i.e. whilst Xiamen Port Holding's proportion of equity interest therein would correspondingly decrease from 49% to 34.92%) upon the Completion, which would totally eliminate the difference in amounts of capital contributions to the Target Company made

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

by them so as either party thereto would take/ suffer a gain/ loss in the Capital Contribution Transactions.

However, the Directors currently expect that the Capital Contribution Transactions can enhance the operational management efficiency/ flexibility and operating capability of the Enlarged Target Group, and then further contribute to its earnings base in the long run, but the quantification of such impact will depend on the future operating performance of the Enlarged Target Group thereafter.

Working capital

Based on the Annual Report, the Group's working capital deficiency (i.e. total current assets of approximately RMB6,136.3 million, less total current liabilities of approximately RMB6,478.2 million) and cash and cash equivalents as at 31 December 2019 amounted to approximately RMB341.9 million and RMB1,883.4 million respectively, representing a current ratio of about 94.7%. The working capital deficiency position as at 31 December 2019 showed that the Group's working capital requirement was relatively tight.

As the Capital Contribution Transactions do not involve any cash outlay from the Group, its present working capital deficiency position would not be adversely affected in material respect after the Completion.

Net asset value

According to the Annual Report, the net asset value (excluding non-controlling interests) of the Group was approximately RMB5,647.4 million as at 31 December 2019. It is currently expected that there will not be any significant impact of the net asset value of the Group following the Completion, as the net asset value of (i) the Target Group originally attributable to the 49% minority equity-holder (i.e. Xiamen Port Holding) would reduce to 34.92% so that an additional 14.08% share of net asset value thereof will belong to the Group; and (ii) Xiamen Haihong attributable to 65.08% equity interest holding under the Target Company would then be included in the consolidated financial statements of the Group; whilst (iii) the Group's original 100% direct equity interest holding in Xiamen Hailong will be reduced to 65.08% indirect equity interest therein through the Target Company, so as there will be new share of the net asset value of Xiamen Hailong as well as Xiamen Haihong attributable to the indirect 34.92% minority equity-holder. However, since the Appraisal Value of the Enlarged Target Group would be considerably higher than the net asset values recorded in their respective audited financial statements as at 31 December 2019, it is currently expected that there may be increase in the consolidated net asset value of the Group to be recognized upon Completion. There will also be no material impact on the income statement and reserves of the Group, so it could be inferred that the consolidated net asset value of the Group would not adversely change upon the Completion.

Gearing position

As at 31 December 2019, the Group had interest-bearing borrowings and net asset value (excluding non-controlling interests) of approximately RMB7,438.3 million and RMB5,647.4 million, respectively, representing a relatively higher gearing ratio (which is calculated as total interest-bearing borrowings divided by the net asset value of the Group) of approximately 131.7%.

As there would not involve any cash outlay and/or new interest-bearing borrowings to finance the Capital Contribution Transactions, it is currently anticipated that the gearing position of the Group

LETTER FROM THE INDEPENDENT FINANCIAL ADVISER

would not deteriorate. In addition, the Target Group itself has strong capability to generate recurrent operating cash inflow from its ordinary and usual course of business operations for the past three FYs from 2017 to 2019. Subsequent to the Completion, upon the additional 14.08%, on top of the existing 51%, equity interest of the Target Group to be included in the Group, it could be sharing additional net profit and operating cash inflow that may be generated from the business operation of the Enlarged Target Group, and hence, it is anticipated that such relatively higher gearing position could gradually be improved in the longer-term future.

Conclusion

In light of the foregoing financial effects of the Capital Contribution Transactions on the earnings, working capital, net asset value and gearing position of the Group as a whole, we are of the view that the Capital Contribution Transactions would have no material adverse impact on the Group's financial performance and position as they would not involve any cash outlay and/or increase in liabilities. Therefore, we are of the view that the Capital Contribution Transactions will be an effective utilisation of their operational assets and management resources which are aimed at positioning the Group (comprising the Enlarged Target Group) for a better growth in the future which, in the long run, is expected to benefit the Group and the Shareholders as a whole.

RECOMMENDATION

Having taken into account the above principal factors and reasons, we are of the view that the Capital Contribution Transactions are corporate re-organisation activities to integrate their respective bulk/ general cargo terminal resources in order to promote synergy effects and competitiveness so as to enhance its operational management flexibility and operating capability for long-term business development, and therefore are ancillary and incidental to the ordinary and usual course of business of the Group; while the Capital Increase Agreement is on normal commercial terms or better, fair and reasonable so far as the Independent Shareholders are concerned and in the interests of the Company and the Shareholders as a whole. Accordingly, we recommend the Independent Shareholders, and the Independent Board Committee to advise the Independent Shareholders, to vote in favour of the ordinary resolution(s) to approve the Capital Contribution Transactions and the transactions contemplated under pursuant to the Capital Increase Agreement at the EGM.

Yours faithfully,

For and on behalf of

First Shanghai Capital Limited

Nicholas Cheng

Director

Note:

Mr. Nicholas Cheng has been the Responsible Officer of Type 6 (advising on corporate finance) regulated activity under the SFO, and has extensive experience in corporate finance industry. He has participated in the provision of independent financial advisory services for, and completed, numerous connected transactions involving companies listed in Hong Kong.

APPENDIX I

PROPERTY VALUATION REPORT

The following is the text of a letter, a summary of values and a valuation report prepared for the purpose of incorporation in this circular received from Savills Valuation and Professional Services Limited, an independent valuer, in connection with their opinion of values of the properties as at 31 May 2020.

The Directors

Xiamen International Port Co., Ltd.

No. 439 Gangnan Road

Haicang District

Xiamen

Fujian Province

The People's Republic of China

Savills Valuation and

Professional Services Limited

1208, Cityplaza One

1111 King's Road, Taikoo Shing

Hong Kong

(852) 2801 6100

(852) 2530 0756

EA LICENCE: C-023750 savills.com

31 August 2020

Dear Sirs,

INSTRUCTIONS

In accordance with the instructions from Xiamen International Port Co., Ltd. (the "Company") for us to value the properties situated in the People's Republic of China (the "PRC") on a 100% interest basis, we confirm that we have carried out inspections, made relevant enquiries and obtained such further information as we consider necessary for the purpose of providing you with our opinion of values of such properties as at 31 May 2020 (the "valuation date") for inclusion in the Company's circular dated 31 August 2020.

BASIS OF VALUATION

Our valuation of each of the properties is our opinion of its market value which we would define as intended to mean "the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm's-length transaction after proper marketing and where the parties had each acted knowledgeably, prudently and without compulsion".

Moreover, market value is understood as the value of an asset or liability estimated without regard to costs of sale or purchase (or transaction) and without offset for any associated taxes or potential taxes.

Our valuation has been undertaken in accordance with the HKIS Valuation Standards 2017 of The Hong Kong Institute of Surveyors ("HKIS"), which incorporates the International Valuation Standards ("IVS"), and (where applicable) the relevant HKIS or jurisdictional supplement. We have also complied with the requirements set out in Chapter 5 and Practice Note 12 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited.

- I-1 -

APPENDIX I

PROPERTY VALUATION REPORT

IDENTIFICATION AND STATUS OF THE VALUER

The subject valuation exercise is handled by Mr. Anthony C.K. Lau, who is a Director of Savills Valuation and Professional Services Limited ("SVPSL") and a corporate member of HKIS with over 27 years' experience in valuation of properties in Hong Kong and the PRC and has sufficient knowledge of the relevant market, the skills and understanding to handle the subject valuation exercise competently.

Prior to your instructions for us to provide this valuation services in respect of the properties, SVPSL had not been involved in valuation of the properties in the last 12 months.

We are independent of the Company. We are not aware of any instances which would give rise to potential conflict of interest from SVPSL or Mr. Lau in the subject exercise. We confirm SVPSL and Mr. Lau are in the position to provide objective and unbiased valuation for the properties.

PROPERTY CATEGORIZATION AND VALUATION METHODOLOGY

The properties are mainly held for owner occupation in the PRC. In valuing Property Nos. 1 to 5, due to the specific purpose for which the properties have been constructed, there are no readily available market comparables and thus the properties cannot be valued on the basis of direct comparison. They have been valued by the Depreciated Replacement Cost ("DRC") Approach. The DRC Approach is based on an estimate of the market value for the existing use of the land plus the current replacement costs of the buildings and structures, from which deductions are then made to allow for physical deterioration and all relevant forms of obsolescence and optimization. The DRC Approach is subject to adequate potential profitability of the business. Our valuation applies to the whole of the complex or development as a unique interest, and no piecemeal transaction of the complex or development is assumed.

We have assigned no commercial value to Property No. 6 because valid title documents have not been obtained as at the valuation date.

TITLE INVESTIGATION

We have been provided with copies of title documents relating to the properties. However, we have not searched the original documents to verify ownership or to ascertain the existence of any amendments which may not appear on the copies provided to us. In the course of our valuation, we have relied to a very considerable extent on the information given by the Company and the legal opinion issued by the Company's PRC legal adviser, King & Wood Mallesons, regarding the titles to the properties in the PRC.

SOURCES OF INFORMATION

In the course of our valuation, we have relied to a considerable extent on information from the Company and also accepted advice given to us on such matters as planning approvals or statutory notices, easements, tenure, particulars of occupancy, site and floor areas and all other relevant matters. Dimensions, measurements and areas included in the valuation report are based on the information contained in the documents provided to us and are therefore only approximations. No on-site measurements have been taken. We have no reason to doubt the truth and accuracy of the information provided to us by the Company, which is material to our valuation. We are also advised by the Company that no material facts have been omitted from the information supplied. We consider that we have been provided with sufficient information to reach an informed view.

- I-2 -

APPENDIX I

PROPERTY VALUATION REPORT

VALUATION ASSUMPTIONS

In valuing the properties in the PRC, unless otherwise stated, we have assumed that transferable land use rights of the properties for their specific terms at nominal annual land use fees have been granted and that any premium payable has already been fully paid. Unless otherwise stated, we have also assumed that the owners of the properties have good legal titles to the properties and have free and uninterrupted rights to occupy, use, transfer or lease the properties for the whole of the respective unexpired terms as granted.

No allowance has been made in our valuation for any charges, mortgages or amounts owing on any property nor for any expenses or taxation which may be incurred in effecting a sale. Unless otherwise stated, it is assumed that the properties are free from encumbrances, restrictions and outgoings of an onerous nature which could affect their values.

SITE INSPECTION

We have inspected the exterior and where possible, the interior of the properties. During the course of our inspections, we did not note any serious defects. However, no structural survey has been made and we are therefore unable to report that the properties are free from rot, infestation and any other defects. No tests were carried out on any of the services. The site inspections were carried out during the period between 11 May 2020 and 15 May 2020 by the following professional valuers:

Mr. Dirk Li	China Registered Real Estate Appraiser
Ms. Vicky Wu	China Registered Real Estate Appraiser and China Registered Land Valuer
Ms. Zoe Zhang	Assistant Valuer

CURRENCY

Unless otherwise stated, all money amounts stated are in Renminbi ("RMB").

We enclose herewith our summary of values and valuation report.

Yours faithfully,

For and on behalf of

Savills Valuation and Professional Services Limited

Anthony C K Lau

MRICS MHKIS RPS(GP)

Director

Note: Mr. Anthony C.K. Lau is a professional surveyor who has over 27 years' experience in valuation of properties in Hong Kong and the PRC.

- I-3 -

	APPENDIX I	PROPERTY VALUATION REPORT
			SUMMARY OF VALUES
				Market value in
				existing state as at
No.			Property	31 May 2020
1. Berth No. 7, a building and various ancillary structures located at		RMB671,700,000
		Haicang Port,
		Haicang District,
		Xiamen,
		Fujian Province,
		PRC
2. Berth No. 9 and various buildings and ancillary structures located at		RMB166,700,000
		Gangnan Road,
		Haicang District,
		Xiamen,
		Fujian Province,
		PRC
3. Berth Nos. 20 and 21 and various buildings and ancillary structures located at		RMB1,456,000,000
		Cangjiang Road,
		Haicang District,
		Xiamen,
		Fujian Province,
		PRC
4. Berth No. 18 and various ancillary structures located at		RMB504,000,000
		Dongdu Port,
		Huli District,
		Xiamen,
		Fujian Province,
		PRC
5. Berth No. 19 and various buildings and ancillary structures located at		RMB655,000,000
		Zhaishang West Road,
		Huli District,
		Xiamen,
		Fujian Province,
		PRC
6. Room Nos. 401			No commercial value
		and 402 of Block 1,
		No. 56 Xinshi South Road,
		Sanyuan District,
		Sanming,
		Fujian Province,
		PRC

			Total:	RMB3,453,400,000

- I-4 -

APPENDIX I

PROPERTY VALUATION REPORT

VALUATION REPORT

No.	Property		Description and tenure
1.	Berth No. 7, a		The property is situated in the south
	building and various		of Haicang District with a number of
	ancillary structures		berths in its immediate
	located at Haicang		neighbourhood. It takes about 20 to
	Port,		25 minutes' drive to the city centre
	Haicang District,		of Xiamen from the property.
	Xiamen,		The property comprises a bulk cargo
	Fujian Province,
		berth together with various ancillary
	PRC
		structures and a building erected on

			three parcels of land with a total site
			area of approximately 304,320.17
			sq m.
			The berth has a total quay length of
			325 metres and a depth of
			17.5 metres. It has a total designed
			annual handling capacity of
			3,000,000 ton and was completed in
		2006.
			The building comprises a repair
			workshop with a gross floor area of
			approximately 337.00 sq m and was
			completed in 2017.
			The ancillary structures mainly
			comprise a sewage pumping room, a
			railway crossing room, a stacking
			area, quays, a guard room and roads
			and were completed in various stages
			between 2007 and 2017.
			The land use rights of the property
			have been granted for a term due to
			expire on 20 November 2056 for
			port, storage and railway route uses
			respectively.

Notes:

		Market value
Particulars of	in existing state as at
occupancy		31 May 2020
As at the valuation	RMB671,700,000
date, portion of the		(Renminbi Six
property with a gross		Hundred Seventy
floor area of		One Million and
approximately 337.00		Seven Hundred
sq m was occupied by		Thousand)
Xiamen Shihushan		(see Notes 5 and
Terminal Labour	6)
Service Co., Ltd. (廈門
石湖山碼頭勞動服務有
限公司) ("Shihushan
Labour").
The remaining portion
of the property was
being owner-occupied
for port use.

Pursuant to the State-owned Construction Land Use Rights Grant Contract - (2006) Xia Hai Di He (Xie) Zi No. 063 dated 4 December 2006 and its two supplementary contracts dated 5 March 2012 and 31 May 2016 respectively, the land use rights of various parcels of land of Berth No. 7 with a total site area of approximately 312,466.854 sq m have been agreed to be granted to Xiamen Port Haiyu Terminal Co., Ltd. (廈門港務海宇碼頭有限公司) ("Haiyu Terminal") for a term due to expire on 20 November 2056 for port, storage, railway route and ancillary road uses respectively.
As advised by the Company, the property only comprises portion of the land parcels as stated in the State-owned Construction Land Use Rights Grant Contract and its two supplementary contracts as mentioned above.
Pursuant to the Xiamen Land and Building Ownership Certificate - Xia Guo Tu Fang Zheng Di No. Di 00011375 dated 30 November 2011, the land use rights of Land Plot A1 of Berth No. 7 with a site area of approximately 177,816.60 sq m have been granted to Haiyu Terminal for a term due to expire on 20 November 2056 for port use.
Pursuant to the Real Estate Title Certificate - Min (2016) Xia Men Shi Bu Dong Chan Quan Di No. 0141370 dated 21 November 2016, the land use rights of Land Plots A1 and A4 of Berth No. 7 with a total site area of approximately 126,503.57 sq m have been granted to Haiyu Terminal for a term due to expire on 20 November 2056 for storage (Land Plot A1) and railway route (Land Plot A4) uses respectively.

- I-5 -

APPENDIX I

PROPERTY VALUATION REPORT

Pursuant to two Certificates of Completion of Works of Port - Xia Gang Jun [2011] No. 2 and Min Jiao Gang Hang Yan Zheng Zi [2014] No. 6 dated 30 March 2011 and 10 October 2014 respectively, the construction works of Berth No. 7 of Haicang Port were certified to be completed.
As advised by the Company, the building of the property does not have any ownership certificate.
In the course of our valuation, we have assigned no commercial value to the building of the property with no valid title document as mentioned in Note 5. For the Company's management reference purpose, the depreciated replacement cost of the said building was RMB530,000.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. Haiyu Terminal is entitled to occupy, use, transfer, lease, mortgage or by other legal means to dispose of the property;
2. in respect of the building as stated in Note 5, there exists legal risk of being punished by the relevant government departments. Shihushan Labour is entitled to occupy or use the building. Up to now, there exists no punishment from the relevant government departments for the building; and
3. the property is free from mortgage.

- I-6 -

APPENDIX I

PROPERTY VALUATION REPORT

No.	Property		Description and tenure
2.	Berth No. 9 and		The property is situated in the north
	various buildings		of Haicang District with a number of
	and ancillary		berths in its immediate
	structures located at		neighbourhood. It takes about 25 to
	Gangnan Road,		30 minutes' drive to the city centre
	Haicang District,		of Xiamen from the property.
	Xiamen,		The property comprises a multi-
	Fujian Province,
		functional berth together with eight
	PRC
		buildings and various structures

				erected on two parcels of land with a
				total site area of approximately
				49,673.27 sq m.
				The berth has a quay length of 233
				metres and a depth of 13.8 metres. It
				has a total designed annual handling
				capacity of 2,520,000 ton and was
				completed in 2015.
				The buildings comprise a multi-
				functional building and other
				ancillary buildings with a total gross
				floor area of approximately 8,124.80
				sq m and were completed in 2009.
				The ancillary structures mainly
				comprise a harbour basin, power and
				water supply systems, roads and
				walls and were completed in various
				stages between 2009 and 2019.
				The land use rights of the property
				have been granted for a term due to
				expire on 18 January 2056 for
				storage and port uses respectively.

Notes:

		Market value in
Particulars of		existing state as at
occupancy		31 May 2020
As at the valuation	RMB166,700,000
date, portions of the		(Renminbi One
property with a total		Hundred Sixty
gross floor area of		Six Million and
approximately 692.18		Seven Hundred
sq m were subject to		Thousand)
two tenancies with the	(see Notes 5 and 6)
latest one due to expire
on 31 August 2021 at a
total monthly rent of
approximately
RMB19,226.
The remaining portion
of the property was
being owner-occupied
for port use.

Pursuant to the State-owned Land Use Rights Grant Contract - (2006) Xia Hai Di He (Xie) Zi No. 005 dated 2 March 2006 and its two supplementary contracts dated 22 April 2008 and 18 June 2008 respectively, the land use rights of various parcels of land of Berth No. 9 with a total site area of approximately 173,623.969 sq m have been agreed to be granted to Xiamen Port Holding Group Co., Ltd. (廈門港務控股集團有限公司) ("Xiamen Port Holding") for a term due to expire on 18 January 2056 for storage and port uses respectively.
As advised by the Company, the property only comprises portion of the land parcels as stated in the State-owned Land Use Rights Grant Contract and its two supplementary contracts as mentioned above.
Pursuant to the State-owned Land Use Rights Transfer Contract entered into between Xiamen Port Holding and Xiamen Haihong Petrochemical Terminal Co., Ltd. (廈門海鴻石化碼頭有限公司) ("Xiamen Haihong") on 25 June 2015, the land use rights of Land Plots B1 and B2 of Berth No. 9 with a total site area of approximately 49,673.27 sq m have been transferred to Xiamen Haihong at a consideration of RMB4,685,529.46.
Pursuant to two Real Estate Title Certificates - Min (2020) Xiamen Shi Bu Dong Chan Quan Di Nos. 0020742 and 0020743, the land use rights of Land Plots B1 and B2 of Berth No. 9 with a total site area of approximately 49,673.27 sq m have been granted to Xiamen Port Holding for a term due to expire on 18 January 2056 for storage and port (Land Plot B1) and port (Land Plot B2) uses respectively.
Pursuant to the Certificate of Completion of Works of the Port - Xia Gang Jun [2015] No. 1 dated 9 February 2015, the construction works of Berth No. 9 of Haicang Port were certified to be completed.
As advised by the Company, there are eight buildings of the property with a total gross floor area of approximately 8,124.80 sq m which do not have any ownership certificates.

- I-7 -

APPENDIX I

PROPERTY VALUATION REPORT

In the course of our valuation, we have assigned no commercial value to the buildings of the property with no valid title documents as mentioned in Note 5. For the Company's management reference purpose, the depreciated replacement cost of the said buildings of the property was in the sum of RMB16,200,000 as at the valuation date.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. in respect of the land parcels as mentioned in Note 3, the ownership has not been changed to Xiamen Haihong and also, the title ownership has not been obtained for the existing buildings. In this circumstance, Xiamen Haihong is entitled to occupy or use and will be entitled to occupy, use, transfer, lease or by other legal means to dispose of the property after the ownership has been obtained by them;
2. up to now, there exist no dispute or claim by any other third parties and punishment from the relevant government departments for the property;
3. given that Xiamen Port Holding will strictly fulfil the relevant legal obligations and commitments, there exist no foreseeable and substantial legal obstacles for changing the ownership of the land parcels of the property to Xiamen Haihong; and
4. the property is free from mortgage.

- I-8 -

APPENDIX I

PROPERTY VALUATION REPORT

No.	Property		Description and tenure
3.	Berth Nos. 20 and		The property is situated in the
	21 and various		southwest of Haicang District with
	buildings and		a number of berths in its
	ancillary structures		immediate neighbourhood. It takes
	located at		about 30 minutes' drive to the city
	Cangjiang Road,		centre of Xiamen from the
	Haicang District,		property.
	Xiamen,		The property comprises two multi-
	Fujian Province,
		functional berths, 15 buildings and
	PRC
		various structures erected on two

				parcels of land with a total site
				area of approximately
				368,197.97 sq m.
				Berth Nos. 20 and 21 has a quay
				length of 504 metres and a depth
				of 11.5 metres. It has a total
				designed annual handling capacity
				of 5,910,000 ton and was
				completed in 2016.
				The buildings comprise a multi-
				functional building, five
				warehouses and other ancillary
				buildings with a total gross floor
				area of approximately 61,815.69
				sq m and were completed in
				various stages between 2017 and
			2020.
				The ancillary structures mainly
				comprise simple granaries, power
				and water supply systems, roads
				and walls and were completed in
				various stages between 2010 and
			2019.
				The land use rights of the property
				have been granted for a term due
				to expire on 1 December 2063 for
				port (storage) use.

Notes:

		Market value
Particulars of		in existing state as at
occupancy		31 May 2020
As at the valuation		RMB1,456,000,000
date, the property was		(Renminbi One
being owner-occupied		Billion Four
for port use.		Hundred and Fifty
		Six Million)
		(see Notes 7 and 8)

1. Pursuant to the State-owned Construction Land Use Rights Grant Contract - No. 35020520131202CG022 dated 2 December 2013, the land use rights of a parcel of land with a site area of approximately 368,197.97 sq m have been agreed to be granted to Xiamen Hailong Terminal Co., Ltd. (廈門海隆碼頭有限公司) ("Xiamen Hailong") for a term due to expire on 1 December 2063 for port (storage) use.

- I-9 -

APPENDIX I

PROPERTY VALUATION REPORT

2. Pursuant to the following Real Estate Title Certificates all dated 25 May 2018, the building ownership of portions of the buildings of the property with a total gross floor area of approximately 43,849.09 sq m together with their corresponding land use rights with a total site area of approximately 368,197.97 sq m are vested in Xiamen Hailong for a term due to expire on 1 December 2063 for port (storage) use. Details of the said certificates are as follows:

						Approximate
						Gross Floor Area
No.		Certificate No.		Building			(sq m)
i.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058269		Fire Pump House	258.89
ii.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058271		Canteen and Bathroom	1,487.10
iii.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058274		Air Compressor Station	169.07
iv.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058275		Labour Building	1,700.61
v.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058261		Multi-functional Building	6,853.11
vi.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058264		Comprehensive Maintenance Warehouse	3,068.65
vii.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058265		Warehouse No. 3	9,137.90
viii.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058266		Warehouse No. 2	9,988.11
ix.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058267		Warehouse No. 1	9,988.11
x.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058268		Guard Room	21.00
xi.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058270		Main Gate	761.09
xii.	Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058272		Sewage Treatment Room	76.37
xiii. Min (2018) Xiamen Shi Bu Dong Chan Di No. 0058273		Transportation Management Centre	339.08

				Total:	43,849.09

Pursuant to the Construction Works Planning Permit - Jian Zi Di No. 350205201813024 dated 21 May 2018, the total approved construction scale of Warehouse Nos. 4 and 5 of the property was approximately 17,966.60 sq m.
Pursuant to the Construction Works Commencement Permit - No. 350205201812200101 dated 20 December 2018, the construction works of Warehouse Nos. 4 and 5 with a total construction scale of approximately 17,966.60 sq m was approved for commencement.
Pursuant to the Certificate of Completion of Works of the Port - Xia Gang Jun [2016] No. 5 dated 6 December 2016, the construction works of Berth Nos. 20 and 21 of Haicang Port were certified to be completed.
Pursuant to the Completion Acceptance Report, the construction works of Warehouse Nos. 4 and 5 were certified to be completed.
As advised by the Company, there are two buildings of the property (namely Warehouse Nos. 4 and 5) with a total gross floor area of approximately 17,966.60 sq m which do not have any ownership certificates.
In the course of our valuation, we have assigned no commercial value to the buildings of the property with no valid title documents as mentioned in Note 7. For the Company's management reference purpose, the depreciated replacement cost of the said buildings of the property was in the sum of RMB42,700,000 as at the valuation date.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. Xiamen Hailong is entitled to occupy, use, transfer, lease, mortgage or by other legal means to dispose of the property save for the portion referred to in Note 7 above;
2. in respect of the buildings as mentioned in Note 7, Xiamen Hailong is entitled to occupy or use those buildings. Up to now, there exist no dispute or claim by any other third parties and punishment from the relevant government departments for those buildings; and
3. the property is free from mortgage.

- I-10 -

APPENDIX I

PROPERTY VALUATION REPORT

No.	Property		Description and tenure
4.	Berth No. 18 and		The property is situated in the west
	various ancillary		of Huli District with a number of
	structures located at		berths in its immediate
	Dongdu Port,		neighbourhood. It takes about 15 to
	Huli District,		20 minutes' drive to the city centre
	Xiamen,		of Xiamen from the property.
	Fujian Province,		The property comprises a multi-
	PRC
		functional berth together with

			various ancillary structures erected
			on a parcel of land with a site area of
			approximately 219,068.27 sq m.
			The berth has a total quay length of
			435 metres and a depth of
			15.3 metres. It has a total designed
			annual handling capacity of 960,000
			ton and was completed in 2004.
			The ancillary structures mainly
			comprise a stacking area, quays and
			a guard room and were completed in
			various stages between 2004 and
		2018.
			The land use rights of the property
			have been granted for a term due to
			expire on 3 December 2041 for port
			use.

Notes:

		Market value
Particulars of	in existing state as at
occupancy		31 May 2020
As at the valuation	RMB504,000,000
date, portion of the		(Renminbi Five
property with a site		Hundred and
area of approximately		Four Million)
60,000.00 sq m was
leased to Xiamen
Hailong (廈門海隆碼頭
有限公司) for a term
due to expire on
31 December 2020 at
an annual rent of
approximately
RMB5,893,700 for
port use.
The remaining portion
of the property was
being owner-occupied
for port use.

Pursuant to the State-owned Construction Land Use Rights Grant Contract-No. 35020020160706CX08 dated 4 August 2016, the land use rights of a parcel of land of Berth No. 18 with a site area of approximately 220,346.951 sq m have been agreed to be granted to Xiamen Port Haiyi Terminal Co., Ltd. (廈門港務海億碼頭有限公司) ("Haiyi Terminal") for a term due to expire on 3 December 2041 for port use at a consideration of RMB156,464,000.
Pursuant to the Real Estate Title Certificate-Min (2016) Xia Men Shi Bu Dong Chan Quan Di No. 0134161, the land use rights of a parcel of land of Berth No. 18 with a site area of approximately 220,346.95 sq m have been granted to Haiyi Terminal for a term due to expire on 3 December 2041 for port use.
As advised by the Company, portion of the aforesaid land parcel with a total site area of approximately 1,278.684 sq m has been returned to the local government for drainage use.
Pursuant to the Certificate of Completion of Works of the Port-No. Xia Gang Jun [2012] No. 1 dated 10 February 2012, the construction works of Berth No. 18 of Dongdu Port were certified to be completed.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. Haiyi Terminal is entitled to occupy, use, transfer, lease, mortgage or by other legal means to dispose of the property; and
2. the property is free from mortgage.

- I-11 -

APPENDIX I

PROPERTY VALUATION REPORT

No.	Property	Description and tenure
5. Berth No. 19 and	The property is situated in the
	various buildings	west of Huli District with a
	and ancillary	number of berths in its immediate
	structures located	neighbourhood. It takes about 15
	at Zhaishang	to 20 minutes' drive to the city
	West Road,	centre of Xiamen from the
	Huli District,	property.

Xiamen,

The property comprises a multi-

Fujian Province,

		Market value in
		existing state as at
Particulars of occupancy		31 May 2020
As at the valuation date,		RMB655,000,000
portion of the land parcels of		(Renminbi Six
the property with a site area		Hundred and Fifty
of approximately 40,665.00		Five Million)
sq m and portion of the office		(see Notes 4 and 5)
building with a gross
floor area of approximately
701.00 sq m were leased to
Xiamen Port Logistics Co.,

PRC

Notes:

functional berth together with 22 buildings and various structures erected on two parcels of land with a total site area of approximately 235,193.14 sq m.

The berth has a quay length of 289.677 metres and a depth of 15.3 metres. It has a total designed annual handling capacity of 960,000 ton and was completed in 2007.

The buildings comprise workshops, office buildings and other ancillary buildings with a total gross floor area of approximately 16,105.75 sq m and were completed in various stages between 1993 and 2011.

The ancillary structures comprise a stacking area, walls, quays, railways and roads and were completed in various stages between 1995 and 2020.

The land use rights of the property have been granted for a term due to expire on 30 June 2053 for storage and port uses respectively.

Ltd. (廈門港務物流有限公司)

for a term due to expire on

31 December 2020 at a

monthly rent of

approximately RMB373,933

for stacking area and office

uses respectively.

Portion of the office building

with a gross floor area of

approximately 90.00 sq m

were leased to Shihushan

Labour for a term due to

expire on 15 March 2021 at a

monthly rent of

approximately RMB2,250 for

office use.

The remaining portion of the

property was being owner-

occupied for port use.

Pursuant to two State-owned Land Use Rights Grant Contracts-(2005) Xia Di He (Xie) Zi Di Nos. 23 and 24 both dated 17 May 2005 and their supplementary contract dated 30 May 2016, the land use rights of two parcels of land with a total site area of approximately 235,193.131 sq m have been agreed to be granted to Xiamen Port Holding for a term due to expire on 30 June 2053 for storage and port uses respectively.
Pursuant to two Certificates of Completion of Works of the Port-Xia Gang Jun [2012] No. 2 and Min Jiao Gang Hang Yan Zheng Zi [2014] No. 3 dated 10 February 2012 and 10 October 2014 respectively, the construction works of Berth No. 19 of Dongdu Port were certified to be completed.

- I-12 -

APPENDIX I

PROPERTY VALUATION REPORT

3. Pursuant to the following Real Estate Title Certificates all dated 25 January 2017, the building ownership of portions of the buildings of the property with a total gross floor area of approximately 15,166.06 sq m together with their corresponding land use rights with a total site area of approximately 235,193.14 sq m are vested in Xiamen Port Group Shihushan Terminal Co., Ltd. (廈門港務集團石湖山碼頭有限公司) ("Shihushan Terminal") for a term due to expire on 30 June 2053 for storage and port uses respectively. Details of the said certificates are as follows:

						Approximate
						Gross Floor Area
No.		Certificate No.		Building			(sq m)
i.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008095		Canteen	907.33
ii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008096		Pump Room	33.71
iii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008097		Sewage Disposal Room	235.32
iv.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008099		Transformer Station	614.15
v.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008101		Guard Room	29.95
vi.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008103		Guard Room	20.02
vii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008104		Pump Room	128.68
viii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008105		Workshop	869.00
ix.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008107		Office	2,049.07
x.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008113		Boiler Room	183.46
xi.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008199		Guard Room	21.16
xii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008201		Canteen	850.03
xiii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008203		Winder Chamber	39.69
xiv.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008210		Guard Room	28.22
xv.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008245		Labour Building	2,375.61
xvi.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008248		Office	3,396.32
xvii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008268		Switching Room	179.14
xviii.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008285		Office	2,247.38
xix.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008288		Transfer Station	226.62
xx.	Min (2017) Xiamen Shi Bu Dong Chan Di No. 0008298		Transformer Station	731.20

				Total:	15,166.06

As advised by the Company, there are two buildings (being the Parking Workshop No. 19 and Hoist Room No. 1) with a total gross floor area of approximately 939.69 sq m which do not have any ownership certificates.
In the course of our valuation, we have assigned no commercial value to the buildings of the property with no valid title documents as mentioned in Note 4. For the Company's management reference purpose, the depreciated replacement cost of the said buildings of the property was in the sum of RMB1,400,000 as at the valuation date.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. Shihushan Terminal is entitled to occupy, use, transfer, lease, mortgage or by other legal means to dispose of the property save for the portion referred to in Note 4 above;
2. in respect of the buildings as mentioned in Note 4, there exists risk of being punished by the relevant government departments. Shihushan Terminal is entitled to occupy or use those buildings. Up to now, there exists no punishment from the relevant government departments for those buildings; and
3. the property is free from mortgage.

- I-13 -

APPENDIX I

PROPERTY VALUATION REPORT

No.

Property

Description and tenure

6. Room Nos. 401 The property is situated in the and 402 of Block 1, north of Sanyuan District of

No. 56 Xinshi South	Sanming. Developments in the
Road,	vicinity are dominated by
Sanyuan District,	medium-rise residential
Sanming,	developments. It takes about 10 to
Fujian Province,	15 minutes' drive to the city
PRC	centre of Sanming from the
	property.
	The property comprises two
	residential units of a residential
	building with a total gross floor
	area of approximately 204.56 sq
	m. As advised by the Company,
	the property was completed in
	2003.

Notes:

		Market value in
		existing state as at
Particulars of occupancy		31 May 2020
As advised by the		No commercial value
Company, the property		(see Note 4)
was occupied by
Xiamen Penavico
International Freight
and Forwarding Co.,
Ltd. (廈門外代國際貨運
有限公司) for
dormitory use as at the
valuation date.

Pursuant to the Building Ownership Certificate-Min Fang Quan Zheng Zi Di No. 126063, the building ownership of the property with a total gross floor area of approximately 204.56 sq m is vested in Huaxia (Yongan) Real Estate Development Co., Ltd., an independent third party of the Company.
Pursuant to two Sale and Purchase Agreements entered into between Fujian Sanming Yongfu Real Estate Co., Ltd. (福建三明市永福房地產有限公司) and Xiamen Port Group Co., Ltd. (廈門港務集團有限公司) ("Xiamen Port Group") on 18 June 1999 and 9 August 1999 respectively, the property was contracted to be sold to Xiamen Port Group at a total consideration of approximately RMB197,066.
We have been provided with a legal opinion on the title to the property issued by the Company's PRC legal adviser, which contains, inter-alia, the following information:
1. the property is now under legal proceeding and the original purchaser Xiamen Port Holding may be unable to obtain the ownership of the property;
2. Shihushan Terminal is entitled to occupy or use but cannot legally dispose of those building units. Up to now, there exists no punishment from the relevant government departments for those building units; and
3. the property is free from mortgage.
In the course of our valuation, we have assigned no commercial value to the property because no valid Building Ownership Certificate was obtained by Xiamen Port Holding or Shihushan Terminal. For the Company's management reference purpose, the depreciated replacement cost of the building units was in the sum of RMB200,000, and the market value of the property was estimated to be RMB1,180,000 on the hypothetical assumption that a valid Building Ownership Certificate was obtained by Xiamen Port Holding or Shihushan Terminal as at the valuation date.

- I-14 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

This Appendix II contains the English translation of the Asset Valuation Report of the Target Company and the Target Equity Interest prepared by Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd., the PRC Qualified Valuer, using asset-based approach which is the basis of the determination of the Consideration. In case of discrepancy between the English translation and the Chinese version, the Chinese version shall prevail.

All Equity Interests of Xiamen Port Group Shihushan Terminal Co., Ltd.

in connection with Proposed Equity Increase due to Terminal Equity Integration by Xiamen

Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd.

Asset Valuation Report

Lian He Zhong He Ping Bao Zi (2020) No. 5011

To: Xiamen Port Holding Group Co., Ltd., Xiamen Port Development Co., Ltd.

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. (hereinafter referred to as the "Asset Appraisal Institution") accepts your engagement to conduct asset appraisal on the market value as at 31 December 2019 of all equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. in connection with proposed terminal equity integration by Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd. in accordance with the administrative regulations on asset valuation and asset valuation standards of the People's Republic of China and pursuant to objective, independent, fair and scientific manner and by using the recognized asset valuation approach. The Asset Appraisal Institution and the signing asset valuer conducted field survey and market investigation on the assets authorized for valuation according to necessary valuation procedures. The information on asset valuation and valuation results is set forth herein as follows:

Principals, Appraised Entity and Other Users of the Asset Valuation Report as stipulated in the Asset Valuation Commission Contract

The Principals are Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd., and the appraised entity is Xiamen Port Group Shihushan Terminal Co., Ltd..

1. Particulars of Principals

Principal A

Company name: Xiamen Port Holding Group Co., Ltd.

Social Unified Organization Code Certificate: 9135020026013542XA

Registered address: 25th Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB3.1 billion

Legal representative: Chen Zhiping

Company type: Limited liability company (wholly state-owned)

Scope of business: 1. to operate and manage the state-owned assets within the authorized scope;

2. to invest in enterprises operating in the port, terminals, logistics, information, real estate, hotels, property, tourism, trading and aquatic products processing industries; 3. to provide investment

II-1-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

enterprises with financing services in accordance with laws, and utilize different channels to raise funds for self-investment; 4. to invest in financial services and securities companies such as banks, trusts, guarantees, insurance etc.; 5. port engineering development, construction and consulting; 6. the analysis and consulting business of marine oil pollution, water recovery, environmental testing and oil type; 7. development and sales of information products, services on information consulting and technology, development and construction of information engineering and related services; 8. other business related to port construction and operation.

Principal B

Company name: Xiamen Port Development Co., Ltd.

Social Unified Organization Code Certificate: 913502007054097384

Registered address: 20th and 21st Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB531 million

Legal representative: Chen Zhaohui

Company type: Other joint stock limited company (listed)

Scope of business: 1. to provide ships with dock facilities and provide cargo handling, warehousing, logistics services within the port area; container handling, stacking and dismantling; roll on and roll off services for vehicle; simple processing for goods and their packaging (refer to license for expiration date); 2. the logistics and supply chain management, overall logistics planning and consulting, transit, multimodal transport services (excluding transport), logistics information management; 3. to operate all types of import and export of goods and technologies (no further attachment for directory of export commodities), except those goods and technologies the State restricts companies to operate or prohibits to import and export. 4. the wholesale and retail of building materials, chemical raw materials and products (excluding hazardous chemicals and monitoring chemicals), mineral products (except the state-controlled), machinery and equipment, hardware and electrical equipment and electronic products, textiles, clothing and daily necessities, agricultural products and livestock, stationery, sporting goods and equipment, arts and crafts; 5. lease of properties.

2. Particulars of the appraised entity

Company name: Xiamen Port Group Shihushan Terminal Co., Ltd.

Social Unified Organization Code Certificate: 91350200051166553E

Registered address: Building Complex, 98 Cangjiang Road, Haicang District, Xiamen

Registered capital: RMB40 million

Legal representative: Zheng Cenglin

Company type: Limited liability company (corporate-owned invested or controlled by a non-natural person)

Scope of business: cargo loading and unloading as well as warehousing services in port (excluding hazardous chemicals warehousing, loading and unloading).

3. History and shareholding structure

Xiamen Port Group Shihushan Terminal Co., Ltd. (hereinafter referred to as "Shihushan Terminal") was originally a joint venture of Xiamen Port Group Co., Ltd. (hereinafter referred to as

- II-2 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

"Port Group") and Xiamen Port Logistics Co., Ltd., which was incorporated on 14 January 2002. It is formerly known as Xiamen Port Group Shihushan Terminal Branch Company. Pursuant to Xia Gang Ji Cai (2002) No. 8 of Port Group, known as "Notice on financial matters related to company-owned branch setting up a company with limited liability", the assets and liabilities of Xiamen Port Group Shihushan Terminal Branch Company as at 31 December 2001 were taken up by Shihushan Terminal since 1 January 2002.

Pursuant to Xia Gang Ji Cai (2003) No. 58 of Port Group, Port Group transferred the 5% equity interest in Shihushan Terminal held by Xiamen Port Logistics Co., Ltd. to Xiamen Port Shipping Company Limited according to its book value in 2003.

Pursuant to Xia Gang Ji Cai (2004) No. 93 of Xiamen Port Group, Port Group transferred the 5% equity interest in Shihushan Terminal held by Xiamen Port Shipping Company Limited to Xiamen Port Heping Tourism & Passenger Transport Co., Ltd. according to its book value in 2004.

In September 2004, Xiamen Urban Traffic State-owned Assets Investment Company (later renamed as Xiamen Port Holding Co., Ltd.) transferred the 100% equity interest in Port Group held by Xiamen Municipal Bureau of Finance to Xiamen Port Holding Co., Ltd., with equity interest in Shihushan Terminal held by Port Group being transferred to Port Holding and the relevant procedures have been completed. After the above change of shareholders, the current shareholders of Shihushan Terminal are Xiamen Port Holding Co., Ltd. (renamed as Xiamen Port Holding Group Co., Ltd. in 2006, and hereinafter referred to as "Port Holding", which held 95% equity of Shihushan Terminal) and Xiamen Port Heping Tourism & Passenger Transport Co., Ltd. (which held 5% equity interest in Shihushan Terminal, hereinafter referred to as "Heping Passenger Transport").

In 2015, Xiamen Port Heping Tourism & Passenger Transport Co., Ltd. transferred its 5% equity interest to Port Holding with nil consideration, with benchmark date as 31 December 2014. This equity transfer was completed on 23 December 2015 upon completion of procedures for the change of business registration.

In June 2016, Port Holding entered into an Equity Interest Transfer Agreement with Xiamen Port Development Co., Ltd. (hereinafter referred to as "Port Development") to transfer the 51% equity interest in Shihushan Terminal to Port Development with benchmark date of 31 December 2015. The equity transfer was completed on 21 November 2016 upon completion of procedures for the change of business registration.

As of the valuation benchmark date, the paid-up capital of Xiamen Port Group Shihushan Terminal Co., Ltd. was RMB40,000,000.00, among which Xiamen Port Development Co., Ltd. contributed RMB20,400,000.00, representing 51% of the total paid-up capital, and Xiamen Port Holding Group Co., Ltd. contributed RMB19,600,000.00, representing 49% of the total paid-up capital.

