香港交易及結算所有限公司及香港聯合交易所有限公司（「香港聯交所」）對本公告的內容概不負
責，對其準確性或完整性亦不發表任何聲明，並明確表示概不就因本公告全部或任何部分內容而產生或因依賴該等內容而引致的任何損失承擔任何責任。
本公告及隨附的上市文件僅供參考，並非收購、購買或認購任何證券的邀請或要約。
本公告所述證券及擔保未曾亦不會根據經修訂的1933年《美國證券法》（「證券法」）或美國任何
州或其他司法權區的證券法登記，除非獲豁免遵守或交易毋須遵守證券法及適用州或地方證券法的登記規定，否則證券不得向或在美國境內提呈發售、出售或交付。
本公告及隨附的發售通函乃按香港聯合交易所有限公司證券上市規則（「上市規則」）規定僅供參考之用，並不構成出售或招攬購買任何證券的要約。本公告及本文所述任何內容（包括隨附的上市文件）並非任何合同或承諾的依據。為免生疑，刊發本公告及隨附的上市文件不應被視為就香港法例第32章公司（清盤及雜項條文）條例而言由發行人（定義見下文）或其代表刊發的招
股章程提出的證券發售要約，亦不屬於香港法例第571章證券及期貨條例所指其中載有向公眾人士發出邀請以訂立或發出要約以訂立有關購買、出售、認購或承銷證券的協議的廣告、邀請或文件。
香港投資者須知：發行人及擔保人（定義見下文）確認債券（定義見下文）擬僅供專業投資者（定義見上市規則第37章）購買，並已按此基準於香港聯交所上市。因此，發行人及擔保人各自確認，債券不適合作為香港散戶投資者的投資。投資者應審慎考慮所涉及的風險。
刊發發售通函
SF HOLDING INVESTMENT 2023 LIMITED（於英屬維爾京群島註冊成立之有限公司）（「發行人」）於2026年到期的2950000000港元零息有擔保可換股債券（「債券」）（債券代號：5724）
S.F. HOLDING CO. LTD.順豐控股股份有限公司（於中華人民共和國註冊成立的股份有限公司）（股份代號：6936）（「擔保人」）提供無條件及不可撤回地擔保
聯席全球協調人、聯席牽頭經辦人及聯席賬簿管理人高盛（亞洲）有限責任公司華泰國際
1本公告乃根據上市規則第37.39A條刊發。
請參閱本公告隨附的日期為2025年7月7日的與債券發行相關的發售通函（「發售通函」）。誠如發售通函所披露，債券僅供專業投資者（定義見上市規則第37章）購買，並按該基準於香港聯交所上市。
發售通函並不構成向任何司法權區的公眾提呈出售任何證券的招股章程、通告、
通函、宣傳冊或廣告，且並非向公眾發出邀請以就認購或購買任何證券作出要約，亦非供傳閱以邀請公眾就認購或購買任何證券作出要約。
本發售通函不得被視為認購或購買發行人或擔保人任何證券的勸誘，且並無意進行有關勸誘。
中國深圳，2025年7月11日於本公告日期，SF Holding Investment 2023 Limited的董事為何捷先生及Ooi BeeTi女士。
於本公告日期，順豐控股股份有限公司的董事會成員包括董事長及執行董事王衞先生，執行董事何捷先生、王欣女士及徐本松先生；及獨立非執行董事陳尚偉先生、李嘉士先生及丁益博士。
2附錄1－發售通函
3IMPORTANT NOTICE
NOT FOR DISTRIBUTION TO ANY PERSON OR ADDRESS IN THE UNITED STATES.IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to the attached
offering circular (the “Offering Circular”). You are therefore advised to read this disclaimer carefully before accessing reading or
making any other use of the attached Offering Circular. In accessing the attached Offering Circular you agree to be bound by the
following terms and conditions including any modifications to them from time to time each time you receive any information from
the Issuer the Guarantor (each as defined in the attached Offering Circular) or from Goldman Sachs (Asia) L.L.C. and Huatai
Financial Holdings (Hong Kong) Limited (each a “Manager” and together the “Managers”) as a result of such access. In order to
review the attached Offering Circular or make an investment decision with respect to the securities you must be located outside the
United States.Confirmation of Your Representation: The attached Offering Circular is being sent to you at your request and by accepting the
e-mail and accessing the attached Offering Circular you shall be deemed to represent to the Issuer the Guarantor and the Managers
that (1) you are not in the United States and to the extent you purchase the securities described in the attached Offering Circular
you will be doing so pursuant to Regulation S under the U.S. Securities Act of 1933 as amended (the “Securities Act”); (2) the
e-mail address that you gave the Issuer and/or the Guarantor and to which this e-mail has been delivered is not located in the United
States its territories or possessions; (3) you consent to delivery of the attached Offering Circular and any amendments or
supplements thereto by electronic transmission; (4) you (and any nominee and any person on whose behalf you are subscribing for
the securities to which the attached Offering Circular relates) are not a “connected person” (as defined in the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”)) of the Guarantor which includes but is
not limited to any director chief executive or substantial shareholder of the Guarantor or any of its subsidiaries or any associate of
any of them within the meaning of the Listing Rules; and (5) you (and any nominee and any person on whose behalf you are
subscribing for the securities to which the attached Offering Circular relates) are and will immediately after completion of the
offering of such securities be independent of and not acting in concert with any of such connected persons in relation to the control
of the Guarantor.The attached Offering Circular has been made available to you in electronic form. You are reminded that documents transmitted via
this medium may be altered or changed during the process of transmission and consequently none of the Issuer the Guarantor the
Managers the Trustee (as defined in the attached Offering Circular) and the Agents (as defined in the attached Offering Circular)
or any of their respective directors officers employees agents representatives affiliates or advisers or any person who controls any
of them accepts any liability or responsibility whatsoever in respect of any discrepancies between the document distributed to you
in electronic format and the hard copy version. The Managers will provide a hard copy version to you upon request.Restrictions: The attached Offering Circular is being furnished in connection with an offering exempt from registration under the
Securities Act solely for the purpose of enabling a prospective investor to consider the purchase of the securities described herein.THE SECURITIES DESCRIBED IN THE ATTACHED OFFERING CIRCULAR HAVE NOT BEEN AND WILL NOT BE
REGISTERED UNDER THE SECURITIES ACT OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR OTHER JURISDICTION. THE SECURITIES MAY NOT BE OFFERED OR SOLD DIRECTLY OR INDIRECTLY
WITHIN THE UNITED STATES EXCEPT PURSUANT TO AN EXEMPTION FROM OR IN A TRANSACTION NOT
SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE OR
LOCAL SECURITIES LAWS. THIS OFFERING IS MADE SOLELY IN OFFSHORE TRANSACTIONS PURSUANT TO
THE SECURITIES ACT.NOTHING IN THIS ELECTRONIC TRANSMISSION CONSTITUTES AN OFFER OF SECURITIES FOR SALE IN ANY
JURISDICTION WHERE IT IS UNLAWFUL TO DO SO.Except with respect to eligible investors in jurisdictions where such offer or invitation is permitted by law nothing in this electronic
transmission constitutes an offer or an invitation by or on behalf of the Issuer the Guarantor the Managers the Trustee or the Agents
or any of their respective directors officers employees agents representatives affiliates or advisers or any person who controls any
of them to subscribe for or purchase any of the securities described therein and access has been limited so that it shall not constitute
in the United States or elsewhere a general solicitation or general advertising (as those terms are used in Regulation D under the
Securities Act) or directed selling efforts (within the meaning of Regulation S under the Securities Act). If a jurisdiction requires
that the offering be made by a licensed broker or dealer and the Managers or any respective affiliate of the Managers is a licensed
broker or dealer in that jurisdiction the offering shall be deemed to be made by the Managers or such affiliate on behalf of the Issuer
and the Guarantor in such jurisdiction.You are reminded that you have accessed the attached Offering Circular on the basis that you are a person into whose possession
the attached Offering Circular may be lawfully delivered in accordance with the laws of the jurisdiction in which you are located
and you may not nor are you authorised to deliver or forward this document electronically or otherwise to any other person. If you
have gained access to this transmission contrary to the foregoing restrictions you are not allowed to purchase any of the securities
described in the attached Offering Circular.Actions that You May Not Take: If you receive this document by e-mail you should not reply by e-mail to this electronic
transmission and you may not purchase any securities by doing so. Any reply e-mail communications including those you generate
by using the “Reply” function on your e-mail software will be ignored or rejected.YOU ACKNOWLEDGE THAT THE ATTACHED OFFERING CIRCULAR AND THE INFORMATION CONTAINED
THEREIN ARE STRICTLY CONFIDENTIAL AND INTENDED FOR YOU ONLY. YOU ARE NOT AUTHORISED TO AND
YOU MAY NOT DELIVER OR FORWARD THE ATTACHED OFFERING CIRCULAR ELECTRONICALLY OR
OTHERWISE TO ANY OTHER PERSON OR REPRODUCE SUCH OFFERING CIRCULAR IN ANY MANNER
WHATSOEVER. ANY FORWARDING DISTRIBUTION OR REPRODUCTION OF THE ATTACHED OFFERING
CIRCULAR IN WHOLE OR IN PART IS UNAUTHORISED. FAILURE TO COMPLY WITH THIS DIRECTIVE MAY
RESULT IN A VIOLATION OF THE SECURITIES ACT OR THE APPLICABLE LAWS OF OTHER JURISDICTIONS.You are responsible for protecting against viruses and other destructive items. If you receive this document by e-mail your use
of this e-mail is at your own risk and it is your responsibility to take precautions to ensure that it is free from viruses and other items
of a destructive nature.SF HOLDING INVESTMENT 2023 LIMITED
(incorporated in the British Virgin Islands with limited liability)
(as “Issuer”)
S.F. HOLDING CO. LTD.(順豐控股股份有限公司)
(A joint stock company incorporated in the People’s Republic of China with limited liability)
(Stock Code: 6936)
(as “Guarantor”)
HK$2950000000 Zero Coupon Guaranteed Convertible Bonds due 2026
Issue Price: 100 per cent.HK$2950000000 Zero Coupon Guaranteed Convertible Bonds due 2026 (the “Bonds”) will be issued by SF Holding Investment 2023 Limited (the “Issuer”) and
unconditionally and irrevocably guaranteed (the “Guarantee”) by S.F. Holding Co. Ltd. (順豐控股股份有限公司) (the “Guarantor” or the “Company”).The Bonds will constitute direct unsubordinated unconditional and (subject to the provisions of Condition 3.1 (Negative Pledge) of the terms and conditions of the Bonds (the
“Terms and Conditions” or the “Conditions”)) unsecured obligations of the Issuer and shall at all times rank pari passu and without any preference or priority among
themselves. The payment obligations of the Issuer under the Bonds shall save for such exceptions as may be provided by mandatory provisions of applicable law and subject
to Condition 3.1 (Negative Pledge) of the Terms and Conditions at all times rank at least equally with all of its other present and future direct unsubordinated unconditional
and unsecured obligations.Each Bond will at the option of the holder be convertible (unless previously redeemed converted or purchased and cancelled) at any time on and after the 41st day after 10
July 2025 (the “Issue Date”) up to the close of business (at the place where the Certificate evidencing such Bond is deposited for conversion) on the date falling 10 working
days prior to the Maturity Date (as defined below) (both days inclusive) into fully paid ordinary foreign shares with a par value of RMB1.00 each issued by the Guarantor which
are traded in HK dollars on The Stock Exchange of Hong Kong Limited (the “Hong Kong Stock Exchange”) (the “H Shares”) at an initial conversion price of HK$48.47 per
H Share. The conversion price is subject to adjustment in the circumstances described under “Terms and Conditions of the Bonds – Conversion”. The Closing Price (as defined
in the Terms and Conditions) of the H Shares on the Hong Kong Stock Exchange on 25 June 2025 was HK$46.20 per H Share.The Bonds will be zero coupon and will not bear interest unless upon due presentation thereof payment of principal and premium (if any) is improperly withheld or refused.Unless previously redeemed converted or purchased and cancelled as provided in the Terms and Conditions the Issuer will redeem each Bond at 100.5 per cent. of its principal
amount on 8 July 2026 (the “Maturity Date”). On giving not less than 30 nor more than 60 days’ notice the Issuer may redeem all but not some only of the Bonds at their
Early Redemption Amount (as defined in the Terms and Conditions) if at any time the aggregate principal amount of the Bonds outstanding is less than 10 per cent. of the
aggregate principal amount originally issued (which shall for this purpose include any further bonds issued in accordance with Condition 15 (Further Issues) of the Terms and
Conditions and consolidated and forming a single series therewith). On giving not less than 30 nor more than 60 days’ notice the Issuer may also redeem all but not some only
of the Bonds at their Early Redemption Amount in the event of certain changes or amendments relating to the taxation laws or regulations of the People’s Republic of China
(the “PRC”) or British Virgin Islands (“BVI”) as further described in the Terms and Conditions subject to the non-redemption option of each holder after the exercise by the
Issuer of such tax redemption option as described in the Terms and Conditions. The holder of each Bond will also have the right at such holder’s option to require the Issuer
to redeem all or some only of such holder’s Bonds at their Early Redemption Amount on the Relevant Event Put Date (as defined in the Terms and Conditions) following the
occurrence of a Relevant Event (as defined in the Terms and Conditions). See “Terms and Conditions of the Bonds – Redemption Purchase and Cancellation”.The denomination of the Bonds shall be HK$2000000 and integral multiples of HK$1000000 in excess thereof.The Guarantor will enter into a deed of guarantee (the “Deed of Guarantee”) with China Construction Bank (Asia) Corporation Limited (中國建設銀行(亞洲)股份有限公司)
(the “Trustee”) on the Issue Date. The Guarantor will undertake that it will (i) register or cause to be registered with the State Administration of Foreign Exchange of the PRC
or its local branch (“SAFE”) the Deed of Guarantee in accordance with and within the time period prescribed by the Provisions on the Foreign Exchange Administration Ruleson Cross-border Security (《跨境擔保外匯管理規定》) promulgated by SAFE on 12 May 2014 and became effective from 1 June 2014 (the “Cross-border SecurityRegistration”) and any implementation rules as issued by SAFE from time to time (ii) use its best endeavours to complete the Cross-border Security Registration and obtain
a registration record from SAFE on or before the Registration Deadline (as defined in the Terms and Conditions) and (iii) comply with all applicable PRC laws and regulations
in relation to the Deed of Guarantee.The Guarantor will undertake to file or cause to be filed with the China Securities Regulatory Commission (the “CSRC”) within the relevant prescribed timeframes after theIssue Date the requisite information and documents in respect of the Bonds in accordance with the CSRC Filing Rules (as defined in the Terms and Conditions) (the “CSRCPost-Issuance Filings” which for the avoidance of doubt includes the Initial CSRC Post-Issuance Filing (as defined in the Terms and Conditions)) and comply with the
continuing obligations under the CSRC Filing Rules and any implementation rules as issued by the CSRC from time to time.Application will be made to the Hong Kong Stock Exchange for (i) the listing of and permission to deal in the Bonds on the Hong Kong Stock Exchange by way of debt issues
to professional investors (as defined in Chapter 37 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”))
(“Professional Investors”) only; and (ii) the listing of and permission to deal in the H Shares issuable on conversion and such permissions are expected to become effective
on 11 July 2025 and when such H Shares are issued respectively. This document is for distribution to Professional Investors only.Notice to Hong Kong investors: The Issuer and the Guarantor confirm that the Bonds are intended for purchase by Professional Investors only and will be listed on the Hong
Kong Stock Exchange on that basis. Accordingly the Issuer and the Guarantor confirm that the Bonds are not appropriate as an investment for retail investors in Hong Kong.Investors should carefully consider the risks involved.The Hong Kong Stock Exchange has not reviewed the contents of this document other than to ensure that the prescribed form disclaimer and responsibility statements
and a statement limiting distribution of this document to Professional Investors only have been reproduced in this document. Listing of the Bonds on the Hong Kong
Stock Exchange is not to be taken as an indication of the commercial merits or credit quality of the Bonds or the Issuer the Guarantor or the Guarantor and its
subsidiaries (the “Group”) or quality of disclosure in this document. Hong Kong Exchanges and Clearing Limited and the Hong Kong Stock Exchange take no responsibility
for the contents of this document make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from
or in reliance upon the whole or any part of the contents of this document.Investing in the Bonds and the Shares involves certain risks. Investors should be aware that there are risks relating to the exercise of the Conversion Right attached
to the Bonds and there are various other risks relating to the Bonds the Issuer the Guarantor their respective businesses and their respective jurisdiction of operations
which investors should familiarise themselves with before making an investment in the Bonds. See “Risk Factors”.The Bonds the Guarantee and the Shares to be issued upon conversion of the Bonds have not been and will not be registered under the United States Securities Act
of 1933 as amended (the “Securities Act”) or other securities laws and subject to certain exceptions may not be offered or sold within the United States. The Bonds
are being offered and sold only outside the United States in reliance on Regulation S under the Securities Act (“Regulation S”). For a description of these and certain
further restrictions on offers and sales of the Bonds and the Shares to be issued upon conversion of the Bonds and the distribution of this Offering Circular see
“Subscription and Sale”.The Bonds will initially be represented by a global certificate (the “Global Certificate”) in registered form which will be registered in the name of a nominee of and shall
be deposited on or about the Issue Date with a common depositary on behalf of Euroclear Bank SA/NV (“Euroclear”) and Clearstream Banking S.A. (“Clearstream”).Beneficial interests in the Global Certificate will be shown on and transfer thereof will be effected only through records maintained by Euroclear and Clearstream. Except asdescribed in the Global Certificate individual certificates for Bonds will not be issued in exchange for interests in the Global Certificate. See “Summary of Provisions relatingto the Bonds while in Global Form”.The Bonds are expected to be assigned a rating of “A-” by Standard & Poor’s Ratings Services a rating of “A3” by Moody’s Investor Service Inc. and a rating of “A-” by
Fitch Ratings Inc.. A rating does not constitute a recommendation to buy sell or hold the Bonds and may be subject to suspension reduction or withdrawal at any time by the
assigning rating agency. A suspension reduction or withdrawal of the rating assigned to the Bonds may adversely affect the market price of the Bonds.Joint Global Coordinators Joint Bookrunners and Joint Lead Managers
Goldman Sachs (Asia) L.L.C. Huatai International
The date of this Offering Circular is 7 July 2025.IMPORTANT NOTICE
PRIIPs REGULATION – PROHIBITION OF SALES TO EEA RETAIL INVESTORS – The Bonds
are not intended to be offered sold or otherwise made available to and should not be offered sold or
otherwise made available to any retail investor in the European Economic Area (“EEA”). For these
purposes a retail investor means a person who is one (or more) of: (i) a retail client as defined in point
(11) of Article 4(1) of Directive 2014/65/EU (as amended “MiFID II”); (ii) a customer within the
meaning of Directive (EU) 2016/97 (as amended the “Insurance Distribution Directive”) where that
customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II.Consequently no key information document required by Regulation (EU) No 1286/2014 (as amended the
“PRIIPs Regulation”) for offering or selling the Bonds or otherwise making them available to retail
investors in the EEA has been prepared and therefore offering or selling the Bonds or otherwise making
them available to any retail investor in the EEA may be unlawful under the PRIIPS Regulation.UK PRIIPs REGULATION – PROHIBITION OF SALES TO UK RETAIL INVESTORS – The Bonds
are not intended to be offered sold or otherwise made available to and should not be offered sold or
otherwise made available to any retail investor in the United Kingdom (the “UK”). For these purposes a
retail investor means a person who is one (or more) of: (i) a retail client as defined in point (8) of Article
2 of Regulation (EU) No 2017/565 as it forms part of domestic law by virtue of the European Union
(Withdrawal) Act 2018 (the “EUWA”); (ii) a customer within the meaning of the provisions of the
Financial Services and Markets Act 2000 (the “FSMA”) and any rules or regulations made under the
FSMA to implement the Insurance Distribution Directive where that customer would not qualify as a
professional client as defined in point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part
of domestic law by virtue of the EUWA. Consequently no key information document required by the
PRIIPs Regulation as it forms part of domestic law by virtue of the EUWA (the “UK PRIIPs Regulation”)
for offering or selling the Bonds or otherwise making them available to retail investors in the UK has been
prepared and therefore offering or selling the Bonds or otherwise making them available to any retail
investor in the UK may be unlawful under the UK PRIIPs Regulation.This Offering Circular includes particulars given in compliance with the Listing Rules for the purpose of
giving information with regard to the Issuer the Guarantor and the Group. Each of the Issuer and the
Guarantor accepts full responsibility for the accuracy of the information contained in this Offering
Circular and confirms having made all reasonable enquiries that to the best of its knowledge and belief
there are no other facts the omission of which would make any statement herein misleading.The Issuer and the Guarantor having made all reasonable enquiries confirm that (i) this Offering Circular
contains all information with respect to the Issuer the Guarantor and the Group the Guarantee and to the
Bonds and the Shares which is material in the context of the issue and offering of the Bonds (the
“Offering”) (including the information required by applicable laws and which according to the particular
nature of the Issuer the Guarantor the Group the Guarantee the Bonds and the Shares is necessary to
enable investors to make an informed assessment of the assets and liabilities financial position profits
and losses and prospects of the Group and of the rights attaching to the Bonds) (ii) this Offering Circular
does not contain any untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements herein in the light of the circumstances under which they were made not
misleading (iii) all statements of opinion intention belief or expectation contained in this Offering
Circular are honestly held and were or have been made after due and careful consideration of all relevant
circumstances and were based on reasonable assumptions and all reasonable enquiries have been made by
the Guarantor and the Issuer to ascertain such facts and to verify the accuracy of all such statements. The
Issuer and the Guarantor accept full responsibility for the information contained in this Offering Circular.– i –This Offering Circular has been prepared by the Issuer and the Guarantor solely for use in connection with
the proposed offering of the Bonds described in this Offering Circular and may not be reproduced
redistributed or made available in whole or in part to any other person for any purpose. This Offering
Circular does not constitute an offer of or an invitation by or on behalf of Goldman Sachs (Asia) L.L.C.and Huatai Financial Holdings (Hong Kong) Limited (each a “Manager” and together the “Managers”)
the Issuer or the Guarantor to subscribe for or purchase any of the Bonds. The distribution of this Offering
Circular and the offering of the Bonds in certain jurisdictions may be restricted by law. Persons into whose
possession this Offering Circular comes are required by the Issuer the Guarantor the Managers to inform
themselves about and to observe any such restrictions. No action is being taken to permit a public offering