- II-3 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

4. Assets, financial and business conditions in recent years

The main indicators of financial position of Xiamen Port Group Shihushan Terminal Co., Ltd. in the past three years are shown in the table below (monetary unit: RMB):

Item		31 December 2017		31 December 2018		31 December 2019
Current assets:
Monetary funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6,997,758.20	4,690,433.67	5,681,583.99
Trading financial assets . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Financial assets at fair value through profit or loss . . .			-		-
Derivative financial assets . . . . . . . . . . . . . . . . . . . . . .			-		-
Notes receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,578,901.60	8,185,091.00	5,220,000.00
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . .	12,046,933.44	11,657,318.58	13,828,027.34
Receivables financing . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Prepayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	191,724.00	318,395.89	317,350.49
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21,714,850.20	17,678,432.71	942,982.42
Among which: Interests receivable . . . . . . . . . . . . . . .			-		-
Dividends receivable . . . . . . . . . . . . . . . . . . . . . . . . . .	412,105.24	4,636,522.57	412,105.24
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2,651,675.18	3,719,584.95	3,672,564.45
Held-for-sale assets . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Non-current assets due within one year . . . . . . . . . . .			-		-
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,773,894.38		551,874.63		-
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .	48,955,737.00	46,801,131.43	29,662,508.69
Non-current assets:


Debt investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Available-for-sale financial assets . . . . . . . . . . . . . . .			-		-
Other debt investments . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Held-to-maturity investments . . . . . . . . . . . . . . . . . . .			-		-
Long-term receivables . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Long-term equity investment . . . . . . . . . . . . . . . . . . .	968,101,556.18	968,102,725.04	968,101,556.18
Other equity instrument investments . . . . . . . . . . . . .			-		-
Other non-current financial assets . . . . . . . . . . . . . . . .			-		-
Investment real estates . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	307,065,751.91	296,266,898.40	279,350,978.00
Construction in progress . . . . . . . . . . . . . . . . . . . . . . .	410,081.59	634,798.57	794,312.19
Productive biological assets . . . . . . . . . . . . . . . . . . . .			-		-
Oil and gas assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	97,758,276.75	95,048,242.11	93,099,363.13
Expenditures for development . . . . . . . . . . . . . . . . . .			-		-
Goodwill . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Long-term deferred expenses . . . . . . . . . . . . . . . . . . .			-		-
Deferred income tax assets . . . . . . . . . . . . . . . . . . . . .	273,180.44	642,383.50	650,500.23
Other non-current assets . . . . . . . . . . . . . . . . . . . . . . .	187,775.00	12,850.00	153,649.55

Total non-current assets . . . . . . . . . . . . . . . . . . . . . . .	1,373,796,621.87		1,360,707,897.62		1,342,150,359.28
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,422,752,358.87	1,407,509,029.05	1,371,812,867.97

- II-4 -

APPENDIX II	VALUATION REPORT OF THE TARGET COMPANY
Item		31 December 2017		31 December 2018		31 December 2019

Current liabilities:
Short-term loans . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	490,000,000.00	394,000,000.00	100,000,000.00
Trading financial liabilities . . . . . . .	. . . . . . . . . . . . . .			-		-
Financial liabilities at fair value through profit or
loss . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Derivative financial liabilities . . . . .	. . . . . . . . . . . . . .			-		-
Notes payable . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Accounts payable . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	19,881,483.30	16,005,727.30	6,716,413.64
Advance receipts . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	2,642,005.50	368,991.64	632,156.50
Employee compensation payable . .	. . . . . . . . . . . . . .	9,126,379.47	10,650,102.18	13,743,372.23
Taxes payable . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	1,194,116.74	4,703,135.34	1,612,383.93
Other payables . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	185,990,772.96	289,138,710.44	199,538,962.58
Among which: Interests payable . . .	. . . . . . . . . . . . . .	715,817.36	535,787.10	578,560.28
Dividends payable . . . . . . . . . . . . . .	. . . . . . . . . . . . . .		81,419,118.69		-
Held-for-sale liabilities . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Non-current liabilities due within one year . . . . . . . . .	28,000,000.00		-	11,750,000.00
Other current liabilities . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Total current liabilities . . . . . . . . . .	. . . . . . . . . . . . . .	736,834,757.97	714,866,666.90	333,993,288.88
Non-current liabilities:


Long-term loans . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-	346,250,000.00
Bonds payable . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Among which: Preferred stock . . . .	. . . . . . . . . . . . . .			-		-
Perpetual notes . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Long-term payables . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Long-term employee compensation payable . . . . . . .			-		-
Estimated liabilities . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Deferred income . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Deferred income tax liabilities . . . .	. . . . . . . . . . . . . .			-		-
Other non-current liabilities . . . . . .	. . . . . . . . . . . . . .			-		-

Total non-current liabilities . . . . . . .	. . . . . . . . . . . . . .			-	346,250,000.00

Total liabilities . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	736,834,757.97	714,866,666.90	680,243,288.88
Owner's equity:

Paid-in capital . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	40,000,000.00	40,000,000.00	40,000,000.00
Other equity instruments . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Among which: Preferred stock . . . .	. . . . . . . . . . . . . .			-		-
Perpetual notes . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Capital reserves . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	579,499,361.81	579,499,361.81	579,499,361.81
Less: Treasury stock . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Other comprehensive income . . . . .	. . . . . . . . . . . . . .			-		-
Special reserves . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	3,713,387.04	3,197,610.22	3,330,574.06
Surplus reserves . . . . . . . . . . . . . . . .	. . . . . . . . . . . . . .	42,614,252.77	42,614,252.77	42,614,252.77
General risk reserves . . . . . . . . . . . .	. . . . . . . . . . . . . .			-		-
Undistributed profits . . . . . . . . . . . .	. . . . . . . . . . . . . .	20,090,599.28		27,331,137.35		26,125,390.45
Total owner's equity . . . . . . . . . . . .	. . . . . . . . . . . . . .	685,917,600.90	692,642,362.15	691,569,579.09

Total liabilities and owner's equity .	. . . . . . . . . . . . . .	1,422,752,358.87	1,407,509,029.05	1,371,812,867.97

- II-5 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The main indicators of operating results of Xiamen Port Group Shihushan Terminal Co., Ltd. in past three years are shown in the table below (monetary unit: RMB):

Item		2017		2018		2019
I. Operating incomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	175,097,447.73	197,672,166.30	209,121,602.32
Less: Operating costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	131,969,356.29	129,415,717.74	138,268,703.57
Taxes and surcharges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,900,145.49	3,987,120.77	3,964,471.02
Sales expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Management expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6,370,802.66	7,453,244.35	8,387,301.01
Research and development expenses . . . . . . . . . . . . . . . . . .			-		-
Financial expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7,315,154.51	27,399,193.59	26,333,328.88
Among which: Interest expenses . . . . . . . . . . . . . . . . . . . . .		28,007,314.08	26,517,827.46
Interest incomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		611,614.92	186,351.21
Plus: Other incomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5,357,638.09	8,386,409.92	2,986,300.68
Investment incomes (loss marked "-") . . . . . . . . . . . . . . . . .	-934,137.43	61,329,688.27	74,187,820.33
Among which: Incomes from investments in associated
enterprises and joint ventures . . . . . . . . . . . . . . . . . . . . . .		1,168.86	-1,168.86
Income from derecognition of financial assets measured at
amortized cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .			-		-
Net exposure hedging income (loss marked "-") . . . . . . . . .			-		-
Income from changes in fair value (loss marked "-") . . . . .			-		-
Credit impairment losses (loss marked "-") . . . . . . . . . . . . .			-	-32,466.91
Asset impairment losses (loss marked "-") . . . . . . . . . . . . .	1,019,730.36	-1,476,812.23		-
Income from disposal of assets (loss marked "-") . . . . . . . .	19,906.40	48,205.37	148,959.59
II. Operating profits (loss marked "-") . . . . . . . . . . . . . . . . .	33,005,126.20	97,704,381.18	109,458,411.53
Plus: Non-operating incomes . . . . . . . . . . . . . . . . . . . . . . . .	123,486.65	785,165.46	68,480.11
Less: Non-operating expenses . . . . . . . . . . . . . . . . . . . . . . .	62,604.43	30,265.42	99,535.45
III. Total profits (total losses marked "-") . . . . . . . . . . . . . .	33,066,008.42	98,459,281.22	109,427,356.19
Less: Income tax expenses . . . . . . . . . . . . . . . . . . . . . . . . . .	8,257,192.21	9,799,624.46	9,112,976.55
IV. Net profits (net losses marked "-") . . . . . . . . . . . . . . . .	24,808,816.21	88,659,656.76	100,314,379.64

Note: The above data for 2017 and 2018 have been audited by Grant Thornton Certified Public Accountants (Limited Liability Partnership) Xiamen Branch, and the data for 2019 have been audited by RSM China Xiamen Branch, all of which have issued unqualified auditor's reports.

5. Company profile

Shihushan Terminal is a bulk cargo terminal with iron ore, coal, sandstone and other bulk cargo varieties under Xiamen Port Development Co., Ltd., an A-share listed enterprise of Xiamen Port Holding Group Co., Ltd.. There are about 227 employees, with a throughput of 6,964,000 tons and an operating income of RMB209 million in 2019, mainly serving local enterprises in Xiamen (such as Tenglong Special Resin, Ruixin Thermal Power, Xinyang Thermal Power, Tongji Thermal Power, Haiyi Thermal Power, etc.) and power plants and steel mills in southwest Fujian. The main asset of the company is Berth No. 19 at Haicang Port Area.

Dongdu Beth No. 19 terminal is located in the northern section of the coastline of Dongdu Port Area, which was formed by the demolition and reconstruction of the original site of raw coal and ore bulk cargo terminal, with top of the berth bridge reaches +7.5m high, berth length of 289.677m long, pontoon berth length of 56m long, and semi-upright shore of 77.077m long. Dongdu Berth No. 19 upon completion of reconstruction is a multi-purpose berth for 50,000 tons, with hydro-structure constructed targeting at 100,000-ton container ships. The latest designed annual throughput is 960,000

- II-6 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

tons, of which the container throughput is 90,000 TEUs and the bulk cargo is 150,000 tons. The total investment of the project is estimated to be RMB198.11 million. Top surface of the dock marked at +7.50 m high, the coastline is 302m long, the water depth at the front is -15.3m, covering an area of 170,973 m2. The main structure of terminal is gravity caisson structure.

The handling technological process of Dongdu Berth No. 19 is as follows:

Bulk cargo
1. Ship←→Storage yard
  Bulk cargo ship←→Portal crane←→Dump truck←→Storage yard
2. Storage yard←→Departure
  Storage yard←→Loader←→Railway truck or cargo owner's truck←→Departure
Roll-on/roll-off(RORO or ro-ro) process
RORO ship←→Pontoon←→Moving steel bridge approach←→Ramp←→Land marshaling platform

There is a total of 5 production portal cranes for Berth No. 18 and Berth No. 19, with an average output of 400 tonnes per hour of one portal crane, operated its shift system in four- shift, with a storage yard area of 140,000m2.

6. Other users of the Asset Valuation Report

This Asset Valuation Commission Contract specifies that there are no other users of the asset valuation report other than the Principal and users of asset valuation report specified by laws and administrative regulations of the state.

Purpose of Valuation

According to the (2020) No. 51 meeting minutes of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China and the meeting minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020] No. 8), it was agreed in principle to the equity integration plan of bulk cargo terminal (Xiamen Port Holding Group Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Haihong Petrochemical Terminal Co., Ltd. (廈門海鴻石化碼頭有限公司); Xiamen Port Development Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Hailong Terminal Co., Ltd.), and it is required to appraise all equity interests of shareholders of the Target Company according to relevant regulations.

The purpose of this asset valuation is to give a fair view of the market value of all equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. as of the benchmark date and provide value reference basis for the economic behaviour of the proposed terminal equity integration by the Principal.

- II-7 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The Subject and Scope of Valuation

The subject of valuation is all equity interests of shareholders of Xiamen Port Group Shihushan Terminal Co., Ltd..

The scope of valuation includes all the assets and related liabilities of Xiamen Port Group Shihushan Terminal Co., Ltd., including:

The assets and liabilities of Xiamen Port Group Shihushan Terminal Co., Ltd. as of the valuation benchmark date, 31 December 2019, have been audited by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0214 Auditor's Report, which specifically include: current assets, non-current assets (including fixed assets of buildings (structures), fixed assets of equipment, construction in progress, intangible assets-land use rights, intangible assets-others, deferred income tax assets and other non-current assets), current liabilities and non-current liabilities. According to the audited financial statements as at benchmark date provided by Xiamen Port Group Shihushan Terminal Co., Ltd., the book values of assets, liabilities and net assets are RMB1,371,812,900, RMB680,243,300 and RMB691,569,600 respectively. The specific contents are listed as follows (monetary unit: RMB'0,000):

No.	Item		Book value
1	Current assets	2,966.25
2	Non-current assets	134,215.04
3	Among which: Long-term Equity investment	96,810.16
4	Other equity instrument investment		-
5	Investment real estate		-
6	Fixed asset	27,935.10
7	Among which: Buildings	22,267.95
8	Equipment	5,817.09
9	Construction in progress	79.43
10	Intangible assets	9,309.94
11	Among which: Land use rights	9,233.82
12	Long-term deferred expenses		-
13	Deferred income tax assets	65.05
14	Other non-current assets	15.36

15	Total assets	137,181.29


16	Current liabilities	33,399.33
17	Non-current liabilities	34,625.00

18	Total liabilities	68,024.33

19	Shareholder's interests	69,156.96

The assets, liabilities and net assets of Xiamen Port Group Shihushan Terminal Co., Ltd. as at the valuation benchmark date have been audited and verified by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0214 Auditor's Report.

The main assets included in the scope of valuation include monetary funds, notes receivable, accounts receivable, other receivables, inventory, long-term equity investment, fixed assets of buildings (structures), fixed assets of equipment, construction in progress, intangible assets, deferred income tax assets and other non-current assets. The main assets of the company are as follows:

1. Monetary funds

Monetary funds are mainly bank deposits of enterprises.

- II-8 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

2. Notes receivable

Notes receivable are bank acceptance bills held by enterprises.

3. Accounts receivable

Accounts receivable mainly refer to port fees incurred in business operations.

4. Prepayment

Prepayment refers to the oil and premium paid in advance by the enterprise.

5. Other receivables

Other receivables are mainly internal current accounts and deposits, etc.

6. Inventory

Inventory is mainly turnover materials in stock.

7. Long-term equity investment

The scope of valuation of long-term equity investment is the foreign long-term equity investment of Xiamen Port Group Shihushan Terminal Co., Ltd.. As of the valuation benchmark date, the book value of long-term equity investment of Xiamen Port Group Shihushan Terminal Co., Ltd. is RMB968,101,556.18, and there are 5 foreign equity investment projects, including 3 equity investment projects of wholly-owned subsidiaries, 1 controlled project and 1 equity participation project. See the following table for specific investment:

Breakdown of Appraisal for Long-term Equity Investments

		Investment	Investment	Unit: RMB

No.	Name of investee	date	proportion	Book value

Xiamen Lushenda Port Mechanical & Electronic Engineering

Co., Ltd. (廈門鷺申達港口機電工程有限公司)

1997.04.11 51%

243,118.33

Xiamen Port Domestic Shipping Agency Co., Ltd. (廈門港務國

內船舶代理有限公司)

2003.1.1 20%

Xiamen Shihushan Terminal Labour Service Co., Ltd. (廈門石

湖山碼頭勞動服務有限公司)

1993.02.25 100%

740,000.00

Xiamen Port Haiyu Terminal Co., Ltd. (廈門港務海宇碼頭有限

公司)

2010.10.11

100% 692,967,620.15

Xiamen Port Haiyi Terminal Co., Ltd. (廈門港務海億碼頭有限公

司)	2010.10.11	100%	274,393,936.03
Total	-	-	968,344,674.51


Minus: provision for impairment of long-term equity investment	-	-	243,118.33
Net amount	-	-	968,101,556.18

- II-9 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

8. Fixed assets of buildings (structures)

(1) Buildings

The original book value and net book value of the fixed assets of housing construction included in the scope of valuation totalled RMB32,838,370.93 and RMB19,785,673.28 respectively, without provision for impairment, with 51 items in total, mainly including office building, labour building, canteen and bathroom, power transform room , machine repair workshop, etc., all of which are located at Berth No. 19 of Xiamen Dongdu Port Area owned by Xiamen Port Group Shihushan Terminal Co., Ltd..

The above houses and buildings were mainly built between 1994 and 2019, and maintain normal functions at present. The land use rights occupied by houses and buildings have been within the scope of valuation.

As of the valuation benchmark date, the following houses and buildings within the scope of valuation have obtained the Property Ownership Certificate, with a total gross floor area (GFA) of

15,166.06 m2. See below for details:

Serial				Year of
No.	Ownership Certificate No.	Name of Building	Structure		Completion	GFA (m2)
1	Min (2017) Xiamen Real Estate	No. 213, Zhai Shang Xi Road, Huli	Steel and		1994		2,247.38
	Ownership No. 0008285	District (5/F Office Building)	concrete
2	Min (2017) Xiamen Real Estate	No. 223, Zhai Shang Xi Road, Huli	Steel and	1994		869.00
	Ownership No. 0008105	District (machine repair workshop)	concrete
3	Min (2017) Xiamen Real Estate	No. 215, Zhai Shang Xi Road, Huli	Steel and	1994		850.03
	Ownership No. 0008201	District (canteen and bathroom)	concrete
4	Min (2017) Xiamen Real Estate	No. 219, Zhai Shang Xi Road, Huli	Mixed	1994		2,375.61
	Ownership No. 0008245	District (labour building)
5	Min (2017) Xiamen Real Estate	No. 239, Zhai Shang Xi Road, Huli	Steel and	1994		226.62
	Ownership No. 0008288	District (5# transfer station)	concrete
6	Min (2017) Xiamen Real Estate	No. 221, Zhai Shang Xi Road, Huli	Mixed	1994		183.46
	Ownership No. 0008113	District (boiler room)
7	Min (2017) Xiamen Real Estate	No. 237, Zhai Shang Xi Road, Huli	Steel and	1998		614.15
	Ownership No. 0008099	District (power transformer room	concrete
		No. 1)
8	Min (2017) Xiamen Real Estate	No. 209, Zhai Shang Xi Road, Huli	Steel and	1994		731.2
	Ownership No. 0008298	District (power transformer room	concrete
		No. 2 and central control room)
9	Min (2017) Xiamen Real Estate	No. 227, Zhai Shang Xi Road, Huli	Mixed	1994		39.69
	Ownership No. 0008203	District (hoist room No. 2)
10	Min (2017) Xiamen Real Estate	No. 211, Zhai Shang Xi Road, Huli	Mixed	1994		21.16
	Ownership No. 0008199	District (guard room No. 1)
11	Min (2017) Xiamen Real Estate	No. 225, Zhai Shang Xi Road, Huli	Mixed	1994		20.02
	Ownership No. 0008103	District (guard room No. 2)
12	Min (2017) Xiamen Real Estate	No. 201, Zhai Shang Xi Road, Huli	Mixed	1993		29.95
	Ownership No. 0008101	District (guard room No. 2)
13	Min (2017) Xiamen Real Estate	No. 203, Zhai Shang Xi Road, Huli	Mixed	1993		33.71
	Ownership No. 0008096	District (loading room)

- II-10 -

APPENDIX II	VALUATION REPORT OF THE TARGET COMPANY
Serial							Year of
No.		Ownership Certificate No.		Name of Building		Structure		Completion	GFA (m2)
14		Min (2017) Xiamen Real Estate	No. 231, Zhai Shang Xi Road, Huli		Mixed		1993		179.14
		Ownership No. 0008268		District (power transform room
				No. 4)
15		Min (2017) Xiamen Real Estate	No. 205, Zhai Shang Xi Road, Huli		Steel	1994		2,049.07
		Ownership No. 0008107		District (office building complex)		and
						concrete
16		Min (2017) Xiamen Real Estate	No. 207, Zhai Shang Xi Road, Huli		Steel	1994		907.33
		Ownership No. 0008095		District (canteen and bathroom)		and
						concrete
17		Min (2017) Xiamen Real Estate	No. 229, Zhai Shang Xi Road, Huli		Mixed	1994		3,396.32
		Ownership No. 0008248		District (China Gas office building
				complex)
18		Min (2017) Xiamen Real Estate	No. 217, Zhai Shang Xi Road, Huli		Mixed	1994		28.22
		Ownership No. 0008210		District (garage backup building
				door guard room)
19		Min (2017) Xiamen Real Estate	No. 233, Zhai Shang Xi Road, Huli		Mixed	1994		128.68
		Ownership No. 0008104		District (booster pump room)
20		Min (2017) Xiamen Real Estate	No. 235, Zhai Shang Xi Road, Huli		Mixed	1994		235.32
		Ownership No. 0008097		District (sewage disposal
				workshop)

The ownership of houses and buildings with ownership certificate within the scope of this asset appraisal is Xiamen Port Group Shihushan Terminal Co., Ltd.. As of the valuation benchmark date, the assets authorized for appraisal can be used normally, and the ownership is clear, free from any mortgage, seizure and other situations that restrict the ownership.

The houses and buildings of the appraised entity which have not yet obtained ownership certificates as of the valuation benchmark date are as follows:

Serial
No.	Name of building	Structure		GFA (m2)	Remarks
1	Parking workshop No. 19	Framework		900
2	Winch room No. 1	Mixed	39.69

The area of houses and buildings which have not yet obtained ownership certificates is determined according to the reported number of the appraised entity and after consulting relevant engineering drawings and on-site verification. The asset appraisal professionals applied such area reported by the appraised entity to perform the appraisal. If the reported areas are inconsistent with the areas to be quoted in applying for the relevant ownership certificates in the future, the appraisal results should be adjusted according to the areas stated in the ownership certificates. The appraisal conclusion of this report is made on the premise that there is no property right dispute in the above-mentioned houses, and the related expenses required to be paid when handling the ownership certificate in the future are not considered.

(2) Structures

The original book value and net book value of the structures included in the scope of this asset appraisal are RMB271,978,862.54 and RMB202,598,669.04 respectively, totalling 101 items, mainly for the No. 19 reconstruction project.

- II-11 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Dongdu Berth 19# terminal is located in the northern section of the coastline of Dongdu Port Area, which is formed by the demolition and reconstruction of the original site of raw coal and ore bulk cargo terminal. The original terminal was completed in 2000, with top of the berth bridge reaching +7.5m high, berth length of 289.677m long, pontoon berth length of 56m long, and semi-upright shore of 77.077m long. Dongdu Berth No. 19 rebuilt in 2009 is a multi-purpose berth for 50,000 tons, with hydro- structure constructed targeting at 100,000-ton container ships. The latest designed annual throughput is 960,000 tons, of which the container throughput is 90,000 TEUs and the bulk cargo is 150,000 tons. The total investment of the project is estimated to be RMB198,110,000. Top surface of the terminal marks at +7.50 m high, the coastline is 302m long, the water at the front is -15.3m deep, covering an area of 170,973m2. The main structure of the terminal is gravity caisson structure.

The reconstruction project of Berth No. 19 in Dongdu Port Area of Xiamen Port mainly includes: terminal hydro-engineering, dredging engineering, land formation, roads and depots, civil engineering, power supply and lighting, water supply and drainage and fire services engineering.

The terminal hydro-engineering project is divided into five units: main terminal project, roll-on/roll-off function berth project, front depot project, rear depot project, terminal berthing water area and connecting water area project. Main terminal project: the coastline of the main terminal of Berth No. 19 in Dongdu Port Area of Xiamen Port is 289.677m long, with top surface of the dock marked at +7.50m high (the theoretical lowest tide level in Xiamen, the same below), and the elevation of terminal front is -15.3m. The hydro-structure main body is gravity caisson structure with unloading plate, which is designed targeting at 100,000-ton container ships; the designed bottom elevation of berthing waters is -15.3m. The main hydro-structure is prefabricated 980t caisson and cast-in-place C40 concrete breast wall. 510,000m3 of foundation trench dredging, 72,000m3 of foundation bed riprap, 47,000m3 of prism riprap, 28 caissons, 96 unloading plates, 6,870m3 of cast-in-place breast wall concrete, 22 sets of drum-shaped rubber fenders, 3 rubber gangways, 12 bollards of 1,000kN and 644m of QU100 steel rail. The construction scope of terminal surface in front operation area is 30m from the main terminal to the front line, and its structural form is foundation rolling, 200mm graded crushed stone cushion, 350mm thick 6% cement stabilized stone chips, 100mm thick C60 high-strength interlocking block with a total area of 7,068.89m2. Roll-on/roll-off function berth project: the northern end of roll-on/roll-off function berth is next to Berth No. 20, with a coastline of 77.077m, which is of semi-vertical and semi-slope structure. The foundation is 10~100kg riprap foundation bed, which is compacted and leveled, and then cast-in-place C40 concrete breast wall directly, with a total of 2,402m3. In order to prevent settlement of steel approach abutment, bored pile foundation is adopted. The terminal surface structure is ground rolling, 200mm graded gravel cushion, 350mm thick 6% cement stabilized layer and 100mm thick C60 high-strength interlocking block, with a total area of 3,365.67m2. Roll-on/roll-off function facilities (1#, 2# barges and steel approach bridges) are relocated and installed from Berth No. 18 to form a new roll-on/roll-off landing point. Dock berthing waters and connecting waters project: the total volume of dredged mud is 1.38 million m3, the bottom elevation of berthing waters is -15.3m, and the bottom elevation of connecting waters is -10.0m. Front depot project: The front depot project covers a total area of 24,487.87m2, with the main quantities of 4,900m3 graded crushed stone layer, 8,570.75m3 cement stabilized layer, 24,487.87m2 high-strength interlocking block pavement, 8 inspection wells, 6 water supply valve wells, 5 fire hydrant wells, 4 rain inlets and 2 cable hand hole wells. Rear depot project: 24,098m2 in total, with the main quantities as follows: 24,098 m2 foundation leveling and compaction, 7,229.4 m3 graded crushed stone layer, 8,438.3 m3 cement stabilized layer, 24,098m2 high-strength interlocking block pavement, 657m drainage pipeline, 23 inspection wells, 31 rainwater wells, 113m communication lines, 2 communication handholes, 183m of power supply pipeline extension, and 5 cable handholes.

- II-12 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Depot works: Subgrade is leveled and compacted, elevation and slope are controlled by pulling wires, and leveled by mechanical and manual cooperation. 25t vibratory roller shall be used for subgrade rolling, and it shall be rolled to meet the design compactness requirements according to the specification requirements. Graded gravel cushion shall be constructed in strict accordance with the design and specification requirements. The gravel shall be selected from materials meeting the specification requirements, and shall be mechanically mixed on site according to the test gradation. It shall be paved by a combination of loaders and labours, and shall be compacted by a 25t vibratory roller. The materials and mixture ratio of cement stabilized layer shall meet the design requirements and specifications, and the stabilized layer is mixed on site by loaders, with uniform mixing and quality assurance. 25t vibratory roller shall be used to roll the stable layer until it has no obvious indentation and meets the requirements of compaction degree. After the construction of the stable layer, water conservation shall be carried out in time. For cement stabilized layer with thickness greater than 25cm, it shall be constructed in two layers according to the specification requirements. After the bottom layer is rolled to meet the design requirements, the upper stable layer shall be constructed. Paving interlocking blocks shall be prefabricated near the site, and paving of interlocking blocks shall be carried out in batches in strict accordance with the prefabrication sequence. Before paving, the appearance of interlocking blocks that do not meet the quality requirements shall be eliminated in advance, and the paving shall be controlled by pulling longitudinal and horizontal lines to ensure that the paving elevation, flatness, joints and lines meet the design and visual quality requirements. Interlocking blocks are paved with rubber hammers for stability and filled with fine sand in time. After all the interlocking blocks are laid, the interlocking blocks shall be rolled by a roller without vibration, so that the interlocking blocks are smooth and stable. Finally, the joints shall be filled fully with sand. Masonry shape, thickness and mortar quality of water supply valve well, fire hydrant well, drainage inspection well and rain inlet shall all meet the requirements.

Dredging project (expansion project of turning area): the expansion project of turning area of Berths 18#-19# in Xiamen Dongdu Port Area is a unit project in the expansion project of Dongdu Waterway, which is implemented together with the expansion project of Dongdu Waterway. The turning area of Berths 18#-19# is designed to meet the turnaround requirements of 100,000T container ships. The designed turning waters of Berths 18#-19# are elliptical waters centered on points (N＝24°31'37.6", E＝118°04'43.0"; that is, X＝2,713,784.64, Y＝457,299.80), with the long axis of 853m and the short axis of 590m. The designed bottom elevation is -12.0m of the designed bottom elevation of the waterway. The swing waters of ships are connected with the adjacent swing waters of berths 12#-16# in Xiangyu and 20#-21# in Guomao, and the 100,000T container ship can share some waters with the adjacent berths when turning around. The designed dredging quantity is 1,811,200 m3. The 4,500m3 and 18 m3/bucket grab dredgers are used for dredging in the construction of the turning area, and the 8-square grab dredgers are used for the corners and some sections. The reef blasting construction is completed by the equipped mobile down-the-hole drilling machine. The blasting mesh spacing is determined according to the weathering degree and blasting thickness of rocks. The millisecond lightning non-electric detonating system using the plastic detonating tube is adopted, and the explosive is emulsion explosive. After reef explosion, the reef is cleared by 8-square grab dredger with mud barge and tugboat. The dredging quantity of ship swing waters project in berths 18#-19# is 811,499.14m3, and the quantity of reef blasted and cleared is 484.5m3. The dredged soil is mainly Grade 2 soil, namely silt, with a small amount of Grade 5 soil (hard clay) and Grade 8-9 soil (sand of loose to medium density). The dredging project of Berth 19# within the scope of valuation accounts for 40% of the dredging projects of Berths 18#-19# (divided according to the proportion of the coastline length of Berths 18#-19#).

- II-13 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Berth No. 19 terminal is formed by the demolition and reconstruction of the original site of raw coal and ore bulk and general cargo terminal. The original terminal was completed in 2000. Dongdu Berth 19# rebuilt in 2009 is a multi-purpose berth for 50,000 tons, and its land use right is within the scope of valuation.

9. Fixed assets of equipment

The fixed assets of equipment included in the scope of valuation are the machinery, vehicles and electronic equipment reported by Xiamen Port Group Shihushan Terminal Co., Ltd., with a total of 1,106 items, with an original book value of RMB177,992,800.46, provision for impairment of fixed assets of RMB1,499,428.17 and net book value of RMB56,966,635.68.

Machinery and equipment mainly include portal cranes, loaders, excavators, grab buckets, etc. The above equipment was purchased and installed between 1995 and 2019;

Vehicles are mainly commercial vehicles, Ford cars, Buick cars, etc. The above equipment was put into use from 2007 to 2013;

Electronic equipment mainly includes office equipment and auxiliary equipment, including servers, air conditioners, computers, printers, etc. The above equipment was put into use between 2004 and 2019;

The above equipment has clear property rights and is owned by Xiamen Port Group Shihushan Terminal Co., Ltd.. As of the valuation benchmark date, except for some equipment which cannot be used, all other equipment is in normal use. There is no mortgage, seizure or other limitations on other rights in the equipment authorized for asset appraisal.

10. Construction in progress

The construction in progress mainly includes the shed construction project for the new warehouse of Shihushan Terminal, the stone road pavement hardening and supporting projects of Shihushan Terminal, etc.

11. Deferred income tax assets

Deferred income tax assets are mainly deductible temporary differences formed by provision for bad debts, inventory depreciation provision and provision for impairment of fixed assets.

12. Other non-current assets

Deferred income tax assets are mainly prepaid equipment funds.

The recorded or unrecorded intangible assets reported by the enterprise 1. Recorded intangible assets reported by enterprises

As of the valuation benchmark date, the recorded intangible assets reported by the enterprise are land use rights and outsourced software.

- II-14 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Intangible assets included in the scope of this valuation-2 land use rights, with land area of 235,193.14 square meters, original recorded value of RMB103,178,346.04 and book value of RMB92,338,207.47.

The registration status of land use rights is as follows:

Type of

Serial no.

Name of parcel

Land Certificate No.

Right holder

Purpose

use right

Area (m2)

Shihushan

Min (2017)

Xiamen Port

Storage

Transfer

81,613.69

No. 23 (Land)

Xiamen Real

Group Shihushan

Estate Ownership

Terminal Co., Ltd.

No. 0008096

Shihushan

Min (2017)

Xiamen Port

Storage

Transfer

153,579.45

No. 24 (Land)

Xiamen Real

Group Shihushan

Estate Ownership

Terminal Co., Ltd.

No. 0008298

Land rights and utilization status are as follows:

					Limitation
			Remaining	on other	Actual development
Serial no.	Name of parcel		useful life		rights	degree	Status of land use
1	Shihushan	33.52		None	Five access with	There are office buildings, machine
	No. 23 (land)					ground leveling	repair workshop, canteens and
							bathrooms, labour buildings and
							various auxiliary facilities for
2	Shihushan	33.52		None	Five access with	production on the ground, and the land
	No. 24 (land)					ground leveling	has been fully utilized.

Outsourced software mainly includes business billing system, mobile application system and environmental protection information system.

After due diligence by the valuer, as of the valuation benchmark date, intangible assets with unrecorded books in the appraised enterprise was the sea use right for the port sea area in the berth basin with certificate of "Guo Hai Zheng No. 2016C35020603990".
According to Jiao Gui Hua Fa [2006] No. 267 issued by the Ministry of Transport, the appraised entity has obtained the right to use the 289.7-meter port line corresponding to Berth No. 19 at Dongdu Port Area.

(III) Other off-balance-sheet assets reported by enterprises

The appraised enterprise has no other reported off-balance-sheet assets. After due diligence by the valuer, no other off-balance-sheet assets were found in the appraised enterprise as of the valuation benchmark date.

(IV) Reference to the asset type, quantity and carrying amount (or appraised value) involved in the report conclusion issued by other institutions.

In this asset appraisal, except that RSM China Xiamen Branch audited and issued the auditor's report (Rong Cheng Shen Zi [2020] No. 361F0214) as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.

- II-15 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

It is confirmed by the Principal and the appraised entity that the above appraisal object and scope are consistent with those involved in the above economic behaviour.

IV.	Type of Value and Its Definition

1. Based on the purpose of this asset appraisal, the type of value of this asset appraisal is market

value.

1. Market value refers to the estimated amount of the value that can be realized by the valuation target under normal and fair transaction as at the valuation benchmark date when the voluntary buyer and the voluntary seller act rationally without any coercion.
2. Reasons and basis for types of value selected: According to the purpose of this asset valuation, particular market conditions and situation of valuation target, market value was determined to be the selected value type in this valuation.
Valuation Benchmark Date
1. The valuation benchmark date of this asset appraisal is 31 December 2019.
  Illustration of the related matters for the determination of the valuation benchmark date:
2. Reason for determination of the valuation benchmark date: this date is close to the realization date of valuation purpose, and the valuation benchmark date of this report is determined to be 31 December 2019 upon written confirmation by the Principal.
3. All the pricing standards, interest rates and tax rates of this asset valuation are the effective pricing standards, interest rates and tax rates of the valuation benchmark.

VI. Valuation Basis

The basis of this asset valuation mainly includes basis of economic behaviour, laws and regulations, criterion, ownership, pricing and other reference materials, with details as follows:

Basis for economic behaviour

The (2020) No. 51 Meeting Minutes of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China.
The meeting minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020]
No. 8).

Basis for main laws and regulations

Assets Appraisal Law of the People's Republic of China (adopted at the 21st meeting of the Standing Committee of the 12th National People's Congress on 2 July 2016);
Company Law of the People's Republic of China (revised at the 6th Meeting of the Standing Committee of the 12th National People's Congress on 28 December 2013);
- II-16-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Measures for Financial Supervision and Administration of Assets Valuation Industry (Order No. 86 of the Ministry of Finance of the People's Republic of China);
Enterprise Income Tax Law of the People's Republic of China (adopted at the 5th Meeting of the 10th National People's Congress on 16 March 2007);
Law of the People's Republic of China on State-owned Assets of Enterprises (adopted at the 5th Meeting of the Standing Committee of the 11th National People's Congress on 28 October 2008);
Interim Measures for the Supervision and Administration of State-owned Assets of Enterprises (Order No. 378 of the State Council, revised by Order No. 588 of the State Council);
Decision of the State Council on Abolishing the Provisional Regulations of the People's Republic of China on Business Tax and Amending the Provisional Regulations of the People's Republic of China on Value Added Tax (Order No. 691 of the State Council);
Circular of the Ministry of Finance and the State Administration of Taxation on Adjusting the VAT Rate (Cai Shui [2018] No. 32);
Administrative Measures for State-Owned Assets Assessment (Order No. 91 of the State
Council);
Circular on Printing and Distributing the Detailed Rules for the Implementation of the Administrative Measures for State-owned Assets Assessment (Guo Zi Ban Fa [1992] No. 36);
Interim Measures for the Administration of Assessment of State-owned Assets of Enterprises (Order No. 12 of State-ownedAssets Supervision and Administration Commission of the State Council);
Notice of Issues on Strengthening the Administration of Assessment of State-owned Assets of Enterprises (Guo Zi Wei Chan Quan [2006] No. 274);
Notice on Relevant Matters Concerning the Audit of State-owned Asset Valuation Report of Enterprises (Guo Zi Chan Quan [2009] No. 941);
Guidelines for the Filing of State-owned Assets Valuation Projects of Enterprises (Guo Zi Fa Chan Quan [2013] No. 64);
Measures for the Supervision and Administration of State-owned Assets Trading of Enterprises (Order No. 32 of the Ministry of Finance of the State-ownedAssets Supervision and Administration Commission of the State Council);
Basic Standards for Assets Valuation (Cai Zi [2017] No. 43);
Measures for Supervision and Administration of State-owned Assets of Enterprises in Xiamen (Order No. 157 of Xiamen Municipal People's Government);
Notice of Interim Measures for the Administration of Assets Assessment Projects of State- owned Enterprises in Xiamen (Xia Guo Zi Chan [2007] No. 546);
- II-17-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

19. Notice of the State-owned Assets Supervision and Administration Commission of Xiamen Government on Further Strengthening the Administration of Assessment of State-owned Assets of Enterprises (Xia Guo Zi Chan [2014] No. 346).

Basis for valuation standards

1. Code of Professional Ethics for Asset Valuation (Zhong Ping Xie [2017] No. 30);

2. Practice Guidelines for Asset Valuation-Asset Valuation Procedures (Zhong Ping Xie

[2018] No. 36);

3. Practice Guidelines for Asset Valuation-Asset Valuation Report (Zhong Ping Xie [2018] No. 35);

4. Practice Guidelines for Asset Valuation-Asset Valuation Authorization Contracts (Zhong Ping Xie [2017] No. 33);

5. Practice Guidelines for Asset Valuation-Asset Valuation Archives (Zhong Ping Xie [2018] No. 37);

6. Practice Guidelines for Asset Valuation-Enterprise Value (Zhong Ping Xie [2018] No. 38);

7. Practice Guidelines for Asset Valuation-Real Estate (Zhong Ping Xie [2017] 38);

8. Practice Guidelines for Asset Valuation-Machinery and Equipment (Zhong Ping Xie [2017] No. 39);

9. Guidelines for Business Quality Control of Asset Appraisal Institutions (Zhong Ping Xie

[2017] No. 46);

10. Guiding Opinions on Value Types of Assets Valuation (Zhong Ping Xie [2017] No. 47);

11. Guiding Opinions on Legal Ownership of Assets Valuation Objects (Zhong Ping Xie [2017] No. 48);

Practice Guidelines for Asset Valuation-Using Expert Work and Related Reports (Zhong Ping Xie [2017] 35);
Practice Guidelines for Asset Valuation-Asset Valuation Approach (Zhong Ping Xie [2019]
No. 35);
Guidelines for the Asset Valuation Report of State-owned Assets of Enterprises (Zhong Ping Xie [2017] No. 42).

(IV) Basis for property rights

1. Copy of business license of Xiamen Port Group Shihushan Terminal Co., Ltd.;

2. Copy of financial statements of Xiamen Port Group Shihushan Terminal Co., Ltd.;

- II-18 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

3. Copy of auditor's report as of the valuation benchmark date of Xiamen Port Group Shihushan Terminal Co., Ltd.;

4. Auditor's reports of Xiamen Port Group Shihushan Terminal Co., Ltd. over the years;

5. Copy of state-owned land use right certificate;

6. Certificates for the sea use right;

7. Equipment purchase contract and invoice;

8. Vehicle registration certificate;

9. Commitment letter of the principal and the appraised entity;

10. Relevant financial, business and sales materials;

11. Other ownership certificates corresponding to the assets included in the scope of valuation.

Pricing basis

The deposit and loan interest rates of financial institutions implemented on the valuation benchmark date announced by the People's Bank of China;
Relevant information from Choice finance terminal of Eastmoney;
Equipment valuation breakdown provided by Xiamen Port Group Shihushan Terminal Co.,
Ltd.;
Certain equipment purchase contracts, invoices and large-scale equipment acceptance records provided by Xiamen Port Group Shihushan Terminal Co., Ltd.;
Mechanical and Electrical Products Quotation Manual-editedby Machinery Industry Information Research Institute (2019 Edition);
Handbook of Common Approaches and Parameters of Assets Valuation (Mechanical Industry Press, 2011 Edition);
Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs;
Circular of the Ministry of Finance and the State Administration of Taxation on Comprehensively Pushing Forward the Pilot Program of Changing Business Tax to Value-added Tax (Cai Shui [2016] No. 36);

9. Circular of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Implementation of VAT Transformation Reform in China (Cai Shui [2008] No. 170);

- II-19 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Provisional Regulations of the People's Republic of China on Vehicle Purchase Tax (Order No. 294 of 2001 of the State Council);
Regulations on Compulsory Scrapping Standards of Motor Vehicles (Order No. 12 of 2012 of the Ministry of Commerce, Development and Reform Commission, Ministry of Public Security and Ministry of Environmental Protection);
Regulations on Management of Construction Engineering Supervision and Related Service Charges (Fa Gai Jia Ge (2007) No. 670);
Charges for Consulting Service of Construction Project Cost (Min Jia (2002) Fang
No. 457);
Notice on Printing and Distributing the Regulations on Construction Cost Management of Capital Construction Projects (Cai Jian [2016] No. 504);
Budget Quota of Hydro Construction Projects in Coastal Ports;
Notice of Audit of Project Final Accounts of China Construction Bank Xiamen Branch;
Notice of Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management Regulations (Xia Fu [2017] No. 413);
Notice of the State Council on Promoting Economical and Intensive Land Use (Guo Fa (2008) No. 3);
Notice of Xiamen Municipal People's Government on Adjusting Compensation Standards for Land Acquisition in Xiamen City (Xia Fu (2016) No. 398);
Measures for the Implementation of Farmland Occupation Tax in Fujian Province (Min Zheng (2008) No. 17);
Provisions on the Collection and Use of Cultivated Land Reclamation Fees in Fujian Province (Min Zheng (2000) No. 98);
Provisions on Tax Collection and Administration of Deed Tax in Fujian Province (Min Cai Nong Shui (1997) No. 58);
Forwarding the Notice on Effective Implementation on Matters Concerning the Social Security of Land-expropriated Farmers from the Ministry of Labour and Social Security and the Ministry of Land and Resources (Department of Labour and Social Security of Fujian Province);
Equipment manufacturers and sellers telephone inquiry and other relevant price
information;
The 2019 Enterprise Performance Appraisal Standard Value prepared by the Appraisal and Distribution Bureau of the State-ownedAssets Supervision and Administration Commission of the State Council;
Budget Quota of Fujian General Installation Project (FJYD-301-201 ~ FJYD 311-2017);
- II-20-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Price information accessed online;
Other relevant materials provided by Xiamen Port Group Shihushan Terminal Co., Ltd..
Stipulations on Compiling Estimate and Budget for Water Transportation Construction Engineering (JTS/Tl16-2019).

(VI) Reference basis

The approval documents of relevant engineering construction provided by Xiamen Port Group Shihushan Terminal Co., Ltd.;
Bidding documents and bid-winning contracts of part of the equipment, acceptance records, purchase contracts and invoices of large-scale equipment provided by Xiamen Port Group Shihushan Terminal Co., Ltd.;
The Auditor's Report (Rong Cheng Shen Zi [2020] No. 361F0214) audited and issued by RSM China Xiamen Branch;
Circular of the National Development and Reform Commission and the Ministry of Construction on Printing and Distributing the Regulations on the Management of Construction Project Supervision and Related Service Charges (Fa Gai Jia Ge [2007] No. 670);
The original Interim Provisions on Consultation Fees for Preparatory Work of Construction Projects (Ji Jia Ge (1999) No. 1283);
The original Charge Standard for Environmental Impact Appraisal Consultation of Construction Projects (Ji Jia Ge (2002) No. 125);
The original Regulations on the Management of Engineering Survey and Design Fees (Ji Jia Ge (2002) No. 10);

8. The original Interim Measures for the Administration of Bidding Agency Service Charges (Ji Jia Ge [2002] No. 1980);

Code for Real Estate Valuation (GB/T 50291-2015);
Code for Urban Land Valuation (GB/T 18508-2014);
Rules for Classification and Grading of Urban Land (GB/T 18507-2014);
The original Circular of Fujian Provincial Price Bureau on Regulating the Charges of Consulting Services for Construction Project Cost (Min Jia [2002] Fang No. 457).

VII. Valuation Approaches

(I) Selection of valuation approaches

According to the current asset valuation standards and relevant regulations, the basic approaches for enterprise value appraisal include market approach, income approach and asset-based

- II-21 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

approach. In the specific valuation, it is necessary to analyze the applicability of the three basic approaches of asset valuation according to the relevant conditions such as the appraisal object, value type and data collection, and properly select the valuation approaches to form the appraisal results reasonably.

1. Market approach

Market approach refers to the appraisal idea of comparing the assets of the appraisal object with existing transaction cases in the market to determine the value of the appraisal object, which is used on the premise that:

there is an active open market with sufficient market data;
there are comparable transaction cases with reasonable comparative basis in the open
market;
it is able to collect relevant information of comparable transaction cases.

2. Income approach

The income approach refers to the appraisal idea of determining the value of the appraisal object by discounting the expected income of the appraised enterprise. The following preconditions must be met for application of the income approach:

future earnings of the appraised entity are predictable and can be measured by currency;
the risks of obtaining the prospective earnings are predictable and can be measured by
currency;
the number of years with prospective earnings is predictable.

3. Asset-based approach

Asset-based approach refers to the appraisal idea of determining the value of the appraisal object on the basis of regaining assets, which is used on the premise that:

the appraisal object is in continuous use;
it is possible to investigate the current ways to obtain the appraisal object purchased and constructed and the corresponding social average cost data.

The appraisal object of this valuation is all equity interests. Because it is difficult to collect public information related to the equity trading market, it is difficult to obtain detailed information of the equity trading cases in the open market that are the same as or similar to those of this appraisal object. Meanwhile, although there are listed companies in the same industry in the capital market, it shows a great diversity in the assets size and structure, scope of business, the present stage and profitability as compared to the appraised entity, therefore, it is not appropriate to adopt the market approach for this valuation.

- II-22 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Xiamen Port Group Shihushan Terminal Co., Ltd. was established in January 2002, which is a bulk cargo terminal company specializing in iron ore, coal, sandstone and other bulk cargo varieties. There are about 227 employees, mainly serving local enterprises in Xiamen (such as Dragon Special Resin, Ruixin Thermal Power, Xinyang Thermal Power, Tongji Thermal Power, Haiyi Thermal Power, etc.) and power plants and steel mills in southwest Fujian. The main assets of the Company are Berth No. 19 at Haicang Port Area and three wholly-owned subsidiaries. In the long-term equity investment, Xiamen Shihushan Terminal Labour Service Co., Ltd., Xiamen Port Haiyu Terminal Co., Ltd. and Xiamen Port Haiyi Terminal Co., Ltd. all hold 100% of the shares. Meanwhile, the three subsidiaries and parent company have crossed main operating business and the collection & division of operating costs and expenses or it is difficult to differentiate.

The coal and iron ore businesses of Shihushan Terminal occupies an absolute dominant share of the overall business of the Company, regardless of indicators for throughput, income and profits. As the Company's business was heavily relied on the development of iron ore and coal businesses, the Company's business may fluctuate significantly once the external environment changes suddenly.

According to the Profile of Xiamen Port (2020) and the Master Plan of Xiamen Port (2035) issued by Xiamen Port Authority:

Dongdu Port Area includes Dongdu, Heping and Wutong Operation Areas. Currently, Dongdu Port Area has 59 berths, and its design carrying capacity is 35.782 million tons/year, of which the carrying capacity of container is 2.774 million TEUs/year. Dongdu Port Area is mainly planned to maintain container transportation, develop international cruise ships and RO-RO passenger to Taiwan, and gradually expand the functions of modern logistics and shipping services. According to the Planning, Dongdu Port Area will form a terminal coastline of 8,420m in total and has 51 productive berths after integration, including 24 deep-water berths, and its consolidated carrying capacity is nearly
38.00 million tons, of which the carrying capacity of container is 2.50 million TEUs. In addition, Berth No. 5-20 at Dongdu Port Area are planned as the container berth area, in which the transportation functions of coal and ore are adjusted to form 10 container berths of 50,000 tons during the planning period, in order to undertake the container transportation tasks of near-sea,mid-ocean and domestic trade.
The Haicang Port Area includes the Songyu, Haicang and Jiaomei Operating Areas. It currently has 38 berths with a designed traffic capacity of 104.848 million tons/year, of which the container throughput is 7.65 million TEUs/year. The Haicang Port Area is planned to mainly develop container trunk line transportation, as well as serve the port industry, and actively expand the functions of bonded, modern logistics and shipping services. It is planned to form a terminal with a port line length of 11,396m and 37 buildable productive berths, including 30 deep-water berths, with a throughput of 112 million tons, of which container throughput is 7.60 million TEUs. Among them: ① the Songyu Operation Area has a planned terminal coastline of 3,340 meters, with 10 buildable berths and a throughput of 22.90 million tons, of which the container throughput is 2.00 million TEUs. Except for the Botan oil terminal and the power plant coal terminal, it focuses on the construction of large container terminal and the development of mid-ocean and ocean trunk line transportation. ② The port line of Berth No. 1-8 at Haicang Operating Area is approximately 2,400 meters, and it is planned to build a large container berth area that can berth 100,000~200,000-ton ships; the port line of Berth No. 9-12 is approximately 1,060 meters and used as berth area for bulk cargo of liquid, planning to construct 4 berths which can berth 30,000~50,000-ton ships for liquid chemicals; the Berth No. 13 is for 50,000-ton ships for bulk and general cargos and the port line is 298 meters; the coastline of berth
- II-23-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

No. 14-19 is 2,290 meters and used as large-scale container berth area, which are planned to construct 6 large-scale container berth areas that can berth 100,000 ~ 200,000-ton ships; the coastline of berth No. 20-24 is approximately 1,170 meters, which are planned to construct 5 berths of 20,000 - 70,000 - ton for bulk and general cargo.

According to the Profile of Xiamen Port (2020) and the Master Plan of Xiamen Port (2035) issued by Xiamen Port Authority, there will be significant changes in the operation of the terminals in Dongdu Port Area and Haicang Port Area with the progress of terminals integration. In addition, imports and exports of all countries are affected by the spread of COVID-19Outbreak around the world since 2020. Given the above-mentionedfactors, the Company can forecast the operation indicators of future business based on historical financial data, however, there exist great uncertainties on the accuracy and realizability of these important forecast parameters.

As there exist great uncertainties on some important forecast parameters such as the operation indicators of future business of the appraised entity, and the asset valuer is unable to predict the profit for future development of the appraised entity due to the limitation of its professional ability and the understanding of the industry in which the enterprise operates, therefore, the asset valuer cannot adopt income approach in this asset valuation.

As the appraised assets are in continuous use or assumed to be in continuous use, and through the asset verification procedure, it is found that the ownership of various assets and liabilities of Xiamen Port Group Shihushan Terminal Co., Ltd. is basically clear, and the relevant information is relatively complete, with available historical data, and the value of various assets and liabilities can be appraised and estimated by various approaches, so it is suitable to adopt the asset-based approach for valuation.

According to Article 23 of Practice Guidelines for Asset Valuation-Asset Valuation Approaches, in any of the following circumstances, asset appraisal professionals can adopt an appraisal approach: (2) Because the appraisal object only meets the applicable conditions of one appraisal approach, one appraisal approach is adopted.

Therefore, the asset-based approach is adopted for this asset valuation.

Implementation of the valuation procedures by the asset-based approach

Asset-based approach refers to an appraisal approach that reasonably determines the value of the appraisal object by evaluating the contribution value of various assets and liabilities on and off the balance sheet of an enterprise on the basis of the balance sheet of the appraised entity on the valuation benchmark date. It takes the replacement of various factors of production as an assumption, selects appropriate approaches to assess and estimate the value of each sub-item asset according to the specific conditions of the sub-item assets authorized for appraisal, accumulates and sums it up, and then deducts the appraised value of relevant liabilities to obtain the appraised value of all equity interests. The valuation of assets and liabilities in the asset-based approach is as follows:

[Current assets]

1. Monetary funds (including bank deposits)

There are 7 RMB deposit accounts in bank deposits. Asset appraisal professionals verify all bank deposit accounts, checking whether bank statements are consistent with book records, and

- II-24 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

verifying the authenticity and accuracy of book records of bank deposits. After verification, the deposit accounts of all banks are recorded accurately, and the outstanding items of banks on the benchmark date have been adjusted by audit, and no outstanding items affecting equity interests have been found. The appraised value of RMB account deposits shall be determined by the verified book balance.

2. Receivables (including notes receivable, accounts receivable, prepayments and other receivables)

Asset appraisal professionals check receivables by consulting relevant account books, vouchers, business contracts, etc., and with the help of historical data and investigation and verification, analyze the amount and aging of creditor's rights, the reasons for the long aging of certain creditor's rights, the recovery of payment, the funds, credit and management status of the debtors, and verify whether there are abnormal situations such as inconsistent accounts and facts.

In this valuation, the appraised value of various receivables is obtained by deducting the appraisal risk loss determined by asset appraisal professionals from the verified book balance, and meanwhile, the accrued provisions for bad debts are evaluated to zero. The confirmation approaches of risk loss in the evaluation of various types of receivables are as follows: ➀ There is sufficient evidence to show that there is no recovery risk for the amount that can be fully recovered, the amount from customers with good reputation and regular business dealings, and the related amount between related parties, and the risk loss is evaluated to zero; ➁ There is no sufficient evidence to show that it will be recovered in full or it will have loss in full, there is a possibility of recovery risk. Asset appraisal professionals refer to the proportion of impairment losses determined by enterprise accounting policies, and determine the evaluated risk losses in combination with aging analysis; ➂ The relevant management system stipulates that impairment should be accrued in full, or there is sufficient evidence to show that it will have loss in full, the evaluated risk loss will be accrued in full.

3. Inventory

(1) Raw materials

Most raw materials of Xiamen Port Group Shihushan Terminal Co., Ltd. are purchased as required. In this asset valuation, the market price of raw materials is multiplied by the actual quantity to determine the appraised value of raw materials.

(2) Turnover materials in stock

Turnover materials in stock are mainly supplies for daily operation of enterprises, and the verified book value is taken as the appraised value.

[Non-current assets]

1. Valuation of long-term equity investment

As for the investment in Xiamen Lushenda Port Mechanical & Electronic Engineering Co., Ltd., since the enterprise has been closed for many years, it is now going through cancellation procedures, and provisions for impairment have been accrued fully. According to the statement issued by the appraised entity, Xiamen Lushenda Port Mechanical & Electronic Engineering Co., Ltd. has no valuable assets, so the appraised value of such long-term equity investment in this valuation is zero.

- II-25 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

According to the audited statement, the investment in Xiamen Port Domestic Shipping Agency Co., Ltd. totaled RMB6,668,548.17, including the fixed assets of RMB91,255.94. Other assets mainly included monetary funds, accounts receivable and deferred income tax assets. The liabilities totaled RMB7,229,749.58, mainly including accounts payable, employee compensation payable and taxes payable, and there are no liabilities that are not required to be assumed. As Xiamen Port Domestic Shipping Agency Co., Ltd. is now insolvent, and Xiamen Port Group Shihushan Terminal Co., Ltd. (廈門港務集團石湖山碼頭有限公司) holds 20% shares of Xiamen Port Domestic Shipping Agency Co., Ltd., which has a low shareholding ratio and there is no value-added assets, the appraised value of such long-term equity investment in this valuation is 0.

As for the investment in holding subsidiaries-Xiamen Shihushan Terminal Labour Service Co., Ltd., Xiamen Port Haiyu Terminal Co., Ltd. and Xiamen Port Haiyi Terminal Co., Ltd., because their land, houses, machinery and equipment and other assets have certain appreciation, on-site asset verification and overall appraisal are carried out on the subsidiaries on the same standard and on the same benchmark date, to obtain the appraised value of net assets of the subsidiaries. The appraised value after multiplying the net assets value (net assets) by the shareholding ratio held by the parent company is taken as the appraised value of the long-term equity investment of the parent company.

2. Valuation of fixed assets of buildings (structures)

According to the appraisal purpose and value type determined by this specific economic behaviour, appraisal object and profitability status, market conditions during valuation, data collection and the value basis of main technical and economic indicators, the approach suitable for this valuation is determined through applicability judgment.

Because the transaction cases of similar comparable assets in the market are difficult to obtain, the conditions for valuation by market approach are not satisfied, so it is not suitable to perform appraisal by market approach; the assets of the appraisal object cannot be stripped from the operating income of the enterprise, so it is not suitable to use the income approach for valuation; the replacement cost data and parameters of the appraised assets are easy to obtain, so the cost approach can be adopted.

The so-called cost approach is a valuation approach to calculate the replacement price or reconstruction price of the appraisal object on the valuation benchmark date and deduct depreciation, so as to calculate the objective and reasonable price or value of the appraisal object. The calculation formula is:

Appraised value = replacement cost × comprehensive newness rate

Replacement cost = development cost + management cost + cost of capital + development profit-deductible VAT amount

Development cost = construction and installation engineering cost + upfront and other engineering cost

- II-26 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

(1) Construction and installation costs

Construction and installation costs include civil engineering costs, installation costs, decoration engineering costs and other costs incurred in the construction of buildings (structures). Among them, civil works include foundation works, general civil works and decoration works, and installation works include water supply and drainage works, lighting works and fire service works.

For large-scale,high-value and important buildings (structures), the final accounts adjustment approach is adopted to determine their comprehensive construction and installation costs, that is, based on the quantities in the final accounts of the buildings (structures) to be appraised, according to the local quota standards and relevant charging documents, the civil engineering costs and installation costs are calculated respectively, to get the construction and installation costs. For buildings with small value and simple structure, the unilateral cost approach is used to determine the construction and installation costs.

(2) Upfront and other engineering costs

The upfront and other project costs of the buildings include upfront work consulting fees, environmental impact appraisal fees, survey and design fees, bidding agency fees, project supervision fees, project cost consulting service fees, project supervision fees and supporting charges, etc. According to the project scale and complexity of the appraisal object, the upfront and other project costs are calculated based on the construction and installation project costs.

The upfront cost and other construction expenses of the structures include feasibility study fee, environmental impact assessment fee, surveying and design fee, third-party technical consulting fee for design documents, supervision fee, tender agency fee, joint commissioning fee, etc. According to the construction scale and complexity of the evaluated subject, the upfront cost and other construction expenses of the evaluation are calculated based on the cost of construction and erection works.

(3) Management cost

The management cost of the construction unit refers to the management expenses incurred by the construction unit from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenditure and travel expenses, etc. For houses and buildings, management expenses are calculated according to a certain proportion of development costs with reference to the Notice on Printing and Distributing the Regulations on the Management of Construction Costs of Capital Construction Projects (Cai Jian [2016] No. 504) in combination with the actual situation of the project. For structures, management expenses are calculated according to a certain proportion of development costs with reference to the Regulations on Preparation of Budgetary Estimate for Water Transport Construction Project (JTS/ T116-2019) in combination with the actual condition of the project.

(4) Cost of capital

The cost of capital shall be calculated according to the reasonable construction period of the project, with reference to benchmark interest rate of RMB loans of financial institutions issued by the People's Bank of China on the valuation benchmark date, based on the sum of the development cost

- II-27 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

and the management cost. The reasonable construction period of houses and buildings is one year, and that of wharf berth structures is two years. The cost of capital is calculated as follows:

Cost of capital = (development cost + management cost) x [(1+ loan interest rate)construction period

(month)/12/2-1]

(5) Development profit

Development profit refers to the average profit that enterprises can obtain under normal conditions.

For buildings that have obtained ownership certificates, through investigating the reasonable profits which should be obtained in the development process of the site where the appraised buildings are located and by reference to the statistics of cost-profit ratio of transportation enterprises in the port industry set out in the Standard Value of Enterprise Performance Appraisal 2019 prepared by the Financial Supervision and Appraisal Bureau of the State-owned Assets Supervision and Administration Commission of the State Council, 13.00% is adopted as the development profit margin in this valuation. For buildings for which no property ownership certificates can be applied according to the current regulations, the development profit is not considered in this valuation.

The structures are mainly terminal hydro engineering, which are the main self-use business assets of enterprises. Based on the characteristics of such structures, and with reference to the valuation cases in the same industry, the development profit margin of such structures is zero in this valuation.

The deductible VAT amount is the real estate acquired after 30 April 2016 according to the Circular of the Ministry of Finance and the State Administration of Taxation on Pushing Forward the Pilot Project of Changing Business Tax to VAT in an All-roundWay (Cai Shui [2016] No. 36) and the Announcement of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs (No. 39, 2019). For those who meet the VAT deduction conditions, the corresponding VAT is calculated and deducted. Real estate includes VAT input tax on construction and installation engineering costs, with a tax rate of 9%; the upfront and professional expenses are VAT input tax with a tax rate of 6%, which is deducted from the replacement cost.
Determination of newness rate

When determining the renewal rate of buildings (structures), the main factors that may cause real estate depreciation should be fully considered, and all kinds of depreciation should be reasonably estimated. The depreciation of buildings includes substantive depreciation, functional depreciation and economic depreciation.

- II-28 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

buildings (structures), taking into account the internal quality, appearance and purchase of the buildings (structures). In this valuation, the newness rate of buildings is calculated by comprehensive newness rate approach, and the newness rate of buildings with small unit value is calculated by life approach or on-site scoring approach.

A. Length of life approach

Newness rate = acceptable useful life / (used life + acceptable useful life) ×100%

B. On-site scoring approach

Newness rate = total score of structural part × correction coefficient of structural part + total score of decoration part × correction coefficient of decoration part + total score of other parts × correction coefficient of other parts

(8) Determination of appraised value

Appraised value = replacement cost × comprehensive newness rate

3. Valuation of fixed assets of equipment

According to the appraisal purpose determined by this specific economic behaviour and the value type adopted, the appraisal object, the market conditions at the time of valuation, the data collection and the value basis of the main technical and economic index parameters, the market approach cannot be adopted because the recent comparable transaction cases of similar assets with sufficient correlation cannot be obtained; because it is difficult to strip the income of the assets authorized for valuation from the income of the enterprise, the income approach cannot be adopted; considering that the appraised equipment can be regenerated, and with the passage of time, there is obsolescence depreciation, and the purpose of this valuation will not change its original use, and it is comparable with the brand-new equipment existing in the market. Cost approach can be used for appraisal.

According to Article 23 of Practice Guidelines for Asset Valuation-Asset Valuation Approaches, in any of the following circumstances, asset appraisal professionals can adopt an appraisal approach: (2) Because the appraisal object only meets the application conditions of one appraisal approach, one appraisal approach is adopted. Therefore, the cost approach is adopted for this asset valuation.

The replacement cost approach is an appraisal approach to determine the appraisal object based on the sum of all necessary expenses for developing or building the appraisal object, plus normal interest and profit and deducting all losses. Calculation formula is as follows:

Appraised value = replacement cost × newness rate

3.1 Valuation of machinery and equipment

The current market price approach (second-hand price) is adopted for certain machinery and equipment, and the current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.
- II-29-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Machinery and equipment are evaluated by cost approach. Cost approach is to estimate the replacement cost of the assets to be appraised and the physical depreciation, functional depreciation and economic depreciation of the assets, and deduct various depreciation from the replacement cost as an asset appraised value. Its calculation formula is as follows: appraised value = replacement cost × newness rate.

Determination of replacement cost of machinery and equipment;

Replacement cost = equipment purchase price + transportation and miscellaneous fees + installation cost + basic cost + upfront cost and other expenses + employer management fee + cost of capital -deductible VAT.

a. Determination of equipment purchase price

Domestic equipment is determined by asking the manufacturer about the market price as at the valuation benchmark date, or looking up the current market price from the relevant quotation materials and referring to the contract price or winning bid price of the equipment recently purchased by similar companies. The FOB or CIF price of the imported equipment is determined by inquiring the relevant quotation manual or inquiring from sellers.

b. Determination of equipment transportation and miscellaneous fees

Refer to the Handbook of Common Approaches and Parameters of Assets Valuation and comprehensively determine the transportation and miscellaneous fees in combination with factors such as transportation distance, weight and volume of equipment.

c. Determination of installation cost

According to the installation engineering technical data and final accounts data provided by the Principal, determine the actual installation engineering quantity to determine the installation engineering cost.

d. Determination of basic cost

According to the basic engineering technical data and final accounts data provided by the Principal, determine the actual basic engineering quantity to determine the basic engineering cost.

- II-30 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

e. Determination of upfront fees and other expenses

The upfront and other expenses include upfront work consulting fees, environmental impact appraisal fees, survey and design fees, bidding agency fees, project supervision fees, project cost consulting service fees, etc., which are calculated according to the relevant quota and charging standards in combination with the actual situation of the project. The fee rate, charging base and charging basis are as follows:

Serial
no.	Fees	Base		Rate		Basis
1	Upfront work	Construction cost	0.28%		Refer to Yuan Ji Jia Ge
	consulting fee					(1999) No. 1283
2	Environmental impact	Construction cost	0.07%		Refer to Yuan Ji Jia Ge
	evaluation fee					[2002] No. 125
3	Survey and design fee	Construction cost	2.60%		Refer to Yuan Ji Jia Ge
						[2002] No. 10
4	Bidding agency fee	Construction cost	0.10%		Refer to Yuan Ji Jia Ge
						[2002] No. 1980
5	Project supervision fee	Construction cost	1.74%		Fa Gai Jia Ge [2007] No. 670
6	Construction cost	Construction cost	1.68%		Refer to Yuan Min Jia [2002]
	consulting service fee					Fang No. 457
Total		6.47%

f. Management fee of the construction entity

The management fee of the construction entity refers to the management expenses incurred by the construction entity from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenses and travel expenses, etc. The management rate of the construction entity can be based on the Notice of the Ministry of Finance on Printing and Distributing the Provisions on Financial Management of Capital Construction (Cai Jian [2016] No. 504) combined with the actual situation of the project. The management fee of the construction entity shall be calculated according to a certain proportion based on the sum of equipment purchase cost, transportation and miscellaneous expenses, installation and commissioning cost and upfront and other expenses.

g. Determination of cost of capital

According to the reasonable construction period of the project and the loan interest rate as at the valuation benchmark date, the cost of capital is determined based on the sum of equipment purchase cost, transportation and miscellaneous expenses, installation cost, basic cost, upfront and other expenses. The reasonable construction period is determined according to the time from installation and commissioning to normal operation of the equipment, and the average investment and compound interest are calculated according to the bank loan interest rate over the same period as at the valuation benchmark date.

h. Determination of VAT deduction

- II-31 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

of Customs), if the conditions for VAT deduction are satisfied, VAT input tax (tax rate: 13%) in

equipment purchase fee, VAT input tax (tax rate: 9%) in installation and commissioning fee, and VAT

input tax (tax rate: 6%) in upfront and other expenses, are deducted from replacement cost.

Determination of newness rate:

The theoretical newness rate depends on substantive depreciation, functional depreciation and economic depreciation. The analysis of the three types of depreciation is as follows:

a. Substantive depreciation:

For large-scale and key equipment in machinery and equipment, through on-site inspection of equipment service conditions, consulting relevant equipment operation conditions, main technical indicators and other data, and inquiring relevant engineering and technical personnel, operation and maintenance personnel about the technical conditions, overhaul times and maintenance conditions of the equipment, and considering the regulations on actual useful life of various types of equipment and factors such as the useful life of the equipment, the comprehensive newness rate of the equipment is reasonably determined.

Age newness rate = acceptable age ÷ (used age + acceptable age)

b. Functional depreciation:

Functional depreciation refers to the promotion and application of new technologies, which makes the original assets of enterprises obviously backward in technology, lower in performance and lower in value compared with the assets widely promoted and applied in society. This loss is called functional loss of assets, also called functional depreciation.

The functional depreciation of machinery and equipment is the depreciation of equipment value caused by technological progress. It includes two aspects, namely, functional depreciation caused by excessive investment cost and functional depreciation caused by excessive operating cost.

Before estimating the functional depreciation of machinery and equipment, asset appraisal professionals should analyze the determined replacement cost and substantive depreciation to see if the factors of functional depreciation have been deducted. If the functional depreciation has been deducted, no calculation will be repeated; if the functional depreciation is not deducted and exists, the corresponding approach should be adopted for estimation, and no appraisal should be omitted. In fact, the equipment replacement cost determined by price index approach contains functional depreciation factor, and the equipment replacement cost determined by functional value approach has been deducted from functional depreciation; the newness rate determined by the age approach does not deduct the functional depreciation factor; however, using the repair cost approach may deduct all or part of the functional depreciation.

In the appraisal, if the restoration replacement cost is used, it should be considered whether there is functional depreciation caused by excess investment cost. If the estimated replacement cost is the renewal replacement cost, the excess investment cost included in the appraised equipment value has actually been eliminated, and there is no functional depreciation.

- II-32 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The replacement price of the machinery and equipment included in the scope of valuation adopts the current ex-factory price, which belongs to the non-functional depreciation factor of the replacement cost.

c. Economic depreciation: Economic depreciation, also known as external loss, refers to the value loss caused by the external influence of assets themselves. It is mainly reflected that the utilization rate of equipment in operation decreases or even idles, which leads to the decrease of operating income of equipment.

Economic depreciation of machinery and equipment refers to the value loss caused by the external influence of assets themselves. It is mainly reflected that the utilization rate of equipment in operation decreases or even idles, which leads to the decrease of operating income of machinery and equipment. Economic depreciation caused by external conditions can originate from international and domestic industry bases or places. Various external factors affect the potential economic returns, thus directly affecting the market value of assets or properties.

The amount of economic depreciation is mainly determined by factors such as difficulty in selling products, insufficient start-up or idle assets caused by stopping production. The machinery and equipment included in the scope of valuation have no above reasons, so there is no economic depreciation.

d. Comprehensive newness rate: calculate theoretical newness rate N1 and field investigation newness rate N2 respectively, and determine its newness rate N by weighted average, i.e., N=N1*40%+N2*60%

3.2 Description of vehicle appraisal calculation

(1) Determination of replacement cost

The replacement cost is determined according to the current sales price of the automobile trading market in the entrusted asset appraisal area, the vehicle purchase tax uniformly stipulated by the state and the relevant fees collected by the local authorities. The replacement cost of a vehicle consists of three parts: the purchase price, the purchase surcharge and other expenses (such as the inspection and licensing fee and handling fee).

Determination of purchase price

a. The current market price approach (second-hand price) is adopted for certain vehicles. The current market price approach is to determine the price of the appraised asset according to the price of the reference object which is similar or comparable to the appraised asset in the open market.

b. It is determined with reference to the latest market price (excluding value-added tax) of similar models where the vehicles are located. For certain vehicles that have been discontinued, the purchase price is determined by the market price of alternative models with similar brand performance, and other expenses are determined according to the contract charging standard level of the local vehicle management department. (According to the Circular of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Implementation of VAT Transformation Reform in China (Cai Shui [2008] No. 170) and Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, the input

- II-33 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

tax of VAT special invoices obtained by ordinary VAT taxpayers who purchase motorcycles, automobiles and yachts can be deducted without distinguishing whether they are used for their own use.)

Determination of Vehicle Purchase Tax

Determination of other expenses

Mainly for vehicle inspection and licensing fees: the local vehicle inspection and licensing fee is RMB500/vehicle.

Replacement cost = purchase price + vehicle purchase tax (10% of purchase price)+other
expenses

(2) Valuation of vehicle renewal rate

The newness rate of vehicles is determined by age newness rate, mileage newness rate, on-site investigation of vehicle service conditions, and comprehensive consideration of actual technical conditions, technical progress, equipment load and utilization rate, maintenance status and other factors.

Comprehensive newness rate = theoretical newness rate ×40%+ technical newness rate ×60%

Among them, the theoretical newness rate takes the lower of mileage newness rate and age newness rate

Mileage newness rate = (specified mileage-mileage already traveled)/specified mileage ×100%

Age newness rate = (economic durability-used age)/economic durability ×100%

3.3 Electronic equipment

The electronic equipment included in the scope of valuation mainly includes air conditioners, computers, printers, etc., which are appraised by the replacement cost approach.

(1) Determination of replacement cost

The current market price approach (second-hand price) is adopted for certain electronic devices. The current market price approach is to determine the price of the appraised asset according to the price of the reference object which is similar or comparable to the appraised asset in the open market.

The value of electronic equipment is small. Considering that most of the electronic equipment does not need to be installed (or the seller is responsible for the installation) and the transportation cost is low, the replacement price of electronic equipment (excluding VAT) is determined in this asset valuation based on recent market price data such as local market information and online quotation.
- II-34-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

(2) Determination of newness rate

The working environment of electronic equipment and office furniture is relatively stable, and the newness rate is determined by the age approach. The calculation formula is as follows:

Newness rate = (1-actual useful life ÷ economic useful life) ×100%

3.4 Description of newness rate of extended service equipment

In case of extended service and normal use, the newness rate of this asset valuation shall not be less than 15%.

3.5 Appraisal instructions for scrapped equipment

When the appraised equipment is cleaned and scrapped, the appraised value is determined by the residual value of the scrapped equipment. If there is a demolition and cleaning cost, the residual value and the demolition and cleaning cost will be deducted to determine the appraised value.

4. Construction in progress

The construction in progress included in the scope of this valuation mainly includes the shed construction project for the new warehouse of Shihushan Terminal, the stone road pavement hardening and supporting projects of Shihushan Terminal, etc. The valuers know the image progress of the construction in progress through on-site investigation, verify the various project expenditures incurred in the construction in progress according to the current quota standards for construction and installation projects, and know the payment progress. They also investigate the market prices of the main engineering materials consumed by the construction in progress, and think that the book expenditure amount is reasonable and the basis is sufficient, and the expenditure proportion is basically consistent with the image progress of the completion of the project, taking the verified book value as the appraised value.

5. Intangible assets-land use rights

According to "Assets Appraisal Standards-Real Estate" and referring to "Rules for Urban Land Valuation", the common land valuation approaches include market comparison approach, income reduction approach, surplus approach, cost approximation approach, benchmark land price coefficient correction approach, etc. The selection of valuation approaches should be based on the development of local real estate market, combined with the specific characteristics of the appraisal object and the appraisal purpose, etc., to select appropriate valuation approaches.

The parcels included in the scope of this valuation are industrial land for transfer, and there are no similar parcel transactions in the area where the parcel to be appraised is located, so the market approach cannot be used for appraisal; considering that the parcel of the appraisal object is located in the area covered by the benchmark land price, there is a perfect benchmark land price correction system, and most of the parcels with the same purpose in the area are obtained by the paid transfer of the benchmark land price, so the benchmark land price correction approach can be used for appraisal; the land requisition compensation standard data of the local government where the parcel is authorized for appraisal is relatively complete, and the valuers can collect a large amount of relevant data of the same type of land development costs, so the cost approximation approach can be adopted for appraisal.

- II-35 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The cost approximation approach and the benchmark land price coefficient correction approach are used to appraise the land use right.

The so-called cost approximation approach is to calculate the redevelopment cost, that is, the necessary expenditure for redeveloping the land on the valuation benchmark date. The basic formula is as follows:

Land value = land acquisition cost to be developed + land development cost+ management cost+ investment interest + development profit

The so-called benchmark land price coefficient correction approach refers to an approach to determine the correction coefficient and correct the benchmark land price according to the benchmark land price published by the local government, referring to the land price standard and various correction factor explanation tables in the same land grade or homogeneous area as the parcel to be estimated, and according to the regional conditions, individual conditions, market conditions, floor area ratio and micro location conditions, etc. The basic formula of the benchmark land price coefficient correction approach is as follows: P = P1b×(1±∑Ki)×Kj+D

Wherein,

P= parcel price

P1b-the benchmark land price for a certain purpose and a certain level (homogeneous area)

∑Ki -land price correction coefficient

Kj- other correction factors such as appraisal period date, floor area ratio and land use period

D-land development degree correction value

6. Intangible assets-other intangible assets

Intangible assets in this asset valuation-other intangible assets are mainly business billing system, mobile application system and environmental protection information system, which are system software customized by Xiamen Port Group Shihushan Terminal Co., Ltd. in combination with the relevant management system, accounting system and business model of enterprises. They have obvious industry characteristics and distinctive own characteristics, and cannot find the market price of similar products, nor can they determine their redevelopment value through reset.

Due to the restriction of objective conditions, asset appraisal professionals verify the authenticity, rationality and accuracy of the original recorded value, amortization period and amortized amount by querying the purchase contract and related accounting vouchers. After verification, the relevant items recorded in the book are consistent with the actual situation, and the verified amortized value is taken as the appraised value.

7. Deferred tax assets

Deferred income tax assets are deductible temporary differences due to provision for bad debts of accounts receivable and other receivables, provision for inventory depreciation, provision for impairment of long-term equity investment and provision for impairment of fixed assets, and are recognized according to income tax standards.

- II-36 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

For deferred income tax assets formed by provision for bad debts of accounts receivable and other receivables and provision for inventory depreciation, asset appraisal professionals can judge whether there is appraised risk loss by analyzing the aging of funds, contents and inventory age, and determine the appraised value of deferred income tax assets according to the deductible temporary difference formed by appraised risk loss and the income tax rate applicable to the appraised entity on the valuation benchmark date.

For deferred income tax assets formed by the provision for impairment of long-term equity investment and the provision for impairment of fixed assets, asset appraisal professionals investigate and understand the reasons for the formation, verify relevant contracts and accounting vouchers, determine the consistency between the book accounting contents and the actual ones, and take the verified book value as the appraised value.

8. Other non-current assets

Other non-current assets are mainly prepaid equipment price. The asset appraisal professionals investigate and understand the reasons for the formation of other non-current assets, verify the relevant contracts and accounting vouchers, and determine the consistency between the book accounting contents and the actual ones, and take the verified book value as the appraised value.

[Valuation of liabilities]

The liabilities included in this asset valuation include: short-term loans, accounts payable, advance receipts, salaries payable to employees, taxes payable, other payables, non-current liabilities due within one year and long-term loans. Appraisal professionals verify whether the accounting contents of various liabilities are consistent with the actual situation by consulting relevant contracts, agreements and accounting vouchers, analyze whether there is any amount requiring no payment, and take the real amount of liabilities confirmed after verification as the appraised value.

1. Technical description of valuation of short-term loans

Short-term loans refer to bank credit loans due within one year borrowed from China Construction Bank Corporation Xiamen Dongdu Sub-branch. The asset appraisal professionals have consulted relevant loan contracts and related materials, understood the loan conditions and terms, and understood the loan, repayment and overdue situation by consulting account books and bookkeeping vouchers. According to the financial accounting system, no discrepancies were found. The actual debt to be borne on the benchmark date after verification is taken as the appraisal value.

2. Technical description of valuation of accounts payable

Accounts payable mainly include project payment, purchase payment, maintenance fee and renovation fee, etc. The asset appraisal professionals verify the consistency between the book accounting contents and the actual ones by analyzing the accounting contents, settlement approaches, occurrence dates and payment periods. After verification, the accounts payable are consistent and no amounts requiring no payment are found. The verified book value is taken as the appraised value.

3. Technical description of the valuation of advance receipts

Advance receipts mainly include loading and unloading fees and port fees received in advance. The asset appraisal professionals verify the consistency between the book accounting contents and the

- II-37 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

actual ones by analyzing the accounting contents, settlement approaches, occurrence dates and payment periods. After verification, the advance receipts are consistent and no liabilities that are not required to be assumed are found, and the verified book value is taken as the appraised value.

4. Technical description of valuation of employee compensation payable

Employee compensation payable mainly includes unpaid wages, bonuses, trade union funds and employee education funds accrued according to regulations. The asset appraisal professionals verify the calculation standard and basis by investigating the staff composition and the staff compensation system, and spot check certain accounting vouchers for paying salaries after the valuation benchmark date. After verification, the book accounting content is consistent with the reality, and the verified book value is taken as the appraised value.

5. Technical description of valuation of taxes payable

Taxes payable include value-added tax, enterprise income tax, urban maintenance and construction tax, property tax, land use tax, individual income tax, education surcharge, local education surcharge, stamp duty and environmental protection tax that are payable after calculation. The asset appraisal professionals can understand the taxes, tax rates and relevant tax policies that the appraised entity should bear by checking the relevant tax declaration documents and relevant accounting vouchers. After verification, the book accounting content is consistent with the reality, and the verified book value is taken as the appraised value.

6. Technical description of valuation of other payables

Other payables mainly include current payments due to related parties, deposits, prepayments and loan interest, etc. The asset appraisal professionals verify the consistency between the book accounting contents and the actual ones by analyzing the accounting contents, settlement approaches, occurrence dates and payment periods. After verification, the accounts of other payables are consistent and no amounts requiring no payment are found. The verified book value is taken as the appraised value.

7. Technical description of valuation of non-current liabilities due within one year

Non-current liabilities due within one year refer to the part of accounting long-term loans that will be due within one year according to the installment repayment plan. Asset appraisal professionals refer to relevant loan contracts, installment repayment plans and other relevant materials, check the start and end dates of installment repayment, and understand the loan, repayment and overdue situation. According to the financial accounting system, no discrepancies were found. The actual debt on the benchmark date after verification is taken as the appraised value.

8. Technical description of valuation of long-term loans

Long-term loans are bank credit loans borrowed from Industrial and Commercial Bank of China Xiamen Huli Sub-branch and Agricultural Bank of China Xiamen Financial Center Sub-branch. The asset appraisal professionals have consulted relevant loan contracts and related materials, understood the loan conditions and terms, and understood the loan, repayment and overdue situation by consulting account books and bookkeeping vouchers. According to the financial accounting system, no discrepancies were found. The actual debt on the benchmark date after verification is taken as the appraised value.

- II-38 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

[Appraisal result of asset-based approach]

Net asset value = sum of appraised values of individual assets-sum of liabilities

VIII. Implementation Process and Situation of Valuation Procedure

After accepting the engagement, the Asset Appraisal Institution shall select asset appraisal professionals according to the agreement of both parties, and form an appraisal project team according to the assets distribution of the appraised entity. The whole asset appraisal work is divided into four stages:

Stage of acceptance of engagement and preliminary preparation

Request the Principal to clarify the basic matters of the valuation business, such as the appraisal purpose, scope of valuation and object, valuation benchmark date, etc., and conduct project investigation and risk appraisal;
Accept the engagement of the Principal's asset appraisal project;
Determine the project leader and project team members, formulate the asset appraisal work plan, put forward the appraisal plan time arrangement, determine the appraisal approach, etc., and train the project team members;
According to the preliminary understanding of the situation and the characteristics of the appraisal object, the asset appraisal declaration form is arranged in a targeted manner, and the main asset questionnaire and the main business profit questionnaire are designed. The personnel participating in the asset valuation of the appraised entity are given business training, and the appraised entity is instructed to check assets and prepare appraisal materials, and fill in the asset appraisal declaration form and any kinds of questionnaires.

Stage of asset verification

On the basis of enterprises' truthful declaration of assets and comprehensive self-examination of assets to be appraised, asset appraisal professionals have carried out a comprehensive inventory and verification of assets and liabilities included in the scope of valuation, and systematically investigated the financial and operating conditions of enterprises.

For physical assets, conduct on-site physical investigation and verification according to the asset appraisal declaration form accompanied by relevant personnel of the appraised entity, understand the status of physical assets, and learn about the use, maintenance and management of assets from asset management personnel, and make corresponding records;
Understand the situation of non-physical assets and liabilities, consult relevant financial information, and collect information such as contracts and agreements;
Collect relevant property registration documents and other relevant certification documents of assets, and investigate and verify the property rights of assets;
Communicate with the management of the appraised entity in time, and coordinate and solve the related problems in the on-site appraisal;
- II-39-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Listen to the introduction of the staff of the appraised entity on the basic business situation and financial status of assets, and collect relevant operational and basic financial data;
Investigate and understand the historical operation of the appraised entity, the composition of income, cost and expenses and their change reasons, and analyze its profitability and development trend;
Investigate the comprehensive strength, management level, profitability, development ability, competitive advantage and other factors of the appraised entity;
Obtain the forecast data of future operation provided by the appraised entity, analyze and verify the expected income and income period of the appraised entity in the future according to its financial plan and strategic planning, potential market advantages, economic environment and market development status, and make appropriate adjustments to the forecast data by communicating with the appraised entity;
Select appropriate formal or substantive verification procedures and approaches (including observation, inquiry, written examination, inspection of records or documents, field investigation, inquiry and confirmation, analysis, calculation, review, etc.) according to factors such as the type, source, acquisition method and influence degree of examination and verification data, examine and verify the data obtained from field investigation and data collection.

Stage of appraisal, estimation and summary

According to the appraisal purpose and the characteristics of the assets to be appraised, select the appraisal ways and specific approaches, and select relevant parameters;
Carry out market research and inquiry work, collect market price information and relevant information of appraisal;
Adopt appropriate valuation approaches to appraise various assets and liabilities, and determine the appraisal results of the asset-based approach;
Analyze the rationality of valuation approaches and appraisal results, form professional appraisal opinions and write Asset Valuation Reports by asset valuer;
Carry out three-level review according to the internal procedures of the Asset Appraisal Institution, and make relevant modifications according to the review opinions.

(IV) Stage of issuance of the Asset Valuation Report

Without affecting the independent judgment of the final appraisal result, the rechecked Asset Valuation Report shall be sent to the Principal or the relevant parties permitted by the Principal to communicate and solicit opinions on the relevant contents of the Asset Valuation Report. After communication and reporting, a formal Asset Valuation Report shall be issued and submitted to the Principal after final review and issuance.

IX. Appraisal Assumptions

1. Premise of appraisal: This valuation is based on the assumption that the property rights of the entrusted assets are complete and legal, and they are set for current purposes and continue to operate according to current trends.

II-40-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

2. Basic assumptions:

It is assumed that all documents and materials provided by the Principal are true, valid and
accurate.
It is assumed that there is no significant change in the national macroeconomic policy and the social and economic environment in the region.
It is assumed that the tax policies, credit interest rates, exchange rate changes, etc. on which the business operation and asset appraisal are based, have not changed significantly enough to affect the appraisal conclusion.
It is assumed that the influence of natural forces and other force majeure factors, as well as the possible influence of special trading approaches on the appraisal conclusion, are not considered.
The impact of future auctions, sales and collaterals on asset appraisal prices, or the impact of additional prices paid by special trading approaches when property rights change, or the factors that may affect the value of the assets due to the expenses and taxes for sale, are not considered in this Asset Valuation Report.
Except for the known and disclosed matters, it is assumed in this asset valuation that there are no other undeclared off-balance-sheet assets and liabilities, mortgage or guarantee matters, major litigation or post-period events, and the appraised entity has legal rights to the assets included in the scope of valuation.
Transaction assumption: it is assumed that all assets to be valued are already in the process of transaction, and the asset valuer carries out a valuation based on the transaction conditions of the assets to be valued in a simulated market.
Open market assumption: it is assumed that both trading parties of the assets traded in the market or the assets to be traded in the market are in the same position and have opportunities and time to obtain sufficient market information so as to make reasonable judgment upon the function, usage and transaction price of assets.
Assumption on continuing operation of the enterprise: it is assumed that the appraised entity is in full compliance with all relevant laws and regulations, and will continue to operate in the foreseeable future.