of the Bonds or the distribution of this Offering Circular in any jurisdiction where action would be
required for such purposes. There are restrictions on the offer and sale of the Bonds and the circulation
of documents relating thereto in certain jurisdictions including the United States the UK the European
Economic Area (the “EEA”) the PRC Hong Kong Singapore BVI and Japan and to persons connected
therewith. For a description of certain further restrictions on offers sales and resales of the Bonds and
distribution of this Offering Circular see “Subscription and Sale”. By purchasing the Bonds investors are
deemed to have represented and agreed to all of those provisions contained in that section of this Offering
Circular. This Offering Circular is personal to each offeree and does not constitute an offer to any other
person or to the public generally to subscribe for or otherwise acquire the Bonds. Distribution of this
Offering Circular to any person other than the prospective investor and any person retained to advise such
prospective investor with respect to its purchase is unauthorised. Each prospective investor by accepting
delivery of this Offering Circular is deemed to have agreed to the foregoing and to make no photocopies
of this Offering Circular or any documents referred to in this Offering Circular.Each prospective investor acknowledges that it is purchasing the Bonds for its own account and not with
a view to distribution thereof and it is or at the time of its purchase will be the beneficial owner of the
Bonds purchased and (i) outside the United States; and (ii) not an affiliate of the Issuer the Guarantor or
a person acting on behalf of such an affiliate. Each prospective investor acknowledges that its purchase
of the Bonds is lawful under the securities laws of the jurisdiction in which such prospective investor
accepts the offer to purchase the Bonds.The completion of the Offering is subject to the satisfaction and/or waiver of customary conditions
precedent and the Managers may exercise their discretion to terminate the transaction for reasons set forth
in the Subscription Agreement (as defined below). Each person receiving this Offering Circular represents
and acknowledges that the Managers will not be held liable for any damages as a result of non-completion
of the Offering or for the exercise of such rights or discretion.No person has been or is authorised to give any information or to make any representation concerning the
Issuer the Guarantor the Group the Guarantee or the Bonds other than as contained herein and if given
or made any such other information or representation should not be relied upon as having been authorised
by the Issuer the Guarantor the Managers China Construction Bank (Asia) Corporation Limited (中國建
設銀行(亞洲)股份有限公司) as the trustee (the “Trustee”) or the Agents (as defined in the Terms and
Conditions) or any of their respective directors officers employees agents representatives affiliates or
advisers or any person who controls any of them. Neither the delivery of this Offering Circular nor any
offering sale or delivery made in connection with the issue of the Bonds shall under any circumstances
constitute a representation that there has been no change or development reasonably likely to involve a
change in the affairs of the Issuer the Guarantor the Group or any of them since the date hereof or create
any implication that the information contained herein is correct as of any date subsequent to the date
hereof. This Offering Circular does not constitute an offer of or an invitation by or on behalf of the Issuer
the Guarantor the Managers the Trustee or the Agents or any of their respective directors officers
employees agents representatives affiliates or advisers or any person who controls any of them to
subscribe for or purchase any of the Bonds and may not be used for the purpose of an offer to or a
solicitation by anyone in any jurisdiction or in any circumstances in which such offer or solicitation is not
authorised or is unlawful.– ii –This Offering Circular is being furnished by the Issuer the Guarantor in connection with the offering of
the Bonds and is exempt from registration under the Securities Act solely for the purpose of enabling a
prospective investor to consider purchasing the Bonds. Investors must not use this Offering Circular for
any other purpose make copies of any part of this Offering Circular or give a copy of it to any other
person or disclose any information in this Offering Circular to any other person. The information
contained in this Offering Circular has been provided by the Issuer and the Guarantor and other sources
identified in this Offering Circular. Any reproduction or distribution of this Offering Circular in whole or
in part and any disclosure of its contents or use of any information herein for any purpose other than the
consideration of an investment in the Bonds offered by this Offering Circular is prohibited. By accepting
delivery of this Offering Circular each investor is deemed to have agreed to these restrictions.None of the Managers the Trustee or the Agents or any of their respective directors officers employees
agents representatives affiliates or advisers or any person who controls any of them has separately
verified the information contained in this Offering Circular and none of them can give any assurance that
such information is accurate truthful or complete. Accordingly no representation warranty or
undertaking express or implied is made and no responsibility or liability is accepted by the Managers
the Trustee or the Agents or any of their respective directors officers employees agents representatives
affiliates or advisers or any person who controls any of them as to the accuracy completeness or
sufficiency of the information contained in this Offering Circular or of any such information or for any
other statement made or purported to be made by the Managers the Trustee or the Agents or any of their
respective directors officers employees agents representatives affiliates or advisers or any person who
controls any of them or on their behalf in connection with the Issuer the Guarantor the Group or the issue
and offering of the Bonds or the giving of the Guarantee or the Shares. Nothing contained in this Offering
Circular is or shall be relied upon as a promise recommendation representation or warranty express or
implied by the Managers the Trustee the Agents or any of their respective directors officers employees
agents representatives affiliates or advisers or any person who controls any of them. This Offering
Circular is not intended to provide the basis of any credit or other evaluation nor should it be considered
as a recommendation by the Issuer the Managers the Trustee the Agents or any of their respective
directors officers employees agents representatives affiliates or advisers or any person who controls
any of them that any recipient of this Offering Circular should purchase the Bonds.Each prospective investor agrees not to hold the Managers the Trustee or the Agents or any of their
respective directors officers employees agents representatives affiliates or advisers or any person who
controls any of them responsible for any misstatements in or omissions from this Offering Circular. Each
person receiving this Offering Circular acknowledges that such person has not relied on any investigation
or due diligence conducted by the Managers the Trustee or the Agents or any of their respective directors
officers employees agents representatives affiliates or advisers or any person who controls any of them
in connection with its investigation of the accuracy of such information or its investment decision and
each such person must rely on its own examination of the Issuer the Guarantor and the Group and the
merits and risks involved in investing in the Bonds.In making an investment decision investors must rely on their own examination of the Issuer the
Guarantor the Group and the terms of the offering of the Bonds including the merits and risks involved.Each prospective investor acknowledges that it has such knowledge and experience in financial business
and international investment matters such that it is capable of evaluating the merits and risks of investing
in the Bonds and understands that entering into the Offering involves a high degree of risk and that the
Bonds are a speculative investment. See “Risk Factors” for a discussion of certain factors to be considered
in connection with an investment in the Bonds. Each prospective investor acknowledges that the Shares
are listed on the Hong Kong Stock Exchange and the Guarantor is therefore required to publish certain
business and financial information in accordance with the rules and practices of the Hong Kong Stock
Exchange which includes among other things descriptions of the Group’s principal activities and the
– iii –balance sheets income statements and cash flow statements and other information relating to the Group
which is necessary to enable holders of the Shares and the public to appraise the position of the Issuer
the Guarantor and the Group and each prospective investor is able to obtain or access such information
without undue difficulty. Nothing herein shall be construed as a recommendation to each such person to
purchase the Bonds. To the fullest extent permitted by law none of the Managers the Trustee or the Agents
or any of their respective directors officers employees agents representatives affiliates or advisers or
any person who controls any of them accepts any responsibility for the contents of this Offering Circular.Each of the Managers the Trustee and the Agents and each of their respective directors officers
employees agents representatives affiliates and advisers and each person who controls any of them
accordingly disclaims all and any liability whether arising in tort or contract or otherwise which it might
otherwise have in respect of this Offering Circular or any such statement. None of the Managers the
Trustee or the Agents or any of their respective directors officers employees agents representatives
affiliates or advisers or any person who controls any of them undertakes to review the Issuer’s the
Guarantor’s or the Group’s business financial condition results of operations prospects or affairs after
the date of this Offering Circular nor to advise any investor or potential investor in the Bonds of any
information coming to the attention of any of the Managers the Trustee or the Agents or any of their
respective directors officers employees agents representatives affiliates or advisers or any person who
controls any of them.The Trustee shall not be responsible or have any liability for the recitals statements warranties or
representations of any other party contained in the Trust Deed (as defined in the Terms and Conditions)
the Agency Agreement (as defined in the Terms and Conditions) the Deed of Guarantee or any other
document entered into in connection with the Bonds and/or the Guarantee and the Trustee shall be entitled
to assume the accuracy and correctness thereof for the execution legality effectiveness adequacy
genuineness validity enforceability or admissibility in evidence in the Trust Deed the Agency
Agreement the Deed of Guarantees or any such other agreement or document referred to above.In connection with the offering of the Bonds the Managers and/or their respective affiliates or affiliates
of the Issuer and/or the Guarantor may act as investors and place orders receive allocations and trade the
Bonds for their own account and such orders allocations or trading of the Bonds may be material. These
entities may hold or sell such Bonds or purchase further Bonds for their own account in the secondary
market or deal in any other securities of the Issuer and/or the Guarantor and therefore they may offer or