3. Specific assumptions:

The conclusion of this asset valuation is based on the assumption that the value of the assets included in the scope of valuation is reflected on the valuation benchmark date under the condition that the current scale and current use are unchanged.
In the process of asset appraisal, this Asset Appraisal Institution accepted some materials provided by the Principals and the appraised entity which are considered indispensable by the asset valuers in the asset appraisal process. The Principal and the appraised entity are responsible for the authenticity, correctness and legitimacy of these materials. The asset valuers all assume that these materials are true, correct and legitimate. The results of this asset valuation depend on the authenticity, correctness and legitimacy of these materials to a certain extent.
- II-41-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The result of this asset valuation assumes that there are no other estimated liabilities except those known by the asset valuer.
The relevant taxes and expenses arising from the future transfer of the appraised assets are not considered in this Asset Valuation Report.

This Asset Valuation Report and conclusion are based on the above appraisal premises, basic assumptions and specific assumptions, as well as the principles, basis, conditions, approaches and procedures determined in this Asset Valuation Report. If the above premises and assumptions change, this Asset Valuation Report and conclusion will generally automatically become invalid.

Appraisal Conclusion

In line with the principles of independence, impartiality, science and objectivity, the asset appraisal agency applied the legal procedures and fair approaches of asset appraisal, and adopted the asset-based approach to appraise all equity interests authorized for valuation of Xiamen Port Group Shihushan Terminal Co., Ltd..

Appraisal results

After audited by RSM China Xiamen Branch, the book value of all equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. is RMB691,569,600. After appraised by using the asset- based approach, subject to meeting all valuation assumptions and premises of this report, the appraised value of all equity interests as at the valuation benchmark date of this asset valuation is RMB1,529,890,200 (SAY RMB ONE BILLION FIVE HUNDRED AND TWENTY-NINE MILLION EIGHT HUNDRED AND NINETY THOUSAND TWO HUNDRED ONLY), representing an increase in value of RMB838,320,600 and an increase in percentage of 121.22%. The summary of asset appraisal is as follows (unit: RMB'0,000):

Appraised enterprise: Xiamen Port Group Shihushan Terminal Co., Ltd.	Valuation benchmark date: 31 December 2019
Serial						Appraisal		Added		Value-added
No.		Item		Book value		value		value			rate %
1		Current assets			2,966.25	2,941.27	-24.98	-0.84
2		Non-current assets	134,215.04	218,072.08	83,857.04	62.48
3		Among which: long-term equity investment			96,810.16	145,645.01	48,834.85	50.44
4		Investment in other equity instruments			-		-		-
5		Investment real estate			-		-		-
6		Fixed assets			27,935.10	38,915.33	10,980.23	39.31
7		Among which: buildings			22,238.43	31,562.23	9,323.80	41.93
8		Equipment			5,696.66	7,353.10	1,656.44	29.08
9		Construction in progress			79.43	79.43		-			-
10		Intangible assets			9,309.94	33,355.94	24,046.00	258.28
11		Among which: land use right			9,233.82	33,279.83	24,046.01	260.41
12		Long-term prepaid expenses			-		-		-
13		Deferred tax assets			65.05	60.99	-4.06	-6.24
14		Other non-current assets			15.36	15.36		-			-

15		Total assets	137,181.29	221,013.35	83,832.06	61.11


16		Current liabilities			33,399.33	33,399.33		-			-
17		Non-current liabilities			34,625.00	34,625.00		-			-

18		Total liabilities			68,024.33		68,024.33		-			-
19		Shareholders' equity			69,156.96	152,989.02	83,832.06	121.22

- II-42 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

For details of the appraisal conclusion, please refer to the appraisal breakdown.

Changes and reasons of comparison between appraisal results and book value

Impairment of other receivables is RMB351,700, mainly because the valuation of the dividend receivable that is expected to be uncollectible is zero.
The inventory impairment has a value appreciation of RMB101,900 due to the rising market price of some raw materials.
The long-term equity investment has a value appreciation of RMB488,348,500, which is mainly due to the fact that the book value of long-term equity investment is the original investment cost, and the operating accumulation of subsidiaries over the years and the increase of related physical appraisal lead to the increase of long-term equity investment.
The fixed assets of houses and buildings have a value appreciation of RMB93,238,000, which is mainly caused by the fact that the building was built a long time ago from this valuation benchmark date, the material price and labor cost have since surged, and there is difference between the financial depreciation period and the economic useful life used in the appraisal.
The fixed assets of equipment have a value appreciation of RMB16,564,400, which is mainly for the reason that the financial depreciation period is shorter than the economic useful life used in the appraisal.
Intangible assets-land use rights have a value appreciation of RMB24,046.01. The main reasons for the appreciation are as follows: the entrusted land was acquired earlier, the government's benchmark land price has been raised many times, the regional economy has developed, the supporting facilities have been continuously improved, the demand for land has been growing, and the land available for development and utilization has decreased. In recent years, the rising land development cost has caused the increase in the value of this valuation.
Impairment of deferred income tax assets is RMB40,600, which is caused by reversal of corresponding deferred income tax due to zero inventory depreciation reserve.

XI. Special Notes

The appraisal conclusion of this Asset Valuation Report shall be only used by the Principal for the appraisal purposes listed in this Asset Valuation Report. Without the consent of the Asset Appraisal Institution, all or part of the contents of the Asset Valuation Report shall not be extracted, quoted or disclosed in the public media, except as stipulated by laws and regulations and otherwise agreed by the Principal and relevant parties.
The Asset Appraisal Institution and asset appraisal professionals shall abide by relevant laws and regulations and asset valuation standards in the principles of independence, objectivity and impartiality in the implementation of this asset valuation business; according to the data collected by the Asset Appraisal Institution and asset appraisal professionals during their practice, the contents stated in the Asset Valuation Report are objective, and the Asset Appraisal Institution and the signing asset valuer shall assume corresponding legal responsibilities for the rationality of the appraisal conclusion.
- II-43-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

The list of assets and liabilities involved in the appraisal object, descriptions of relevant matters and important materials related to the appraisal shall be reported by the Principal and relevant parties and confirmed by their signatures.
The Asset Appraisal Institution and the signing asset valuer have no existing or expected interests in the appraisal object; at the same time, there is no personal interest relationship with the Principal and related parties, and there is no prejudice against the Principal and related parties.
The asset valuer limited the ownership of objective conditions to the appraised assets and the certification materials related to asset appraisal based on professional judgment and general investigation, without substantive verification and verification. However, the asset valuer's professional judgment and investigation conclusion cannot relieve or replace the responsibility of the Principal and relevant parties to provide real ownership and certification materials related to asset appraisal.
This valuation conclusion is valid only on the valuation benchmark date stated in the valuation report. The user of the valuation report shall reasonably determine the useful life of the valuation report according to the asset status and market changes after the valuation benchmark date. Generally, the Asset Valuation Report can only be used when the distance between the valuation benchmark date and the economic behaviour realization date is less than one year.
The asset valuers and their Asset Appraisal Institutions have the professional qualifications and relevant professional appraisal experience required for this valuation business. Except that RSM China Xiamen Branch was used to audit and issue the auditor's report of Rong Cheng Shen Zi [2020] No. 361F0214 as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.
The use of this Asset Valuation Report is limited to the appraisal purpose stated in the Asset Valuation Report, and the consequences caused by improper use is not the responsibility of the signing asset valuer and the Asset Appraisal Institution.
The analysis, judgment and conclusion in the appraisal report issued by the asset valuers and their Asset Appraisal Institutions are limited by the assumptions and qualifications in the report, and the users of the Asset Valuation Report should fully consider the assumptions and qualifications stated in the report and their influence on the appraisal conclusion.
For the defective matters and post-period matters that may affect the appraised value of assets in the appraised entity, if the Principal and the relevant parties do not make special instructions at the time of authorization and the asset appraisal professionals are generally unable to know according to their professional experience, the Asset Appraisal Institution and the asset appraisal professionals will not bear relevant responsibilities.
The Asset Appraisal Institution has not independently examined the economic behaviour approval documents, legal documents, historical evolution, qualification certificates, business licenses, ownership certificates, accounting vouchers, financial statements, account books and records, contract orders, control relations, historical changes in equity and other evidential materials provided by the Principal and the appraised entity, nor will it be responsible for the authenticity of the above materials.
- II-44-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Although the asset appraisal professionals did not find any other guarantees and mortgages in the appraised assets during the valuation of this project, the users of this Asset Valuation Report should make independent judgments on the asset status without relying on this Asset Valuation Report.
Unless otherwise specified, the appraised value in this Asset Valuation Report is based on the fact that the appraised entity has full rights to the relevant assets, without taking into account the relevant debts and influences caused by the certain unpaid fees or the unfinished relevant procedures which are not reflected in the books of the appraised entity.
Descriptive words about the Principal and related parties in this Asset Valuation Report are taken from the relevant introduction materials provided by the Principal and related parties to the asset valuer, which should be regarded as a general description by the report reader, and should not be regarded as the approval or publicity report of the Asset Appraisal Institution and the signing asset valuer on their relevant situation. The Asset Appraisal Institution and the signing asset valuer are not responsible for any possible discrepancy between the introduction and the actual situation.
Limited by objective conditions, in this asset valuation, startup test was not conducted on the appraised equipment one by one, nor did it test the structure of buildings and structures. The valuer assumes that the physical, economic and technical indicators, structure and quality of the above appraisal object meet the design requirements and relevant national regulations, and can be used normally within the remaining economic durability life of this valuation.
The asset valuer's purpose in carrying out this asset valuation business is to measure the value of the appraisal object and express professional opinions, and the asset valuer and the appraisal institution where he works are not responsible for the decision-making of relevant parties. The appraisal conclusion should not be regarded as the guarantee of the realizable price of the appraisal object.
According to Cai Shui [2008] No. 170, Circular of the Ministry of Finance and the State Administration of Taxation on Launching the Pilot Program of Reforming from Business Tax to VAT in an All-round Way, Cai Shui [2016] No. 36 and Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, the appraised value of buildings (structures) and production equipment included in the scope of this asset valuation does not include VAT input tax.
As of the valuation benchmark date, the housing and buildings without ownership certificates of the appraised entity are as follows:

Serial
no.	Name of Building	Structure		GFA (m2)	Remarks
1	Parking workshop no. 19	Framework	900
2	Hoist room no. 1	Mixed	39.69

The area of buildings that have not yet gone through the ownership certificates is determined according to the reported number of the appraised entity and after consulting relevant engineering drawings and on-site verification. The asset appraisal professionals shall appraise the area reported by the appraised entity. If the area is inconsistent with the reported area when handling the relevant ownership certificates in the future, the appraisal results shall be adjusted according to the area stated in the ownership certificates. The appraisal conclusion of this report is made on the assumption that

- II-45 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

there is no property right dispute in the above-mentioned house, and the related expenses required to be paid when handling the ownership certificate in the future are not considered.

Among the buildings, the book value of Sanming property of Item 5 is RMB118,652.53. According to the Report on the Property Right Dispute over Sanming Houses provided by the appraised entity Sanming houses are commodity houses purchased by Xiamen Port Group in August 1999 at a consideration of RMB160,000. It is located in Rooms 401 and 402, Block 1, No. 56 Xin Shi Nan Road, Sanyuan District, Sanming City. Currently, the property right of the 2 houses together with those of the other houses in the same building have been transferred to Huaxia Company (華夏公司), and used as securities by Huaxia Company to apply for loans from banks. Since the property right dispute of the above property is still pending for resolution, book value is presented temporarily in this valuation.
The net book value of No. 53 of the structure, "Gangzhong Road Project in Dongdu Port Area (Berth No. 19 Section)", is RMB499,574.21. After verification, this road project was built by the company and has been used as a municipal road, which does not belong to the road in the factory area. The land use right occupied by the road project is not within the scope of valuation. Therefore, this road project is listed as the net book value after audit, which should draw the attention of report users.
Xiamen Lushenda Port Mechanical & Electronic Engineering Co., Ltd., a long-term equity investment, has been out of business for many years, and is currently going through cancellation procedures, with full provisions for impairment on its books. According to the statement issued by the appraised entity, Xiamen Lushenda Port Mechanical & Electronic Engineering Co., Ltd. has no valuable assets, so the appraised value of this long-term equity investment is zero.
In this asset valuation and when confirming the appraised value of long-term equity, the influence of liquidity discount, control right and surplus and discount of minority owners' equity were not considered.
As of the valuation benchmark date, Xiamen Port Group Shihushan Terminal Co., Ltd. has obtained the right to use sea areas of Dongdu Berth No. 19 reconstruction project in Xiamen Port, with the certificate No. of Guo Hai Zheng No. 2016C35020603990. The enterprise shall, in accordance with the Notice on Improving the Administration on Collection of Sea Waters Use Fee (Cai Zong [2007] No. 10) issued by the Ministry of Finance and the State Oceanic Administration, pay the sea waters use fee on an annual basis. The paid sea waters use fee is directly included in the current cost, which is not separately listed as an asset in the book. Considering that the asset right of the sea area use right is embodied in the form of expense, this valuation is zero.
According to Jiao Gui Hua Fa [2006] No. 267 issued by the Ministry of Transport, the appraised entity has obtained the right to use the 289.7-meter port line corresponding to Berth No. 19 at Dongdu Port Area. Due to the scarcity, limitation and non-renewability of the port line use rights, "the port line is subject to a paid use system and the specific measures shall be formulated by the Provincial People's Government" according to the Fujian Port Regulations. However, as of the valuation benchmark date, the Fujian Provincial People's Government has not formulated specific implementation measures for the paid use of the port line, and the appraised entity has not paid for the port line use right acquired, so the port line value has not been considered in this valuation.
- II-46-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

25. Special Notes on Xiamen Port Haiyu Terminal Co., Ltd.

As of the valuation benchmark date, none of the houses and buildings included in the scope of valuation of the appraised entity have applied for the ownership certificate, with the construction area of 4,438.04 square meters. The main details are as follows:

Serial
no.	Name of Building	Structure		GFA (m2)
1	1# Power transformer room	Steel and	1,874.89
		concrete
2	Material tool warehouse (repair workshop)	Steel and	1,806.94
		concrete
3	Sewage pumping room	Steel and	229.08
		concrete
4	Railway crossing room	Mixed	17.13
5	New clothes drying shed project at Haiyu Terminal Warehouse	Steel	322.00
		structure
6	New Bicycle Parking Shed at Haiyu Terminal Office Building	Steel	143.00
		structure
7	Haicang Berth No. 7 DC Passage Sentry Box Crossing (2014-213)	Mixed	9.00
8	Container Reconstructed to Employee Waiting Dining Room Project (214) at Haiyu	Steel	36.00
	Terminal	structure

The area of buildings that have not yet gone through the ownership certificate is determined according to the reported number of the appraised entity and after consulting relevant engineering drawings and on-site verification. The asset appraisal professionals shall appraise the area reported by the appraised entity. If the area is inconsistent with the reported area when handling the relevant ownership certificates in the future, the appraisal results shall be adjusted according to the area stated in the ownership certificates. The appraisal conclusion of this report is made on the assumption that there is no property right dispute in the above-mentioned house, and the related expenses required to be paid when handling the ownership certificate in the future are not considered.

The structure No. 9 "No. 2 Flood Drainage Canal Project" with a book value of RMB6,992,292.11. After verification, this project was built by the company and has been used as a municipal supporting project. The valuation of this project is listed temporarily in the audited book value.
The certificate No. of land use right of Haicang Berth No. 7 is "Guo Hai Zheng No. 083550015". The sea has been reclaimed to form land, and the certificate has not been cancelled, and its value has been considered in the land use right evaluation and will not be valuated separately.
As of the valuation benchmark date, Xiamen Port Haiyu Terminal Co., Ltd. has obtained the right to use sea areas of Haicang Berth No. 7 in Xiamen Port, with the certificate of Guo Hai Zheng No. 2016C35020503987. The enterprise shall, in accordance with the Notice on Improving the Administration on Collection of Sea Waters Use Fee (Cai Zong [2007] No. 10) issued by the Ministry of Finance and the State Oceanic Administration, pay the sea waters use fee on an annual basis. The paid sea waters use fee is directly included in the current cost, which is not separately listed as an asset in the book. Considering that the asset right of the sea area use right is embodied in the form of expense, this valuation is zero.
According to Jiao Gui Hua Fa [2006] No. 769 issued by the Ministry of Transport, the appraised entity has obtained the right to use the 325-meter port line corresponding to Berth No. 7 at Haicang Port Area. Due to the scarcity, limitation and non-renewability of the port line use rights, "the
- II-47-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

port line is subject to a paid use system and the specific measures shall be formulated by the Provincial People's Government" according to the Fujian Port Regulations. However, as of the valuation benchmark date, the Fujian Provincial People's Government has not formulated specific implementation measures for the paid use of the port line, and the appraised entity has not paid for the port line use right acquired, so the port line value has not been considered in this valuation.

The certificate of land ownership of Haicang Berth No. 7 records that the legal purpose is terminal and the land for storage transfer for 50 years. According to Article 26 of Notice on Several Regulations of Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management (Xia Fu [2017] No. 413), for the land that has been provided for the port, wharf, logistics (transportation), software and R&D projects, if the land price is calculated based on the industrial land standard at the time of land supply, the value of the land shall be transferred and mortgaged according to the original standard of industrial land. Therefore, the benchmark land price for this appraisal is RMB550 per square meter according to the standard of industrial land in Haicang District.

26. Special Notes on Xiamen Shihushan Terminal Labour Service Co., Ltd.

As of the valuation benchmark date, none of the houses and buildings included in the scope of valuation have yet applied for the real estate title certificate, with a total construction area of 337.00 square meters.

Serial
no.	Name of Building	Structure		GFA (m2)
1	Berth No. 7 steel structure auto repair workshop	Steel	337.00
		structure

27. Special notes on Xiamen Port Haiyi Terminal Co., Ltd.

1. As of the valuation benchmark date, Xiamen Port Haiyi Terminal Co., Ltd. has obtained the right to use sea areas of Dongdu Berth No. 18 multi-purposeroll-off terminal in Xiamen Port, with the certificate No. of Guo Hai Zheng No. 2016C35020604000. The enterprise shall, in accordance with the Notice on Improving the Administration on Collection of Sea Waters Use Fee (Cai Zong [2007] No.
issued by the Ministry of Finance and the State Oceanic Administration, pay the sea waters use fee on an annual basis. The paid sea waters use fee is directly included in the current cost, which is not separately listed as an asset in the book. Considering that the asset right of the sea area use right is embodied in the form of expense, this valuation is zero.
1. According to Jiao Gui Hua Fa [2001] No. 422 issued by the Ministry of Transport, the appraised entity has obtained the right to use the port line 435-meter port line corresponding to Berth No. 18 at Dongdu Port Area. Due to the scarcity, limitation and non-renewability of the port line use rights, "the port line is subject to a paid use system and the specific measures shall be formulated by
2. - II-48-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

the Provincial People's Government" according to the Fujian Port Regulations. However, as of the valuation benchmark date, the Fujian Provincial People's Government has not formulated specific implementation measures for the paid use of the port line, and the appraised entity has not paid for the port line use right acquired, so the port line value has not been considered in this valuation.

28. Post-period events

The novel coronavirus outbreak broke out nationwide in January 2020, and the prevention and control of pneumonia epidemic continued nationwide as of the date of this valuation report. All parts of the country have launched the "First-level Response Mechanism for Major Public Health Emergencies", which has caused great impact on all walks of life and the whole national economy, especially on transportation, tourism, hotels, restaurants and other industries. This epidemic also has a certain impact on the operation and normal business activities of the appraised entity and the degree of impact will depend on the situation of epidemic prevention and control, duration and implementation of various control policies. In this valuation, the possible impact of the epidemic situation before the valuation report on the enterprise was considered, but we cannot predict the final impact of the epidemic situation on the industry and the appraised entity.
The appraisal conclusion of this report cannot be directly used when major post-period events occur after the report submission date.
After the valuation benchmark date and within the validity period, if the quantity and price standard of assets change, the following principles should be followed:

If the quantity of assets changes, the quantity and amount of assets shall be adjusted accordingly according to the original appraisal approach.

When the asset price standard changes, which has a significant impact on the asset appraisal price, the Principal shall promptly hire a qualified Asset Appraisal Institution to re-determine the appraised value.

Due to the change of asset quantity and price standard after the valuation benchmark date, the Principal should give full consideration to the actual pricing of assets and make corresponding adjustments.

Up to the date of the Asset Valuation Report, except for the above-mentioned matters, neither the asset appraisal professionals found in the asset appraisal process of this project, nor the Principal and relevant parties provided any special matters that may affect the appraisal conclusion and need to be clearly disclosed.

The above matters are brought to the attention of users of relevant reports when using the reports.

XII. Limitations of the Use of Asset Valuation Report

This Asset Valuation Report can only be used for the purpose and application stated herein, and only by the users specified herein.
If the Principal or other users of the Asset Valuation Report fail to use the Asset Valuation Report in accordance with the laws, administrative regulations and the scope of use stated in the Asset Valuation Report, the Asset Appraisal Institution and its signing asset valuer shall not be held liable.
- II-49-

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Except for the Principal, other users of Asset Valuation Report agreed in the Authorized Asset Appraisal contract and users of Asset Valuation Report stipulated by laws and administrative regulations, no other institution or individual shall become users of Asset Valuation Report.
The user of the Asset Valuation Report shall correctly understand the appraisal conclusion, which is not equal to the realizable price of the appraisal object, and shall not be regarded as the guarantee of the realizable price of the appraisal object.
Any extraction, citation or disclosure of this Asset Valuation Report in entirety or part to the public media should be subject to the consent of the Asset Appraisal Institution, unless otherwise permitted by the requirements of laws, regulation or agreement otherwise engaged between concerning parties.
The appraisal conclusion of the Asset Valuation Report shall remain valid for one year, commencing from 31 December 2019, the valuation benchmark date, to 30 December 2020.
The appraisal conclusion shall not be used unless the Asset Valuation Report has been filed with Xiamen SASAC (or authorized state-owned assets management department).

XIII. Date of Asset Valuation Report

The date of Asset Valuation Report is 21 July 2020, which is the formation date of the appraisal conclusion.

The document number of this Asset Valuation Report is Lian He Zhong He Ping Bao Zi

(2020) No. 5011. The appraised value of all equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. in connection with the proposed equity increase by Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd. due to the terminal equity integration is RMB1,529,890,200 (SAY RMB ONE BILLION FIVE HUNDRED AND TWENTY-NINE MILLION EIGHT HUNDRED AND NINETY THOUSAND TWO HUNDRED ONLY).

Chinese Asset Valuer: Chen Shiqin Chen Lizhu

Legal Representative: Shang Guangtai

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. 21 July 2020

Note: Ms. Chen Shiqin has over 9 years of experience in asset appraisal and holds the certificate of asset valuer. Ms. Chen Lizhu has over 10 years of experience in asset appraisal and holds the certificates of asset valuer and land valuer.

- II-50 -

APPENDIX II

VALUATION REPORT OF THE TARGET COMPANY

Appendices to the Asset Valuation Report

Content

Copies of business licenses of the Principal and the appraised entity;

Copies of commitment letter of the Principal and other relevant parties;

Economic behaviour documents;
(IV) Copy of commitment letter of the signing asset valuer;

Copies of record documents of the Asset Appraisal Institution;
(VI) Copy of counterpart of business license of the Asset Appraisal Institution; (VII) Copies of qualification certificates of the signing asset valuer;

(VIII) Explanation of the significant difference between the book value of assets and the appraisal conclusion;

(IX) Copies of the Authorized Asset Appraisal contract.

- II-51 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

This Appendix III contains the English translation of the Asset Valuation Report of Equity Interests of Xiamen Hailong prepared by Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd., a PRC Qualified Valuer, using asset-based approach which is the basis for the determination of the consideration. In case of discrepancy between the English translation and the Chinese version, the Chinese version shall prevail.

All Equity Interests of Xiamen Hailong Terminal Co., Ltd. in connection with Proposed Increase in Equity Interests of Xiamen Port Group Shihushan Terminal Co., Ltd.

by Xiamen Port Development Co., Ltd. with 100% Equity Interests of Xiamen Hailong Terminal Co., Ltd. due to Proposed Terminal Equity Integration

Asset Valuation Report

Lian He Zhong He Ping Bao Zi (2020) No. 5011-2

To: Xiamen Port Holding Group Co., Ltd., Xiamen Port Development Co., Ltd.

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. (hereinafter referred to as the "Asset Appraisal Institution") accepts your engagement to conduct asset appraisal on the market value as at 31 December 2019 of all equity interests of Xiamen Hailong Terminal Co., Ltd. in connection with proposed terminal equity integration by you in accordance with the administrative regulations on asset valuation and asset valuation standards of the People's Republic of China and pursuant to objective, independent, fair and scientific manner and by using the recognized asset valuation approach. The Asset Appraisal Institution and the signing asset valuer conducted field survey and market investigation on the assets authorized for valuation according to necessary valuation procedures. The information on asset valuation and valuation results is set forth herein as follows.

Principals, Appraised Entity and Other Users of the Asset Valuation Report as Stipulated in the Asset Valuation Commission Contract

The Principals are Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd., and the appraised entity is Xiamen Hailong Terminal Co., Ltd..

1. Particulars of Principals

Principal A

Company name: Xiamen Port Holding Group Co., Ltd.

Social Unified Organization Code Certificate: 9135020026013542XA

Registered address: 25th Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB3.1 billion

Legal representative: Chen Zhiping

Company type: Limited liability company (wholly state-owned)

Scope of business: 1. to operate and manage the state-owned assets within the authorized scope;

2. to invest in enterprises operating in the port, terminals, logistics, information, real estate, hotels,

III-1-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

property, tourism, trading and aquatic products processing industries; 3. to provide investment enterprises with financing services in accordance with laws, and utilize different channels to raise funds for self-investment; 4. to invest in financial services and securities companies such as banks, trusts, guarantees, insurance, etc.; 5. port engineering development, construction and consulting; 6. the analysis and consulting business of marine oil pollution, water recovery, environmental testing and oil type; 7. development and sales of information products, services on information consulting and technology, development and construction of information engineering and related services; 8. other business related to port construction and operation.

Principal B

Company name: Xiamen Port Development Co., Ltd.

Social Unified Organization Code Certificate: 913502007054097384

Registered address: 20th and 21st Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB531 million

Legal representative: Chen Zhaohui

Company type: Other joint stock limited company (listed)

Scope of business: 1. to provide ships with dock facilities and provide cargo handling, warehousing, logistics services within the port area; container handling, stacking and dismantling; roll on and roll off services for vehicle; simple processing for goods and their packaging (refer to license for expiration date); 2. the logistics and supply chain management, overall logistics planning and consulting, transit, multimodal transport services (excluding transport), logistics information management; 3. to operate all types of import and export of goods and technologies (no further attachment for directory of export commodities), except those goods and technologies the State restricts companies to operate or prohibits to import and export; 4. the wholesale and retail of building materials, chemical raw materials and products (excluding hazardous chemicals and monitoring chemicals), mineral products (except the state-controlled), machinery and equipment, hardware and electrical equipment and electronic products, textiles, clothing and daily necessities, agricultural products and livestock, stationery, sporting goods and equipment, arts and crafts; 5. lease of properties.

2. Particulars of the appraised entity

Company name: Xiamen Hailong Terminal Co., Ltd.

Social Unified Organization Code Certificate: 91350200051166553E

Registered address: Building Complex, 98 Cangjiang Road, Haicang District, Xiamen

Registered capital: RMB450 million

Legal representative: Zheng Cenglin

Company type: Limited liability company (corporate-owned invested or controlled by a non-natural person)

Scope of business: cargo handling, delivery in port, warehousing services (excluding hazardous chemicals warehousing and handling and delivery).

3. History and shareholding structure

On 15 August 2012, the 22nd Meeting of the Fourth Board of Directors of Xiamen Port Development Co., Ltd. considered and passed the "Proposal on the Establishment of a New Wholly-

- III-2 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

owned Subsidiary in Haicang Port Area", agreeing to establish Xiamen Hailong Terminal Co., Ltd. with a registered capital of RMB10 million.

On 4 February 2013, the 28th Meeting of the Fourth Board of Directors of Xiamen Port Development Co., Ltd. considered and passed the "Proposal on Capital Increase of Xiamen Hailong Terminal Co., Ltd.", determining to increase the capital of Xiamen Hailong Terminal Co., Ltd. by RMB150 million. After the capital increase, Xiamen Hailong Terminal Co., Ltd. had a registered capital of RMB160 million.

On 26 December 2013, the 36th Meeting of the Fourth Board of Directors of Xiamen Port Development Co., Ltd. considered and passed the "Proposal on Capital Increase of Xiamen Hailong Terminal Co., Ltd.", agreeing to increase the capital of Xiamen Hailong Terminal Co., Ltd. by RMB290 million. After the capital increase, Xiamen Hailong Terminal Co., Ltd. had a registered capital of RMB450 million.

As at 31 December 2019, Xiamen Hailong Terminal Co., Ltd. had a registered capital of RMB450 million, as shown in the following table:

			Registered capital	Paid-in capital	Proportion in
No.	Name of shareholder		(RMB10,000)		(RMB10,000)		registered capital
1	Xiamen Port Development Co., Ltd. . . . . . . . . . . . . . . . . .	45,000.00		45,000.00		100.00%
	Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	45,000.00		45,000.00		100.00%

- III-3 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

4. Assets, financial and business conditions in recent years

The main indicators of financial position of Xiamen Hailong Terminal Co., Ltd. in the past three years are shown in the table below (monetary unit: RMB):

Item/year		31 December 2017		31 December 2018	31 December 2019
Monetary funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7,830,271.41	4,489,530.05	4,130,835.83
Financial assets at fair value through profit or loss
Derivative financial assets
Notes receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . .				900,000.00
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . .	17,278,305.18	22,600,162.15	25,431,307.03
Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	376,164.89	677,278.63	505,968.06
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	33,271,811.83	12,404,671.20	3,207,597.37
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	3,948,638.85	3,145,431.16	1,988,223.09
Held-for-sale assets
Non-current assets due within one year
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .	32,464,881.65	35,393,164.60	36,021,340.39

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . .	95,170,073.81	78,710,237.79	72,185,271.77
Available-for-sale financial assets

Held-to-maturity investments
Long-term receivables
Long-term equity investment
Other non-current financial assets
Investment properties
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,276,410,685.32	1,224,047,813.55	1,178,304,824.28
Construction in progress . . . . . . . . . . . . . . . . . . . . . . .	961,446.07	2,013,849.06	95,154,444.85
Construction materials
Disposal of fixed assets
Productive biological assets
Oil and gas assets
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	123,535,274.35	124,233,960.76	121,287,847.41
Expenditures for development
Goodwill
Long-term deferred expenses . . . . . . . . . . . . . . . . . . .	1,010,626.34	308,938.50	199,873.74
Deferred income tax assets . . . . . . . . . . . . . . . . . . . . .	1,747,415.32	1,184,895.83	1,153,645.83
Other non-current assets . . . . . . . . . . . . . . . . . . . . . . .	283,237.70		10,756.56
Total non-current assets . . . . . . . . . . . . . . . . . . . . . . .	1,403,948,685.10	1,351,800,214.26	1,396,100,636.11

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	1,499,118,758.91	1,430,510,452.05	1,468,285,907.88

- III-4 -

APPENDIX III	VALUATION REPORT OF XIAMEN HAILONG
Item/year		31 December 2017		31 December 2018	31 December 2019

Short-term borrowings
Financial liabilities at fair value through profit or loss
Derivative financial liabilities
Notes and accounts payable . . . . . . . . . . . . .	. . . . . . . 153,360,201.16	95,901,547.95	92,725,993.64
Advance receipts . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 445,729.13	1,310,945.31	833,096.62
Employee compensation payable . . . . . . . . .	. . . . . . . 18,932,015.50	23,388,763.50	18,984,567.81
Taxes payable . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 838,353.33	839,956.63	719,417.49
Interest payable
Dividends payable
Other payables . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 153,840,286.28	240,701,999.07	386,262,711.16
Held-for-sale liabilities
Non-current liabilities due within one year
Other current liabilities

Total current liabilities . . . . . . . . . . . . . . . . .	. . . . . . . 327,416,585.40	362,143,212.46	499,525,786.72

Long-term borrowings . . . . . . . . . . . . . . . . . .	. . . . . . . 74,000,000.00	74,000,000.00	54,391,848.00
Bonds payable
Long-term payables
Special payables
Deferred income . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 4,864,583.33	4,739,583.33	4,614,583.33
Deferred income tax liabilities . . . . . . . . . . .	. . . . . . . 131,996,921.55	129,272,384.91	126,547,848.27
Other non-current liabilities

Total non-current liabilities . . . . . . . . . . . . . .	. . . . . . . 210,861,504.88	208,011,968.24	185,554,279.60

Total liabilities . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 538,278,090.28	570,155,180.70	685,080,066.32

Paid-in capital (or share capital) . . . . . . . . . .	. . . . . . . 450,000,000.00	450,000,000.00	450,000,000.00
Capital reserve . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 599,450,559.60	599,450,559.60	599,450,559.60
Surplus reserve
Special reserve . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . 1,112,015.51	272,017.37	680,484.97
Less: Treasury stock
Undistributed profits . . . . . . . . . . . . . . . . . . .	. . . . . . . -89,721,906.48	-189,367,305.62	-266,925,203.01

Total owner's equity . . . . . . . . . . . . . . . . . . .	. . . . . . . 960,840,668.63	860,355,271.35	783,205,841.56

Total liabilities and owner's equity . . . . . . . .	. . . . . . . 1,499,118,758.91	1,430,510,452.05	1,468,285,907.88

- III-5 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The main indicators of operating results of Xiamen Hailong Terminal Co., Ltd. in the past three years are shown in the table below (monetary unit: RMB):

Item/year		2017		2018		2019
I. Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	179,780,418.23	172,940,213.80	203,401,683.32
Less: Operating costs . . . . . . . . . . . . . . . . . . . . . . . . .	229,419,073.92	253,264,918.05	257,006,846.31
	Taxes and surcharges . . . . . . . . . . . . . . . . . . . . .	1,702,964.39	2,127,634.13	1,594,659.22
	Sales expenses
	Management expenses . . . . . . . . . . . . . . . . . . . .	6,240,468.49	15,431,800.71	12,469,526.61
	Research and development expenses
	Financial expenses . . . . . . . . . . . . . . . . . . . . . . .	23,984,623.76	11,886,913.20	13,559,325.33
	Asset impairment loss . . . . . . . . . . . . . . . . . . . . .	137,486.03	-563,640.94
Plus: Net gain on change of fair value
	Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4,025,000.00	5,140,975.00	638,140.20
	Investment income
	Credit impairment loss . . . . . . . . . . . . . . . . . . . .				7,592.27
	Gain on asset disposal . . . . . . . . . . . . . . . . . . . . .		232,298.68	-166,076.23
II. Operating profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-77,679,198.36	-103,834,137.67	-80,749,017.91
	Plus: Subsidy income
	Non-operating income . . . . . . . . . . . . . . . .	13,010.00	1,039,612.12	514,198.89
	Less: Non-operating expenses . . . . . . . . . . . . . .	270,060.49	200,538.58	16,365.01
III. Total profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-77,936,248.85	-102,995,064.13	-80,251,184.03
	Less: Income tax . . . . . . . . . . . . . . . . . . . . . . . . .	-2,032,901.67	-2,100,887.95	-2,693,286.64
IV. Net profits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-75,903,347.18	-100,894,176.18	-77,557,897.39

Note: The above data for 2017 and 2018 have been audited by Grant Thornton Certified Public Accountants ( Limited Liability Partnership) Xiamen Branch, and the data for 2019 have been audited by RSM China Xiamen Branch, all of which have issued unqualified auditor's reports.

5. Company profile

Xiamen Hailong Terminal Co., Ltd. is a wholly-owned subsidiary of the listed company Xiamen Port Development Co., Ltd. (stock code 000905). It is mainly engaged in port cargo loading and unloading, storage and distribution, and is a major bulk cargo port loading and unloading enterprise in Fujian Province. It is a key enterprise engaged in bulk cargo port loading and unloading business in Xiamen Port, the only port enterprise in Xiamen that receives and unloads bulk imported grain, and a major distribution center for imported stone materials. Its main assets are 20# and 21# berths in Haicang Port Area.

The construction of 20# and 21# berths in Haicang Port Area commenced at the end of August 2013. 20# berth was completed and accepted on 2 July 2015, and 21# berth was completed and accepted on 30 November 2015. 20# berth in Haicang Port Area is a 70,000-ton general berth, which is mainly used for grain unloading operations; and 21# berth in Haicang Port Area is a 50,000-ton general berth, which is mainly used for general bulk cargo loading and unloading, and the goods mainly include grain, chemical fertilizer, steel, sand and gravel, and other general cargoes. The throughput capacity of the terminal is 5.5 million tons/year, of which 3.8 million tons/year is for grain. The azimuth angle of the terminal front is 103°~283°, and the total length of the berth coastline is 504m (including 255.5m for 20# berth and 248.5 m for 21# berth). The top elevation of the terminal is 7.5m; the bottom elevation of the front edge is -15m; and the bottom elevation of the channel is -11.5m. The structure is designed for berthing 100,000-ton bulk carriers. The turning basin is arranged on the south side of the berth, with the long axis of the turning basin 3 times the designed ship length,

- III-6 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

being 684m, and the short axis 2 times the designed ship length, being 456m. The total land area is approximately 360,000 square meters. The designed terminal throughput of the project is 5.91 million tons/year. The total investment of the project is approximately RMB1.5 billion. The terminal project passed the completion acceptance organized by the Port Bureau and was officially put into operation on 15 November 2016.

Hailong Terminal currently has 3 warehouses with a total of 17,950m2 and a design load of 5 tons/m2, 16 silos each with a capacity of 10,000 tons and a storage yard of 80,000m2 with a design load of 5 tons/m2.

Principal Cargos in Hailong
Port Area		Mode of Operation
Bulk Soybeans and Wheat	Ship→ Warehouse
(Unloading) . . . . . . . . . .
		(Silo)
		Ship→ Vehicle
Rapeseed (Unloading) . . .	Ship→ Warehouse
		Ship→ Warehouse
		Ship→ Vehicle
Bulk Soybeans and Wheat	Silo→ Ship
(Loading) . . . . . . . . . . . .
Bulk Soybeans and Wheat	Silo→ Vehicle
(Transportation) . . . . . .
Rapeseed	Warehouse→
(Transportation) . . . . . .
		Vehicle
Bulk Soybeans and Wheat
(Clearance of the	Silo→ Silo
silo)★No Machine . . . . .
Bulk Soybeans and Wheat
(Clearance of the	Silo→ Silo
silo)★Loader . . . . . . . . .

Processes

Ship→ Portal Crane (Grab Bucket)→ Cap Block→ Conveyor→ Silo

Ship→ Portal Crane (Grab Bucket)→ Cap Block→ Loading of Leaking Material→ Platform Cleaning →Weighing→ Departures

Ship→ Portal Crane (Grab Bucket)→ Cap Block→ Loading of Leaking Material (Dumper)→Warehousing → Loader→ Stacking by Belt Conveyor

Ship→ Portal Crane (Grab Bucket)→ Cap Block→ Conveyor→ Spreading→ Piling Up by Loader

Ship→ Portal Crane (Grab Bucket)→ Cap Block→ Loading of Leaking Material → Platform Cleaning→ Weighing→ Departures

Loading at the Leakage Port of Silo→ Dumper→ Frontier Storage Yard→ Portal Crane (Grab Bucket)→ Loading

Arrival→ Weighing→ Loading at the Leakage Port of Silo→ Platform Cleaning→ Weighing→ Departures

Arrival→ Weighing→ Warehousing→ Loader→ Loading by Belt Conveyor→ Platform Cleaning→ Weighing→ Departures

Opening the Silo→ Packing Auger → Clearance with Assistance of Manpower →Building of the Silo

Opening the Silo→ Craning Loader with Assistance of Manpower→ Operation by Loader→ Packing Auger→ Clearance with assistance of Manpower→ Building of the Silo

- III-7 -

APPENDIX III	VALUATION REPORT OF XIAMEN HAILONG
Principal Cargos in Hailong
Port Area		Mode of Operation		Processes
Coil Steel (Unloading and
Congregation of	Vehicle→ Storage		Vehicle Arrival→ Forklift→ Storage Yard (Warehouse)
Goods) . . . . . . . . . . . . . .
		Yard (Warehouse)
		Vehicle→ Storage		Vehicle Arrival→ Craning → Storage Yard (Warehouse)
		Yard (Warehouse)
Coil Steel (Loading) . . . . .	Vehicle→ Ship		Vehicle Arrival → Portal Crane → Ship→ Stowage
		Storage Yard		Forklift →Trailer →Portal Crane→ Ship→ Forklift →
		(Warehouse)→Ship		Stowage
Coil Steel, Billet	Ship→ Vehicle		Cabin (Forklift)→ Portal Crane (Deck Cranes)→ Direct
(Unloading) . . . . . . . . . .
				Lifting Down into Vehicle
		Ship→ Storage Yard		Cabin (Forklift)→ Portal Crane (Deck Cranes)→
		(Warehouse)		Trailer→ Storage Yard (Warehouse)→ Forklift (Craning)
				Stacking
Coke (Unloading) . . . . . . .	Ship→ Storage Yard		Ship→ Portal Crane (Grab Bucket)→ Cap Block→
				Loading of the Leaking Material (Dumper)→ Entering
				into the Storage Yard→ Piling Up by Loader→
				Heightening by Excavator
Water Slag Powder	Ship→ Storage Yard		Ship→ Portal Crane (Grab Bucket)→ Cap Block →
(Unloading) . . . . . . . . . .
				Loading of the Leaking Material (Dumper)→ Back-Up
				Storage Yard→ Piling Up by Loader → Heightening by
				Excavator
Raw Sugar . . . . . . . . . . . . .	Ship→ Warehouse		Ship→ Portal Crane (Grab Bucket)→Cap Block→
				Loading of Leaking Material (Dumper)→ Warehousing
				→ Piling Up by Loader→ Heightening by Excavator
		Warehouse→		Arrival→ Weighing→ Warehousing → Loading by
		Vehicle		Loader → Platform Cleaning → Weighing → Departures
Sanders, Rubble	Ship→ Vehicle		Ship (Sorting out by Themselves)→Storage Yard→
(Unloading) . . . . . . . . . .
				Loading by Loader→ Dumper→ Departures

It currently has approximately 505 employees, and has established a relatively sound set of organization and management structure, operation standards and service system. It has passed the ISO9001:2015 quality management system certification, established an advanced information management system, and trained a group of highly skilled and experienced employees.

- III-8 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The organization chart of Xiamen Hailong Terminal Co., Ltd. is as follows:

					General Manager
	Secretary

	Deputy
Deputy secretary	General Manager

Party-Masses

Work Department

General Department

Finance Department

Safetyand Environmental

Protection Department

Operations Management

Department

Equipment Engineering

Department

Marketing Department

International Trade

Department

Hailong Business

Department

Haixiang Business

Department

Storage Team

Driver Team

Production Security

Department

6. Other users of the Asset Valuation Report

This Asset Valuation Commission Contract specifies that there are no other users of the asset valuation report other than the Principals and users of asset valuation report specified by laws and administrative regulations of the state.

Purpose of Valuation

According to the (2020) No. 51 meeting minutes of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China and the meeting minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020] No. 8), it was agreed in principle to the equity integration plan of bulk cargo terminal (Xiamen Port Holding Group Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Haihong Petrochemical Terminal Co., Ltd.; Xiamen Port Development Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Hailong Terminal Co., Ltd.), and it is required to appraise all equity interests of shareholders of the Target Company according to relevant regulations.

The purpose of this asset valuation is to give a fair view of the market value of all equity interests of Xiamen Hailong Terminal Co., Ltd. as of the benchmark date and provide value reference basis for the economic behaviour of the proposed terminal equity integration by the Principals.

The Subject and Scope of Valuation

The subject of valuation is all equity interests of shareholders of Xiamen Hailong Terminal Co.,

Ltd..

- III-9 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The scope of valuation includes all the assets and related liabilities of Xiamen Hailong Terminal Co., Ltd., including:

The assets and liabilities of Xiamen Hailong Terminal Co., Ltd. as of the valuation benchmark date, 31 December 2019, have been audited by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0198 Auditor's Report, which specifically include: current assets, non-current assets (including fixed assets of buildings, fixed assets of equipment, construction in progress, intangible assets-land use rights, intangible assets-others,long-term deferred expenses, deferred income tax assets), current liabilities and non-current liabilities. According to the audited financial statements as at benchmark date provided by Xiamen Hailong Terminal Co., Ltd., the book values of assets, liabilities and net assets are RMB1,468,285,900, RMB685,080,100 and RMB783,205,800 respectively. The specific contents are listed as follows (monetary unit: RMB'0,000):

No.	Item		Book value
1	Current assets	7,218.53
2	Non-current assets	139,610.06
3	Among which: Long-term equity investment		-
4	Other equity instrument investment		-
5	Investment properties		-
6	Fixed assets	117,830.48
7	Among which: Buildings	96,187.85
8	Equipment	21,642.63
9	Construction in progress	9,515.44
10	Intangible assets	12,128.78
11	Among which: Land use rights	12,091.62
12	Long-term deferred expenses	19.99
13	Deferred income tax assets	115.36
14	Other non-current assets		-

15	Total assets	146,828.59


16	Current liabilities	49,952.58
17	Non-current liabilities	18,555.43

18	Total liabilities	68,508.01

19	Owner's equity	78,320.58

The assets, liabilities and net assets of Xiamen Hailong Terminal Co., Ltd. as at the valuation benchmark date have been audited and verified by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0198 Auditor's Report.

The main assets included in the scope of valuation include monetary funds, notes receivable, accounts receivable, other receivables, inventory, fixed assets of buildings (structures), fixed assets of equipment, construction in progress, intangible assets, long-term deferred expenses and deferred income tax assets. The main assets of the company are as follows:

1. Monetary funds

Monetary funds are mainly bank deposits of the enterprise.

2. Notes receivable

Notes receivable are bank acceptance bills held by the enterprise.

- III-10 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

3. Accounts receivable

Accounts receivable mainly refer to handling charges incurred in business operations.

4. Prepayments

Prepayments refer to the services fee paid in advance by the enterprise.

5. Other receivables

Other receivables are mainly internal current accounts and electricity expenses etc.

6. Inventory

Inventory mainly refers to raw materials and turnover materials in stock.

7. Fixed assets of buildings (structures)

The original book value and net book value of the fixed assets of buildings included in the scope of valuation totalled RMB141,944,217.36 and RMB118,272,160.50 respectively, without provision for impairment, with 29 items in total, mainly including 1# warehouse, 2# warehouse, 3# warehouse, entrance and exit gates, canteen bathroom and complex building, all of which are located at 98 Cangjiang Road, Haicang District.
The original book value and net book value of the structures included in the scope of this asset appraisal are RMB915,701,070.66 and RMB843,606,373.32 respectively, with 22 items in total, mainly including 20# berth, 21# berth, mooring water waters and turning basin, roads and sites, grain silo, power supply network, water supply and drainage fire fighting engineering in port area. The engineering characteristics of the main structures are as follows:

20# berth represents the hydraulic main works, land formation and soft foundation treatment of 20# berth, of which the hydraulic main works include foundation, wall body 1, wall body 2, superstructure and wharf facilities, backfilling and surface layer. The foundation part includes 296,139 m³ of dredging in the wharf foundation trench and the rear, 57,825.6m³ of replacing filling of the foundation bed with 10~300 riprap, 30,480m³ of 10~300 riprap for the foundation bed, 34,363m³ of backfilling medium coarse sand in front of the machine tool, and the cost of dredging measures for foundation trench excavation and foundation bed formation. Wall body 1 includes caisson prefabrication of 9,857.43m³, installation of 1,063.4t and backfilling in the caisson. Wall body 2 and superstructure include cast-in-situ parapet wall, track beam and other superstructure and ancillary facilities such as rubber fender, mooring pillar and rail. Backfilling and surface layer include riprap prism, rubble, gravel filter layer and backfilling sand, wharf surface layer interlocking block structure, etc. Land formation and soft foundation treatment include land backfilling sand, rear filling sand, vacuum preloading and surcharge preloading soft foundation treatment.

21# berth represents the hydraulic main works, land formation and soft foundation treatment of 21# berth, of which the hydraulic main works include foundation, wall body 1, wall body 2, superstructure and wharf facilities, backfilling and surface layer, land formation and soft foundation treatment. The foundation part includes 970,133.73m³ of dredging in the wharf foundation trench and the rear, 138,354.33m³ of replacing filling of the foundation bed with 10~300 riprap, 52,022.2m³ of

- III-11 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

10~300 riprap for the foundation bed, 83,180.93m³ of backfilling medium coarse sand in front of the machine tool, and the cost of dredging measures for foundation trench excavation and foundation bed formation. Wall body 1 includes caisson prefabrication of 15,234.21m³, installation of 1,645.02t and backfilling in the caisson. Wall body 2 and superstructure include cast-in-situ parapet wall, track beam and other superstructure and ancillary facilities such as rubber fender, mooring pillar and rail. Backfilling and surface layer include riprap prism, rubble, gravel filter layer and backfilling sand, wharf surface layer interlocking block structure, etc. Land formation and soft foundation treatment include land backfilling sand, rear filling sand, vacuum preloading and surcharge preloading soft foundation treatment.

Mooring waters and turning basin: mainly including dredging works in 20# and 21# mooring waters and turning basin, as well as dredging works in later expanded mooring waters and turning basin. The main works are dredging and excavation and back-silting measures for mooring waters.

Grain silos: including 16 silos each with a diameter of 24m, trestles and T towers. The 16 silos each with a diameter of 24m are mainly composed of six-division works, being foundation works (reinforced concrete cast-in-place piles, brick masonry and reinforced concrete raft foundation with bearing platform), silo main project (cylinder wall, silo bottom, silo wall, silo roof), loader platform project (steel concrete column, slab, raft box foundation), roof project (waterproof layer, heat preservation and insulation layer, concrete protective layer, eaves ditch, rainwater outlet, deformation joint), decoration project (cement concrete surface layer, metal door installation, special door installation, coating finishing) and steel ladder project. Each silo foundation is 64 φ800mm concrete cast-in-place piles, and the pile body is made of concrete C40. The pile foundation safety grade is Grade II; the designed pile top elevation is +6.4m; and the pile length is 37-47m. The silo bottom is 450cm thick; the lower cylinder wall of the silo bottom is 35cm thick; the upper silo wall of silo bottom is 30cm thick; the steel bar protective layer is 3cm thick; and the cylinder is made of concrete C35. The silo roof project is a reinforced concrete conical shell structure, with a thickness of 120mm and a bottom of 33.3m of the silo roof conical shell. The trestle and T-tower works include 7 transfer towers, 7 steel trestles, 16 distribution platforms and 1 elevator shaft.

The above buildings (structures) were mainly completed between 2010 and 2019, and can be used normally at present. The land use right occupied by buildings (structures) has been included in the scope of valuation.

As of the valuation benchmark date, the following buildings (structures) included in the scope of valuation have obtained the Property Ownership Certificate, with the main details as follows:

Ownership Certificate No.		Name of Building		Corresponding Land Certificate No.
Min (2018) Xiamen Real Estate	3# warehouse		Min (2018) Xiamen Real Estate
Ownership No. 0058265			Ownership No. 0058261
Min (2018) Xiamen Real Estate	1# warehouse		Min (2018) Xiamen Real Estate
Ownership No. 0058267			Ownership No. 0058261
Min (2018) Xiamen Real Estate	Guard room		Min (2018) Xiamen Real Estate
Ownership No. 0058268			Ownership No. 0058261
Min (2018) Xiamen Real Estate	Transportation management center		Min (2018) Xiamen Real Estate
Ownership No. 0058273			Ownership No. 0058261
Min (2018) Xiamen Real Estate	Air compressor station		Min (2018) Xiamen Real Estate
Ownership No. 0058274			Ownership No. 0058261
Min (2018) Xiamen Real Estate	Sewage treatment room		Min (2018) Xiamen Real Estate
Ownership No. 0058272			Ownership No. 0058261

- III-12 -

APPENDIX III	VALUATION REPORT OF XIAMEN HAILONG
Ownership Certificate No.	Name of Building	Corresponding Land Certificate No.

Min (2018) Xiamen Real Estate	Fire pump room	Min (2018) Xiamen Real Estate
Ownership No. 0058269		Ownership No. 0058261
Min (2018) Xiamen Real Estate	Entrance and exit gates	Min (2018) Xiamen Real Estate
Ownership No. 0058270		Ownership No. 0058261
Min (2018) Xiamen Real Estate	Canteen bathroom	Min (2018) Xiamen Real Estate
Ownership No. 0058271		Ownership No. 0058261
Min (2018) Xiamen Real Estate	Waiting building	Min (2018) Xiamen Real Estate
Ownership No. 0058275		Ownership No. 0058261
Min (2018) Xiamen Real Estate	Comprehensive maintenance	Min (2018) Xiamen Real Estate
Ownership No. 0058264	building	Ownership No. 0058261
Min (2018) Xiamen Real Estate	Complex building	Min (2018) Xiamen Real Estate
Ownership No. 0058261		Ownership No. 0058261

Except for some simple buildings, all the buildings (structures) included in the scope of this asset appraisal have obtained certificates, and the ownership belongs to Xiamen Hailong Terminal Co., Ltd.. As of the valuation benchmark date, the assets authorized for appraisal can be used normally, and the ownership is clear, free from any mortgage, seizure and other situations that restrict the ownership.

8. Fixed assets of equipment

The fixed assets of equipment included in the scope of valuation are the machinery, vehicles and electronic equipment reported by Xiamen Hailong Terminal Co., Ltd., with a total of 946 items, with an original book value of RMB340,342,707.07 and a net book value of RMB216,426,290.46.

Machinery and equipment mainly include portal cranes, substations, bulk grain unloading process system, etc. The above equipment was purchased and installed between 1997 and 2019.

Vehicles are mainly special tractors, pickup trucks, flatbed trucks, etc. used in container ports. The above equipment was put into use between 2007 and 2018.

Electronic equipment mainly includes office equipment and auxiliary equipment, including air conditioners, computers, printers, etc. The above equipment was put into use between 2002 and 2019.

The above equipment has clear property rights and is owned by Xiamen Hailong Terminal Co., Ltd.. As of the valuation benchmark date, all equipment is in normal use. There is no mortgage, seizure or other limitations on other rights in the equipment authorized for asset appraisal.

9. Construction in progress

The construction in progress mainly includes 4# and 5# warehouses of Haicang 20# and 21#

berths.

10. Long-term deferred expenses

Long-term deferred expenses are mainly the amortized value of decoration expenses, etc.

11. Deferred income tax assets

Deferred income tax assets are mainly deductible temporary differences arising from deferred income less construction subsidies for the first phase of grain transit project in Haicang Port Area of Xiamen Port.

- III-13 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The recorded or unrecorded intangible assets reported by the enterprise 1. Recorded intangible assets reported by the enterprise

As of the valuation benchmark date, the recorded intangible assets reported by the enterprise are land use rights and purchased software.

Intangible assets included in the scope of this valuation-one land use right, with land area of 368,197.90 square meters, original recorded value of RMB137,665,513.13 and book value of RMB120,916,209.08.

The registration status of land use rights is as follows:

Type of the

No.

Name of parcel

Land Certificate No.

Holder of the right to use

Use

right to use

Area (m2)

Land of Haicang

Min (2018)

Xiamen Hailong

Wharf land

Assignment

368,197.90

berths #20 and #21

Xiamen Real

Terminal Co., Ltd.

Estate Ownership

No. 0058265

Land rights and utilization status are as follows:

					Limitation
			Remaining	on other	Actual development
No.	Name of parcel		useful life		rights		degree			Status of land use
1	Land of Haicang	43.95		None	Five access	As a freight, port cargo loading and
	berths #20 and #21						with ground	unloading,	warehousing services business
							leveling	site. There is a complex building,
									warehouses 1-3, boiler room, canteen
									bathrooms,	comprehensive maintenance
									building, sewage treatment room, guard
									room, walls, gates and various auxiliary
									facilities for production on the ground. The
									construction projects of warehouses 4 and
									5 on the ground and the storage yard with
									no surface cover occupy an area of
									approximately 90,000 square meters.

Purchased software includes the Hailong Terminal bulk cargo and general cargo management system customized for the enterprise and 360 antivirus software.

After due diligence by the valuer, as of the valuation benchmark date, intangible assets with unrecorded books were found in the appraised enterprise. The relevant certificate numbers are Guo Hai Zheng No. 2013C35020502654 and Guo Hai Zheng No. 2013C35020502706 of the sea use right for the port sea area in the berth basin.
According to Jiao Gui Hua Fa [2013] No. 263 issued by the Ministry of Transport, the appraised enterprise has obtained the right to use the 504-meter port line corresponding to Berth Nos. 20 and 21.

(III) Other off-balance-sheet assets reported by the enterprise

- III-14 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

(IV) Reference to the asset type, quantity and carrying amount (or appraised value) involved in the report conclusion issued by other institutions.

In this asset appraisal, except that RSM China Xiamen Branch audited and issued the auditor's report (Rong Cheng Shen Zi [2020] No. 361F0198) as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.

It is confirmed by the Principals and the appraised entity that the above appraisal object and scope are consistent with those involved in the above economic behaviour.

IV.	Type of Value and Its Definition

1. Based on the purpose of this asset appraisal, the type of value of this asset appraisal is market

value.

1. Market value refers to the estimated amount of the value that can be realized by the valuation target under normal and fair transaction as at the valuation benchmark date when the voluntary buyer and the voluntary seller act rationally without any coercion.
2. Reasons and basis for types of value selected: According to the purpose of this asset valuation, particular market conditions and situation of valuation target, market value was determined to be the selected value type in this valuation.
Valuation Benchmark Date
1. The valuation benchmark date of this asset appraisal is 31 December 2019.
  Illustration of the related matters for the determination of the valuation benchmark date:
2. Reason for determination of the valuation benchmark date: this date is close to the realization date of valuation purpose, and the valuation benchmark date of this report is determined to be 31 December 2019 upon written confirmation by the Principals.
3. All the pricing standards, interest rates and tax rates of this asset valuation are the effective pricing standards, interest rates and tax rates of the valuation benchmark.

VI. Valuation Basis

The basis of this asset valuation mainly includes basis of economic behaviour, laws and regulations, criterion, ownership, pricing and other reference materials, with details as follows:

Basis for economic behaviour

The (2020) No. 51 meeting minutes of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China;
The meeting minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020]
No. 8).
- III-15-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Basis for main laws and regulations

Assets Appraisal Law of the People's Republic of China (adopted at the 21st Meeting of the Standing Committee of the 12th National People's Congress on 2 July 2016);
Company Law of the People's Republic of China (revised at the 6th Meeting of the Standing Committee of the 12th National People's Congress on 28 December 2013);
Measures for Financial Supervision and Administration of Assets Valuation Industry (Order No. 86 of the Ministry of Finance of the People's Republic of China);
Enterprise Income Tax Law of the People's Republic of China (adopted at the 5th Meeting of the 10th National People's Congress on 16 March 2007);
Law of the People's Republic of China on State-owned Assets of Enterprises (adopted at the 5th Meeting of the Standing Committee of the 11th National People's Congress on 28 October 2008);
Interim Measures for the Supervision and Administration of State-owned Assets of Enterprises (Order No. 378 of the State Council, revised by Order No. 588 of the State Council);
Decision of the State Council on Abolishing the Provisional Regulations of the People's Republic of China on Business Tax and Amending the Provisional Regulations of the People's Republic of China on Value Added Tax (Order No. 691 of the State Council);
Circular of the Ministry of Finance and the State Administration of Taxation on Adjusting the VAT Rate (Cai Shui [2018] No. 32);
Administrative Measures for State-Owned Assets Assessment (Order No. 91 of the State
Council);
Circular on Printing and Distributing the Detailed Rules for the Implementation of the Administrative Measures for State-owned Assets Assessment (Guo Zi Ban Fa [1992] No. 36);
Interim Measures for the Administration of Assessment of State-owned Assets of Enterprises (Order No. 12 of State-ownedAssets Supervision and Administration Commission of the State Council);
Notice of Issues on Strengthening the Administration of Assessment of State-owned Assets of Enterprises (Guo Zi Wei Chan Quan [2006] No. 274);
Notice on Relevant Matters Concerning the Audit of State-owned Asset Valuation Report of Enterprises (Guo Zi Chan Quan [2009] No. 941);
Guidelines for the Filing of State-owned Assets Valuation Projects of Enterprises (Guo Zi Fa Chan Quan [2013] No. 64);
Measures for the Supervision and Administration of State-owned Assets Trading of Enterprises (Order No. 32 of the State-ownedAssets Supervision and Administration Commission of the State Council and the Ministry of Finance);
- III-16-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Basic Standards for Assets Valuation (Cai Zi [2017] No. 43);
Measures for the Supervision and Administration of Enterprise-owned Assets in Xiamen (Order No. 157 of Xiamen Municipal People's Government);
Notice of Interim Measures for the Administration of Assets Assessment Projects of State- owned Enterprises in Xiamen (Xia Guo Zi Chan [2007] No. 546);
Notice of the State-owned Assets Supervision And Administration Commission of Xiamen Government on Further Strengthening the Administration of Assets Assessment of State-owned Enterprises (Xia Guo Zi Chan [2014] No. 346).

Basis for valuation standards

Code of Professional Ethics for Asset Valuation (Zhong Ping Xie [2017] No. 30);
Practice Guidelines for Asset Valuation-Asset Valuation Procedures (Zhong Ping Xie [2018] No. 36);
Practice Guidelines for Asset Valuation-Asset Valuation Report (Zhong Ping Xie [2018]
No. 35);
Practice Guidelines for Asset Valuation-Asset Valuation Authorization Contracts (Zhong Ping Xie [2017] No. 33);
Practice Guidelines for Asset Valuation-Asset Valuation Archives (Zhong Ping Xie [2018]
No. 37);
Practice Guidelines for Asset Valuation-Enterprise Value (Zhong Ping Xie [2018] No. 38);
Practice Guidelines for Asset Valuation-Real Estate (Zhong Ping Xie [2017] No. 38);
Practice Guidelines for Asset Valuation-Machinery and Equipment (Zhong Ping Xie [2017]
No. 39);
Guidelines for Business Quality Control of Asset Appraisal Institutions (Zhong Ping Xie [2017] No. 46);
Guiding Opinions on Value Types of Assets Valuation (Zhong Ping Xie [2017] No. 47);
Guiding Opinions on Legal Ownership of Assets Valuation Objects (Zhong Ping Xie [2017]
No. 48);
Practice Guidelines for Asset Valuation-Using Expert Work and Related Reports (Zhong Ping Xie [2017] No. 35);
Practice Guidelines for Asset Valuation-Asset Valuation Approach (Zhong Ping Xie [2019] No. 35);
Guidelines for the Asset Valuation Report of State-owned Assets of Enterprises (Zhong Ping Xie [2017] No. 42).
- III-17-

APPENDIX III	VALUATION REPORT OF XIAMEN HAILONG
(IV) Basis for property rights

Copy of business license of Xiamen Hailong Terminal Co., Ltd.;
Copy of financial statements of Xiamen Hailong Terminal Co., Ltd.;
Copy of auditor's report as of the valuation benchmark date of Xiamen Hailong Terminal
Co., Ltd.;
Auditor's reports of Xiamen Hailong Terminal Co., Ltd. over the years;
Copy of state-owned land use right certificate;
Certificates for the sea use right;
Equipment purchase contract and invoice;
Vehicle registration certificate;
Commitment letter of the Principals and the appraised entity;
Relevant financial, business and sales materials;
Other ownership certificates corresponding to the assets included in the scope of valuation.

Pricing basis

The benchmark interest rate of RMB loans of financial institutions over the same period issued by the People's Bank of China on the valuation benchmark date;
Equipment valuation breakdown provided by Xiamen Hailong Terminal Co., Ltd.;
Certain equipment purchase contracts, invoices and large-scale equipment acceptance records provided by Xiamen Hailong Terminal Co., Ltd.;
Mechanical and Electrical Products Quotation Manual - prepared by Machinery Industry Information Research Institute (2019 Edition);
Handbook of Common Approaches and Parameters of Assets Valuation (Mechanical Industry Press, 2011 Edition);
Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs;
Circular of the Ministry of Finance and the State Administration of Taxation on Comprehensively Pushing Forward the Pilot Program of Changing Business Tax to Value-added Tax (Cai Shui [2016] No. 36);
Circular of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Implementation of VAT Transformation Reform in China (Cai Shui [2008] No. 170);
- III-18-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Order No. 294 of 2001 of the State Council, Provisional Regulations of the People's Republic of China on Vehicle Purchase Tax;
Regulations on Compulsory Scrapping Standards of Motor Vehicles, Order No. 12 of 2012 of the Ministry of Commerce, Development and Reform Commission, Ministry of Public Security and Ministry of Environmental Protection;
Stipulations on Compiling Estimate and Budget for Water Transportation Construction Engineering (JTS/T116-2019);
Regulations on Management of Construction Engineering Supervision and Related Service Charges (Fa Gai Jia Ge (2007) No. 670);
Charges for Consulting Service of Construction Project Cost (Min Jia (2002) Fang
No. 457);
Notice on Printing and Distributing the Regulations on Construction Cost Management of Capital Construction Projects (Cai Jian [2016] No. 504);
Budget Quota of Hydro Construction Projects in Coastal Ports;
Notice of Audit of Project Final Accounts of China Construction Bank Xiamen Branch;
Circular of Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management Regulations (Xia Fu [2017] No. 413);
Circular of the State Council on Promoting Economical and Intensive Land Use (Guo Fa (2008) No. 3);
Circular of Xiamen Municipal People's Government on Adjusting Compensation Standards for Land Acquisition in Our City (Xia Fu (2016) No. 398);
Measures for the Implementation of Farmland Occupation Tax in Fujian Province (Min Zheng (2008) No. 17);
Provisions on the Collection and Use of Cultivated Land Reclamation Fees in Fujian Province (Min Zheng (2000) No. 98);
Provisions on Tax Collection and Administration of Deed Tax in Fujian Province (Min Cai Nong Shui (1997) No. 58);
Circular on Forwarding the Issues Concerning the Social Security of Land-expropriated Farmers from the Ministry of Labour and Social Security and the Ministry of Land and Resources issued by Fujian Provincial Department of Human Resources and Social Security;
Equipment manufacturers and sellers telephone inquiry and other relevant price
information;
Construction and Installation Engineering Cost Quota in Fujian Province (2017);
- III-19-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Xiamen Construction Project Cost Information;
Price information accessed online;
Other relevant materials provided by Xiamen Hailong Terminal Co., Ltd..

(VI) Reference basis

The approval documents of relevant engineering construction provided by Xiamen Hailong Terminal Co., Ltd.;
Certain bidding documents and bid-winning contracts of the equipment, acceptance records, purchase contracts and invoices of large-scale equipment provided by Xiamen Hailong Terminal Co., Ltd.;
The Auditor's Report Rong Cheng Shen Zi [2020] No. 361F0198 issued by RSM China Xiamen Branch;
Circular of the National Development and Reform Commission and the Ministry of Construction on Printing and Distributing the Regulations on the Management of Construction Project Supervision and Related Service Charges (Fa Gai Jia Ge [2007] No. 670);
The original Interim Provisions on Consultation Fees for Preparatory Work of Construction Projects (Ji Jia Ge (1999) No. 1283);
The original Charge Standard for Environmental Impact Appraisal Consultation of Construction Projects (Ji Jia Ge (2002) No. 125);
The original Regulations on the Management of Engineering Survey and Design Fees (Ji Jia Ge (2002) No. 10);
The original Interim Measures for the Administration of Bidding Agency Service Charges (Ji Jia Ge [2002] No. 1980);
Code for Real Estate Valuation (GB/T 50291-2015);
Code for Urban Land Valuation (GB/T 18508-2014);
Rules for Classification and Grading of Urban Land (GB/T 18507-2014);
The original Circular of Fujian Provincial Price Bureau on Regulating the Charges of Consulting Services for Construction Project Cost (Min Jia [2002] Fang No. 457).

VII. Valuation Approaches

Selection of valuation approaches

- III-20 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

approaches of asset valuation according to the relevant conditions such as the appraisal object, value type and data collection, and properly select the valuation approaches to form the appraisal results reasonably.

1. Market approach

there is an active open market with sufficient market data;
there are comparable transaction cases with reasonable comparative basis in the open
market;
it is able to collect relevant information of comparable transaction cases.

2. Income approach

Future earnings of the appraised entity are predictable and can be measured by currency;
The risks of obtaining the prospective earnings are predictable and can be measured by
currency;
The number of years with prospective earnings is predictable.

3. Asset-based approach

Asset-based approach refers to the appraisal idea of determining the value of the appraisal object on the basis of regaining assets, which is used on the premise that:

the appraisal object is in continuous use;
it is possible to investigate the current ways to obtain the appraisal object purchased and constructed and the corresponding social average cost data.

The subject of the evaluation is all shareholder equities, due to the difficulties in collecting public information related to the equity transaction market, it is hard to obtain details about the transaction cases of the equity interests, which is same as or similar to the subject of the evaluation, traded in the open market. Meanwhile, although there are listed companies in the same industry in the capital market, it shows a great diversity in the assets size and structure, scope of business, the present stage and profitability as compared to the appraised entity, therefore, it is not appropriate to adopt the market approach for this valuation.

Xiamen Hailong Terminal Co., Ltd. was established in 2012. It is mainly engaged in port cargo loading and unloading, storage and distribution, and is a major bulk cargo port loading and unloading

- III-21 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

enterprise in Fujian Province. It is a key enterprise engaged in bulk cargo port loading and unloading business in Xiamen Port, the only port enterprise in Xiamen that receives and unloads bulk imported grain, and a major distribution center for imported stone materials. Its main assets are 20# and 21# berths in Haicang Port Area. The construction of 20# and 21# berths in Haicang Port Area commenced at the end of August 2013. 20# berth was completed and accepted on 2 July 2015, and 21# berth was completed and accepted on 30 November 2015. 20# berth in Haicang Port Area is a 70,000-ton general berth, which is mainly used for grain unloading operations; and 21# berth in Haicang Port Area is a 50,000-ton general berth, which is mainly used for general bulk cargo loading and unloading, and the goods mainly include grain, chemical fertilizer, steel, sand and gravel, and other general cargoes. The throughput capacity of the terminal is 5.5 million tons/year, of which 3.8 million tons/year is for grain. The azimuth angle of the terminal front is 103°~283°, and the total length of the berth coastline is 504m (including 255.5m for 20# berth and 248.5m for 21# berth). The top elevation of the terminal is 7.5m; the bottom elevation of the front edge is -15m; and the bottom elevation of the channel is -11.5m. The structure is designed for berthing 100,000-ton bulk carriers. The turning basin is arranged on the south side of the berth, with the long axis of the turning basin 3 times the designed ship length, being 684m, and the short axis 2 times the designed ship length, being 456m. The total land area is approximately 360,000 square meters. The designed terminal throughput of the project is 5.91 million tons/year. The total investment of the project is approximately RMB1.5 billion. The terminal project passed the completion acceptance organized by the Port Bureau and was officially put into operation on 15 November 2016.

Hailong Terminal currently has 3 warehouses with a total of 17,950㎡ and a design load of 5 tons/㎡, 16 silos each with a capacity of 10,000 tons and a storage yard of 80,000㎡ with a design load of 5 tons/㎡.

The operation and capacity utilization of Xiamen Hailong Terminal Co., Ltd. in past three years are shown in the table below (unit: RMB):

Item/Year		2017		2018	2019
Operating incomes	179,780,418.23	172,940,213.80	203,401,683.32
Operating profits	-77,679,198.36	-103,834,137.67	-80,749,017.91
Net profits	-75,903,347.18-100,894,176.18-77,557,897.39
Throughput of Berth Nos. 20 and 21 (10,000 tons)	247.04	302.81	218.4
Rate of capacity utilization of Berth Nos. 20 and 21	44.92%	55.06%	39.71%

Although Berth Nos. 20 and 21, the main assets of Xiamen Hailong Terminal Co., Ltd., have passed the completion acceptance and have been put into operation in 2016, the supporting facilities and warehouses related to the terminal have not been completely constructed and the terminal operation was still in the early stage as of the valuation benchmark date.

According to the spirit of the Meeting Minutes on Matters Related to the Planning and Construction of Cruise Home Port ([2012] No. 154) issued by the municipal government, Berth No. 20 at Haicang Port Area (as the public berth of grain) and Berth No. 21 (as the terminal of compensation and settlement for the business relocation of Dongdu Berth No. 1-4)are controlled and operated by Xiamen Port Development Co., Ltd. (廈門港務發展股份有限公司). Terminal Company has been put into operation by the end of 2016, and the relevant supporting facilities have not been completely constructed. Due to the influence of various factors, such as the current situation of the terminal and the natural conditions, the appraised entity continuously suffered huge losses.

- III-22 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

According to the Profile of Xiamen Port (2020) and the Master Plan of Xiamen Port (2035) issued by Xiamen Port Authority, there will be significant changes in the operation of the terminals in Dongdu Port Area and Haicang Port Area with the progress of terminals integration. In addition, imports and exports of all countries are affected by the spread of COVID-19Outbreak around the world since 2020. Given the above-mentionedfactors, there exist great uncertainties on such important forecast parameters as when the production capacity of the Company can be achieved and the operation indicators after the production capacity is achieved in the future operation.

As there exist great uncertainties on such important forecast parameters as when the production capacity can be achieved and the operation indicators after the production capacity is achieved in the future operation of the appraised entity, and the asset valuer is unable to predict the profit for future development of the appraised entity due to the limitation of its professional ability and the understanding of the industry in which the enterprise operates, therefore, the asset valuer cannot adopt income approach in this asset valuation.

As the appraised assets are in continuous use or assumed to be in continuous use, and through the asset verification procedure, it is found that the ownership of various assets and liabilities of Xiamen Hailong Terminal Co., Ltd. is basically clear, and the relevant information is relatively complete, with available historical data, and the value of various assets and liabilities can be appraised and estimated by various approaches, so it is suitable to adopt the asset-based approach for valuation.

Therefore, the asset-based approach is adopted for this asset valuation.

Implementation of the valuation procedures by the asset-based approach

[Current assets]

1. Monetary funds (including bank deposits)

There are 2 RMB deposit accounts in bank deposits. Asset appraisal professionals verify all bank deposit accounts, checking whether bank statements are consistent with book records, and verifying the authenticity and accuracy of book records of bank deposits. After verification, the deposit accounts of all banks are recorded accurately, and the outstanding items of banks on the benchmark date have been adjusted by audit, and no outstanding items affecting equity interests have been found. The appraised value of RMB account deposits shall be determined by the verified book balance.

- III-23 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

2. Notes receivable

Notes receivable are mainly bank acceptance bills. During the appraisal, check whether the subsidiary ledger is consistent with the balance of the general ledger and the balance of the statement, check whether it is consistent with the appraisal statement, and check the consistency between the face value, occurrence time, business content and stated interest rate of the bills and the accounting records, so as to confirm the authenticity and integrity of the notes receivable and verify that the results are consistent with the amounts of the bills and statements. The verified book value of notes receivable is recognized as the appraised value.

3. Receivables (including accounts receivable, prepayments and other receivables)

4. Inventory

(1) Raw materials

Most raw materials of Xiamen Hailong Terminal Co., Ltd. are purchased as required. In this asset valuation, the market price of raw materials is multiplied by the actual quantity to determine the appraised value of raw materials.

(2) Turnover materials in stock

Turnover materials in stock are mainly supplies for daily operation of enterprises, and the verified book value is taken as the appraised value.

5. Other current assets

The other current assets are prepayments of other taxes and input taxes to be deducted. Asset appraisal professionals verify relevant tax payment documents and accounting vouchers to determine that the accounting records are consistent with the actual situation, and take the verified book value as the appraised value.

- III-24 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

[Non-current assets]

1. Valuation of fixed assets of buildings (structures)

Appraised value = replacement cost × comprehensive newness rate

Replacement cost = development cost + management cost + cost of capital + development profit-deductible VAT amount

Development cost = construction and installation engineering cost + upfront and other engineering cost

(1) Construction and installation costs

- III-25 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

(2) Upfront and other project costs

(3) Management cost

The management cost of the employer refers to the management expenses incurred by the employer from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenses and travel expenses, etc., which of the buildings are calculated according to a certain proportion of development costs with reference to the Notice on Printing and Distributing the Regulations on the Management of Construction Costs of Capital Construction Projects (Cai Jian [2016] No. 504) in combination with the actual situation of the project. The structures are charged based on a certain proportion of the development cost referred to the Stipulations on Compiling Estimate and Budget for Water Transportation Construction Engineering (JTS/T116-2019) and combined with the actual situation of the work.

(4) Cost of capital

The cost of capital is calculated according to the reasonable construction period of the project, with reference to the valuation benchmark interest rate of RMB loans of financial institutions over the same period issued by the People's Bank of China on the valuation benchmark date, and invested uniformly based on the sum of development cost and management cost. The reasonable construction period of structures is 2 years, and the reasonable construction period of houses and buildings is 1 year:

The calculation formula of cost of capital is as follows:

Cost of capital = (development cost + management cost) × [(1+loan interest rate)construction period

(month)/12/2-1]

(5) Development profit

The direct cost-profit ratio is adopted as the profit margin, representing development cost × direct cost-profit ratio.

For buildings that have obtained ownership certificates, through investigating the reasonable profits which should be obtained in the development process of the site where the appraised buildings are located and by refer to the statistics of cost-profit ratio of transportation enterprises in the port
- III-26-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

industry set out in the Standard Value of Enterprise Performance Appraisal 2019 prepared by the Appraisal and Distribution Bureau of the State-ownedAssets Supervision and Administration Commission of the State Council, 13.00% is adopted as the development profit margin in this valuation.

The structures are mainly terminal hydro engineering, which is the main self-use business assets of enterprises. Based on the characteristics of such structures, and with refer to the valuation cases in the same industry, the development profit margin of such structures is zero in this valuation.

The deductible VAT amount is determined through the calculation of VAT for the acquisition of real estate after 30 April 2016 according to the Circular of the Ministry of Finance and the State Administration of Taxation on Pushing Forward the Pilot Project of Changing Business Tax to VAT in an All-roundWay (Cai Shui [2016] No. 36) and the Announcement of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs (No. 39, 2019) which meet the conditions for the deduction of VAT. Real estate includes VAT input tax on construction and installation engineering costs, with a tax rate of 9%. The upfront and professional expenses are VAT input tax with a tax rate of 6%, which is deducted from the replacement cost.
Determination of newness rate

When determining the newness rate of buildings (structures), the main factors that may cause real estate depreciation should be fully considered, and all kinds of depreciation should be reasonably estimated. The depreciation of buildings includes substantive depreciation, functional depreciation and economic depreciation.

After analysis, the buildings (structures) of the appraisal object can meet the normal production needs, and no obvious functional and economic depreciation factors are found, so only substantive depreciation is calculated in this valuation. Through on-site understanding and on-site inspection, asset appraisal professionals analyze and compare the appraised buildings (structures) with reference to different engineering structures. Combined with on-site observation, they check and record the foundations, load-bearing columns and beams, walls, floors, roofs, waterproof and ground surface layers, doors and windows, painting, water and electricity supporting facilities, etc. of the appraised buildings (structures), taking into account the internal quality, appearance, purchase date and maintenance and service condition of the buildings (structures). The newness rate is determined using the useful life approach based on the useful life of buildings, and the comprehensive newness rate is determined using the weighted arithmetic average method. In this valuation, the newness rate of buildings is calculated by comprehensive newness rate approach, and the newness rate of buildings with small unit value is calculated by life approach or on-site scoring approach.

A. Length of life approach

Newness rate = acceptable useful life / (used life + acceptable useful life) × 100%

B. On-site scoring approach

- III-27 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

(8) Determination of appraised value

Appraised value = replacement cost × comprehensive newness rate

2. Valuation of fixed assets of equipment

Appraised value = replacement cost × newness rate

2.1 Valuation of machinery and equipment

The current market price approach (second-hand price) is adopted for certain machinery and equipment. The current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.
Machinery and equipment are evaluated by cost approach. Cost approach is to estimate the replacement cost of the assets to be appraised and the physical depreciation, functional depreciation and economic depreciation of the assets, and deduct various depreciation from the replacement cost as an asset appraised value. Its calculation formula is as follows:

Appraised value = replacement cost × newness rate.

Determination of replacement cost of machinery and equipment:

Replacement cost = equipment purchase price + transportation and miscellaneous fees + installation cost + upfront cost and other expenses + employer management fee + cost of capital - deductible VAT.

a. Determination of equipment purchase price

Domestic equipment is determined by asking the manufacturer about the market price as at the valuation benchmark date, or looking up the current market price from the relevant quotation materials

- III-28 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

and referring to the contract price or winning bid price of the equipment recently purchased by similar companies. The FOB or CIF price of the imported equipment is determined by inquiring the relevant quotation manual or inquiring from sellers.

b. Determination of equipment transportation and miscellaneous fees

c. Determination of installation cost

According to the installation engineering technical data and final accounts data provided by the Principals, determine the actual installation engineering quantity to determine the installation cost.

d. Determination of upfront fees and other expenses

No.	Fees	Base		Rate			Basis
1	Upfront work consulting	Construction cost	0.15%		Refer to original Ji Jia Ge
	fee				(1999)	No. 1283
2	Environmental impact	Construction cost	0.04%		Refer to original Ji Jia Ge
	evaluation fee				[2002]	No. 125
3	Survey and design fee	Construction cost	2.30%		Refer to original Ji Jia Ge
					[2002]	No. 10
4	Bidding agency fee	Construction cost	0.06%		Refer to original Ji Jia Ge
					[2002]	No. 1980
5	Project supervision fee	Construction cost	1.42%		Fa Gai Jia Ge [2007] No. 670
6	Construction cost	Construction cost	1.68%		Min Jia [2002] Fang No. 457
	consulting service fee
Total		5.65%

e. Management fee of the construction unit

The management cost of the construction unit refers to the management expenses incurred by the construction unit from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenses and travel expenses, etc. The management rate of the construction unit can be based on the Notice of the Ministry of Finance on Printing and Distributing the Provisions on Financial Management of Capital Construction (Cai Jian [2016] No. 504) combined with the actual situation of the project. The management fee of the construction unit shall be calculated according to a certain proportion based on the sum of equipment purchase cost, transportation and miscellaneous expenses, installation and commissioning cost and upfront and other expenses.

f. Determination of cost of capital

According to the reasonable construction period of the project and the loan interest rate as at the valuation benchmark date, the cost of capital is determined based on the sum of equipment purchase

- III-29 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

cost, transportation and miscellaneous expenses, installation cost, basic cost, upfront and other expenses. The reasonable construction period is determined according to the time from installation and commissioning to normal operation of the equipment, and the average investment and compound interest are calculated according to the bank loan interest rate over the same period as at the valuation benchmark date.

g. Determination of VAT deduction

According to Cai Shui [2008] No. 170, Provisional Regulations on Value Added Tax of the People's Republic of China (Order No. 538 of the State Council), Detailed Rules for the Implementation of Provisional Regulations on Value Added Tax of the People's Republic of China (Order No. 50 of the Ministry of Finance and the State Administration of Taxation) and the Announcement on Policies Concerning Deepening Value Added Tax Reform (Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs), if the conditions for VAT deduction are satisfied, VAT input tax (tax rate: 13%) in equipment purchase fee, VAT input tax (tax rate: 9%) in installation and commissioning fee, and VAT input tax (tax rate: 6%) in upfront and other expenses, are deducted from replacement cost.

Determination of newness rate:

The theoretical newness rate depends on substantive depreciation, functional depreciation and economic depreciation. The analysis of the three types of depreciation is as follows:

a. Substantive depreciation:

Age newness rate = acceptable age ÷ (used age + acceptable age)

b. Functional depreciation:

- III-30 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

no calculation will be repeated; if the functional depreciation is not deducted and exists, the corresponding approach should be adopted for estimation, and no appraisal should be omitted. In fact, the equipment replacement cost determined by price index approach contains functional depreciation factor, and the equipment replacement cost determined by functional value approach has been deducted from functional depreciation; the newness rate determined by the age approach does not deduct the functional depreciation factor; however, using the repair cost approach may deduct all or part of the functional depreciation. In the appraisal, if the restoration replacement cost is used, it should be considered whether there is functional depreciation caused by excess investment cost. If the estimated replacement cost is the renewal replacement cost, the excess investment cost included in the appraised equipment value has actually been eliminated, and there is no functional depreciation.

c. Economic depreciation:

Economic depreciation, also known as external loss, refers to the value loss caused by the external influence of assets themselves. It is mainly reflected that the utilization rate of equipment in operation decreases or even idles, which leads to the decrease of operating income of equipment.

Economic depreciation caused by external conditions can originate from international and domestic industry bases or places. Various external factors affect the potential economic returns, thus directly affecting the market value of assets or properties.

d. Comprehensive newness rate:

calculate theoretical newness rate N1 and field investigation newness rate N2 respectively, and determine its newness rate N by weighted average, i.e.,

N=N1*40%+N2*60%

2.2 Description of vehicle appraisal calculation

(1) Determination of replacement cost

Determination of purchase price

a. The current market price approach (second-hand price) is adopted for certain vehicles. The current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.

- III-31 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Determination of vehicle purchase tax

According to the relevant regulations of the Provisional Regulations of the People's Republic of China on Vehicle Purchase Tax (Order No. 294 of 2001 of the State Council), the taxable amount of vehicle purchase tax = taxable value × 10%, and the taxable value where taxpayers buy their own vehicles should not include VAT tax. Therefore: vehicle purchase tax = purchase price × 10%. According to the Announcement on Exemption of Purchase Tax for New Energy Vehicles (Ministry of Finance Announcement No. 172 of 2017), from 1 January 2018 to 31 December 2020, vehicle purchase tax will be exempted for the purchase of new energy vehicles. Since 1 January 2018, new energy vehicles listed in the "Catalogue of New Energy Vehicles Exempted from Vehicle Purchase Tax" must also meet the following conditions:

a. Pure electric vehicles, plug-in (including extended-range) hybrid vehicles and fuel cell vehicles licensed to be sold in China.

b. Meeting the technical requirements for new energy vehicle products.

c. Passing the special inspection of new energy vehicles and reaching the special inspection standard for new energy vehicle products.

d. New energy vehicle manufacturers or dealers of imported new energy vehicles shall meet relevant requirements in terms of product quality assurance, product consistency, after-sales service, safety monitoring, power battery recycling, etc.