sell the Bonds or other securities otherwise than in connection with the offering of the Bonds. Accordingly
references herein to the offering of the Bonds should be read as including any offering of the Bonds to
the Managers and/or their respective affiliates or affiliates of the Issuer or the Guarantor as investors for
their own account. Such entities are not expected to disclose such transactions or the extent of any such
investment otherwise than in accordance with any applicable legal or regulatory requirements. If such
transactions occur the trading price and liquidity of the Bonds may be impacted.Hong Kong Exchanges and Clearing Limited and the Hong Kong Stock Exchange take no responsibility
for the contents of this Offering 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 Offering Circular.The Bonds are expected to be assigned a rating of “A-” by Standard & Poor’s Ratings Services a rating
of “A3” by Moody’s Investor Service Inc. and a rating of “A-” by Fitch Ratings Inc.. A rating is not a
recommendation to buy sell or hold securities does not address the likelihood or timing of prepayment
and may be subject to revision qualification suspension or withdrawal at any time by the assigning rating
agency. A revision qualification suspension or withdrawal of any rating assigned to the Bonds may
adversely affect the market price of the Bonds.– iv –Notice to capital market intermediaries and prospective investors pursuant to paragraph 21 of the
Hong Kong SFC Code of Conduct – Important Notice to Prospective Investors: Prospective investorsshould be aware that in the context of this offering of the Bonds certain Managers are “capital marketintermediaries” (“CMI”) subject to Paragraph 21 of the Code of Conduct for Persons Licensed by or
Registered with the Securities and Futures Commission (the “SFC Code”). This notice to prospective
investors is a summary of certain obligations the SFC Code imposes on the CMIs which require the
attention and cooperation of prospective investors.Certain CMIs may also be acting as “overall coordinator” (“OC”) for this offering and are subject to
additional requirements under the SFC Code.Prospective investors who are the directors employees or major shareholders of the Issuer the Guarantor
a CMI or its group companies would be considered under the SFC Code as having an association (an
“Association”) with the Issuer the Guarantor the CMIs or the relevant group company. Prospective
investors associated with the Issuer the Guarantor or the CMIs (including its group companies) should
specifically disclose this when placing an order for the Bonds and should disclose at the same time if such
orders may negatively impact the price discovery process in relation to this offering. Prospective investors
who do not disclose their Associations are hereby deemed not to be so associated. Where prospective
investors disclose their Associations but do not disclose that such order may negatively impact the price
discovery process in relation to this offering such order is hereby deemed not to negatively impact the
price discovery process in relation to this offering.Prospective investors should ensure and by placing an order prospective investors are deemed to confirm
that orders placed are bona fide are not inflated and do not constitute duplicated orders. If a prospective
investor is an asset management arm affiliated with any of the Managers such prospective investor should
indicate when placing an order if it is for a fund or portfolio where such Manager or its group company
has more than a 50% interest in which case it will be classified as a “proprietary order” and subject to
appropriate handling by the CMIs in accordance with the SFC Code and should disclose at the same time
if such “proprietary order” may negatively impact the price discovery process in relation to this offering.Prospective investors who do not indicate this information when placing an order are hereby deemed to
confirm that their order is not a “proprietary order”. If a prospective investor is otherwise affiliated with
any of the Managers such that its order may be considered to be a “proprietary order” (pursuant to the
SFC Code) such prospective investor should indicate to such Manager when placing such order.Prospective investors who do not indicate this information when placing an order are hereby deemed to
confirm that their order is not a “proprietary order”. Where prospective investors disclose such
information but do not disclose that such “proprietary order” may negatively impact the price discovery
process in relation to this offering such “proprietary order” is hereby deemed not to negatively impact the
price discovery process in relation to this offering.Prospective investors should be aware that certain information may be disclosed by the CMIs (including
private banks) which is personal and/or confidential in nature to the prospective investor. By placing an
order prospective investors are deemed to have understood and consented to the collection disclosure use
and transfer of such information by the Managers and/or any other third parties as may be required by the
SFC Code including to the Issuer the Guarantor the OCs relevant regulators and/or any other third
parties as may be required by the SFC Code it being understood and agreed that such information shall
only be used for the purpose of complying with the SFC Code during the bookbuilding process for this
offering. Failure to provide such information may result in that order being rejected.– v –Industry and Market Data
Market data and certain information and statistics included in this Offering Circular have been obtained
from both public and private sources including market research publicly available information and
industry publications. Although each of the Issuer and the Guarantor believes such information to be
reliable it has not been independently verified by the Issuer the Guarantor the Managers the Trustee or
the Agents or any of their respective directors officers employees agents representatives affiliates or
advisers or any person who controls any of them and none of the Issuer the Guarantor the Managers the
Trustee or the Agents or any of their respective directors officers employees agents representatives
affiliates or advisers or any person who controls any of them makes any representation as to the accuracy
or completeness of such information. In addition third party information providers may have obtained
information from market participants and such information may not have been independently verified. In
making an investment decision each investor must rely on its own examination of the Issuer the
Guarantor the Group and the terms of this offering and the Bonds including the merits and risks involved.Where information has been sourced from a third party the Issuer and the Guarantor confirm that this
information has been accurately reproduced and that as far as the Issuer and the Guarantor are aware and
are able to ascertain from information published by third parties no facts have been omitted which would
render the reproduced information to be inaccurate or misleading.– vi –FORWARD-LOOKING STATEMENTS
This Offering Circular includes “forward-looking statements”. All statements other than statements of
historical fact contained in this Offering Circular including without limitation those regarding the
Issuer’s the Guarantor’s and the Group’s future financial position and results of operations strategy
plans objectives goals and targets future developments in the markets where the Issuer the Guarantor
or the Group participates or is seeking to participate and any statements preceded by followed by or that
include the words “believe” “expect” “aim” “intend” “will” “may” “anticipate” “seek” “should”
“estimate” or similar expressions or the negatives thereof are forward-looking statements. These
forward-looking statements involve known and unknown risks uncertainties and other factors some of
which are beyond the Issuer’s the Guarantor’s or the Group’s control which may cause its actual results
performance or achievements or industry results to be materially different from any future results
performance or achievements expressed or implied by the forward-looking statements. These forward-
looking statements are based on numerous assumptions regarding the Issuer’s the Guarantor’s and the
Group’s present and future business strategies and the environment in which the Issuer the Guarantor or
the Group will operate in the future. Important factors that could cause the Issuer’s the Guarantor’s or the
Group’s actual results performance or achievements to differ materially from those in the forward-looking
statements include regional national or global political economic business competitive market and
regulatory conditions and the following:
* changes in the macro environment regional and global economy as well as industry trends related
to the Group’s operations;
* the Group’s ability to successfully implement its business plans strategies objectives and goals;
* the Group’s ability to obtain adequate capital resources to fund future development plans;
* the Group’s ability to control costs as well as to achieve and maintain operational efficiency;
* changes in the Group’s customers’ demands and expectations;
* changes in the competitive landscape of the industries where the Group operates;
* the Group’s ability to protect its reputation and brand image as well as trademarks technologies
knowhow patents and other intellectual property rights;
* changes in local economic and political conditions and changes in compliance with international
laws and regulations in the countries and regions where the Group operates;
* developments in technology and the Group’s ability to successfully keep up with technological
advancement;
* the Group’s ability to attract and retain experienced professionals and other qualified employees and
key personnel;
* changes in currency exchange rates; and
* the other risk factors discussed in this Offering Circular as well as other factors beyond the Group’s
control.– vii –Additional factors that could cause actual results performance or achievements to differ materially
include but are not limited to those discussed in “Risk Factors” and elsewhere in this Offering Circular.The Issuer and the Guarantor caution investors not to place undue reliance on these forward-looking
statements which reflect their managements’ view only as at the date on which it is made. None of the
Issuer the Guarantor the Managers the Trustee or the Agents or any of their respective directors officers
employees agents representatives affiliates or advisers or any person who controls any of them undertake
any obligation to update or revise any forward-looking statements whether as a result of new information
future events or otherwise. In light of these risks uncertainties and assumptions the forward-looking
events discussed in this Offering Circular might not occur.– viii –DOCUMENTS INCORPORATED BY REFERENCE
The following documents are incorporated by reference in this Offering Circular: (i) audited consolidated
financial statements of the Guarantor for the years ended 31 December 2021 2022 and 2023 (as extracted
from the accountant’s report of the Guarantor for the years ended 31 December 2021 2022 and 2023 and
for the six months ended 30 June 2023 and 2024) (the “2023 Financial Statements”) and (ii) the audited
consolidated financial statements of the Guarantor as at and for the year ended 31 December 2024 (the
“2024 Financial Statements”). The 2023 Financial Statements and the 2024 Financial Statements are
prepared in accordance with IFRS Accounting Standards.Copies of these documents can be downloaded from the website of the Hong Kong Stock Exchange at
http://www.hkexnews.hk and the website of the Guarantor at www.sf-express.com (the other contents of