Determination of other expenses

Mainly for vehicle inspection and licensing fees: the local vehicle inspection and licensing fee is RMB500/vehicle.

Replacement cost = purchase price + vehicle purchase tax (10% of purchase price) + other
expenses

(2) Determination of vehicle newness rate

- III-32 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Comprehensive newness rate = theoretical newness rate × 40% + technical newness rate × 60%

Among them, the theoretical newness rate takes the lower of mileage newness rate and age newness rate

Mileage newness rate = (specified mileage-mileage already traveled)/specified mileage × 100%

Age newness rate = (economic durability-used age)/economic durability × 100%

2.3 Electronic equipment

The electronic equipment included in the scope of valuation mainly includes air conditioners, computers, printers, etc., which are appraised by the replacement cost approach.

(1) Determination of replacement cost

The current market price approach (second-hand price) is adopted for certain electronic devices. The current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.

The value of electronic equipment is small. Considering that most of the electronic equipment does not need to be installed (or the seller is responsible for the installation) and the transportation cost is low, the replacement price of electronic equipment (excluding VAT) is determined in this asset valuation based on recent market price data such as local market information and online quotation.

(2) Determination of newness rate

The working environment of electronic equipment and office furniture is relatively stable, and the newness rate is determined by the age approach. The calculation formula is as follows:

Newness rate = (1-actual useful life ÷ economic useful life) × 100%

2.4 Description of newness rate of extended service equipment

In case of extended service and normal use, the newness rate of this asset valuation shall not be less than 15%.

3. Construction in progress

The construction in progress included in the scope of this valuation mainly includes 4# and 5# warehouse projects and Hailong OA platform, with a total book value of RMB95,154,444.85. The valuers know the image progress of the construction in progress through on-site investigation, verify the various project expenditures incurred in the construction in progress according to the current quota standards for construction and installation projects, and know the payment progress.

- III-33 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The construction in progress is appraised using the cost approach. According to the types and specific conditions of various projects under construction, the following valuation approaches have been adopted:

(1) Uncompleted projects:

For projects under construction which commenced construction no more than half a year before the valuation benchmark date, the residual value after deducting unreasonable expenses from the verified book value of the construction in progress is taken as the appraised value.

For projects under construction which commenced construction more than half a year before the valuation benchmark date, the appraisal is carried out using the cost approach, in which each relevant parameter is determined in accordance with the following principles:

The interest rate shall be determined according to the benchmark interest rate of RMB loans of financial institutions as at the valuation benchmark date;

The construction period shall be reasonably determined according to the project scale and actual completion rate and with reference to the relevant construction period quota;

The upfront and other project costs include upfront work consulting fees, environmental impact appraisal fees, survey and design fees, bidding agency fees, project supervision fees, project cost consulting service fees, project supervision fees and supporting charges, etc. According to the project scale and complexity of the appraisal object, the upfront and other project costs are calculated based on the verified equipment costs and basic construction costs;

The development profit is determined with reference to the hydraulic berth structure.

Pure cost construction in progress: Pure cost constructions in progress have no material entities. If the verified payment is necessary for the construction projects to be started in the future or has actual value for the future owners, the verified book value should be taken as the appraised value after it is confirmed that there is no duplicate valuation with the related asset projects, otherwise it should be treated as zero.

4. Intangible assets

4.1 Intangible assets-land use rights

According to Assets Appraisal Standards-Real Estate and referring to Rules for Urban Land Valuation, the common land valuation approaches include market comparison approach, income reduction approach, surplus approach, cost approximation approach, benchmark land price coefficient correction approach, etc. The selection of valuation approaches should be based on the development of local real estate market, combined with the specific characteristics of the appraisal object and the appraisal purpose, etc., to select appropriate valuation approaches. The parcels included in the scope of this valuation are industrial land for transfer, and there are no similar parcel transactions in the area where the parcel to be appraised is located, so the market approach cannot be used for appraisal; considering that the parcel of the appraisal object is located in the area covered by the benchmark land price, there is a perfect benchmark land price correction system, and most of the parcels with the same purpose in the area are obtained by the paid transfer of the benchmark land price, so the benchmark

- III-34 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

land price correction approach can be used for appraisal; the land requisition compensation standard data of the local government where the parcel is appraised is relatively complete, and the valuers can collect a large amount of relevant data of the same type of land development costs, so the cost approximation approach can be adopted for appraisal. The cost approximation approach and the benchmark land price coefficient correction approach are used to appraise the land use right.

Land value = land acquisition cost to be developed + land development cost + management cost + investment interest + development profit

= P1b×(1±∑Ki)×Kj+D Wherein,
= parcel price

P1b-the benchmark land price for a certain purpose and a certain level (homogeneous area)

∑Ki-land price correction coefficient

Kj-other correction factors such as appraisal period date, floor area ratio and land use period

D-land development degree correction value

4.2 Intangible assets-other intangible assets

Intangible assets in this asset valuation-other intangible assets are mainly the Hailong Terminal bulk cargo and general cargo management system and 360 antivirus software, which are system software customized by Xiamen Hailong Terminal Co., Ltd. in combination with the relevant management system, accounting system and business model of enterprises. They have obvious industry characteristics and distinctive own characteristics, and cannot find the market price of similar products, nor can they determine their redevelopment value through reset.

- III-35 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

6. Long-term deferred expenses

For long-term deferred expenses that are still in the income period, the appraised value is determined according to their actual remaining beneficial rights or asset values. The valuers consult relevant documents and contracts, verify relevant original vouchers, determine the degree of conformity between the accounting records and the actual situation, check the remaining values and rights of various expenses, and take the amortized book value as at the valuation benchmark date as the appraised value.

7. Deferred income tax assets

Deferred income tax assets are deductible temporary differences arising from government subsidy income and represent deferred income tax assets recognized according to the Accounting Standards for Enterprises No. 18-IncomeTaxes. Asset appraisal professionals judge whether there is an appraisal risk loss by analyzing the content of government subsidies, and determine the appraised value of deferred income tax assets according to the deductible temporary difference arising from the appraisal risk loss and the applicable income tax rate of the appraised entity on the valuation benchmark date.

[Valuation of liabilities]

The liabilities included in this asset valuation include: accounts payable, advances from customers, remuneration payable to employees, taxes payable, other payables, long-term borrowing, deferred income and deferred income tax liabilities. Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, made inquiries about those of large amount, implemented necessary replacement procedures for unanswered inquiries, and conducted spot checks on relevant information including purchase invoices, contracts, vouchers, etc. to verify the authenticity of liabilities. The verified actual liabilities to be borne on the benchmark date are taken as the appraised value.

1. Valuation of accounts payable

Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, made inquiries about current accounts of large amount, implemented necessary replacement procedures for unanswered inquiries, and conducted spot checks on relevant information including purchase invoices, contracts, vouchers, etc. As verified, the accounts are in line with the statements and all liabilities are the labilities required to be borne. The verified book value is taken as the appraised value.

2. Valuation of prepayments

Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, made inquiries about those of large amount, implemented necessary replacement procedures for unanswered inquiries, and verified the relevant business contracts, receipts and other information to determine the existence of debts. They also verified whether the incurred costs of the corresponding items have been carried forward. According to the matching principle of income realization and cost carrying-forward, it has been determined whether all the payments are made in advance, and the verified book value is taken as the appraised value.

- III-36 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

3. Valuation of employee compensation payable

Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger. It has been verified that the accrual of employee remuneration meets the requirements of the accrual standard, and the amount is calculated accurately and is the liability actually assumed. The verified book value is recognized as the appraised value.

4. Valuation of taxes payable

The taxes payable are property taxes payable. Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, and checked and consulted tax notices. It has been verified that the company has accrued, declared and paid such taxes at the relevant tax rates, which have been verified to be correct. The verified book value is recognized as the appraised value.

5. Valuation of other payables

Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, made inquiries about those of large amount, implemented necessary replacement procedures for unanswered inquiries, and checked relevant vouchers and information. It has been verified that such payables are liabilities required to be borne, and the verified book value is recognized as the appraised value.

6. Valuation of long-term borrowings

Long-term borrowings are bank loans borrowed from the Financial Center Sub-branch of Agricultural Bank of China Limited. Asset appraisal professional have consulted relevant loan contracts and relevant materials to understand the loan conditions and term, and learned about the loan, repayment and overdue situation through consulting account books and bookkeeping vouchers. According to the financial and accounting system verification, no discrepancy was found. The verified actual liabilities to be borne on the benchmark date are taken as the appraised value.

7. Deferred income

Deferred income is mainly an investment subsidy for the first phase of grain transfer project in Haicang Port Area of Xiamen Port. Asset appraisal professionals have verified the book value of the company and relevant accounting vouchers, consulted relevant contracts and relevant materials, understood and analyzed the causes and settlement of the liability, and the verified book value is recognized as the appraised value.

8. Deferred income tax liabilities

Deferred income tax liabilities are mainly the compensation income for the demolition of 1# berth and the corresponding recognized subsidy income for business losses and employees' economic compensation. Asset appraisal professionals have verified the book value of the company and relevant accounting vouchers, consulted relevant contracts and relevant materials, understood and analyzed the causes and settlement of the liability, and the verified book value is recognized as the appraised value.

[Appraisal result of asset-based approach]

Net asset value = sum of appraised values of individual assets - sum of liabilities

- III-37 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

VIII. Implementation Process and Situation of Valuation Procedure

After accepting the engagement, the Asset Appraisal Institution shall select asset appraisal professionals according to the agreement of both parties, and form an appraisal project team according to the asset distribution of the appraised entity. The whole asset appraisal work is divided into four stages:

Stage of acceptance of engagement and preliminary preparation

Request the Principals to clarify the basic matters of the valuation business, such as the appraisal purpose, scope of valuation and object, valuation benchmark date, etc., and conduct project investigation and risk appraisal;
Accept the engagement of the Principals' asset appraisal project;
Determine the project leader and project team members, formulate the asset appraisal work plan, put forward the appraisal plan time arrangement, determine the appraisal approach, etc., and train the project team members;
According to the preliminary understanding of the situation and the characteristics of the appraisal object, the asset appraisal declaration form is arranged in a targeted manner, and the main asset questionnaire and the main business profit questionnaire are designed. The personnel participating in the asset valuation of the appraised entity are given business training, and the appraised entity is instructed to check assets and prepare appraisal materials, and fill in the asset appraisal declaration form and any kinds of questionnaires.

Stage of asset verification

For physical assets, conduct on-site physical investigation and verification according to the asset appraisal declaration form accompanied by relevant personnel of the appraised entity, understand the status of physical assets, and learn about the use, maintenance and management of assets from asset management personnel, and make corresponding records;
Understand the situation of non-physical assets and liabilities, consult relevant financial information, and collect information such as contracts and agreements;
Collect relevant property registration documents and other relevant certification documents of assets, and investigate and verify the property rights of assets;
Communicate with the management of the appraised entity in time, and coordinate and solve the related problems in the on-site appraisal;
Listen to the introduction of the staff of the appraised entity on the basic business situation and financial status of assets, and collect relevant operational and basic financial data;
- III-38-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Investigate and understand the historical operation of the appraised entity, the composition of income, cost and expenses and their change reasons, and analyze its profitability and development trend;
Investigate the comprehensive strength, management level, profitability, development ability, competitive advantage and other factors of the appraised entity;
Select appropriate formal or substantive verification procedures and approaches (including observation, inquiry, written examination, inspection of records or documents, field investigation, inquiry and confirmation, analysis, calculation, review, etc.) according to factors such as the type, source, acquisition method and influence degree of examination and verification data, examine and verify the data obtained from field investigation and data collection.

Stage of appraisal, estimation and summary

According to the appraisal purpose and the characteristics of the assets to be appraised, select the appraisal ways and specific approaches, and select relevant parameters;
Carry out market research and inquiry work, collect market price information and relevant information of appraisal;
Adopt appropriate valuation approaches to appraise various assets and liabilities, and determine the appraisal results of the asset-based approach;
Analyze the rationality of valuation approaches and appraisal results, form professional appraisal opinions and write Asset Valuation Reports;
Carry out three-level review according to the internal procedures of the Asset Appraisal Institution, and make relevant modifications according to the review opinions.

(IV) Stage of issuance of the Asset Valuation Report

Without affecting the independent judgment of the final appraisal result, the rechecked Asset Valuation Report shall be sent to the Principals or the relevant parties permitted by the Principals to communicate and solicit opinions on the relevant contents of the Asset Valuation Report. After communication and reporting, a formal Asset Valuation Report shall be issued and submitted to the Principals after final review and issuance.

IX. Appraisal Assumptions

Premise of appraisal: This valuation is based on the assumption that the property rights of the entrusted assets are complete and legal, and they are set for current purposes and continue to operate according to current trends.
Basic assumptions:

It is assumed that all documents and materials provided by the Principals are true, valid and
accurate.
It is assumed that there is no significant change in the national macroeconomic policy and the social and economic environment in the region.
- III-39-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

It is assumed that the tax policies, credit interest rates, exchange rate changes, etc. on which the business operation and asset appraisal are based, have not changed significantly enough to affect the appraisal conclusion.
It is assumed that the influence of natural forces and other force majeure factors, as well as the possible influence of special trading approaches on the appraisal conclusion, are not considered.
The impact of future auctions, sales and collaterals on asset appraisal prices, or the impact of additional prices paid by special trading approaches when property rights change, or the factors that may affect the value of the assets due to the expenses and taxes for sale, are not considered in this Asset Valuation Report.
Except for the known and disclosed matters, it is assumed in this asset valuation that there are no other undeclared off-balance-sheet assets and liabilities, mortgage or guarantee matters, major litigation or post-period events, and the appraised entity has legal rights to the assets included in the scope of valuation.
Transaction assumption: it is assumed that all assets to be valued are already in the process of transaction, and the asset valuer carries out a valuation based on the transaction conditions of the assets to be valued in a simulated market.
Open market assumption: it is assumed that both trading parties of the assets traded in the market or the assets to be traded in the market are in the same position and have opportunities and time to obtain sufficient market information so as to make reasonable judgment upon the function, usage and transaction price of assets.
Assumption on continuing operation of the enterprise: it is assumed that the appraised entity is in full compliance with all relevant laws and regulations, and will continue to operate in the foreseeable future.

3. Specific assumptions:

The conclusion of this asset valuation is based on the assumption that the value of the assets included in the scope of valuation is reflected on the valuation benchmark date under the condition that the current scale and current use are unchanged.
In the process of asset appraisal, this Asset Appraisal Institution accepted some materials provided by the Principals and the appraised entity which are considered indispensable by the asset valuers in the asset appraisal process. The Principal and the appraised entity are responsible for the authenticity, correctness and legitimacy of these materials. The asset valuers all assume that these materials are true, correct and legitimate. The results of this asset valuation depend on the authenticity, correctness and legitimacy of these materials to a certain extent.

The result of this asset valuation assumes that there are no other estimated liabilities except those known by the asset valuer.
The relevant taxes and expenses arising from the future transfer of the appraised assets are not considered in this Asset Valuation Report.
- III-40-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Appraisal Conclusion

In line with the principles of independence, impartiality, science and objectivity, the Asset Appraisal Institution applied the asset-based approach and income approach to appraise all equity interests authorized for valuation of Xiamen Hailong Terminal Co., Ltd..

Appraisal results of the asset-based approach

After audited by RSM China Xiamen Branch, the book value of all equity interests of Xiamen Hailong Terminal Co., Ltd. is RMB783,205,800. After appraised by using the asset-based approach, and on the premise of meeting all the appraisal assumptions and premises in this report, the appraised value of all equity interests as at the valuation benchmark date of this asset valuation is RMB1,208,737,100 (SAY RMB ONE BILLION TWO HUNDRED AND EIGHT MILLION SEVEN HUNDRED AND THIRTY-SEVEN THOUSAND ONE HUNDRED ONLY), representing an increase in value of RMB425,531,300 and an increase in percentage of 54.33%. The summary of asset appraisal is as follows (unit: RMB'0,000):

Appraised enterprise: Xiamen Hailong Terminal Co., Ltd.	Valuation benchmark date: 31 December 2019
				Carrying		Appraised	Increase in		Increase
No.		Item		value		value	value			in%
1		Current assets	7,218.53	7,241.64	23.11	0.32
2		Non-current assets	139,610.06	182,140.08	42,530.02	30.46
3		Among which: long-term equity investment		-		-	-
4		Other equity instrument investment		-		-	-
5		Investment properties		-		-	-
6		Fixed assets	117,830.48	127,098.08	9,267.60	7.87
7		Among which: buildings	96,187.85	102,497.49	6,309.64	6.56
8		Equipment	21,642.63	24,600.60	2,957.97	13.67
9		Construction in progress	9,515.44	9,730.35	214.91	2.26
10		Intangible assets	12,128.78	45,178.23	33,049.45	272.49
11		Among which: land use right	12,091.62	45,141.06	33,049.44	273.33
12		Long-term deferred expense	19.99	18.06	-1.93	-9.65
13		Deferred income tax assets	115.36	115.36		-		-
14		Other non-current assets		-		-	-

15		Total assets	146,828.59	189,381.72	42,553.13	28.98


16		Current liabilities	49,952.58	49,952.58		-		-
17		Non-current liabilities	18,555.43	18,555.43		-		-

18		Total liabilities		68,508.01		68,508.01	-			-
19		Owner's equities	78,320.58	120,873.71	42,553.13	54.33

Changes and reasons of comparison between appraisal results and book value

1. The inventory impairment valuation increased by RMB231,100, which is due to the rising market price of certain raw materials;

III-41-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

2. The fixed assets-buildings (structures) valuation increased by RMB63,096,400, representing an increase ratio of 6.56%.

The main reasons for valuation appreciation are:

The material price and labor cost of buildings (structures) on the valuation benchmark date had increased to a certain extent compared with the original acquisition cost;
The economic useful life used in the appraisal is longer than the financial depreciation period, resulting in the valuation appreciation;

The fixed assets-equipment valuation increased by RMB29,579,700. The main reason for the appreciation is that the financial depreciation period is shorter than the economic useful life used in the appraisal;
The construction in progress valuation increased by RMB2,149,100. The main reason for the appreciation is that the cost approach is used to evaluate the construction in progress. The appraised value of upfront and other expenses and capital cost, estimated with reference to the relevant standards, is higher than the actual book expenses, resulting in the valuation appreciation;
The intangible assets valuation increased by RMB330,494,500. The main reasons for the appreciation are as follows:

For the intangible assets-land use rights, the entrusted land was acquired earlier, the government's benchmark land price has been raised many times, the regional economy has developed, the supporting facilities have been continuously improved, the demand for land has been rising, and the land available for development and utilization has decreased. In recent years, the rising land development cost has caused the increase in the value of this valuation;
The book cost does not include the engineering cost of land formation and soft foundation treatment, which is accounted for in the structures;

6. The long-term deferred expenses valuation decreased by RMB19,300, due to the inclusion of decoration expenses for self-built office building and office furniture expenses into the valuation of corresponding buildings.

XI. Special Notes

The appraisal conclusion of this Asset Valuation Report shall be only used by the Principals for the appraisal purposes listed in this Asset Valuation Report. Without the consent of the Asset Appraisal Institution, all or part of the contents of the Asset Valuation Report shall not be extracted, quoted or disclosed in the public media, except as stipulated by laws and regulations and otherwise agreed by the Principals and relevant parties.
The Asset Appraisal Institution and asset appraisal professionals shall abide by relevant laws and regulations and asset valuation standards in the principles of independence, objectivity and impartiality in the implementation of this asset valuation business; according to the data collected by the Asset Appraisal Institution and asset appraisal professionals during their practice, the contents stated in the Asset Valuation Report are objective, and the Asset Appraisal Institution and the signing asset valuer shall assume corresponding legal responsibilities for the rationality of the appraisal conclusion.
- III-42-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The list of assets and liabilities involved in the appraisal object, descriptions of relevant matters and important materials related to the appraisal shall be reported by the Principals and relevant parties and confirmed by their signatures.
The Asset Appraisal Institution and the signing asset valuer have no existing or expected interests in the appraisal object; at the same time, there is no personal interest relationship with the Principals and related parties, and there is no prejudice against the Principals and related parties.
The asset valuer limited the ownership of the appraised assets to objective conditions and the certification materials related to asset appraisal based on professional judgment and general investigation, without substantive verification and verification. However, the asset valuer's professional judgment and investigation conclusion cannot relieve or replace the responsibility of the Principals and relevant parties to provide real ownership and certification materials related to asset appraisal.
This valuation conclusion is valid only on the valuation benchmark date stated in the valuation report. The user of the valuation report shall reasonably determine the useful life of the valuation report according to the asset status and market changes after the valuation benchmark date. Generally, the Asset Valuation Report can only be used when the distance between the valuation benchmark date and the economic behaviour realization date is less than one year.
The asset valuers and their Asset Appraisal Institutions have the professional qualifications and relevant professional appraisal experience required for this valuation business. Except that RSM China Xiamen Branch was used to audit and issue the auditor's report of Rong Cheng Shen Zi [2020] No. 361F0198 as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.
The use of this Asset Valuation Report is limited to the appraisal purpose stated in the Asset Valuation Report, and the consequences caused by improper use is not the responsibility of the signing asset valuer and the Asset Appraisal Institution.
The analysis, judgment and conclusion in the appraisal report issued by the asset valuers and their Asset Appraisal Institutions are limited by the assumptions and qualifications in the report, and the users of the Asset Valuation Report should fully consider the assumptions and qualifications stated in the report and their influence on the appraisal conclusion.
For the defective matters and post-period matters that may affect the appraised value of assets in the appraised entity, if the Principals and the relevant parties do not make special instructions at the time of authorization and the asset appraisal professionals are generally unable to know according to their professional experience, the Asset Appraisal Institution and the asset appraisal professionals will not bear relevant responsibilities.
The Asset Appraisal Institution has not independently examined the economic behaviour approval documents, legal documents, historical evolution, qualification certificates, business licenses, ownership certificates, accounting vouchers, financial statements, account books and records, contract orders, control relations, historical changes in equity and other evidential materials provided by the Principals and the appraised entity, nor will it be responsible for the authenticity of the above materials.
Although the asset appraisal professionals did not find any other guarantees and mortgages in the appraised assets during the valuation of this project, the users of this Asset Valuation Report should make independent judgments on the asset status without relying on this Asset Valuation Report.
- III-43-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Unless otherwise specified, the appraised value in this Asset Valuation Report is based on the fact that the appraised entity has full rights to the relevant assets, without taking into account the relevant debts and influences caused by the certain unpaid fees or the unfinished relevant procedures which are not reflected in the books of the appraised entity.
Descriptive words about the Principals and related parties in this Asset Valuation Report are taken from the relevant introduction materials provided by the Principals and related parties to the asset valuer, which should be regarded as a general description by the report reader, and should not be regarded as the approval or publicity report of the Asset Appraisal Institution and the signing asset valuer on their relevant situation. The Asset Appraisal Institution and the signing asset valuer are not responsible for any possible discrepancy between the introduction and the actual situation.
Limited by objective conditions, in this asset valuation, startup tests were not conducted on the appraised equipment one by one, nor did it test the structure of buildings and structures. The valuer assumes that the physical, economic and technical indicators, structure and quality of the above appraisal object meet the design requirements and relevant national regulations, and can be used normally within the remaining economic durability life of this valuation.
The asset valuer's purpose in carrying out this asset valuation business is to measure the value of the appraisal object and express professional opinions, and the asset valuer and the appraisal institution where he works are not responsible for the decision-making of relevant parties. The appraisal conclusion should not be regarded as the guarantee of the realizable price of the appraisal object.
According to the Circular of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Implementation of VAT Transformation Reform in China (Cai Shui [2008] No. 170), the Circular of the Ministry of Finance and the State Administration of Taxation on Pushing Forward the Pilot Project of Changing Business Tax to VAT in an All-round Way (Cai Shui [2016] No. 36) and Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, the appraised value of buildings (structures) and equipment included in this asset valuation scope does not include VAT input tax.
As of the valuation benchmark date, in addition to the declared bank deposits, Xiamen Hailong Terminal Co., Ltd. had an Industrial and Commercial Bank of China account with a balance of RMB2,837,540.18, which was managed by its parent company Xiamen Port Development Co., Ltd. on a centralized basis and corresponded to other receivables from the Capital Center of Xiamen Port Development Co., Ltd. of RMB2,837,540.18.
The results of this asset appraisal have not taken into account the premium or discount caused by controlling interests, minority interests and other factors, or the impact of the liquidity of the appraised shares on the appraisal results.
As of the valuation benchmark date, Xiamen Hailong Terminal Co., Ltd. has obtained the sea use right for the port sea area in the multi-purpose berth basin of No. 20 and No. 21 berths in Haicang Port Area, Xiamen. The certificate numbers are Guo Hai Zheng No. 2013C35020502654 and Guo Hai Zheng No. 2013C35020502706. The enterprise pays the sea area use fee on an annual basis in accordance with the requirements of the Notice on Improving the Administration on Collection of Sea
- III-44-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Waters Use Fee (Cai Zong [2007] No. 10) (《關於加強海域使用金徵收管理的通知》（財綜[2007] 10號）) issued by the Ministry of Finance and the State Oceanic Administration, and directly includes the sea area use fees paid in the cost for the period, which are not shown in the accounts as an separate asset. Considering that the asset right of the sea area use right is embodied in the form of expense, this valuation is zero.

According to Jiao Gui Hua Fa [2013] No. 263 issued by the Ministry of Transport, the appraised entity has obtained the right to use the port line 504-meter port line corresponding to Berth Nos. 20 and 21. Due to the scarcity, limitation and non-renewability of the port line use rights, "the port line is subject to a paid use system and the specific measures shall be formulated by the Provincial People's Government" according to the Fujian Port Regulations. However, as of the valuation benchmark date, the Fujian Provincial People's Government has not formulated specific implementation measures for the paid use of the port line, and the appraised entity has not paid for the port line use right acquired, so the port line value has not been considered in this valuation.
The entrusted land certificate records that the legal purpose is for land for terminal transfer, and the transfer period is 50 years. According to Article 26 of the Notice of Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management Regulations (Xia Fu [2017] No. 413) (《廈門市城鎮土地基準地價和廈門市地價徵收管理若干規定的通知》廈府[2017]413號), "For supplied land for ports, terminals, logistics (transportation) and software and R&D and other projects, if the land price is calculated according to the standard of industrial land at the time of land supply, the value of transfer or mortgage shall be calculated according to the original standard of industrial land when transferring or mortgaging." Therefore, in this valuation of the entrusted land, the benchmark land price is RMB550 per square meter according to the standard of industrial transfer land of Haicang District.
Post-periodevents

The novel coronavirus outbreak broke out nationwide in January 2020, and the prevention and control of pneumonia epidemic continued nationwide as of the date of this valuation report. All parts of the country have launched the "First-level Response Mechanism for Major Public Health Emergencies", which has caused great impact on all walks of life and the whole national economy, especially on transportation, tourism, hotels, restaurants and other industries. This epidemic also has a certain impact on the operation and normal business activities of the appraised entity and the degree of impact will depend on the situation of epidemic prevention and control, duration and implementation of various control policies. In this valuation, the possible impact of the epidemic situation before the valuation report on the enterprise was considered, but we cannot predict the final impact of the epidemic situation on the industry and the appraised entity.
The appraisal conclusion of this report cannot be directly used when major post-period events occur after the report submission date.
After the valuation benchmark date and within the validity period, if the quantity and price standard of assets change, the following principles should be followed:

If the quantity of assets changes, the quantity and amount of assets shall be adjusted accordingly according to the original appraisal approach.
- III-45-

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

When the asset price standard changes, which has a significant impact on the asset appraisal price, the Principals shall promptly hire a qualified Asset Appraisal Institution to re-determine the appraised value.

Due to the change of asset quantity and price standard after the valuation benchmark date, the Principals should give full consideration to the actual pricing of assets and make corresponding adjustments.

Up to the date of the Asset Valuation Report, except for the above-mentioned matters, neither the asset appraisal professionals found in the asset appraisal process of this project, nor the Principals and relevant parties provided any special matters that may affect the appraisal conclusion and need to be clearly disclosed.

The above matters are brought to the attention of users of relevant reports when using the reports.

XII. Limitations of the Use of Asset Valuation Report

This Asset Valuation Report can only be used for the purpose and application stated herein, and only by the users specified herein.
If the Principals or other users of the Asset Valuation Report fail to use the Asset Valuation Report in accordance with the laws, administrative regulations and the scope of use stated in the Asset Valuation Report, the Asset Appraisal Institution and its signing asset valuer shall not be held liable.
Except for the Principals, other users of Asset Valuation Report agreed in the Authorized Asset Appraisal contract and users of Asset Valuation Report stipulated by laws and administrative regulations, no other institution or individual shall become users of Asset Valuation Report.
The user of the Asset Valuation Report shall correctly understand the appraisal conclusion, which is not equal to the realizable price of the appraisal object, and shall not be regarded as the guarantee of the realizable price of the appraisal object.
Any extraction, citation or disclosure of this Asset Valuation Report in entirety or part to the public media should be subject to the consent of the Asset Appraisal Institution, unless otherwise permitted by the requirements of laws, regulation or agreement otherwise engaged between concerning parties.
The appraisal conclusion of the Asset Valuation Report shall remain valid for one year, commencing from 31 December 2019, the valuation benchmark date, to 30 December 2020.
The appraisal conclusion shall not be used unless the Asset Valuation Report has been approved by Xiamen SASAC.

XIII. Date of Asset Valuation Report

The date of Asset Valuation Report is 21 July 2020, which is the formation date of the appraisal conclusion.

- III-46 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

The document number of this Asset Valuation Report is Lian He Zhong He Ping Bao Zi

(2020) No. 5011-2. The appraised value of all equity interests of Xiamen Hailong Terminal Co., Ltd. in connection with the proposed increase in equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. by Xiamen Port Development Co., Ltd. with 100% equity interests in Xiamen Hailong Terminal Co., Ltd. due to the terminal equity integration is RMB1,208,737,100 (SAY RMB ONE BILLION TWO HUNDRED AND EIGHT MILLION SEVEN HUNDRED AND THIRTY-SEVEN THOUSAND ONE HUNDRED ONLY).

Chinese Asset Valuer: Chen Shiqin Chen Lizhu

Legal representative: Shang Guangtai

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. 21 July 2020

- III-47 -

APPENDIX III

VALUATION REPORT OF XIAMEN HAILONG

Appendices to the Asset Valuation Report

Content

Copies of business licenses of the Principals and the appraised entity;

Copies of commitment letter of the Principals and other relevant parties;

Economic behaviour documents;
(IV) Copy of commitment letter of the signing asset valuer;

Copies of record documents of the Asset Appraisal Institution;
(VI) Copy of counterpart of business license of the Asset Appraisal Institution; (VII) Copies of qualification certificates of the signing asset valuer;

(VIII) Explanation of the significant difference between the book value of assets and the appraisal conclusion;

(IX) Copies of the Authorized Asset Appraisal contract.

- III-48 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

This Appendix IV contains the English translation of the Asset Valuation Report of the Equity Interests of Xiamen Haihong prepared by Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd., a PRC Qualified Valuer, using asset-based approach which is the basis for the determination of the consideration. In case of discrepancy between the English translation and the Chinese version, the Chinese version shall prevail.

All Equity Interests of Xiamen Haihong Petrochemical Terminal Co., Ltd. in connection with Proposed Increase in Equity Interests of Xiamen Port Group Shihushan Terminal Co., Ltd. by Xiamen Port Holding Group Co., Ltd. with 100% Equity Interests of Xiamen Haihong Petrochemical Terminal Co., Ltd. due to Proposed Terminal Equity Integration

Asset Valuation Report

Lian He Zhong He Ping Bao Zi (2020) No. 5011-1

To: Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd.

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. (hereinafter referred to as the "Asset Appraisal Institution") accepts your engagement to conduct asset appraisal on the market value as at 31 December 2019 of all equity interests of Xiamen Haihong Petrochemical Terminal Co., Ltd. in connection with proposed terminal equity integration by Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd. in accordance with the administrative regulations on asset valuation and asset valuation standards of the People's Republic of China and pursuant to objective, independent, fair and scientific manner and by using the recognized asset valuation approach. The Asset Appraisal Institution and the signing asset valuer conducted field survey and market investigation on the assets authorized for valuation according to necessary valuation procedures. The information on asset valuation and valuation results is set forth herein as follows.

Principals, Appraised Entity and Other Users of the Asset Valuation Report as Stipulated in the Asset Valuation Commission Contract

The Principals are Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development Co., Ltd., and the appraised entity is Xiamen Haihong Petrochemical Terminal Co., Ltd..

1. Particulars of Principals

Principal A: Xiamen Port Holding Group Co., Ltd.

Company name: Xiamen Port Holding Group Co., Ltd.

Social Unified Organization Code Certificate: 9135020026013542XA

Registered address: 25th Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB3.1 billion

Legal representative: Chen Zhiping

Company type: Limited liability company (wholly state-owned)

Scope of business: 1. to operate and manage the state-owned assets within the authorized scope;

IV-1-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Principal B: Xiamen Port Development Co., Ltd.

Company name: Xiamen Port Development Co., Ltd.

Social Unified Organization Code Certificate: 913502007054097384

Registered address: 20th and 21st Floor, Gangwu Plaza, 31 Donggang North Road, Huli District, Xiamen

Registered capital: RMB531 million

Legal representative: Chen Zhaohui

Company type: Other joint stock limited company (listed)

2. Particulars of the appraised entity

Company name: Xiamen Haihong Petrochemical Terminal Co., Ltd.

Social Unified Organization Code Certificate: 913502007912879839

Registered address: 379 Gangnan Road, Haicang District, Xiamen

Registered capital: RMB30 million

Legal representative: Wang Miaoxuan

Company type: Limited liability company (corporate-owned invested or controlled by a non-natural person)

Scope of business: Terminal and other port facilities services; freight, port cargo loading and unloading, warehousing services; ship port services; sewage treatment and its recycling.

3. History and shareholding structure

Established on 12 December 2006, Xiamen Haihong Petrochemical Terminal Co., Ltd. is a company jointly invested and established by Xiamen Port Holding Group Co., Ltd. and Xiamen Port Development & Construction Co., Ltd. It was established with a registered capital of RMB30 million and a paid-in capital of RMB30 million, of which Xiamen Port Holding Group Co., Ltd. contributed

- IV-2 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

RMB28.5 million, holding 95% of the company's share, and Xiamen Port Development & Construction Co., Ltd. contributed RMB1.5 million, holding 5% of the company's share.

On 10 December 2015, according to Notice on the Equity Transfer of Xiamen Haihong Petrochemical Terminal Co., Ltd. issued by Xiamen Port Holding Group Co., Ltd. (Xiamen Port Holding [2015] No. 256 Document), Xiamen Port Development & Construction Co., Ltd., the wholly- owned subsidiary of Xiamen Port Construction Group Co., Ltd, transferred its 5% shareholding in Haihong Company to Xiamen Port Holding Group Co., Ltd. for free. After the completion of this equity transfer, Xiamen Port Holding Group Co., Ltd. holds 100% of Xiamen Haihong Petrochemical Terminal Co., Ltd..

On 20 December 2016, pursuant to the Notice of Xiamen Port Holding Group Co., Ltd. on the Assignment of Haicang 9# Berth and Public Facilities (Xia Gang Kong Gu [2015] No. 211), Xiamen Port Holding Group Co., Ltd. increased its capital contribution to Xiamen Haihong Petrochemical Terminal Co., Ltd. by RMB158,439,828.45 with the 9# berth and public facilities owned by it. As at 31 December 2019, the paid-incapital of Xiamen Haihong Petrochemical Terminal Co., Ltd. was RMB188,439,828.45, and the change in ownership of the relevant assets and the relevant business registration for the capital increase had not been completed.

As of the valuation benchmark date, the paid-in capital of Xiamen Haihong Petrochemical Terminal Co., Ltd. was RMB188,439,828.45, and Xiamen Port Holding Group Co., Ltd. contributed RMB188,439,828.45, accounting for 100% of the paid-in capital.

- IV-3 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

4. Assets, financial and business conditions in recent years

The main indicators of financial position of Xiamen Haihong Petrochemical Terminal Co., Ltd. in the past three years are shown in the table below (monetary unit: RMB):

Assets		2017		2018	2019
Current assets:
Monetary funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19,337,275.01	16,805,251.97	2,123,536.37
Financial assets at fair value through profit or loss
Notes receivable
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	530,269.54	1,341,074.39	441,315.46
Prepayments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	68,338.43	778,467.14	778,920.88
Other receivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	570,621.29	620.00	620.00
Among which: Interest receivable
Dividends receivable
Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	19,468.39	18,498.62	19,916.14
Assets classified as held for sale
Non-current assets due within one year
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	970,616.39	652,412.69	19,027,201.46

Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	21,496,589.05	19,596,324.81	22,391,510.31
Non-current assets:

Available-for-sale financial assets
Held-to-maturity investments
Long-term receivables
Long-term equity investment . . . . . . . . . . . . . . . . . . . . . . . .	44,779,054.86	46,333,555.15	47,936,076.47
Investment properties
Fixed assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	133,507,774.17	142,764,590.28	137,168,724.37
Construction in progress . . . . . . . . . . . . . . . . . . . . . . . . . . . .	12,972,735.93	1,831,979.91	912,623.45
Productive biological assets
Oil and gas assets
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4,342,726.06	4,275,687.14	4,173,966.04
Expenditures for development
Goodwill
Long-term deferred expenses
Deferred income tax assets . . . . . . . . . . . . . . . . . . . . . . . . . .	5,659,068.89	7,297,335.04	8,732,420.13
Other non-current assets
Total non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . .	201,261,359.91	202,503,147.52	198,923,810.46

Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	222,757,948.96	222,099,472.33	221,315,320.77

- IV-4 -

APPENDIX IV	VALUATION REPORT OF XIAMEN HAIHONG
Assets	2017	2018	2019

Current liabilities:
Short-term borrowings
Financial liabilities at fair value through profit or loss
Derivative financial liabilities
Notes payable
Accounts payable . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 381,293.06	3,142,698.25	4,663,483.47
Advance receipts
Employee compensation payable . . . . . . . . .	. . . . . . . . . . . . 2,800,800.23	3,263,150.47	3,250,510.70
Taxes payable . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 275,934.44	278,230.61	242,339.93
Other payables . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 1,580,493.82	1,326,152.62	1,865,662.81
Among which: Interest payable
Dividends payable
Liabilities classified as held for sale
Non-current liabilities due within one year
Other current liabilities

Total current liabilities . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 5,038,521.55	8,010,231.95	10,021,996.91
Non-current liabilities:

Long-term borrowings
Bonds payable
Long-term payables
Estimated liabilities
Deferred income
Deferred income tax liabilities
Other non-current liabilities
Total non-current liabilities . . . . . . . . . . . . .	. . . . . . . . . . . .	-		-	-

Total liabilities . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 5,038,521.55	8,010,231.95	10,021,996.91
Owner's equity (or shareholder's equity):


Paid-in capital (or share capital) . . . . . . . . .	. . . . . . . . . . . . 188,439,828.45	188,439,828.45	188,439,828.45
Other equity instruments
Capital reserve . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 43,965,296.56	43,965,296.56	43,965,296.56
Less: Treasury stock
Other comprehensive income (equity)
Special reserve . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 5,290.69	5,139.30
Surplus reserve . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 956,741.92	956,741.92	956,741.92
General risk reserve
Undistributed profits . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . -15,647,730.21	-19,277,765.85	-22,068,543.07
Minority interests

Owner's equity (or shareholder's equity): . .	. . . . . . . . . . . . 217,719,427.41	214,089,240.38	211,293,323.86
Total liabilities and owner's equity (or shareholder's
equity) . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . . . . . . . . . . . 222,757,948.96	222,099,472.33	221,315,320.77

- IV-5 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

The main indicators of operating results of Xiamen Haihong Petrochemical Terminal Co., Ltd. in the past three years are shown in the table below (monetary unit: RMB):

Item		2017		2018		2019
I. Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	20,469,880.86	21,282,858.09	21,962,211.49
Less: Operating costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	18,799,552.73	20,154,464.38	21,131,159.92
	Taxes and surcharges . . . . . . . . . . . . . . . . . . . . . . . . . .	939,970.42	547,032.31	519,045.29
	Sales expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-		-		-
	Management expenses . . . . . . . . . . . . . . . . . . . . . . . . .	6,443,730.87	6,908,616.24	6,987,176.10
	Research and development expenses . . . . . . . . . . . . . .			-		-
	Financial expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . .	-783,877.18	-488,732.91	-617,083.62
	Among which: Interest expenses
	Interest income
Plus: Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	113,793.79	98,604.02	159,086.03
Investment income (loss indicated with "-") . . . . . . . . . . . . .	1,100,433.32	1,554,500.29	1,602,521.32
Among which: Gain on investments in associates and joint
ventures
Asset impairment loss (loss indicated with "-") . . . . . . . . . . . . .	-3,550,875.93	-1,076,760.08	14,884.82
Gain on change in fair value (loss indicated with "-")
Gain on disposal of assets (loss indicated with "-") . . . . . . . . . .			-	65,490.52
II. Operating profits (loss indicated with "-") . . . . . . . . . . . . . .	-7,266,144.80-5,262,177.70-4,216,103.51
Plus: Non-operating income . . . . . . . . . . . . . . . . . . . . . . . . . .	609,019.34		-		-
Less: Non-operating expenses . . . . . . . . . . . . . . . . . . . . . . . .	29,800.56	6,124.09	9,758.80
IV. Total profit (total loss indicated with "-") . . . . . . . . . . . . . .	-6,686,926.02	-5,268,301.79	-4,225,862.31
Less: Income tax expenses . . . . . . . . . . . . . . . . . . . . . . . . . . .	-114,393.83	-1,638,266.15	-1,435,085.09
V. Net profit (net loss indicated with "-") . . . . . . . . . . . . . . . . .	-6,572,532.19	-3,630,035.64	-2,790,777.22

5. Company profile

Xiamen Haihong Petrochemical Terminal Co., Ltd. is a specialized company under Xiamen Port Holding Group Co., Ltd. engaged in the strategic development in the liquid chemical industry. Established in 2006 and with a registered address of 379 Gangnan Road, Haicang District, Xiamen, it is principally engaged in the provision of loading and unloading services for refined oil, edible oil, liquid chemicals, etc. The main asset of Xiamen Haihong Petrochemical Terminal Co., Ltd. is the 9# berth in Haicang Port Area.

The 9# berth terminal in Haicang Port Area has a designed annual throughput capacity of

2.52 million tons. The berth is 233m long, and the elevation of berth front bottom is -13.8m. It is arranged in an oval shape. The width of turning basin in the vertical water flow direction is 558m, and the width of turning basin along the flow direction is 800m. The entrance channel is 250m wide and the bottom elevation of the channel is -14m. The construction of the 9# berth terminal in Haicang Port Area commenced in June 2003. The terminal hydro main works and the port basin turn-around area were completed in December 2005, and the water supply and drainage, firefighting, power supply and other ancillary facilities were completed in October 2009. The reinforcement and modification of terminal structure of 9# berth was conducted in February 2014.

IV-6-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Haihong terminal is a liquid chemical terminal. Currently, there is no rear storage area and storage yard. It provides loading and unloading services for the rear storage areas. The main loading and unloading process is that the ship connects to each storage area through the oil delivery arm (oil delivery hose) and process pipeline.

Main equipment for Haihong terminal operation includes 8 oil delivery arms and loading and unloading pipelines in each storage area. The loading and unloading rate depends on the type of cargoes and vessel type. The maximum theoretical loading and unloading capacity is 1,400 tons per hour (diesel); in 2019, the actual maximum capacity is 750 tons per hour and the average capacity is 300 tons per hour.