these websites do not form part of this Offering Circular).The financial information of the Guarantor as of and for the years ended 31 December 2022 and 2023 have
been audited by PricewaterhouseCoopers in accordance with Hong Kong Standard on Investment CircularReporting Engagements 200 “Accountants’ Reports on Historical Financial Information in InvestmentCirculars” (“HKSIR 200”) issued by Hong Kong Institute of Certified Public Accountants (“HKICPA”)
and the consolidated financial statements as of and for the year ended 31 December 2024 has been audited
by PricewaterhouseCoopers in accordance with International Standards on Auditing (“ISAs”) issued by
the International Auditing and Assurance Standards Board (“IAASB”).Certain amounts and percentages included in this Offering Circular have been rounded. Accordingly in
certain instances the sum of the numbers in a column may not exactly equal the total figure for that
column. You should not construe any exchange rate translations as representations that the relevant
exchange and amounts could actually be converted into the amounts expressed.– ix –TABLE OF CONTENTS
Page
IMPORTANT NOTICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
FORWARD-LOOKING STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . vii
DOCUMENTS INCORPORATED BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ix
SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
THE OFFERING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SUMMARY CONSOLIDATED FINANCIAL INFORMATION OF THE GUARANTOR . . . 12
ADJUSTED NON-IFRS MEASURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
GLOSSARY OF TECHNICAL TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
TERMS AND CONDITIONS OF THE BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SUMMARY OF PROVISIONS RELATING TO THE BONDS IN GLOBAL FORM . . . . . . 113
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116
CAPITALISATION AND INDEBTEDNESS OF THE GUARANTOR . . . . . . . . . . . . . . . . . 117
DESCRIPTION OF THE ISSUER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118
DESCRIPTION OF THE GUARANTOR. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 119
DIRECTORS SUPERVISORS AND SENIOR MANAGEMENT . . . . . . . . . . . . . . . . . . . . . 159
RECENT DEVELOPMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 164
MARKET PRICE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 166
EXCHANGE RATE. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 167
DIVIDENDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 169
SUBSTANTIAL SHAREHOLDERS’ AND DIRECTORS’ AND CHIEF EXECUTIVES’
INTERESTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171
DESCRIPTION OF THE SHARES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 175
TAXATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 186
SUBSCRIPTION AND SALE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 190
GENERAL INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196
– x –SUMMARY
The summary below is only intended to provide a limited overview of information described in more detail
elsewhere in this Offering Circular. As it is a summary it does not contain all of the information that may
be important to investors and terms defined elsewhere in this Offering Circular shall have the same
meanings when used in this summary. Prospective investors should therefore read this Offering Circular
in its entirety.OVERVIEW
The Group is a leading global integrated logistics service provider (i.e. logistics service provider that
offers a full spectrum of domestic and international logistics services including but not limited to express
delivery services freight delivery services cold chain logistics services intra-city on-demand delivery
services supply chain services and international logistics services and provides one-stop solutions to
multinationals large corporations small and medium enterprises and retail customers) and was the largest
player in China and Asia and the fourth largest player globally in terms of revenue in 2024. The Group
is a Fortune Global 500 company with market leadership in five logistics sub-segments in China and four
in Asia offering a complete range of logistics services including express freight cold chain intra-city
on-demand supply chain solutions and international logistics services.The Group has a premium brand that is widely recognised for its services and was the only logistics
company recognised as one of the Top Five Most Admired Chinese Companies by Fortune Magazine in
2024. As of 31 December 2024 the Group had an extensive global delivery network covering 206
countries and regions supported by 110 aircraft and over 200000 vehicles. The Group is also a
technology-driven company with 4180 patents and patent applications as of 31 December 2024 and
continuously leverages on proprietary technologies to deliver innovative solutions and execution
excellence. The Group had over 2.3 million customers with active credit accounts and over 730 million
retail customers as of 31 December 2024.The Group’s business model has three key attributes: direct operations integrated capabilities and
third-party independence. First the Group directly operates the entire end-to-end delivery process from
first-mile pickup to last-mile delivery. This enables strong operational control high network visibility and
agile resource allocation to support industry-leading speed cost and reliability. Second the Group’s
integrated capabilities enable it to offer a full-spectrum of services standardised or customised to address
a full range of customers’ logistics needs. Third the Group is the only integrated logistics service provider
of scale in China that is independent of major e-commerce platforms allowing it to serve its customer base
impartially capture new opportunities and build long-term sustainable relationships.China Express Logistics Invest in the Future Global Integrated Logistics
Time Period 1993 - 2012 2012 - 2023 2023 - Future
Geography China China and Asia China Asia and Global
Build a strong foundation Incubate new products Harvest prior investment
Strategic Establish market leadership Invest in infrastructure Enhance profitability
Focus Country Building Global
Leadership Build our brand Capabilities Gain market share Expansion Strengthen cost discipline
For the years ended 31 December 2022 2023 and 2024 the Group’s revenue was RMB267.5 billion
RMB258.4 billion and RMB284.4 billion respectively and its gross profit which equals revenue less cost
of revenue was RMB33.0 billion RMB32.6 billion and RMB38.9 billion respectively.– 1 –STRENGTHS
The Group believes that the following competitive strengths contribute to its success and differentiates it
from its competitors:
* Asia’s Largest Integrated Logistics Service Provider
* Winning Business Model – Directly Operated Integrated and Independent
* Global Gateway Connecting Asia and the World
* Go-to Brand for Differentiated and Premium Services
* Technology and Innovation Driven Operations
* Visionary Management Promoting a People-centric Culture
STRATEGIES
To achieve the Group’s vision and mission it intends to pursue the following strategies:
* Further Strengthen and Optimise the Group’s Network and Service Offerings
* Continue to Enhance Efficiency and Productivity
* Continue to Invest in Technology to Build a Smart Logistics Network and Offer Pioneering Solutions
* Expand its International and Cross-Border Capabilities
* Grow Business and Consumer Mindshare as “the One in Asia”
RECENT DEVELOPMENTS
Financial information for the three months ended 31 March 2025
For the three months ended 31 March 2025 the Group recorded an increase in operating profit when
compared to the corresponding period in 2024 primarily due to an increase in operating revenue from its
(i) express and freight delivery and (ii) supply chain and international segments. The Group also recorded
an increase in total operating costs for the three months ended 31 March 2025 when compared to the
corresponding period in 2024 primarily due to an increase in (i) operating costs and (ii) sales expenses
as a result of increased market promotion and recruitment of its sales team for business development
opportunities. In addition the Group recorded a decrease in other income primarily due to a reduction in
tax incentives and a decrease in investment income primarily due to disposal of the Group’s subsidiaries.As at 31 March 2025 as compared to their respective balances as at 31 December 2024 the Group
recorded (i) a decrease in total assets primarily due to a decrease in cash and cash equivalents and
accounts receivables and (ii) a decrease in total liabilities primarily due to a decrease in short-term
borrowings accounts payables and employee wages payables.– 2 –The financial information of the Group as at and for the three months ended 31 March 2025 is prepared
in accordance with generally accepted accounting principles of the PRC and has not been subject to an
audit or review by the Group’s independent auditors and should not be relied upon by investors to provide
the same quality of information associated with audited or reviewed financial information. Potential
investors must exercise caution when using such data to evaluate the Group’s financial condition and
results of operations. Such financial information as at and for the three months ended 31 March 2025
should not be taken as an indication of the Group’s expected financial condition or results of operations
as at and for the full financial year ended 31 December 2025.Issue of RMB500 million ultra-short-term financing bills by Taisen Holdings
The Group’s wholly owned subsidiary S.F. Taisen Holding (Group) Co. Ltd.* (深圳順豐泰森控股(集團)
有限公司) completed the issuance of RMB500 million ultra-short-term financing bills on 3 January 2025.Partial Repurchase of U.S. Dollar Denominated Guaranteed Notes by Wholly-Owned Subsidiaries
SF Holding Investment Limited (“SFHI”) a wholly-owned subsidiary of the Company issued guaranteed
notes with a 2.875% coupon rate due 2030 in principal amount of US$700000000 in February 2020 (the
“2030 Notes”). SF Holding Investment 2021 Limited (“SFHI 2021”) a wholly-owned subsidiary of the
Company issued guaranteed notes with a 3.125% coupon rate due 2031 in principal amount of
US$500000000 in November 2021 and additional notes in principal amount of US$300000000 in
January 2022 (together the “2031 Notes”) respectively. Both the 2030 Notes and the 2031 Notes are
unconditionally and irrevocably guaranteed by the Company.On 22 May 2025 SFHI and SFHI 2021 respectively announced the launch of cash tender offers for the
2030 Notes and the 2031 Notes (collectively the “Offers”) with a maximum aggregate acceptance amount
up to US$350000000 in principal amount of the 2030 Notes and the 2031 Notes.Upon the settlement of the Offers on 4 June 2025 (i) U.S.$101371000 in aggregate principal amount of
the 2030 Notes were purchased and redeemed by SFHI (ii) U.S.$78306000 in aggregate principal
amount of the 2031 Notes were purchased and redeemed by SFHI 2021 and cancelled pursuant to the terms
and conditions of the respective Notes and (iii) U.S.$552838000 in aggregate principal amount of the
2030 Notes and U.S.$641694000 in aggregate principal amount of the 2031 Notes remain outstanding
respectively.Repurchase of A Shares
The Company held the 13th meeting of the sixth Board of Directors on 29 April 2024 and launched its
2024 Phase 2 A Shares repurchase plan (the “2024 A Shares Repurchase Plan”) whereby the Companywould repurchase its A Shares from the secondary market with its own funds for the purpose of “employeeshare ownership plan or equity incentives”. The Company thereafter repurchased 23270358 A Shares (the
“Repurchased Shares”) pursuant to the 2024 A Shares Repurchase Plan.Pursuant to the 19th meeting of the sixth Board of Directors held on 28 March 2025 and the 2024 annual
general meeting held on 13 June 2025 the purpose of the 2024 A Shares Repurchase Plan was amended