6. Other users of the Asset Valuation Report

Purpose of Valuation

According to the (2020) No. 51 meeting minutes and the meeting minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020] No. 8) of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China, it was agreed in principle to the equity integration plan of bulk cargo terminal (Xiamen Port Holding Group Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Haihong Petrochemical Terminal Co., Ltd.; Xiamen Port Development Co., Ltd. increased its capital to Xiamen Port Group Shihushan Terminal Co., Ltd. by holding 100% equity of Xiamen Hailong Terminal Co., Ltd.), and it is required to appraise all equity interests of the Target Company according to relevant regulations.

The purpose of this asset valuation is to give a fair view of the market value of all equity interests of shareholders of Xiamen Haihong Petrochemical Terminal Co., Ltd. as of the benchmark date and provide value reference basis for the economic behaviour of the proposed terminal equity integration by the Principals.

The Subject and Scope of Valuation

The subject of valuation is all equity interests of shareholders of Xiamen Haihong Petrochemical Terminal Co., Ltd..

The scope of valuation includes all the assets and related liabilities of Xiamen Haihong Petrochemical Terminal Co., Ltd., including:

The assets and liabilities of Xiamen Haihong Petrochemical Terminal Co., Ltd. as of the valuation benchmark date, 31 December 2019, have been audited by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0440 Auditor's Report, which specifically include: current assets, non-current assets (including long-term equity investments, fixed assets of buildings, fixed assets of equipment, construction in progress, intangible assets, deferred income tax assets, etc.), current liabilities. According to the audited financial statements as at benchmark date provided by Xiamen Haihong Petrochemical Terminal Co., Ltd., the book values of assets, liabilities

- IV-7 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

and net assets are RMB221,315,300, RMB10,022,000 and RMB211,293,300 respectively. The specific contents are listed as follows (monetary unit: RMB'0,000):

No.	Item		Book value
1	Current assets	2,239.15
2	Non-current assets	19,892.38
3	Among which: Long-term equity investment	4,793.61
4	Other equity instrument investment		-
5	Investment properties		-
6	Fixed assets	13,716.87
7	Among which: Buildings	10,737.60
8	Equipment	2,979.27
9	Construction in progress	91.26
10	Intangible assets	417.40
11	Among which: Land use rights	411.42
12	Long-term deferred expenses		-
13	Deferred income tax assets	873.24
14	Other non-current assets		-

15	Total assets	22,131.53


16	Current liabilities	1,002.20
17	Non-current liabilities		-

18	Total liabilities	1,002.20

19	Owner's equity	21,129.33

The assets, liabilities and net assets of Xiamen Haihong Petrochemical Terminal Co., Ltd. as at the valuation benchmark date have been audited and verified by RSM China Xiamen Branch, which issued the Rong Cheng Shen Zi [2020] No. 361F0440 Auditor's Report.

The main assets included in the scope of valuation include monetary funds, accounts receivable, prepayments, other receivables, inventory, other current assets, long-term equity investments, fixed assets of buildings, fixed assets of equipment, intangible assets and deferred income tax assets. The main assets of the company are as follows:

1. Monetary funds

Monetary funds are mainly bank deposits of the enterprise.

2. Accounts receivable

Accounts receivable mainly refer to loading and unloading fees and berthing fees receivable incurred in business operations.

3. Prepayments

Prepayments are mainly prepaid insurance premium and diesel payment.

4. Other receivables

Other receivables are mainly deposits due from related parties.

- IV-8 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

5. Inventory

Inventory mainly refers to turnover materials in stock.

6. Other current assets

Other current assets are mainly structured deposits with Industrial Bank and input tax to be certified.

7. Long-term equity investment

As at the valuation benchmark date, long-term equity investment included an external equity investment project, being the investment in Xiamen Sinopetro Port Services and Storage Co., Ltd. with a shareholding of 30%.

8. Fixed assets of buildings (structures)

The original book value and net book value of the fixed assets of buildings included in the scope of valuation totalled RMB135,644,023.19 and RMB91,034,275.64 respectively. No provision for impairment was made.

There were a total of 8 buildings with a total gross floor area of 8,124.80 square meters, mainly including complex building, boiler room, substation and pump room, front substation, all located at 9# berth in Xiamen Haicang Port Area owned by Xiamen Haihong Petrochemical Terminal Co., Ltd.. The above buildings were mainly completed in 2009, and can be used normally at present.
19 structures were included in the scope of this asset appraisal, mainly including 9# berth terminal hydro main works, port basin turn-around area works, power supply network, water supply and drainage firefighting engineering in port area.

The 9# berth terminal in Haicang Port Area has a designed annual throughput capacity of

The 9# berth terminal hydro main works are an along-shore caisson gravity structure, with wall body of 13 caissons and 65 unloading plates and upper part of cast-in-place concrete wall. The main workload includes: 36,120.43m³ of terminal dredging, 10,877.43m³ of reef blasting and reef clearing for foundation trench, 7,720.60m³ of foundation bed rock filling, 6,600m³ of precast caisson C30 concrete, 771.71T of precast caisson reinforcement manufacturing and installation, 7,883m³ of precast unloading plate C30 concrete, 361.82T of precast unloading slab reinforcement manufacturing and installation, 739m³ of rubble backfilling in caisson, 6,721m³ of block stone backfilling in caisson, 13,960m³ of sand backfilling in caisson, 4,354.9m³ of cast-in-place C30 concrete wall, 14.62m³ of cast-in-place C30 guard wheel, 13 rubber fenders, 69,729.3m³ of 10∼100kg block stone prism, 7,272m³ of post-prism rubble filter layer, 8,052m³ of post-prism 50∼80mm mixed filter layer, 175,757m³ of port basin dredging, and 29,507m³ of reef blasting and reef clearing for port basin.

- IV-9 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

The port basin turn-around area works include 367,100.00m³ of dredging and 18,312.14m³ of reef blasting and reef clearing for foundation trench.

Outdoor works include roads, fences, water supply and drainage, electrical, fire protection, communication, cable trench, etc. The widths of road surface are 7m and 5m. For the structure layer, the upper layer is C50 concrete interlocking block; the middle layer is 50mm sand layer; the lower layer is cement stabilized macadam; the base course is graded crushed stone; and the subbase is compacted soil foundation. The water supply and drainage system is mainly divided into south and north areas. The water supply in the south area is mainly for use in loading station, front substation, terminal front, and the water supply in the north area is mainly for use in sewage treatment plant, rear substation and pump room, complex building, boiler room and fire pool. The water supply system is connected to the municipal water supply network of Gangnan road. The rainwater in the north area is discharged into the municipal rainwater pipe network of Gangnan road. The rainwater in the contaminated zone of the south area is collected and discharged into the sewage treatment system, and the chemical sewage is discharged into the sewage lift tank in the loading area, pressurized and discharged to sewage treatment system. The outdoor power supply and lighting system is established using cable transmission glass tube in tank area, and laid along cable trench at the terminal front. The cable well is set according to the drawing, and the outdoor lamps and outdoor distribution boxes are explosion-proof and waterproof. The terminal has in place a manual fire alarm system, which is connected to the firefighting system through signals. The start and stop of the components of the firefighting security are controlled by the PLC system of the fire control room. On-site manual operation is also allowed to enable intelligent operation through the PLC system.

The above buildings (structures) were mainly completed between 2005 and 2019, and can be used normally at present. The land use right occupied by buildings (structures) has been included in the scope of valuation.

As of the valuation benchmark date, all buildings (structures) included in the scope of valuation have not obtained the Property Ownership Certificate.

According to the Statement on the Ownership Certificate for the Buildings Erected on 9# Berth of Haicang Port Area provided by the appraised enterprise, the buildings included in the scope of valuation were built in accordance with the procedures for the construction of port projects, which had been completed. However, the construction procedures in Xiamen required for obtaining property ownership certificates were not completed, and the property ownership certificates have not been obtained yet.

9. Fixed assets of equipment

The fixed assets of equipment included in the scope of valuation are the machinery, vehicles and electronic equipment reported by Xiamen Haihong Petrochemical Terminal Co., Ltd., with a total of 211 items, with an original book value of RMB96,046,786.16, fixed asset impairment provision of RMB12,563,023.56 and a net book value of RMB46,134,448.73.

Machinery and equipment mainly include the first phase of process pipeline rectification project, sewage treatment facilities, and automatic control engineering of 9# berth of Haicang Port Area. The above equipment was purchased and installed between 2009 and 2019;

- IV-10 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Vehicles are mainly Mitsubishi Grundy seven-seat passenger cars and Gonow light trucks. The above equipment was put into use between 2010 and 2011;

Electronic equipment mainly includes office equipment and auxiliary equipment, including air conditioners, computers, intercom, etc. The above equipment was put into use between 2005 and 2019;

The above equipment has clear property right ownership and is owned by Xiamen Haihong Petrochemical Terminal Co., Ltd.. As of the valuation benchmark date, except for certain equipment which have been removed, other equipment is in normal use.

10. Construction in progress

Construction in progress mainly includes the ongoing technical transformation and function upgrading project for the DCS control system and the fire pump diesel unit procurement and installation project.

11. Deferred income tax assets

Deferred income tax assets are mainly deductible temporary differences arising from deductible losses and provision for impairment of fixed assets.

The recorded or unrecorded intangible assets reported by the enterprise 1. Recorded intangible assets reported by the enterprise

As of the valuation benchmark date, the recorded intangible assets reported by the enterprise are land use rights and other intangible assets.

Intangible assets included in the scope of this valuation-two land use rights, with land area of 49,673.27 square meters, original recorded value of RMB5,266,458.69 and book value of RMB4,114,203.82.

The registration status of land use rights is as follows:

Holder of the right

Type of the

No.

Name of parcel

Land Certificate No.

to use

Use

right to use

Area (m2)

B1 parcel, 9#

Xia Guo Tu Fang

Xiamen Port

Terminal and

Assignment

23,976.20

berth, Haicang Port

Zheng Di Di

Holding Group

warehousing

Area

No. 00020204

Co., Ltd.

B2 parcel, 9#

Xia Guo Tu Fang

Xiamen Port

Land for port

Assignment

25,697.07

berth, Haicang Port

Zheng Di Di

Holding Group

and terminal

Area

No. 000201159

Co., Ltd.

- IV-11 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Land rights and utilization status are as follows:

					Limitation
			Remaining	on other	Actual development
No.	Name of parcel		useful life		rights	degree	Status of land use
1	B1 parcel, 9#	36.07		None	Five access with	As the place of production and operation for
	berth, Haicang					ground leveling	the loading and unloading of vegetable oil,
	Port Area						refined oil and liquid chemicals. There are a
							complex building, boiler room, control room
							of oil delivery arm at the front of the
							terminal, electric control room, sewage
							treatment room, guard room, walls, gates
2	B2 parcel, 9#	36.07		None	Five access with	and various pipeline facilities for production
	berth, Haicang					ground leveling	on the ground. The land has been fully
	Port Area						utilized.

Intangible assets included in the scope of this valuation-3 other intangible assets, mainly purchased mobile OA system and genuine Windows operating systems.

2. Unrecorded intangible assets reported by the enterprise

The unrecorded intangible assets declared by the appraised company are the sea use right for the port sea area in the port basin of 9# berth in Haicang Port Area. The certificate number is Guo Hai Zheng No. 033550013, and the sea use right owner is Xiamen Port Holding Group Co., Ltd..
According to Xia Gang [2003] No. 57 issued by Xiamen Port Authority, Xiamen Port Holding Group Co., Ltd. has obtained the right to use the 233-meter port line corresponding to Berth No. 9 at Haicang Port Area on 13 May 2003. On 20 December 2016, Xiamen Port Holding Group Co., Ltd. increased its capital contribution to Xiamen Haihong Petrochemical Terminal Co., Ltd. with Berth No. 9 and public facilities owned by it. After the capital injection, Xiamen Haihong Petrochemical Terminal Co., Ltd. obtained the right to use the 233-meter port line corresponding to Berth No. 9 at Haicang Port Area.

(III) Other off-balance-sheet assets reported by the enterprise

The appraised enterprise has no other reported off-balance-sheet assets.

(IV) Reference to the asset type, quantity and carrying amount (or appraised value) involved in the report conclusion issued by other institutions

In this asset appraisal, except that RSM China Xiamen Branch audited and issued the auditor's report (Rong Cheng Shen Zi [2020] No. 361F0440) as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.

It is confirmed by the Principals and the appraised entity that the above appraisal object and scope are consistent with those involved in the above economic behaviour.

IV.	Type of Value and Its Definition

1. Based on the purpose of this asset appraisal, the type of value of this asset appraisal is market

value.

- IV-12 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

1. Market value refers to the estimated amount of the value that can be realized by the valuation target under normal and fair transaction as at the valuation benchmark date when the voluntary buyer and the voluntary seller act rationally without any coercion.
2. Reasons and basis for types of value selected: According to the purpose of this asset valuation, particular market conditions and situation of valuation target, market value was determined to be the selected value type in this valuation.
Valuation Benchmark Date
1. The valuation benchmark date of this asset appraisal is 31 December 2019.
  Illustration of the related matters for the determination of the valuation benchmark date:
2. Reason for determination of the valuation benchmark date: this date is close to the realization date of valuation purpose, and the valuation benchmark date of this report is determined to be 31 December 2019 upon written confirmation by the Principals.
3. All the pricing standards, interest rates and tax rates of this asset valuation are the effective pricing standards, interest rates and tax rates of the valuation benchmark.

VI. Valuation Basis

The basis of this asset valuation mainly includes basis of economic behaviour, laws and regulations, criterion, ownership, pricing and other reference materials, with details as follows:

Basis for economic behaviour

The (2020) No. 51 meeting minutes of the Party Committee of Xiamen Port Holding Group Co., Ltd. of the Communist Party of China.
Meeting Minutes of Xiamen Port Development Co., Ltd. (Xia Gang Fa Hui Ji [2020] No. 8).

Basis for main laws and regulations

Assets Appraisal Law of the People's Republic of China (adopted at the 21st Meeting of the Standing Committee of the 12th National People's Congress on 2 July 2016);
Company Law of the People's Republic of China (revised at the 6th Meeting of the Standing Committee of the 12th National People's Congress on 28 December 2013);
Measures for Financial Supervision and Administration of Assets Valuation Industry (Order No. 86 of the Ministry of Finance of the People's Republic of China);
Enterprise Income Tax Law of the People's Republic of China (adopted at the 5th Meeting of the 10th National People's Congress on 16 March 2007);
Law of the People's Republic of China on State-owned Assets of Enterprises (adopted at the 5th Meeting of the Standing Committee of the 11th National People's Congress on 28 October 2008);
- IV-13-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Interim Measures for the Supervision and Administration of State-owned Assets of Enterprises (Order No. 378 of the State Council, revised by Order No. 588 of the State Council);
Decision of the State Council on Abolishing the Provisional Regulations of the People's Republic of China on Business Tax and Amending the Provisional Regulations of the People's Republic of China on Value Added Tax (Order No. 691 of the State Council);
Notice of the Ministry of Finance and the State Administration of Taxation on Adjusting the VAT Rate (Cai Shui [2018] No. 32);
Administrative Measures for State-Owned Assets Valuation (Order No. 91 of the State
Council);
Notice on Printing and Distributing the Detailed Rules for the Implementation of the Administrative Measures for State-owned Assets Valuation (Guo Zi Ban Fa [1992] No. 36);
Interim Measures for the Administration of Assessment of State-owned Assets of Enterprises (Order No. 12 of State-ownedAssets Supervision and Administration Commission of the State Council);
Notice on Relevant Matters Concerning Strengthening the Administration of Valuation of State-owned Assets of Enterprises (Guo Zi Wei Chan Quan [2006] No. 274);
Notice on Relevant Matters Concerning the Audit of State-owned Asset Valuation Report of Enterprises (Guo Zi Chan Quan [2009] No. 941);
Guidelines for the Filing of State-owned Assets Valuation Projects of Enterprises (Guo Zi Fa Chan Quan [2013] No. 64);
Measures for the Supervision and Administration of State-owned Assets Trading of Enterprises (Order No. 32 of the State-ownedAssets Supervision and Administration Commission of the State Council and the Ministry of Finance);
Basic Standards for Assets Valuation (Cai Zi [2017] No. 43);
Measures for the Supervision and Administration of State-owned Assets of Enterprises in Xiamen (Order No. 157 of Xiamen Municipal People's Government);
Notice on Interim Measures for the Administration of Assets Valuation Projects of State- owned Enterprises in Xiamen (Xia Guo Zi Chan [2007] No. 546);
Notice of the State-owned Assets Supervision and Administration Commission of Xiamen Municipal People's Government on Further Strengthening the Administration of Valuation of State- owned Assets of Enterprises (Xia Guo Zi Chan [2014] No. 346).

Basis for valuation standards

Code of Professional Ethics for Asset Valuation (Zhong Ping Xie [2017] No. 30);
Practice Guidelines for Asset Valuation-Asset Valuation Procedures (Zhong Ping Xie [2018]
No. 36);
- IV-14-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Practice Guidelines for Asset Valuation-Asset Valuation Report (Zhong Ping Xie [2018]
No. 35);
Practice Guidelines for Asset Valuation-Asset Valuation Commission Contracts (Zhong Ping Xie [2017] No. 33);
Practice Guidelines for Asset Valuation-Asset Valuation Archives (Zhong Ping Xie [2018]
No. 37);
Practice Guidelines for Asset Valuation-Enterprise Value (Zhong Ping Xie [2018] No. 38);
Guidelines for the Asset Valuation Report of State-owned Assets of Enterprises (Zhong Ping Xie [2017] No. 42);
Practice Guidelines for Asset Valuation-Real Estate (Zhong Ping Xie [2017] No. 38);
Practice Guidelines for Asset Valuation-Machinery and Equipment (Zhong Ping Xie [2017]
No. 39);
Guidelines for Business Quality Control of Asset Appraisal Institutions (Zhong Ping Xie [2017] No. 46);
Guiding Opinions on Value Types of Assets Valuation (Zhong Ping Xie [2017] No. 47);
Guiding Opinions on Legal Ownership of Assets Valuation Objects (Zhong Ping Xie [2017]
No. 48);
Practice Guidelines for Asset Valuation-Asset Valuation Approach (Zhong Ping Xie [2019]
No. 35);
Practice Guidelines for Asset Valuation-Using Expert Work and Related Reports (Zhong Ping Xie [2017] No. 35).

(IV) Basis for property rights

Copy of business license of Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Copy of financial statements of Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Copy of auditor's report as of the valuation benchmark date of Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Auditor's reports of Xiamen Haihong Petrochemical Terminal Co., Ltd. over the years;
Copy of state-owned land use right certificate;
Certificates for the sea use right;
Equipment purchase contract and invoice;
Vehicle registration certificate;
- IV-15-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Commitment letter of the Principals and the appraised entity;
Relevant financial, business and sales materials;
Other ownership certificates corresponding to the assets included in the scope of valuation.

Pricing basis

The deposit and loan interest rates of financial institutions implemented on the valuation benchmark date announced by the People's Bank of China;
Relevant information from Choice finance terminal of Eastmoney;
Equipment valuation breakdown provided by Xiamen Haihong Petrochemical Terminal Co.,
Ltd.;
Certain equipment purchase contracts, invoices and large-scale equipment acceptance records provided by Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Mechanical and Electrical Products Quotation Manual - prepared by Machinery Industry Information Research Institute (2019 Edition);
Handbook of Common Approaches and Parameters of Assets Valuation (Mechanical Industry Press, 2011 Edition);
Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs;
Notice of the Ministry of Finance and the State Administration of Taxation on Comprehensively Pushing Forward the Pilot Program of Changing Business Tax to Value-added Tax (Cai Shui [2016] No. 36);
Notice of the Ministry of Finance and the State Administration of Taxation on Several Issues Concerning the Implementation of VAT Transformation and Reform in China (Cai Shui [2008] No. 170);
Order No. 294 of 2001 of the State Council, Provisional Regulations of the People's Republic of China on Vehicle Purchase Tax;
Order No. 12 of 2012 of the Ministry of Commerce, Development and Reform Commission, Ministry of Public Security and Ministry of Environmental Protection, Regulations on Compulsory Scrapping Standards of Motor Vehicles;
Regulations on Management of Construction Engineering Supervision and Related Service Charges (Fa Gai Jia Ge (2007) No. 670);
Consultancy Service Charges for Construction Project Cost (Min Jia (2002) Fang No. 457);
Notice on Printing and Distributing the Regulations on Construction Cost Management of Basic Construction Projects (Cai Jian [2016] No. 504);
- IV-16-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Budget Quota of Hydro Construction Projects in Coastal Ports;
Notice of Audit of Project Final Accounts of China Construction Bank Xiamen Branch;
Notice on Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management Regulations (Xia Fu [2017] No. 413);
Notice of the State Council on Promoting Economical and Intensive Land Use (Guo Fa (2008) No. 3);
Notice of Xiamen Municipal People's Government on Adjusting Compensation Standards for Land Acquisition in Our City (Xia Fu (2016) No. 398);
Measures for the Implementation of Farmland Occupation Tax in Fujian Province (Min Zheng (2008) No. 17);
Provisions on the Collection and Use of Cultivated Land Reclamation Fees in Fujian Province (Min Zheng (2000) Wen No. 98);
Provisions on Administration of Deed Tax Collection in Fujian Province (Min Cai Nong Shui (1997) No. 58);
Notice on Forwarding the Issues Concerning the Social Security of Land-expropriated Farmers from the Ministry of Labour and Social Security and the Ministry of Land and Resources issued by Fujian Provincial Department of Human Resources and Social Security;
Equipment manufacturers and sellers telephone inquiry and other relevant price
information;
The 2019 Enterprise Performance Appraisal Standards prepared by the Appraisal and Distribution Bureau of the State-ownedAssets Supervision and Administration Commission of the State Council;
Budget Quota of Fujian General Installation Project (FJYD-301-201 ~ FJYD311-2017);
Price information accessed online;
Other relevant materials provided by Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Stipulations on Compiling Estimated Budget for Water Transportation Construction Projects (JTS/T116-2019).

(VI) Reference basis

The approval documents of relevant construction projects provided by Xiamen Haihong Petrochemical Terminal Co., Ltd.;
Certain tender documents and bid-winning contracts of the equipment, acceptance records, purchase contracts and invoices of large-scale equipment provided by Xiamen Haihong Petrochemical Terminal Co., Ltd.;
- IV-17-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

The Auditor's Report Rong Cheng Shen Zi [2020] No. 361F0440 issued by RSM China Xiamen Branch;
Notice of the National Development and Reform Commission and the Ministry of Construction on Printing and Distributing the Regulations on the Supervision and Management of Construction Projects and Related Service Charges (Fa Gai Jia Ge [2007] No. 670);
The original Interim Provisions on Consultation Fees for Preparatory Work of Construction Projects (Ji Jia Ge (1999) No. 1283);
The original Charge Standard for Environmental Impact Appraisal Consultation of Construction Projects (Ji Jia Ge (2002) No. 125);
The original Regulations on the Management of Construction Survey and Design Fees (Ji Jia Ge (2002) No. 10);
The original Interim Measures for the Administration of Tender Agency Service Charges (Ji Jia Ge [2002] No. 1980);
Code for Real Estate Valuation (GB/T 50291-2015);
Code for Urban Land Valuation (GB/T 18508-2014);
Rules for Classification and Grading of Urban Land (GB/T 18507-2014);
The original Notice of Fujian Provincial Price Bureau on Regulating the Charges of Consultancy Services for Construction Project Cost (Min Jia [2002] Fang No. 457).

VII. Valuation Approaches

(I) Selection of valuation approaches

According to the current asset valuation standards and relevant regulations, the basic approaches for enterprise value appraisal include market approach, income approach and asset-based approach. In the specific valuation, it is necessary to analyze the applicability of the three basic approaches of asset valuation according to the relevant conditions such as the appraisal object, value type and data collection, and appropriately select the valuation approaches to form reasonable appraisal results.

1. Market approach

Market approach refers to the appraisal idea of comparing the assets of the appraisal object with the existing transaction cases in the market to determine the value of the appraisal object, which is used on the premise that:

there is an active open market with relatively sufficient market data;
there are comparable transaction cases with reasonable comparative basis in the open
market;
it is able to collect relevant information of comparable transaction cases.
- IV-18-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

2. Income approach

Future earnings of the appraised entity are predictable and can be measured with currency;
The risks of achieving the prospective earnings are predictable and can be measured with
currency;
The number of years with prospective earnings is predictable.

3. Asset-based approach

Asset-based approach refers to the appraisal idea of determining the value of the appraisal object on the basis of regaining assets, which is used on the premise that:

the appraisal object is in continuous use;
it is possible to investigate the current ways to obtain the appraisal object purchased and constructed and the corresponding social average cost data.

The appraisal objects of this valuation are all equity interests. Since it is difficult to collect public information related to the equity trading market, it is difficult to obtain detailed information of the equity trading cases in the open market that are the same as or similar to those of this appraisal object. Meanwhile, although there are listed companies in the same industry in the capital market, there is significant difference in the assets size and structure, scope of business, present stage and profitability as compared to those of the appraised entity; therefore, it is not appropriate to adopt the market approach for this valuation.

Established in 2006, Xiamen Haihong Petrochemical Terminal Co., Ltd. is a company under Xiamen Port Holding Group Co., Ltd. specialising in the strategic development in the liquid chemical industry. Its registered address is 379 Gangnan Road, Haicang District, Xiamen, it is principally engaged in the provision of loading and unloading services for refined oil, edible oil, liquid chemicals, etc. The main asset of Xiamen Haihong Petrochemical Terminal Co., Ltd. is the 9# berth in Haicang Port Area. The 9# berth terminal in Haicang Port Area has a designed annual throughput capacity of

2.52 million tons. The berth is 233m long, and the elevation of berth front bottom is -13.8m. It is arranged in an oval shape. The width of turning basin in the vertical water flow direction is 558m, and the width of turning basin along the flow direction is 800m. The entrance channel is 250m wide and the bottom elevation of the channel is -14m. The construction of the 9# berth terminal in Haicang Port Area commenced in June 2003. The terminal hydro main structure and the port basin turn-around area were completed in December 2005, and the water supply and drainage, fire prevention, power supply and other ancillary facilities were completed in October 2009. The reinforcement and modification of terminal structure of 9# berth was conducted in February 2014.

Haihong terminal is a liquid chemical terminal. Currently, there is no rear storage area and storage yard. It provides loading and unloading services for the rear storage areas. The main loading and unloading process includes the connection of vessels to each storage area through the oil delivery arm (oil delivery hose) and process pipeline.

- IV-19 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

The operation and capacity utilization of Xiamen Haihong Petrochemical Terminal Co., Ltd. in past three years are shown in the table below (unit: RMB):

Item/Year		2017		2018	2019
Operating income	20,469,880.86	21,282,858.09	21,962,211.49
Operating profits	-7,266,144.80	-5,262,177.70	-4,216,103.51
Net profit	-6,572,532.19-3,630,035.64-2,790,777.22
Actual throughput (10,000 tons)	131	135	140
Rate of capacity utilization	52%	54%	56%

According to the historical operating data of Haihong Company, Haihong Company has been in a state of loss since 2017.

According to the Profile of Xiamen Port (2020) and the Master Plan of Xiamen Port (2035) issued by Xiamen Port Authority, there will be significant changes in the operation of the terminals in Dongdu Port Area and Haicang Port Area with the progress of terminals integration. In addition, imports and exports of all countries are affected by the spread of COVID-19Outbreak around the world since 2020. Given the above-mentionedfactors, there exist great uncertainties on such important forecast parameters as when the production capacity of the Company can be achieved and the operation indicators after the production capacity is achieved in the future operation.

As the appraised assets are in continuous use or assumed to be in continuous use, and through the asset verification procedure, it is found that the ownership of various assets and liabilities of Xiamen Haihong Petrochemical Terminal Co., Ltd. is basically clear, and the relevant information is relatively complete, with available historical data, and the value of various assets and liabilities can be appraised and estimated by various approaches, so it is suitable to adopt the asset-based approach for valuation.

Therefore, the asset-based approach is adopted for this asset valuation.

(II) Implementation of the valuation procedures by the asset-based approach

Asset-based approach refers to an appraisal approach that reasonably determines the value of the appraisal object by evaluating the contribution value of various assets and liabilities on and off the

- IV-20 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

balance sheet of an enterprise on the basis of the balance sheet of the appraised entity on the valuation benchmark date. It takes the replacement of various factors of production as an assumption, selects appropriate approaches to assess and estimate the value of each sub-item asset according to the specific conditions of the sub-item assets authorized for appraisal, accumulates and sums it up, and then deducts the appraised value of relevant liabilities to obtain the appraised value of all equity interests. The valuation of assets and liabilities in the asset-based approach is as follows:

[Current assets]

1. Monetary funds (all are bank deposits)

There are 3 RMB deposit accounts in bank deposits. Asset appraisal professionals verify all bank deposit accounts, checking whether bank statements are consistent with book records, and verifying the authenticity and accuracy of book records of bank deposits. After verification, the deposit accounts of all banks are recorded accurately, and the outstanding items of banks on the benchmark date have been adjusted by audit, and no outstanding items affecting equity interests have been found. The appraised value of RMB account deposits shall be determined by the verified book balance.

2. Receivables (including accounts receivable, prepayments and other receivables)

3. Inventory

Inventory represents turnover materials in stock, and the verified book value is taken as the appraised value.

4. Other current assets

Other current assets are mainly structured deposits and input tax to be certified, and the verified book value is taken as the appraised value.

- IV-21 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

[Non-current assets]

1. Long-term equity investments

As at the valuation benchmark date, the long-term equity investment of Xiamen Haihong Petrochemical Terminal Co., Ltd. had a book value of RMB47,936,076.47, representing the investment in Xiamen Sinopetro Port Services and Storage Co., Ltd. with a shareholding of 30%.

For the investment in Xiamen Sinopetro Port Services and Storage Co., Ltd., as a result of the appreciation of its assets including land, properties and machinery equipment, on-site asset verification and overall evaluation were carried out for Xiamen Sinopetro Port Services and Storage Co., Ltd. using the same standards and the same benchmark date to determine the appraised value of the net assets of Xiamen Sinopetro Port Services and Storage Co., Ltd.. The appraised value of the net assets was multiplied by the shareholding percentage held by Xiamen Haihong Petrochemical Terminal Co., Ltd. to determine the appraised value of the long-term equity investment of Xiamen Haihong Petrochemical Terminal Co., Ltd..

2. Valuation of fixed assets of buildings (structures)

Appraised value = replacement cost × comprehensive newness rate

Replacement cost = development cost + management cost + cost of capital + development profit-deductible VAT amount

Development cost = construction and installation engineering cost + upfront and other engineering cost

- IV-22 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

(1) Construction and installation costs

(2) Upfront and other project costs

The upfront and other project costs of the houses and buildings include upfront work consulting fees, environmental impact appraisal fees, survey and design fees, bidding agency fees, project supervision fees, project cost consulting service fees, project supervision fees and supporting charges, etc. According to the project scale and complexity of the appraisal object, the upfront and other project costs are calculated based on the construction and installation project costs.

(3) Management cost

The management cost of the employer refers to the management expenses incurred by the employer from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenses and travel expenses, etc., which are calculated according to a certain proportion of development costs for houses and buildings to the Notice on Printing and Distributing the Regulations on the Management of Construction Costs of Capital Construction Projects (Cai Jian [2016] No. 504) in combination with the actual situation of the project. The structures are charged based on a certain proportion of the development cost referred to the Stipulations on Compiling Estimate and Budget for Water Transportation Construction Engineering (JTS/T116-2019) and combined with the actual situation of the work.

(4) Cost of capital

- IV-23 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

period of the houses and buildings is 1 year, and the reasonable construction period of the structures is

2 years. The calculation formula of cost of capital is as follows:

Cost of capital = (development cost + management cost) × [(1+ loan interest rate)construction period

(month) /12/2-1]

(5) Development profit

Development profit is the average profit that an enterprise can earn under normal conditions for such projects.

For buildings that have obtained ownership certificates, through investigating the reasonable profits which should be obtained in the development process of the site where the appraised buildings are located and by reference to the statistics of cost-profit ratio of transportation enterprises in the port industry set out in the Standard Value of Enterprise Performance Appraisal 2019 prepared by the Financial Supervision and Appraisal Bureau of the State-owned Assets Supervision and Administration Commission of the State Council, 13.00% is adopted as the development profit margin in this valuation. For buildings for which no property ownership certificates can be applied according to the current regulations, the development profit is not considered in this valuation.

The structures are mainly terminal hydro engineering, which are the main self-use business assets of enterprises. Based on the characteristics of such structures, and with reference to the valuation cases in the same industry, the development profit margin of such structures is zero in this valuation.

The deductible VAT amount is determined through the calculation of VAT for the acquisition of real estate after 30 April 2016 according to the Circular of the Ministry of Finance and the State Administration of Taxation on Pushing Forward the Pilot Project of Changing Business Tax to VAT in an All-roundWay (Cai Shui [2016] No. 36) and the Announcement of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs (No. 39, 2019) which meet the conditions for the deduction of VAT. Real estate includes VAT input tax on construction and installation engineering costs, with a tax rate of 9%. The upfront and professional expenses are VAT input tax with a tax rate of 6%, which is deducted from the replacement cost.
Determination of newness rate

- IV-24 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

the useful life approach or on-site scoring approach based on the useful life of buildings, and the comprehensive newness rate is determined using the weighted arithmetic average method. In this valuation, the newness rate of buildings is calculated by comprehensive newness rate approach, and the newness rate of buildings with small unit value is calculated by life approach or on-site scoring approach.

A. Length of life approach

Newness rate = acceptable useful life / (used life + acceptable useful life) × 100%

B. On-site scoring approach

(8) Determination of appraised value

Appraised value = replacement cost × comprehensive newness rate

3. Valuation of fixed assets of equipment

Appraised value = replacement cost × newness rate

A. Valuation of machinery and equipment

The current market price approach (second-hand price) is adopted for certain machinery and equipment. The current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.
- IV-25-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Machinery and equipment are evaluated by cost approach. Cost approach is to estimate the replacement cost of the assets to be appraised and the physical depreciation, functional depreciation and economic depreciation of the assets, and deduct various depreciation from the replacement cost as an asset appraised value. Its calculation formula is as follows: Appraised value = replacement cost × newness rate.

Determination of replacement cost of machinery and equipment:

a. Determination of equipment purchase price

b. Determination of equipment transportation and miscellaneous fees

c. Determination of installation cost

According to the installation engineering technical data and final accounts data provided by the Principals, determine the actual installation engineering quantity to determine the installation cost.

d. Determination of basic cost

According to the basic engineering technical data and final accounts data provided by the Principals, determine the actual basic engineering quantity to determine the basic engineering cost.

- IV-26 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

e. Determination of upfront fees and other expenses

No.	Fees	Base		Rate			Basis
1	Upfront work consulting	Construction cost	0.37%		Refer to original Ji Jia Ge
	fee				(1999)	No. 1283
2	Environmental impact	Construction cost	0.03%		Refer to original Ji Jia Ge
	evaluation fee				[2002]	No. 125
3	Survey and design fee	Construction cost	2.8%		Refer to original Ji Jia Ge
					[2002]	No. 10
4	Bidding agency fee	Construction cost	0.16%		Refer to original Ji Jia Ge
					[2002]	No. 1980
5	Project supervision fee	Construction cost	1.91%		Fa Gai Jia Ge [2007] No. 670
6	Construction cost	Construction cost	1.68%		Refer to original Min Jia
	consulting service fee				[2002]	Fang No. 457
Total		6.95%

f. Management fee of the construction entity

The management cost of the construction entity refers to the management expenses incurred by the construction entity from the date of commencement of the project to the date of handling the final financial accounts for completion, including staff salaries and welfare expenses, office expenses and travel expenses, etc. The management rate of the construction entity can be based on the Notice of the Ministry of Finance on Printing and Distributing the Provisions on Financial Management of Capital Construction (Cai Jian [2016] No. 504) combined with the actual situation of the project. The management fee of the construction entity shall be calculated according to a certain proportion based on the sum of equipment purchase cost, transportation and miscellaneous expenses, installation and commissioning cost and upfront and other expenses.

g. Determination of cost of capital

h. Determination of VAT deduction

- IV-27 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs), if the conditions for VAT deduction are satisfied, VAT input tax (tax rate: 13%) in equipment purchase fee, VAT input tax (tax rate: 9%) in installation and commissioning fee, and VAT input tax (tax rate: 6%) in upfront and other expenses, are deducted from replacement cost.

Determination of newness rate:

The theoretical newness rate depends on substantive depreciation, functional depreciation and economic depreciation. The analysis of the three types of depreciation is as follows:

a. Substantive depreciation:

Age newness rate = acceptable age ÷ (used age + acceptable age)

b. Functional depreciation:

- IV-28 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

c. Economic depreciation:

The economic depreciation of machinery and equipment refers to the value loss caused by the external influence of assets themselves. It is mainly reflected that the utilization rate of equipment in operation decreases or even idles, which leads to the decrease of operating income of machinery and equipment. Economic depreciation caused by external conditions can originate from international and domestic industry bases or places. Various external factors affect the potential economic returns, thus directly affecting the market value of assets or properties.

d. Comprehensive newness rate:

calculate theoretical newness rate N1 and field investigation newness rate N2 respectively, and determine its newness rate N by weighted average, i.e.,

N=N1*40%+N2*60%

B. Description of vehicle appraisal calculation

(1) Determination of replacement cost

Determination of purchase price

- IV-29 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Reform in China (Cai Shui [2008] No. 170) and Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, the input tax of VAT special invoices obtained by ordinary VAT taxpayers who purchase motorcycles, automobiles and yachts can be deducted without distinguishing whether they are used for their own use.)

Determination of vehicle purchase tax

Determination of other expenses

Mainly for vehicle inspection and licensing fees: the local vehicle inspection and licensing fee is RMB500/vehicle.

Replacement cost = purchase price + vehicle purchase tax (10% of purchase price) + other
expenses

(2) Determination of vehicle newness rate

Comprehensive newness rate = theoretical newness rate × 40% + technical newness rate × 60%

Among them, the theoretical newness rate takes the lower of mileage newness rate and age newness rate

Mileage newness rate = (specified mileage-mileage already traveled)/specified mileage × 100%

Age newness rate = (economic durability-used age)/economic durability × 100%

C. Electronic equipment

The electronic equipment included in the scope of valuation mainly includes air conditioners, computers, intercom, etc., which are appraised by the replacement cost approach.

(1) Determination of replacement cost

The current market price approach (second-hand price) is adopted for certain electronic devices. The current market price approach determines the price of the appraised assets according to the price of reference objects similar or comparable to the appraised assets in the current open market.

The value of electronic equipment is small. Considering that most of the electronic equipment does not need to be installed (or the seller is responsible for the installation) and the
- IV-30-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

transportation cost is low, the replacement price of electronic equipment (excluding VAT) is determined in this asset valuation based on recent market price data such as local market information and online quotation.

(2) Determination of newness rate

The working environment of electronic equipment and office furniture is relatively stable, and the newness rate is determined by the age approach. The calculation formula is as follows:

Newness rate = (1-actual useful life ÷ economic useful life) × 100%

D. Description of newness rate of extended service equipment

In case of extended service and normal use, the newness rate of this asset valuation shall not be less than 15%.

E. Description of valuation of scrapped equipment

The appraised value of the appraised equipment upon cleaning up and scrapping is determined based on the residual value of the scrapped equipment. In case of any demolition and cleaning costs, the appraised value is determined after deducting demolition and cleaning costs from the residual value.

4. Valuation of construction in progress

The valuers know the image progress of the construction in progress through on-site investigation, verify the various project expenditures incurred in the construction in progress according to the current quota standards for construction and installation projects, and know the payment progress. They obtain the information on the market price of major construction materials consumed by the construction in progress and determine the expenses recorded to be reasonable and with sufficient basis and that the expense percentage is mostly in line with the project completion progress. The verified book value is taken as the appraised value.

5. Valuation of intangible assets-land use rights

- IV-31 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

is relatively complete, and the valuers can collect a large amount of relevant data of the same type of land development costs, so the cost approximation approach can be adopted for appraisal. The cost approximation approach and the benchmark land price coefficient correction approach are used to appraise the land use right.

Land value = land acquisition cost to be developed + land development cost + management cost + investment interest + development profit

P = P1b × (1 ± ∑Ki) × Kj + D

Wherein,

P = parcel price

P1b-the benchmark land price for a certain purpose and a certain level (homogeneous area)

∑Ki-land price correction coefficient

Kj-other correction factors such as appraisal period date, floor area ratio and land use period

D-land development degree correction value

6. Valuation of intangible assets-other intangible assets

The intangible assets-other intangible assets included in this asset valuation are mainly purchased software, including mobile OA system, genuine Windows operating systems, etc.

Details of the method adopted in the valuation of purchased software are as follows:

If the software version purchased by the enterprise is still available for sale in the market, the appraised value is determined according to the prevailing market price. For the software version which is obsolete and no longer available for sale in the market, the appraised value is determined through deducting the version upgrading cost from the purchase price of its replaced or upgraded version;

For the system software specially designed or customized for the enterprise, given its strong industry features and the distinctive characteristics of the appraised entity, it cannot be compared with general software and the market price for similar products is generally not available; In addition, as the
- IV-32-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

development of specific software is typically characterized by technically confidential and falls under absolute technical secret, the software development company cannot provide the details of various costs and expenses incurred in the entire development process. The software also has typical timeliness and pertinence. As a result, its redevelopment value cannot be determined through replacement. Due to the objective limitations, asset appraisal professionals consulted the relevant accounting records to confirm the components of the original book value and the truthfulness and reasonableness of the incurred amortized amount, and, based on the original book value, analyzed the possible software and hardware components to determine the appraised value, taking into account the remaining useful life.

As the mobile OA system in this asset valuation is a system software specially designed or customized for the enterprise, the verified amortized value is taken as the appraised value.

For the genuine Windows systems, asset appraisal professional determined the appraised value through market inquiry.

7. Deferred income tax assets

Deferred income tax assets are deductible temporary differences arising from provision for bad debts of accounts receivable, provision for impairment of fixed assets and deductible losses, and represent deferred income tax assets recognized according to the Accounting Standards for Enterprises No. 18-IncomeTaxes. Asset appraisal professionals judge whether there is an appraisal risk loss by analyzing the content of accounts receivable, fixed assets and deductible losses, and determine the appraised value of deferred income tax assets according to the deductible temporary difference arising from the appraisal risk loss and the applicable income tax rate of the appraised entity on the valuation benchmark date.

[Valuation of liabilities]

The liabilities included in this asset valuation include: accounts payable, employee compensation payable, taxes payable and other payables. Asset appraisal professionals have checked the consistency between the subsidiary ledger and the general ledger, and conducted spot checks on relevant information including purchase invoices, contracts, vouchers, etc. to verify the authenticity of liabilities. The verified actual liabilities to be borne on the benchmark date are taken as the appraised value.

1. Valuation of accounts payable

Accounts payable mainly include equipment and construction cost payables. Through analyzing accounting contents, settlement method, occurrence date and maturity, asset appraisal professionals made inquiries about those of large amount to determine the degree of conformity between the accounting records and the actual situation. For the accounts payable for which the accounting records are consistent with the actual situation upon verification and which are required to be paid, the verified book value is taken as the appraised value.

2. Valuation of employee compensation payable

Employee compensation payable represents the salaries, bonuses, allowances and subsidies payable by the enterprise in accordance with the policies. Through reviewing the staff composition and staff remuneration system, asset appraisal professionals checked the calculation standards and basis,

- IV-33 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

and conducted spot checks on accounting vouchers for the remuneration payment following the valuation benchmark date. If the book accounting contents are consistent with the actual situation upon verification, the verified book value is taken as the appraised value.