to “cancellation and reduction of share capital”. As of the date of this Offering Circular the Company is
in the process of cancelling the Repurchased Shares.Placing of New H Shares under General Mandate
Concurrent with the Offering there is an equity placement (the “Equity Placement”) comprising of the
issuance of 70000000 H Shares at a placing price of HK$42.15 per H Share for a total offer size of
approximately HK$2950.5 million by way of new share issuance (the “Follow-on Offering”). The
Guarantor has entered into a conditional placing agreement (the “Placing Agreement”) with Goldman
Sachs (Asia) L.L.C. and Huatai Financial Holdings (Hong Kong) Limited as placing agents. The Equity
Placement is conducted concurrently with the offering of the Bonds but the completion of the issuance of
the Bonds and the Equity Placement are not inter-conditional. The closing for the Follow-on Offering took
place on 4 July 2025.– 3 –THE OFFERING
The following summary contains basic information about the Bonds and is not intended to be complete.It does not contain all the information that is important to investors. For a more complete description ofthe Bonds please refer to the section of this Offering Circular entitled “Terms and Conditions of theBonds”. Phrases used in this summary and not otherwise defined shall have the meaning given to them
in the section entitled “Terms and Conditions of the Bonds”.Issuer SF Holding Investment 2023 Limited.Guarantor S.F. Holding Co. Ltd. (順豐控股股份有限公司).Bonds HK$2950000000 zero coupon guaranteed convertible bonds due
2026 convertible at the option of the holder thereof into fully paid
ordinary H Shares of the Guarantor of a par value of RMB1.00
each at the initial conversion price of HK$48.47 per H Share.The issue of the Bonds was authorised by resolutions passed in a
meeting of the Issuer held on 25 June 2025 and the guarantee of the
Bonds and the right of conversion into H Shares were authorised
by the resolutions of the Board passed on 25 June 2025.Guarantee The Guarantor will unconditionally and irrevocably guarantee the
due payment of all sums expressed to be payable by the Issuer
under the Bonds and the Trust Deed. The Guarantor’s obligations
in respect of the Bonds and the Trust Deed (the “Guarantee”) will
be contained in the Deed of Guarantee. The Guarantee will
constitute direct unsubordinated unconditional and (subject to the
provisions of Condition 3.1 (Negative Pledge) of the Terms and
Conditions) unsecured obligations of the Guarantor.Issue Price 100 per cent. of the principal amount of the Bonds.Form and Denomination of The Bonds will be issued in registered form in the specified
Bonds denomination of HK$2000000 each and integral multiples of
HK$1000000 in excess thereof.Interest The Bonds will be zero coupon and will not bear interest.Issue Date 10 July 2025.Maturity Date 8 July 2026.– 4 –Negative Pledge So long as any of the Bond remains outstanding (a) the Issuer
itself will not create or have outstanding any Security Interest
upon or with respect to any of its present or future business
undertaking assets or revenues (including any uncalled capital) of
the Issuer to secure any Relevant Indebtedness unless the Issuer
in the case of the creation of a Security Interest before or at the
same time and in any other case promptly takes any and all action
necessary to ensure that: (i) all amounts payable by it under the
Bonds and the Trust Deed are secured by the Security Interest
equally and rateably with the Relevant Indebtedness to the
satisfaction of the Trustee; or (ii) such other Security Interest or
other arrangement (whether or not it includes the giving of a
Security Interest) is provided as is approved by an Extraordinary
Resolution (as defined in the Trust Deed) of the Bondholders; and
(b) the Guarantor will not and the Guarantor will procure that none
of its Principal Subsidiaries (other than the Guarantor’s Listed
Subsidiaries and Subsidiaries of a Listed Subsidiary of the
Guarantor) will create or have outstanding any Security Interest
upon or with respect to any of the present or future business
undertaking assets or revenues (including any uncalled capital) of
the Guarantor and/or any of its Principal Subsidiaries to secure any
Relevant Indebtedness unless the Guarantor in the case of the
creation of the Security Interest before or at the same time and in
any other case promptly takes any and all action necessary to
ensure that: (i) all amounts payable by it under the Deed of
Guarantee are secured by the Security Interest equally and rateably
with the Relevant Indebtedness to the satisfaction of the Trustee; or
(ii) such other Security Interest or other arrangement (whether or
not it includes the giving of a Security Interest) is provided as is
approved by an Extraordinary Resolution of the Bondholders
except in circumstances specified in Condition 3.1 (NegativePledge) of the Terms and Conditions. See “Terms and Conditionsof the Bonds – Covenants – Negative Pledge”.Status The Bonds will constitute direct unsubordinated unconditional
and (subject to the provisions of Condition 3.1 (Negative Pledge)
of the Terms and Conditions) unsecured obligations of the Issuer
and shall at all times rank pari passu and without any preference
or priority among themselves. The payment obligations of the
Issuer under the Bonds shall save for such exceptions as may be
provided by mandatory provisions of applicable law at all times
rank at least equally with all of its other present and future direct
unsubordinated unconditional and unsecured obligations.– 5 –Taxation All payments made by or on behalf of the Issuer (or as the case
may be the Guarantor) in respect of the Bonds (or in the case of
the Guarantor the Guarantee) will be made free from any set-off
counterclaim restriction or condition and will be made without
deduction or withholding for or on account of any present or future
taxes duties assessments or governmental charges of whatever
nature imposed levied collected withheld or assessed by or on
behalf of the PRC or the BVI or in each case any authority thereof
or therein having power to tax unless deduction or withholding of
such taxes duties assessments or governmental charges is
compelled by law. If the Issuer or the Guarantor (as the case may
be) is required to make a deduction or withholding in respect of
PRC tax in excess of the aggregate rate applicable on 25 June
2025 or any BVI deduction or withholding is required the Issuer
or the Guarantor (as the case may be) shall pay such additional
amounts as will result in receipt by the Bondholders of such
amounts as would have been received by them had no such
withholding or deduction been required except in circumstances
specified in Condition 8 (Taxation) of the Terms and Conditions.See “Terms and Conditions of the Bonds – Taxation”.Conversion Right and Period Subject as provided in the Terms and Conditions each Bond shall
entitle the holder to convert such Bond into H Shares (the
“Conversion Right”). Subject to and upon compliance with the
Terms and Conditions (including without limitation Condition
5.1.4 (Revival and/or survival after Default) of the Terms and
Conditions) the Conversion Right attaching to any Bond may be
exercised at the option of the Bondholder at any time on or after
the 41st day after the Issue Date up to the close of business (at the
place where the Certificate evidencing such Bond is deposited for
conversion) on the date falling 10 working days prior to the
Maturity Date (both days inclusive) or if such Bond shall have
been called for redemption by the Issuer before the Maturity Date
then up to and including the close of business (at the place
aforesaid) on a date no later than 10 working days (at the place
aforesaid) prior to the date fixed for redemption thereof; provided
that (i) no Conversion Right may be exercised in respect of a Bond
where the holder shall have exercised its right to require the Issuer
to redeem or repurchase such Bond pursuant to Condition 7.4
(Redemption for Relevant Events) of the Terms and Conditions or
during a Restricted Conversion Period (both dates inclusive) and
(ii) the Conversion Right is exercised subject to any applicable
fiscal or other laws or regulations or as otherwise provided in the
Terms and Conditions (the “Conversion Period”). See “Terms andConditions of the Bonds – Conversion – Conversion Right”.– 6 –Conversion Price The price at which H Shares will be issued upon conversion will
initially be HK$48.47 per H Share but will be subject to adjustment
in the manner provided in Condition 5.3 (Adjustments to
Conversion Price) of the Terms and Conditions and/or Condition
5.6 (Adjustment upon Change of Control) of the Terms andConditions as applicable. See “Terms and Conditions of the Bonds– Conversion”.Redemption at Maturity Unless previously redeemed converted or purchased and cancelled
as provided in the Terms and Conditions the Issuer will redeem
each Bond at 100.5 per cent. of its principal amount on theMaturity Date. See “Terms and Conditions of the Bonds –Redemption Purchase and Cancellation – Maturity”.Redemption for Taxation Reasons The Bonds may be redeemed at the option of the Issuer in whole
but not in part at any time on giving not less than 30 nor more
than 60 days’ notice to the Trustee the Principal Agent and the
Bondholders (which notice shall be irrevocable) at their Early
Redemption Amount on the relevant redemption date if the Issuer
satisfies the Trustee immediately prior to the giving of such notice
that (i) the Issuer (or if the Guarantee was called the Guarantor)
has or will become obliged to pay Additional Tax Amounts as
provided or referred to in Condition 8 (Taxation) of the Terms and
Conditions as a result of any change in or amendment to the laws
or regulations of the PRC or the BVI or in each case any political
subdivision or any authority thereof or therein having power to tax
or any change in the general application or official interpretation of
such laws or regulations which change or amendment becomes
effective on or after 25 June 2025 and (ii) such obligation cannot
be avoided by the Issuer (or as the case may be the Guarantor)
taking reasonable measures available to it provided that no such
notice of redemption shall be given earlier than 90 days prior to the
earliest date on which the Issuer (or as the case may be the
Guarantor) would be obliged to pay such Additional Tax Amounts
were a payment in respect of the Bonds then due. If the Issuer
exercises its tax redemption right each Bondholder shall have the
right to elect that his Bonds shall not be redeemed. Upon a
Bondholder electing not to have its Bonds redeemed in such
circumstances then subject as provided in the Terms and
Conditions any payments due after the relevant date of redemption
shall be made subject to any deduction or withholding of anytaxation required to be deducted or withheld. See “Terms andConditions of the Bonds – Redemption Purchase and Cancellation– Redemption for Taxation Reasons”.– 7 –Redemption at the Option of the On giving not less than 30 nor more than 60 days’ notice to the
Issuer Bondholders the Trustee and the Principal Agent (which notice
will be irrevocable) the Issuer may redeem all but not some only
of the Bonds on the date specified in the Optional Redemption
Notice at their Early Redemption Amount if at any time the
aggregate principal amount of the Bonds outstanding is less than
10 per cent. of the aggregate principal amount originally issued
(which shall for this purpose include any further bonds issued in
accordance with Condition 15 (Further Issues) of the Terms and
Conditions and consolidated and forming a single seriestherewith). See “Terms and Conditions of the Bonds – RedemptionPurchase and Cancellation – Redemption at the Option of theIssuer”.Redemption for Relevant Events Following the occurrence of a Relevant Event the holder of each
Bond will have the right at such holder’s option to require the
Issuer to redeem all or some only of such holder’s Bonds on the
Relevant Event Put Date at the Early Redemption Amount as at the
Relevant Event Put Date.A “Relevant Event” means the occurrence of either:
(i) a Change of Control;
(ii) the H Shares cease to be listed or admitted to trading on the
Hong Kong Stock Exchange or the Alternative Stock
Exchange (as the case may be);
(iii) the suspension in trading of the H Shares for a period of 30
consecutive H Share Stock Exchange Business Days; or
(iv) a No Registration Event.See “Terms and Conditions of the Bonds – Redemption Purchaseand Cancellation – Redemption for Relevant Events”.– 8 –Issuer and Guarantor Lock-up Each of the Issuer and the Guarantor on a joint and several basis
has agreed in the Subscription Agreement that neither the Issuer
the Guarantor nor any person acting on its or their behalf will (a)
effect or arrange or procure placement of allot or issue or transfer
out of treasury or offer to allot or issue or transfer out of treasury
or grant any option right or warrant to subscribe for or enter into
any transaction which is designed to or might reasonably be
expected to result in any of the aforesaid (whether by actual
disposition or effective economic disposition due to cash
settlement or otherwise) directly or indirectly any equity
securities of the Guarantor or any securities convertible into or
exercisable or exchangeable for equity securities of the
Guarantor (b) enter into any swap or similar agreement that
transfers in whole or in part the economic risk of ownership of
such Ordinary Shares whether any such transaction described in
(a) or (b) above is to be settled by delivery of Ordinary Shares or
such other securities in cash or otherwise or (c) publicly
announce an intention to effect any such transaction in any such
case without the prior written consent of the Managers between the
date hereof and the date which is 90 days after the Issue Date (both
dates inclusive); except for (i) the Bonds and the New Shares
issued on conversion of the Bonds (ii) any Ordinary Shares or
other securities (including rights or options) which are issued
offered exercised allotted appropriated modified or granted to
or for the benefit of employees (including directors) of the
Guarantor or any of its subsidiaries pursuant to the Share Schemes
or (iii) the issuance of the 70000000 new H Shares to be placed
pursuant to the Placing Agreement dated 25 June 2025 between the
Guarantor Goldman Sachs (Asia) L.L.C. and Huatai Financial
Holdings (Hong Kong) Limited as the placing agents.Cross Default The Bonds may be accelerated if (i) any indebtedness for borrowed
money of the Issuer the Guarantor or any of the Guarantor’s other
Subsidiaries becomes due and repayable prematurely by reason of
an event of default (however described); (ii) the Issuer the
Guarantor or any of the Guarantor’s other Subsidiaries fails to
make any payment in respect of any indebtedness for borrowed
money upon the expiry of any originally applicable grace period
after the due date for payment; or (iii) the Issuer the Guarantor or
any of the Guarantor’s other Subsidiaries fails to make any
payment in respect of any amount payable under any guarantee
and/or indemnity given by it in relation to any indebtedness for
borrowed money of any other person upon the expiry of any
originally applicable grace period after the due date for payment;
provided that no event described in this subparagraph shall
constitute an Event of Default unless the indebtedness for
borrowed money or other relative liability due and unpaid either
alone or when aggregated (without duplication) with other amounts
of indebtedness for borrowed money and/or other liabilities due
and unpaid relative to all (if any) other events specified in (i)
through (iii) inclusive above which have occurred and are
continuing amounts to the greater of U.S.$200000000 (or the
equivalent thereof in any other currency) and two per cent. of theTotal Equity of the Guarantor. See “Terms and Conditions of theBonds – Events of Default”.– 9 –Events of Default The Bonds will contain events of default as further described in
Condition 9 (Events of Default) of the Terms and Conditions. See
“Terms and Conditions of the Bonds – Events of Default”.Further Issues The Issuer may from time to time without the consent of the
Bondholders create and issue further bonds having the same terms
and conditions as the Bonds in all respects (or in all respects except
for the issue date and the timing for complying with the
requirements set out in the Terms and Conditions in relation to the
Initial CSRC Post-Issuance Filing and the Cross-border Security
Registration and the timing of any subsequent notices relating
thereto to the Trustee and the Bondholders) and so that such further
issue shall be consolidated and form a single series with the Bonds.See “Terms and Conditions of the Bonds – Further Issues”.Clearing Systems The Bonds will be cleared through Euroclear and Clearstream.Euroclear and Clearstream each hold securities for their customers
and facilitate the clearance and settlement of securities
transactions by electronic book entry transfer between their
respective account holders.Governing Law The Bonds and any non-contractual obligations arising out of or in
connection with the Bonds will be governed by and construed in
accordance with English law.Legal Entity Identifier of the 836800YIDYE5HS47RZ68.Issuer
Listing and Trading of the Bonds Application will be made to the Hong Kong Stock Exchange for
the listing of and permission to deal in the Bonds on the Hong
Kong Stock Exchange by way of debt issues to Professional
Investors only and such permission is expected to become effective
on 11 July 2025.Listing of Shares The Shares are listed on the Hong Kong Stock Exchange.Application has been made to the Hong Kong Stock Exchange for
the listing of and permission to deal in the Shares issuable upon
conversion of the Bonds (the “New Shares”).Trustee China Construction Bank (Asia) Corporation Limited (中國建設銀
行(亞洲)股份有限公司).Registrar China Construction Bank (Asia) Corporation Limited (中國建設銀
行(亞洲)股份有限公司).Principal Paying Agent Principal China Construction Bank (Asia) Corporation Limited (中國建設銀
Conversion Agent and 行(亞洲)股份有限公司).Principal Transfer Agent(collectively the “PrincipalAgent”)
– 10 –Selling Restrictions There are restrictions on the offer sale and transfer of the Bonds
in among others the United States the United Kingdom the EEA
the PRC Hong Kong Singapore the BVI and Japan. For a
description of the selling restrictions on offers sales and deliveries
of the Bonds see “Subscription and Sale”.Global Certificate For as long as the Bonds are represented by the Global Certificate
and the Global Certificate is deposited with a common depositary
for Euroclear and Clearstream payments of principal and premium
(if any) in respect of the Bonds represented by the Global
Certificate will be made without presentation or if no further
payment falls to be made in respect of the Bonds against
presentation and surrender of the Global Certificate to or to the
order of the Principal Agent or such other Paying Agent as shall
have been notified to Bondholders for such purpose. The Bonds
which are represented by the Global Certificate will be transferable
only in accordance with the rules and procedures for the time being
of the relevant Clearing System.Use of Proceeds See “Use of Proceeds”.Risk Factors For a discussion of certain factors that should be considered in
evaluating an investment in the Bonds see “Risk Factors”.ISIN XS3108363030.Common Code 310836303.Ratings The Bonds are expected to be assigned a rating of “A-” by Standard
& Poor’s Ratings Services a rating of “A3” by Moody’s Investor
Service Inc. and a rating of “A-” by Fitch Ratings Inc.. A rating is
not a recommendation to buy sell or hold securities and may be
subject to suspension reduction or withdrawal at any time by the
assigning rating agency.– 11 –SUMMARY CONSOLIDATED FINANCIAL INFORMATION OF THE GUARANTOR
The consolidated financial information of the Guarantor as at and for the years ended 31 December 2022
2023 and 2024 included in this Offering Circular has been extracted from the 2023 Financial Statements
and the 2024 Financial Statements. The financial information of the Guarantor as of and for the years
ended 31 December 2022 and 2023 have been audited by PricewaterhouseCoopers in accordance with
HKSIR 200 issued by HKICPA and the consolidated financial statements as of and for the year ended 31
December 2024 has been audited by PricewaterhouseCoopers in accordance with ISAs issued by the
IAASB.The summary financial information set out below and in this Offering Circular should be read in
conjunction with and is qualified in its entirety by reference to the 2023 Financial Statements and the
2024 Financial Statements (including the notes thereto) both of which are incorporated by reference in
this Offering Circular. Potential investors must exercise caution when using such data to evaluate the
Group’s financial condition and results of operations. Historical results are not necessarily indicative of
results that may be achieved in any future period.CONSOLIDATED STATEMENTS OF PROFIT OR LOSS
Year ended 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267490414 258409403 284420059
Cost of revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . (234478008) (225775678) (245524112)
Gross profit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33012406 32633725 38895947
Selling and marketing expenses . . . . . . . . . . . . . . . . . (2784114) (2991589) (3096242)
General and administrative expenses . . . . . . . . . . . . . (17694719) (17766049) (18732335)
Research and development expenses . . . . . . . . . . . . . (2222865) (2285314) (2533607)
Net (impairment losses)/reversal of impairment losses
on financial assets and contract assets . . . . . . . . . . . (825170) 33480 (271693)
Other income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2494659 2281202 989740
Other gains net . . . . . . . . . . . . . . . . . . . . . . . . . . . . 831262 408474 368873
Operating profit . . . . . . . . . . . . . . . . . . . . . . . . . . . 12811459 12313929 15620683
Finance income . . . . . . . . . . . . . . . . . . . . . . . . . . . . 345662 633373 617713
Finance costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2054360) (2269700) (2373319)
Finance costs net . . . . . . . . . . . . . . . . . . . . . . . . . . . (1708698) (1636327) (1755606)
Share of gain/(loss) of associates and joint
ventures net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7549 (67190) (70020)
Impairment provision for investments in associates
and joint ventures . . . . . . . . . . . . . . . . . . . . . . . . . (72474) (123907) (187796)
Profit before income tax . . . . . . . . . . . . . . . . . . . . . 11037836 10486505 13607261
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . (3980922) (2574896) (3388416)
Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . 7056914 7911609 10218845
Attributable to:
– Owners of the Company. . . . . . . . . . . . . . . . . . . . . 6227058 8234493 10170427
– Non-controlling interests . . . . . . . . . . . . . . . . . . . . 829856 (322884) 48418
7056914791160910218845
Earnings per share for profit attributable to the
owners of the Company:
– Basic (RMB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.28 1.70 2.11
– Diluted (RMB) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.28 1.70 2.11
– 12 –CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME
Year ended 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . 7056914 7911609 10218845
Other comprehensive income:
Items that may be reclassified to profit or loss
– Effective portion of changes in fair value of
hedging instruments arising during the year. . . . . . . 15392 12002 8644
– Share of other comprehensive income of associates