3. Valuation of taxes payable

Taxes payable include property tax, land use tax, stamp duty, etc. Through checking the relevant tax return documents and related accounting vouchers, asset appraisal professionals obtained information on the tax types, tax rates and related tax policies applicable to the appraised entity. If the book accounting contents are consistent with the actual situation upon verification, the verified book value is taken as the appraised value.

4. Valuation of other payables

Other payables mainly include dividends payable, quality assurance deposit and accrued expenses. Through analyzing accounting contents, settlement method, occurrence date and maturity, asset appraisal professionals made inquiries about those of large amount to determine the degree of conformity between the accounting records and the actual situation. For other payables for which the accounting records are consistent with the actual situation upon verification and which are required to be paid, the verified book value is taken as the appraised value.

[Appraisal result of asset-based approach]

Net asset value = sum of appraised values of individual assets - sum of liabilities

VIII. Implementation Process and Situation of Valuation Procedure

Stage of acceptance of engagement and preliminary preparation

Request the Principals to clarify the basic matters of the valuation business, such as the appraisal purpose, scope of valuation and object, valuation benchmark date, etc., and conduct project investigation and risk appraisal;
Accept the engagement of the Principals' asset appraisal project;
Determine the project leader and project team members, formulate the asset appraisal work plan, put forward the appraisal plan time arrangement, determine the appraisal approach, etc., and train the project team members;
According to the preliminary understanding of the situation and the characteristics of the appraisal object, the asset appraisal declaration form is arranged in a targeted manner, and the main asset questionnaire and the main business profit questionnaire are designed. The personnel participating in the asset valuation of the appraised entity are given business training, and the appraised entity is instructed to check assets and prepare appraisal materials, and fill in the asset appraisal declaration form and any kinds of questionnaires.
- IV-34-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Stage of asset verification

For physical assets, conduct on-site physical investigation and verification according to the asset appraisal declaration form accompanied by relevant personnel of the appraised entity, understand the status of physical assets, and learn about the use, maintenance and management of assets from asset management personnel, and make corresponding records;
Understand the situation of non-physical assets and liabilities, consult relevant financial information, and collect information such as contracts and agreements;
Collect relevant property registration documents and other relevant certification documents of assets, and investigate and verify the property rights of assets;
Communicate with the management of the appraised entity in time, and coordinate and solve the related problems in the on-site appraisal;
Listen to the introduction of the staff of the appraised entity on the basic business situation and financial status of assets, and collect relevant operational and basic financial data;
Investigate and understand the historical operation of the appraised entity, the composition of income, cost and expenses and their change reasons, and analyze its profitability and development trend;
Investigate the comprehensive strength, management level, profitability, development ability, competitive advantage and other factors of the appraised entity;
Select appropriate formal or substantive verification procedures and approaches (including observation, inquiry, written examination, inspection of records or documents, field investigation, inquiry and confirmation, analysis, calculation, review, etc.) according to factors such as the type, source, acquisition method and influence degree of examination and verification data, examine and verify the data obtained from field investigation and data collection.

Stage of appraisal, estimation and summary

According to the appraisal purpose and the characteristics of the assets to be appraised, select the appraisal ways and specific approaches, and select relevant parameters;
Carry out market research and inquiry work, collect market price information and relevant information of appraisal;
Adopt appropriate valuation approaches to appraise various assets and liabilities, and determine the appraisal results of the asset-based approach;
Analyze the rationality of valuation approaches and appraisal results, form professional appraisal opinions and write Asset Valuation Reports;
- IV-35-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

5. Carry out three-level review according to the internal procedures of the Asset Appraisal Institution, and make relevant modifications according to the review opinions.

(IV) Stage of issuance of the Asset Valuation Report

IX. Appraisal Assumptions

Premise of appraisal: This valuation is based on the assumption that the property rights of the entrusted assets are complete and legal, and they are set for current purposes and continue to operate according to current trends.
Basic assumptions:

It is assumed that all documents and materials provided by the Principals are true, valid and
accurate.
It is assumed that there is no significant change in the national macroeconomic policy and the social and economic environment in the region.
It is assumed that the tax policies, credit interest rates, exchange rate changes, etc. on which the business operation and asset appraisal are based, have not changed significantly enough to affect the appraisal conclusion.
It is assumed that the influence of natural forces and other force majeure factors, as well as the possible influence of special trading approaches on the appraisal conclusion, are not considered.
The impact of future auctions, sales and collaterals on asset appraisal prices, or the impact of additional prices paid by special trading approaches when property rights change, or the factors that may affect the value of the assets due to the expenses and taxes for sale, are not considered in this Asset Valuation Report.
Except for the known and disclosed matters, it is assumed in this asset valuation that there are no other undeclared off-balance-sheet assets and liabilities, mortgage or guarantee matters, major litigation or post-period events, and the appraised entity has legal rights to the assets included in the scope of valuation.
Transaction assumption: it is assumed that all assets to be valued are already in the process of transaction, and the asset valuer carries out a valuation based on the transaction conditions of the assets to be valued in a simulated market.
Open market assumption: it is assumed that both trading parties of the assets traded in the market or the assets to be traded in the market are in the same position and have opportunities and time to obtain sufficient market information so as to make reasonable judgment upon the function, usage and transaction price of assets.
- IV-36-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

2.9 Assumption on continuing operation of the enterprise: it is assumed that the appraised entity is in full compliance with all relevant laws and regulations, and will continue to operate in the foreseeable future.

3. Specific assumptions:

The conclusion of this asset valuation is based on the assumption that the value of the assets included in the scope of valuation is reflected on the valuation benchmark date under the condition that the current scale and current use are unchanged.
In the process of asset appraisal, this Asset Appraisal Institution accepted some materials provided by the Principals and the appraised entity which are considered indispensable by the asset valuers in the asset appraisal process. The Principal and the appraised entity are responsible for the authenticity, correctness and legitimacy of these materials. The asset valuers all assume that these materials are true, correct and legitimate. The results of this asset valuation depend on the authenticity, correctness and legitimacy of these materials to a certain extent.

The result of this asset valuation assumes that there are no other estimated liabilities except those known by the asset valuer.
The relevant taxes and expenses arising from the future transfer of the appraised assets are not considered in this Asset Valuation Report.

Appraisal Conclusion

In line with the principles of independence, impartiality, science and objectivity, the Asset Appraisal Institution applied the legal procedures and fair approaches of asset appraisal, and adopted the asset-based approach to appraise all equity interests authorized for valuation of Xiamen Haihong Petrochemical Terminal Co., Ltd..

- IV-37 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Appraisal results

After audited by RSM China Xiamen Branch, the book value of all equity interests of Xiamen Haihong Petrochemical Terminal Co., Ltd. is RMB211,293,300. After appraised by using the asset- based approach, on the premise of meeting all the appraisal assumptions and premises in this report, the appraised value of all equity interests as at the valuation benchmark date of this asset valuation is RMB317,536,100 (SAY RMB THREE HUNDRED AND SEVENTEEN MILLION FIVE HUNDRED AND THIRTY-SIX THOUSAND ONE HUNDRED ONLY), representing an increase in value of RMB106,242,800 and an increase in percentage of 50.28%. The summary of asset appraisal is as follows (unit: RMB'0,000):

Appraised enterprise: Xiamen Haihong Petrochemical Terminal Co., Ltd.	Valuation benchmark date: 31 December 2019
						Appraised		Increase in		Increase
No.		Item		Book value		value		value		in%
1		Current assets	2,239.15	2,239.15		-		-
2		Non-current assets	19,892.38	30,516.66	10,624.28	53.41
3		Among which: Long-term equity investment	4,793.61	5,951.28	1,157.67	24.15
4		Other equity instrument investment	-		-		-
5		Investment real estate	-		-		-
6		Fixed assets	13,716.87	17,684.95	3,968.08	28.93
7		Among which: Buildings	9,103.43	12,783.65	3,680.22	40.43
8		Equipment	4,613.44	4,901.31	287.87	6.24
9		Construction in progress	91.26	91.26		-		-
10		Intangible assets	417.40	5,917.71	5,500.31	1,317.76
11		Among which: Land use rights	411.42	5,911.12	5,499.70	1,336.76
12		Long-term deferred expenses	-		-		-
13		Deferred income tax assets	873.24	871.46	-1.78	-0.20
14		Other non-current assets	-		-		-

15		Total assets	22,131.53		32,755.81		10,624.28		48.01

16		Current liabilities	1,002.20	1,002.20		-		-
17		Non-current liabilities	-		-		-
18		Total liabilities	1,002.20	1,002.20		-		-

19		Shareholder's interests	21,129.33	31,753.61	10,624.28	50.28

For details of the appraisal conclusion, please refer to the appraisal breakdown.

Changes and reasons of comparison between appraisal results and book value:

The long-term equity investment valuation increased by RMB11,576,700 as the book value of the long-term equity investment represents original investment cost, and factors such as the operation of the investee for years and the valuation appreciation of the relevant physical assets resulted in the valuation appreciation of the long-term equity investment.
Fixed assets-buildings (structures) valuation increased by RMB36,802,200 mainly due to the significant increase in the materials price and labor cost compared to the original cost, as the buildings (structures) were built long before the valuation benchmark date, as well as the difference between the financial depreciation period and the economic useful life used in the appraisal.
Fixed assets of equipment valuation increased by RMB2,878,700 mainly due to that the financial depreciation period is shorter than the economic useful life used in the appraisal.
- IV-38-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

The intangible assets-land use rights valuation increased by RMB5,499.70. The main reasons for the appreciation are as follows: The entrusted land was acquired earlier, the government's benchmark land price has been raised many times, the regional economy has developed, the supporting facilities have been continuously improved, the demand for land has been rising, and the land available for development and utilization has decreased. In recent years, the rising land development cost has caused the increase in the value of this valuation.
Deferred income tax assets valuation decreased by RMB17,800, due to the reversal of deferred income tax as the provision for impairment of fixed assets was appraised at zero.

XI. Special Notes

The appraisal conclusion of this Asset Valuation Report shall be only used by the Principals for the appraisal purposes listed in this Asset Valuation Report. Without the consent of the Asset Appraisal Institution, all or part of the contents of the Asset Valuation Report shall not be extracted, quoted or disclosed in the public media, except as stipulated by laws and regulations and otherwise agreed by the Principals and relevant parties.
The Asset Appraisal Institution and asset appraisal professionals shall abide by relevant laws and regulations and asset valuation standards in the principles of independence, objectivity and impartiality in the implementation of this asset valuation business; according to the data collected by the Asset Appraisal Institution and asset appraisal professionals during their practice, the contents stated in the Asset Valuation Report are objective, and the Asset Appraisal Institution and the signing asset valuer shall assume corresponding legal responsibilities for the rationality of the appraisal conclusion.
The list of assets and liabilities involved in the appraisal object, descriptions of relevant matters and important materials related to the appraisal shall be reported by the Principals and relevant parties and confirmed by their signatures.
The Asset Appraisal Institution and the signing asset valuer have no existing or expected interests in the appraisal object; at the same time, there is no personal interest relationship with the Principals and related parties, and there is no prejudice against the Principals and related parties.
The asset valuer limited the ownership of the appraised assets to objective conditions and the certification materials related to asset appraisal based on professional judgment and general investigation, without substantive verification and verification. However, the asset valuer's professional judgment and investigation conclusion cannot relieve or replace the responsibility of the Principals and relevant parties to provide real ownership and certification materials related to asset appraisal.
This valuation conclusion is valid only on the valuation benchmark date stated in the valuation report. The user of the valuation report shall reasonably determine the useful life of the valuation report according to the asset status and market changes after the valuation benchmark date. Generally, the Asset Valuation Report can only be used when the distance between the valuation benchmark date and the economic behaviour realization date is less than one year.
The asset valuers and their Asset Appraisal Institutions have the professional qualifications and relevant professional appraisal experience required for this valuation business. In this asset
- IV-39-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

appraisal, except that RSM China Xiamen Branch audited and issued the auditor's report (Rong Cheng Shen Zi [2020] No. 361F0440) as the book value before appraisal, the work results of other institutions and experts were not used in the appraisal process.

The use of this Asset Valuation Report is limited to the appraisal purpose stated in the Asset Valuation Report, and the consequences caused by improper use is not the responsibility of the signing asset valuers and the Asset Appraisal Institution.
The analysis, judgment and conclusion in the appraisal report issued by the asset valuers and their Asset Appraisal Institutions are limited by the assumptions and qualifications in the report, and the users of the Asset Valuation Report should fully consider the assumptions and qualifications stated in the report and their influence on the appraisal conclusion.
For the defective matters and post-period matters that may affect the appraised value of assets in the appraised entity, if the Principals and the relevant parties do not make special instructions at the time of authorization and the asset appraisal professionals are generally unable to know according to their professional experience, the Asset Appraisal Institution and the asset appraisal professionals will not bear relevant responsibilities.
The Asset Appraisal Institution has not independently examined the economic behaviour approval documents, legal documents, historical evolution, qualification certificates, business licenses, ownership certificates, accounting vouchers, financial statements, account books and records, contract orders, control relations, historical changes in equity and other evidential materials provided by the Principals and the appraised entity, nor will it be responsible for the authenticity of the above materials.
Although the asset appraisal professionals did not find any other guarantees and mortgages in the appraised assets during the valuation of this project, the users of this Asset Valuation Report should make independent judgments on the asset status without relying on this Asset Valuation Report.
Unless otherwise specified, the appraised value in this Asset Valuation Report is based on the fact that the appraised entity has full rights to the relevant assets, without taking into account the relevant debts and influences caused by the certain unpaid fees or the unfinished relevant procedures which are not reflected in the books of the appraised entity.
Descriptive words about the Principals and related parties in this Asset Valuation Report are taken from the relevant introduction materials provided by the Principals and related parties to the asset valuer, which should be regarded as a general description by the report reader, and should not be regarded as the approval or publicity report of the Asset Appraisal Institution and the signing asset valuer on their relevant situation. The Asset Appraisal Institution and the signing asset valuer are not responsible for any possible discrepancy between the introduction and the actual situation.
Limited by objective conditions, in this asset valuation, startup test was not conducted on the appraised equipment one by one, nor did it test the structure of buildings and structures. The valuer assumes that the physical, economic and technical indicators, structure and quality of the above appraisal object meet the design requirements and relevant national regulations, and can be used normally within the remaining economic durability life of this valuation.
The asset valuer's purpose in carrying out this asset valuation business is to measure the value of the appraisal object and express professional opinions, and the asset valuer and the appraisal
- IV-40-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

institution where he works are not responsible for the decision-making of relevant parties. The appraisal conclusion should not be regarded as the guarantee of the realizable price of the appraisal object.

According to Cai Shui [2008] No. 170, the Circular of the Ministry of Finance and the State Administration of Taxation on Pushing Forward the Pilot Project of Changing Business Tax to VAT in an All-round Way (Cai Shui [2016] No. 36) and Announcement No. 39 of 2019 of the Ministry of Finance, the State Administration of Taxation and the General Administration of Customs, the appraised value of buildings (structures) and production equipment included in this asset valuation does not include VAT input tax.
There were a total of 8 buildings of Xiamen Haihong Petrochemical Terminal Co., Ltd. included in the scope of valuation, with a total gross floor area of 8,124.80 square meters. The buildings were mainly used as complex building, boiler room, substation and pump room, front substation, all located at 9# berth in Xiamen Haicang Port Area owned by Xiamen Haihong Petrochemical Terminal Co., Ltd.. As at the valuation benchmark date, no property ownership certificate had been obtained.

For the buildings for which no property ownership certificate had been obtained, their areas were determined based on the number reported by the appraised entity after consulting the relevant engineering drawings and on-site verification. Asset appraisal professionals conducted valuation based on the area reported by the appraised entity. If the area set out in the relevant property ownership certificate to be issued is inconsistent with the reported area, the appraisal result shall be adjusted according to the area set out in the relevant property ownership certificate. The appraisal conclusion is arrived at on the assumption that there is no dispute over the ownership of the above buildings and without taking into account expenses required to be paid in obtaining ownership certificates in the future.

19. Explanation for the land use rights

The land use right owner of B1 parcel, 9# berth, Haicang Port Area and B2 parcel, 9# berth, Haicang Port Area included in the valuation of Xiamen Haihong Petrochemical Terminal Co., Ltd. stated on the property ownership certificate is Xiamen Port Holding Group Co., Ltd.. The procedures for the change in ownership registration has not been completed yet.

The appraisal conclusion is arrived at on the assumption that there is no dispute over the above land use right and taking into account no expenses required to be paid in obtaining ownership certificates in the future.

The entrusted land certificate records that the legal purpose is for land for terminal and warehousing transfers, and the transfer period is 50 years. According to Article 26 of the Notice of
- IV-41-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Xiamen Urban Land Benchmark Land Price and Xiamen Land Price Collection Management Regulations (Xia Fu [2017] No. 413) (《廈門市城鎮土地基準地價和廈門市地價徵收管理若干規定的通知》廈府[2017]413號), "For supplied land for ports, terminals, logistics (transportation) and software and R&D and other projects, if the land price is calculated according to the standard of industrial land at the time of land supply, the value of transfer or mortgage shall be calculated according to the original standard of industrial land when transferring or mortgaging." Therefore, in this valuation of the entrusted land, the benchmark land price is RMB550 per square meter according to the standard of industrial transfer land of Haicang District.

In this valuation and in determining the appraised value of long-term equity investments, the liquidity discount and the discount or premium on minority interests or controlling interests were not taken into account.
On 20 December 2016, pursuant to the Assignment of Haicang 9# Berth and Public Facilities (Xia Gang Kong Gu [2015] No. 211) issued by Xiamen Port Holding Group Co., Ltd., Xiamen Port Holding Group Co., Ltd. increased its capital contribution to Xiamen Haihong Petrochemical Terminal Co., Ltd. by RMB158,439,828.45 with the 9# berth and public facilities owned by it. As at 31 December 2019, the paid-in capital of Xiamen Haihong Petrochemical Terminal Co., Ltd. was RMB188,439,828.45, and the change in ownership of the relevant assets and the relevant business registration for the capital increase had not been completed.
As at the valuation benchmark date, Xiamen Haihong Petrochemical Terminal Co., Ltd. had obtained the sea use right for the port sea area in the port basin of 9# berth in Haicang Port Area. The relevant certificate number is Guo Hai Zheng No. 033550013, and the sea use right owner is Xiamen Port Holding Group Co., Ltd.. The procedures for the change in ownership had not been completed yet. The enterprise pays the sea area use fee on an annual basis in accordance with the requirements of the Notice on Improving the Administration on Collection of Sea Waters Use Fee (Cai Zong [2007] No. 10) issued by the Ministry of Finance and the State Oceanic Administration, and directly includes the sea area use fees paid in the cost for the period, which are not shown in the accounts as an separate asset. Considering that the asset right of the sea area use right is embodied in the form of expense, this valuation is zero.
According to Xia Gang [2003] No. 57 issued by Xiamen Port Authority, Xiamen Port Holding Group Co., Ltd. has obtained the right to use the 233-meter port line corresponding to Berth No. 9 at Haicang Port Area on 13 May 2003. On 20 December 2016, Xiamen Port Holding Group Co., Ltd. increased its capital contribution to Xiamen Haihong Petrochemical Terminal Co., Ltd. with Berth No. 9 and public facilities owned by it. After the capital injection, Xiamen Haihong Petrochemical Terminal Co., Ltd. obtained the right to use the 233-meter port line corresponding to Berth No. 9 at Haicang Port Area. Due to the scarcity, limitation and non-renewability of the port line use rights, "the port line is subject to a paid use system and the specific measures shall be formulated by the Provincial People's Government" according to the Fujian Port Regulations. However, as of the valuation benchmark date, the Fujian Provincial People's Government has not formulated specific implementation measures for the paid use of the port line, and the appraised entity has not paid for the port line use right acquired, so the port line value has not been considered in this valuation.
Post-periodevents

The novel coronavirus outbreak broke out nationwide in January 2020, and the prevention and control of pneumonia epidemic continued nationwide as of the date of this valuation report. All
- IV-42-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

parts of the country have launched the "First-level Response Mechanism for Major Public Health Emergencies", which has caused great impact on all walks of life and the whole national economy, especially on transportation, tourism, hotels, restaurants and other industries. This epidemic also has a certain impact on the operation and normal business activities of the appraised entity and the degree of impact will depend on the situation of epidemic prevention and control, duration and implementation of various control policies. In this valuation, the possible impact of the epidemic situation before the valuation report on the enterprise was considered, but we cannot predict the final impact of the epidemic situation on the industry and the appraised entity.

The appraisal conclusion of this report cannot be directly used when major post-period events occur after the report submission date.
After the valuation benchmark date and within the validity period, if the quantity and price standard of assets change, the following principles should be followed:

If the quantity of assets changes, the quantity and amount of assets shall be adjusted accordingly according to the original appraisal approach.

When the asset price standard changes, which has a significant impact on the asset appraisal price, the Principals shall promptly hire a qualified Asset Appraisal Institution to re-determine the appraised value.

Due to the change of asset quantity and price standard after the valuation benchmark date, the Principals should give full consideration to the actual pricing of assets and make corresponding adjustments.

Up to the date of the Asset Valuation Report, except for the above-mentioned matters, neither the asset appraisal professionals found in the asset appraisal process of this project, nor the Principals and relevant parties provided any special matters that may affect the appraisal conclusion and need to be clearly disclosed.

The above matters are brought to the attention of users of relevant reports when using the reports.

XII. Limitations of the Use of Asset Valuation Report

This Asset Valuation Report can only be used for the purpose and application stated herein, and only by the users specified herein.
If the Principals or other users of the Asset Valuation Report fail to use the Asset Valuation Report in accordance with the laws, administrative regulations and the scope of use stated in the Asset Valuation Report, the Asset Appraisal Institution and its signing asset valuer shall not be held liable.
Except for the Principals, other users of Asset Valuation Report agreed in the Authorized Asset Appraisal contract and users of Asset Valuation Report stipulated by laws and administrative regulations, no other institution or individual shall become users of Asset Valuation Report.
The user of the Asset Valuation Report shall correctly understand the appraisal conclusion, which is not equal to the realizable price of the appraisal object, and shall not be regarded as the guarantee of the realizable price of the appraisal object.
- IV-43-

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Any extraction, citation or disclosure of this Asset Valuation Report in entirety or part to the public media should be subject to the consent of the Asset Appraisal Institution, unless otherwise permitted by the requirements of laws, regulation or agreement otherwise engaged between concerning parties.
The appraisal conclusion of the Asset Valuation Report shall remain valid for one year, commencing from 31 December 2019, the valuation benchmark date, to 30 December 2020.
The appraisal conclusion shall not be used unless the Asset Valuation Report has been approved by Xiamen SASAC.

XIII. Date of Asset Valuation Report

The date of Asset Valuation Report is 21 July 2020, which is the formation date of the appraisal conclusion.

The document number of this Asset Valuation Report is Lian He Zhong He Ping Bao Zi

(2020) No. 5011-1. The appraised value of all equity interests of Xiamen Haihong Petrochemical Terminal Co., Ltd. in connection with the proposed increase in equity interests of Xiamen Port Group Shihushan Terminal Co., Ltd. by Xiamen Port Holding Group Co., Ltd. with 100% equity interests in Xiamen Haihong Petrochemical Terminal Co., Ltd. due to the terminal equity integration is RMB317,536,100 (SAY RMB THREE HUNDRED AND SEVENTEEN MILLION FIVE HUNDRED AND THIRTY-SIX THOUSAND ONE HUNDRED ONLY).

Chinese Asset Valuer: Chen Shiqin Chen Lizhu

Legal representative: Shang Guangtai

Fujian United Assets Evaluation & Land and Real Estate Appraisal Co., Ltd. 21 July 2020

- IV-44 -

APPENDIX IV

VALUATION REPORT OF XIAMEN HAIHONG

Appendices to the Asset Valuation Report

Content

Copies of business licenses of the Principals and the appraised entity;

Copies of commitment letter of the Principals and other relevant parties;

Economic behaviour documents;
(IV) Copy of commitment letter of the signing asset valuer;

Copies of record documents of the Asset Appraisal Institution;
(VI) Copy of counterpart of business license of the Asset Appraisal Institution; (VII) Copies of qualification certificates of the signing asset valuer;

(VIII) Explanation of the significant difference between the book value of assets and the appraisal conclusion;

(IX) Copies of the Authorized Asset Appraisal contract.

- IV-45 -

APPENDIX V

GENERAL INFORMATION

RESPONSIBILITY STATEMENT

This circular, for which the Directors collectively and individually accept full responsibility, includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors, having made all reasonable enquiries, confirm that to the best of their knowledge and belief, the information contained in this circular 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 circular misleading.

DIRECTORS', SUPERVISORS' AND CHIEF EXECUTIVES' INTERESTS AND SHORT POSITIONS IN SHARE, UNDERLYING SHARES AND DEBENTURES

As at the Latest Practicable Date, none of the Directors, Supervisors or chief executives of the Company or their associates had any interests or short positions in the shares, underlying shares of equity derivatives or debentures of the Company or any of its associated corporation(s) (within the meaning of Part XV of the SFO) which were (1) required to be notified to the Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO (including interests and short positions which they were taken or deemed to be under such provisions of the SFO), or (2) required, pursuant to section 352 of the SFO, to be entered in the register required to be kept by the Company or (3) required to be notified to the Company and the Stock Exchange pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers as contained in Appendix 10 to the Listing Rules.

SUBSTANTIAL SHAREHOLDERS' INTERESTS

As at the Latest Practicable Date, to the best of the knowledge of the Directors, the following persons (other than the Directors or Supervisors) had an interest or short position in the shares and underlying shares of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO or as recorded in the register required to be kept by the Company under section 336 of the SFO:

								As a
								percentage
								of the	As a
								relevant	percentage
								class of	of the total
						Number of		share	share
Name		Class of shares		Capacity		shares		capital		capital
Xiamen Port Holding . . . . . . . . . .	Domestic Shares		Beneficial owner	1,721,200,000	98.95%	63.14%
		(Long position)
		H Shares		Interest of	141,264,000	14.32%	5.18%
		(Long position)		controlled		(note)
				corporation
Xiamen Haixia Investment Co.,	H Shares		Interest of	141,264,000	14.32%	5.18%
Ltd. . . . . . . . . . . . . . . . . . . . . . .	(Long position)		controlled		(note)
				corporation
Shia Ning Shipping Co., Ltd. . . . .	H Shares		Beneficial owner	141,264,000	14.32%	5.18%
		(Long position)				(note)

Note: The 141,264,000 Shares referred to the same batch of Shares as Xiamen Haixia Investment Co., Ltd. and Shia Ning Shipping Co., Ltd. were all directly or indirectly owned by Xiamen Port Holding and therefore by virtue of the SFO, Xiamen Port Holding was deemed to be interested in these Shares.

- V-1 -

APPENDIX V

GENERAL INFORMATION

Save as disclosed above, to the best of the knowledge of the Directors of the Company, no other persons (other than the Directors or Supervisors) had an interest or short position in the shares and underlying shares of the Company which were required to be disclosed to the Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or as recorded in the register required to be kept by the Company under section 336 of the SFO.

At the Latest Practicable Date, save as disclosed below, none of the Directors or any proposed Directors or Supervisors or any proposed Supervisors was a director or employee of a company which has any interests or short positions in the shares, underlying shares of equity derivatives or debentures of the Company which would fall to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the SFO:

Name of Director or Supervisor	Position(s) held in Xiamen Port Holding:

Mr. Cai Liqun . . . . . . . . . . . . . . . . . .	Deputy general manager
Mr. Chen Zhaohui . . . . . . . . . . . . . . .	Deputy general manager
Mr. Chen Zhiping . . . . . . . . . . . . . . .	Chairman
Mr. Fu Chengjing . . . . . . . . . . . . . . .	Deputy general manager and the chief accountant
Mr. Huang Zirong . . . . . . . . . . . . . . .	Chief engineer
Ms. Bai Xueqing . . . . . . . . . . . . . . . .	Deputy general manager
Mr. Du Hongjia . . . . . . . . . . . . . . . . .	Vice chairman of the supervisory committee and Secretary of Disciplinary Inspection Committee
Mr. Zhang Guixian . . . . . . . . . . . . . .	Supervisor and Manager of Audit and Risk Control Department

DIRECTORS' SERVICE CONTRACTS

As at the Latest Practicable Date, none of the Directors had any existing or proposed to enter into, a service contract with any member of the Group which does not expire or is not determinable by such member of the Group within one year without payment of compensation, other than the statutory compensation.

DIRECTORS' AND SUPERVISORS' INTEREST IN COMPETING BUSINESS

As at the Latest Practicable Date, none of the Directors, Supervisors or their close associates had any interests in a business which competes or may compete, either directly or indirectly, with the businesses of the Company or the Group.

INTEREST IN ASSETS

As at the Latest Practicable Date, none of the Directors had any direct or indirect interest in any asset which, since 31 December 2019 (the date to which the latest published audited financial statements of the Group were made up), had been or were proposed to be acquired or disposed of by, or leased to, any member of the Group.

INTEREST IN CONTRACTS OR ARRANGEMENT

As at the Latest Practicable Date, none of the Directors were materially interested in any contract or arrangement subsisting which was significant in relation to the business of the Group.

MATERIAL CONTRACTS

Save and except for the Capital Increase Agreement, details of which are disclosed in the "Letter from the Board" set out in this circular, no contracts, not being contracts entered in the ordinary

- V-2 -

APPENDIX V

GENERAL INFORMATION

course of business of the Group, have been entered into by members of the Group within two years immediately preceding the date of this circular and up to and including the Latest Practicable Date which are or may be material.

MATERIAL ADVERSE CHANGE

As at the Latest Practicable Date, the Directors confirmed that there has been no material adverse change in the financial or trading position of the Group since 31 December 2019, being the date to which the latest published audited consolidated financial statements of the Group were made up.

10 LITIGATION

As at the Latest Practicable Date, no member of the Group was engaged in any litigation or arbitration or claim of material importance and, so far as the Directors were aware, no litigation or claims of material importance are pending or threatened by or against any member of the Group.

11 EXPERTS AND CONSENTS

The following are the qualifications of the experts who have been named in this circular or have given opinions or advice which are contained in this circular:

Name:		Qualifications:
First Shanghai Capital Limited . . . . . . .	a licensed corporation licensed to carry out Type 6 (advising on
		corporate finance) regulated activity under the SFO
Fujian United Zhonghe Assets	PRC Qualified Valuer
Evaluation & Land and Real Estate
Appraisal Co., Ltd. (福建聯合中和
資產評估土地房地產估價有限公司) . .
Savills Valuation and Professional	Independent property valuer
Services Limited . . . . . . . . . . . . . . . .

As at the Latest Practicable Date, each of the above experts did not have any shareholding, direct or indirect, in any member of the Group or any right (whether legally enforceable or not) to subscribe for or to nominate persons to subscribe for securities in any member of the Group.

As at the Latest Practicable Date, each of the above experts did not have any direct or indirect interest in any assets which have been acquired or disposed of by or leased to any member of the Group, or which are proposed to be acquired or disposed of by or leased to any member of the Group since 31 December 2019, being the date to which the latest published audited financial statements of the Group were made up.

Each of the above experts has given, and has not withdrawn, its written consent to the issue of this circular with the inclusion in this circular of its letters or reports (as the case may be) and reference to its names and opinions in the form and context in which they appear in this circular.

- V-3 -

APPENDIX V

GENERAL INFORMATION

MISCELLANEOUS
1. The company secretary of the Company is Mr. Cai Changzhen.
2. The Company's H Shares registrar and transfer office is Computershare Hong Kong Investor Services Limited at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong.
3. The registered address of the Company is No. 439 Gangnan Road, Haicang District, Xiamen City, Fujian Province, the PRC. The principal place of business of the Company in Hong Kong is 31/F, Tower Two, Times Square, 1 Matheson Street, Causeway Bay, Hong Kong.
4. Save for (i) the property valuation report set out in Appendix I to this circular; and (ii) the various valuation reports set out in Appendices II to IV to this circular, in case of inconsistency, the English text shall prevail over the Chinese text.
DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents will be made available for inspection at the Company's principal place of business in Hong Kong at 31/F, Tower Two, Times Square, 1 Matheson Street, Causeway Bay, Hong Kong during normal business hours for a period of 14 days from the date of this circular (inclusive):

the articles of the Company;
the Capital Increase Agreement;
the letter from the Independent Board Committee, the full text of which is set out in this circular;
the letter from First Shanghai, being the Independent Financial Adviser, the full text of which is set out in this circular;
written consents from each of the experts as referred to in paragraph headed "Experts and Consents" in this appendix;
the property valuation report of the Target Company prepared and issued by Savills Valuation and Professional Services Limited, the full text of which is set out in Appendix I to this circular;
the valuation report of the Target Company, the full text of which is set out in Appendix II to this circular;
the valuation report of Xiamen Hailong, the full text of which is set out in Appendix III to this circular;
the valuation report of Xiamen Haihong, the full text of which is set out in Appendix IV to this circular; and
this circular.

- V-4 -

NOTICE OF THE EGM

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 3378)

NOTICE OF THE SECOND EXTRAORDINARY

GENERAL MEETING IN 2020

NOTICE IS HEREBY GIVEN that the second extraordinary general meeting in 2020 (the "EGM") of Xiamen International Port Co., Ltd* (廈門國際港務股份有限公司) (the "Company") will be held at 9:00 a.m. on Wednesday, 16 September 2020 at 23rd Floor, Conference Room, No. 31 Donggang North Road, Xiamen, the People's Republic of China (the "PRC") for the purposes of considering and, if thought fit, passing the following resolution. Unless otherwise indicated, capitalised terms used herein shall have the same meaning as those defined in the circular of the Company in relation to the EGM dated 31 August 2020.

ORDINARY RESOLUTION

1. To consider and approve:

"THAT:

(a) the Capital Increase Agreement entered into by and between Xiamen Port Development Co., Ltd. * (廈門港務發展股份有限公司) and Xiamen Port Holding Group Co., Ltd. * (廈門港務控股集團有限公司) and the Capital Contribution Transactions contemplated thereunder be and are hereby approved, ratified and confirmed; and (b) any one or more of the Directors be and is/are hereby authorised to deal with, for an on behalf of the Company, the relevant matters in relation to the Capital Increase Agreement and the Capital Contribution Transactions contemplate thereunder."

SPECIAL RESOLUTION

2. To consider and approve: "THAT:

(a) subject to paragraphs (b) to (g) below and in accordance with the relevant requirements of the Listing Rules, the Articles of Association and the relevant laws and regulations in the PRC, the application by the Company to the National Association of Financial Market Institutional Investors* (中國銀行間市場交易商協會) (the "NAFMII") for the registration of the issue of the New Super Short-term Notes (the "New Super Short-termNotes") with an aggregate maximum principal amount not exceeding RMB8,000,000,000 and to issue such New Super Short-term Notes during the Effective Period on a rolling basis in either one or multiple tranches be hereby approved;

EGM-1

NOTICE OF THE EGM

1. the registered scale of the New Super Short-term Notes to be issued by the Company pursuant to the approval granted in paragraph (a) above shall not exceed RMB8,000,000,000 at any time during the Effective Period;
2. the maturity of each tranche of the issue shall be not more than 270 days from the date of issue;
3. the target investors of the issue of the New Super Short-term Notes shall only be domestic institutional investors of the PRC inter-bank bond market (other than those who are restricted from participation in accordance with the laws and regulations of the PRC);
4. the underwriter shall be determined by the Board in accordance with the Company's needs and prevailing market condition;
5. the interest rate shall be determined by reference to the condition of the inter-bank bond market at the time of issue of each tranche of the issue through bookbuilding processes;
6. the net proceeds of each tranche of the issue of the New Super Short-term Notes shall be intended to be used primarily for supplementing the Group's liquidity and repayment of its interest-bearing debts so as to satisfy the working capital requirements and lower the finance cost of the Group.
(a) (i) any one or more of the directors of the Company be and is/are hereby authorised to determine the specific terms and conditions and other relevant matters in relation to the registration and issue of the New Super Short-term Notes including, without limitation, the timing of issue, the principal amount and interest rate of each tranche of issue, the underwriters as well as the number of tranches of issue; and (ii) the Chairman of the Company be and is hereby authorised to do all such acts and thing and execute all such documents which he considers necessary, desirable or expedient for the purpose of, or in connection with, the implementation of and giving effect to the terms and conditions of each tranche of the issue of the New Super Short-term Notes, provided that the Chairman and the directors of the Company shall only exercise the above powers in accordance with the Company Law of the PRC, the Listing Rules and the Articles of Association and only if all necessary approvals from the NAFMII and/or other relevant PRC government authorities are obtained by the Company;

for the purposes of this resolution only, "Effective Period" means the registered effective period of the issue of the New Super Short-term Notes, which is two years from the completion of the registration at the NAFMII."

By order of the Board

Xiamen International Port Co., Ltd

Cai Changzhen

Company Secretary

Xiamen, PRC, 31 August 2020

EGM-2

NOTICE OF THE EGM

For identification purpose only Notes:

Pursuant to Rule 13.39 of the Listing Rules, all votes of the Shareholders at a general meeting must be taken by poll except where the chairman of the meeting may, in good faith, allow a resolution which relates purely to a procedural or administrative matter to be voted by a show of hands. Accordingly, the chairman of the meeting will demand a poll for each of the resolutions proposed at the EGM pursuant to the articles of association of the Company.
Shareholders are advised that the registers of members of the Company will be closed from Monday, 14 September 2020 to Wednesday, 16 September 2020 (both days inclusive). Shareholders whose names appear on the register of members of the Company on Monday, 14 September 2020 are entitled to attend the EGM. Holders of H Shares who wish to attend the EGM are required to lodge all transfer documents together with the relevant share certificates at the H Share registrar of the Company, Computershare Hong Kong Investor Services Limited, at Shops 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, no later than 4:30 p.m. on Friday, 11 September 2020.
A Shareholder entitled to attend and vote at the EGM may appoint one or more proxies to attend and vote in his stead. A proxy needs not be a Shareholder.
The instrument appointing a proxy must be in writing under the hand of a Shareholder or his attorney duly authorised in writing. If the Shareholder is a corporation, that instrument must be either under its common seal or under the hand of its director(s) or duly authorised attorney(s). If that instrument is signed by an attorney of the Shareholder, the power of attorney authorising that attorney to sign or other authorisation document must be notarised.
The proxy form together with the power of attorney or other authorisation document (if any) must be deposited at the Secretariat of the Board of the Company for holders of Domestic Shares and at the H Share registrar of the Company for holders of H Shares not less than 24 hours before the time fixed for holding the EGM or any adjournment thereof (as the case may be). Completion and return of a proxy form will not preclude a Shareholder from attending and voting in person at the meeting if he/she so wishes. The name and address of the H Share registrar of the Company are set out in note 2 above.
The EGM is expected to last half a day. Shareholders (in person or by proxy) attending the EGM are responsible for their own transportation and accommodation expenses. Shareholders or their proxies attending the meeting shall produce their identity documents.

EGM-3

Attachments

Original document
Permalink

Disclaimer

Xiamen International Port Co. Ltd. published this content on 31 August 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 August 2020 00:14:07 UTC

Xiamen International Port Co., Ltd

Equities

3378

CNE1000004N5

Marine Port Services

Xiamen International Port : (1) DISCLOSEABLE TRANSACTIONS AND CONNECTED TRANSACTIONS IN RELATION TO THE PROPOSED CAPITAL INCREASE INTO A SUBSIDIARY (2) PROPOSED ADJUSTMENT TO THE REGISTERED AMOUNT OF THE NEW SUPER SHORT-TERM NOTES AND (3) NOTICE OF THE SECOND EXTRAORDINARY GENERAL MEETING IN 2020

Latest news about Xiamen International Port Co., Ltd

Chart Xiamen International Port Co., Ltd

Company Profile

Sector Marine Cargo Handling Services

Xiamen International Port Co.,Ltd. Reports Earnings Results for the Nine Months Ended September 30, 2023	23-10-30	CI
Xiamen International Port Co.,Ltd. Reports Earnings Results for the Half Year Ended June 30, 2023	23-08-31	CI
Xiamen International Port Co.,Ltd. Reports Earnings Results for the First Quarter Ended March 31, 2023	23-04-27	CI
Xiamen International Port Co., Ltd Reports Earnings Results for the Nine Months Ended September 30, 2022	22-10-27	CI
Xiamen International Port Delists from Hong Kong as Privatization Takes Effect	22-09-26	MT
Xiamen Port to Delist Xiamen International Port After $55 Million Acquisition	22-09-23	MT
Xiamen International Port Co., Ltd Reports Earnings Results for the Half Year Ended June 30, 2022	22-08-26	CI
Xiamen International Port Co., Ltd Announces Resignation of Huang Zirong as Non-Executive Director	22-07-08	CI
Xiamen International Port Co., Ltd Announces Resignation of Fu Chengjing as Non-Executive Director, Member of the Audit Committee and Remuneration Committee	22-06-29	CI
Xiamen International Port Co., Ltd Approves Final Dividend for the Year Ended 31 December 2021, Payable on July 29, 2022	22-06-10	CI
Xiamen Port Holding Group Co., Ltd. agreed to acquire remaining 36.86% stake in Xiamen International Port Co., Ltd for approximately HKD 2.3 billion.	22-06-01	CI
Xiamen Port Proposes Offering of Up to $454 Million in Short-Term Renminbi Bonds	22-05-02	MT
Xiamen International Port Co., Ltd Reports Earnings Results for the First Quarter Ended March 31, 2022	22-04-29	CI
Xiamen Port Issues $93 Million of 177-Day Renminbi Bonds in China	22-04-21	MT
Xiamen Port Raises $279 Million from Renminbi Bond Offering in China	22-04-21	MT
Xiamen Port Issues $94 Million of 150-Day Renminbi Bonds in China	22-04-13	MT
Xiamen International Port Co., Ltd Proposes Final Ordinary Dividend for the Year Ended 31 December 2021, Payable on 29 July 2022	22-03-25	CI
Xiamen International Port Co., Ltd Reports Earnings Results for the Full Year Ended December 31, 2021	22-03-25	CI
Xiamen International Port Co., Ltd Appoints Li Maoliang as an Independent Non-Executive Director, Chairman of the Sixth Session of the Audit Committee and as A Member of the Sixth Session of the Remuneration Committee	22-03-15	CI
Xiamen Port Sells $158 Million of 150-Day Renminbi Bonds in China	22-03-08	MT
Xiamen Port Issues $127 Million of 179-Day Renminbi Bonds in China	22-02-28	MT
Xiamen Port Raises $189 Million from Renminbi Bond Sale; Shares Slip 3%	22-02-22	MT
Xiamen Port Sells over $167 Million of 90-Day Renminbi Bonds in China	22-02-21	MT
Xiamen International Port Co., Ltd Announces Resignation of Liu Feng as Independent Non-Executive Director, Chairman and Member of the Audit Committee and Member of the Remuneration Committee	22-02-16	CI
Xiamen Port Development Posts Surge in Preliminary 2021 Earnings	22-01-21	MT

	1st Jan change	Capi.
NINGBO ZHOUSHAN PORT COMPANY LIMITED	+3.37%	9.91B
TANGSHAN PORT GROUP CO.,LTD	+25.43%	3.6B
SHENZHEN YAN TIAN PORT HOLDINGS CO.,LTD.	+3.28%	2.99B
HUAIHE ENERGY (GROUP) CO.,LTD	+34.02%	1.72B
NOVOROSSIYSK COMMERCIAL SEA PORT	-.--%	1.11B
JINZHOU PORT CO., LTD.	-8.33%	691M
TIANJIN PORT DEVELOPMENT HOLDINGS LIMITED	+39.78%	512M
NANJING PORT CO., LTD.	-10.24%	435M
JIANGSU WANLIN MODERN LOGISTICS CO., LTD.	-3.32%	280M