and joint ventures accounted for using the equity
method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (18740) (5254) (1077)
– Currency translation differences of foreign
operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1336071 334708 110885
Items that will not be reclassified to profit or loss
– Fair value changes of equity investments designated
at fair value through other comprehensive income . . (57876) 484100 (1553885)
– Share of other comprehensive income of associates
and joint ventures accounted for using the equity
method . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1486) (329) –
– Income tax effect. . . . . . . . . . . . . . . . . . . . . . . . . . (307) 2749 3899
Other comprehensive (loss)/income for the year
net of tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1273054 827976 (1431534)
Total comprehensive income for the year . . . . . . . . 8329968 8739585 8787311
Attributable to:
– Owners of the Company. . . . . . . . . . . . . . . . . . . . . 8109083 9107526 9136451
– Non-controlling interests . . . . . . . . . . . . . . . . . . . . 220885 (367941) (349140)
832996887395858787311
– 13 –CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As at 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
ASSETS
Non-current assets:
Property plant and equipment . . . . . . . . . . . . . . . . . . 56903667 60104416 59174305
Right-of-use assets . . . . . . . . . . . . . . . . . . . . . . . . . . 22179348 20890047 19625629
Investment properties . . . . . . . . . . . . . . . . . . . . . . . . 4875366 6418720 7241199
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22084612 21030998 20036193
Deferred tax assets . . . . . . . . . . . . . . . . . . . . . . . . . . 1632964 2263870 2291994
Prepayments other receivables and other assets . . . . . 2257364 2333562 1855035
Investments in associates and joint ventures . . . . . . . . 7858000 7378831 6203642
Financial assets at fair value through other
comprehensive income . . . . . . . . . . . . . . . . . . . . . . 7365684 9489535 8231994
Financial assets at fair value through profit or loss . . . 1012209 589996 477416
Total non-current assets . . . . . . . . . . . . . . . . . . . . . 126169214 130499975 125137407
Current assets:
Inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1948354 2440425 2432383
Contract assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1522996 1632592 2740820
Trade and note receivables . . . . . . . . . . . . . . . . . . . . 25796677 25360433 27981633
Prepayments other receivables and other assets . . . . . 12801911 12622706 10114543
Financial assets at fair value through other
comprehensive income . . . . . . . . . . . . . . . . . . . . . . 63310 99978 170913
Financial assets at fair value through profit or loss . . . 7385379 6809742 11246156
Restricted cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 874919 1576496 1354303
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . 40279947 40448308 32646055
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . 90673493 90990680 88686806
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 216842707 221490655 213824213
LIABILITIES
Non-current liabilities:
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26586761 30396912 26319260
Lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8582372 8038495 7094483
Deferred tax liabilities . . . . . . . . . . . . . . . . . . . . . . . 4657954 4550974 4414485
Other payables and accruals . . . . . . . . . . . . . . . . . . . 191871 140329 201037
Deferred income . . . . . . . . . . . . . . . . . . . . . . . . . . . . 860791 1090644 1266359
Total non-current liabilities. . . . . . . . . . . . . . . . . . . 40879749 44217354 39295624
Current liabilities:
Trade and note payables . . . . . . . . . . . . . . . . . . . . . . 24748051 24914300 27395524
Contract liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 1244418 1832018 2039198
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23281547 22309103 18365122
Lease liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6596956 5769965 5501314
Financial liabilities at fair value through profit
or loss. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96647 92120 105464
Income tax payable. . . . . . . . . . . . . . . . . . . . . . . . . . 1630863 1394250 1679132
Other payables and accruals . . . . . . . . . . . . . . . . . . . 20029392 17637171 17061331
Advances from customers . . . . . . . . . . . . . . . . . . . . . 49035 40714 46283
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . 77676909 73989641 72193368
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 118556658 118206995 111488992
Net assets: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98286049 103283660 102335221
EQUITY
Share capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4895202 4895202 4986187
Less: treasury shares . . . . . . . . . . . . . . . . . . . . . . . . . (2040377) (2575532) (758081)
Reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50037565 51634675 48624934
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . 33371351 38835999 39140246
Equity attributable to owners of the Company . . . . . . 86263741 92790344 91993286
Non-controlling interests . . . . . . . . . . . . . . . . . . . . . . 12022308 10493316 10341935
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98286049 103283660 102335221
– 14 –CONSOLIDATED STATEMENTS OF CASH FLOWS
Year ended 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
Cash flows from operating activities
Cash generated from operations . . . . . . . . . . . . . . . . . 37781002 29796205 35364389
Income tax paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5078055) (3226386) (3178016)
Net cash generated from operating activities. . . . . . 32702947 26569819 32186373
Cash flows from investing activities
Redemption of financial assets at fair value through
profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 154858457 93433282 86145328
Disposal of financial assets at fair value through
other comprehensive income. . . . . . . . . . . . . . . . . . 698674 162780 8451
Proceeds from sales of associates and joint ventures . . 841595 468039 620980
Repayment from former subsidiaries . . . . . . . . . . . . . – – 316655
Investment gains or dividend income from financial
assets at fair value through profit or loss. . . . . . . . . 738296 604161 650582
Dividends received from associates and joint
ventures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 171633 192475 183401
Investment gains or dividend income from financial
assets at fair value through other comprehensive
income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3170 1998 20168
Proceeds from disposal of property plant and
equipment and other non-current assets . . . . . . . . . . 176331 335828 309784
Disposal of subsidiaries net of cash and cash
equivalents held by subsidiaries at the disposal
dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 313719 384332 261058
Purchase of property plant and equipment and other
non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . (14183777) (12471899) (9344770)
Acquisition of financial assets at fair value through
other comprehensive income. . . . . . . . . . . . . . . . . . (499939) (275165) (49750)
Acquisition of financial assets at fair value through
profit or loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (151870104) (93974775) (90451596)
Acquisition of associates and joint ventures . . . . . . . . (1122032) (169265) (28381)
Acquisition of subsidiaries net of cash and cash
equivalents held by subsidiaries at the acquisition
dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2217481) (2197408) (696654)
Net cash used in investing activities . . . . . . . . . . . . (12091458) (13505617) (12054744)
– 15 –Year ended 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
Cash flows from financing activities
Proceeds from issue of shares . . . . . . . . . . . . . . . . . . – – 5323198
Capital injection from non-controlling interests . . . . . 162673 157080 30226
Exercise of share options . . . . . . . . . . . . . . . . . . . . . – 355189 –
Drawdown of bank borrowings . . . . . . . . . . . . . . . . . 27676978 32543231 31847545
Drawdown of loans from non-controlling interests . . . 10814 44287 –
Proceeds from corporate bonds and short-term
debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11880297 1499553 4296638
Net cash consideration received from non-controlling
interests without change of control . . . . . . . . . . . . . – – 1193
Deposits received from lessors after the expiry of
lease contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5187 6703 12023
Repayment of bank borrowings . . . . . . . . . . . . . . . . . (31204435) (22365788) (42276973)
Repayment of corporate bonds and short-term
debentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (6660000) (10110178) (2785271)
Repayment of loans from holders of asset-backed
securities scheme . . . . . . . . . . . . . . . . . . . . . . . . . . (391000) (899360) –
Repayment of loans from non-controlling interests . . . (34115) (31478) (2624)
Dividend paid to non-controlling interests . . . . . . . . . (1361769) (599379) (324348)
Dividend paid. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (874518) (1213616) (9602792)
Interests paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (1451895) (1820066) (1818720)
Net cash consideration paid to non-controlling
interests without change of control . . . . . . . . . . . . . (3914671) (1833285) (3451076)
Payments for repurchase of shares . . . . . . . . . . . . . . . (2040377) (959956) (1758094)
Payments of lease liabilities . . . . . . . . . . . . . . . . . . . (7813330) (7765246) (7438385)
Payment of transaction costs related to financing
activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . – (2376) (31653)
Payment for deposits of lease contracts . . . . . . . . . . . (6789) – –
Net cash used in financing activities . . . . . . . . . . . . (16016950) (12994685) (27979113)
Net increase/(decrease) in cash and cash
equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4594539 69517 (7847484)
Cash and cash equivalents at beginning of the year . . 34813768 40279947 40448308
Exchange gains on cash and cash equivalents . . . . . . . 871640 98844 45231
Cash and cash equivalents at end of the year . . . . . 40279947 40448308 32646055
– 16 –ADJUSTED NON-IFRS MEASURES
To supplement the consolidated financial statements which are presented by the Company in accordance
with IFRS Accounting Standards the Company also uses certain additional non-IFRS measures namely
EBITDA and EBITDA margin as additional financial metrics. These non-IFRS measures are not required
by or presented in accordance with IFRS Accounting Standards.The Company believes that these non-IFRS measures facilitate evaluation of its operating performance by
eliminating potential impacts of certain items listed below. The Company also believes that such non-IFRS
measures present useful information to investors in understanding and evaluating its consolidated results
of operations in the same manner as they presented to its management. However its presentation of such
non-IFRS measures may not be comparable to similarly titled measures presented by other companies. The
use of these non-IFRS measures has limitations as an analytical tool and you should not consider it on
an isolated basis or as substitute for analysis of the results of operations or financial condition of the
Company as reported under IFRS Accounting Standards.The following table reconciles profit for the year of the Company calculated and presented in accordance
with IFRS Accounting Standards to EBITDA (non-IFRS measure) for the years indicated:
Year ended 31 December
202220232024
(RMB’000) (RMB’000) (RMB’000)
Profit for the year . . . . . . . . . . . . . . . . . . . . . . . . . . 7056914 7911609 10218845
Add:
Depreciation and amortisation . . . . . . . . . . . . . . . . . . 16241432 17319107 17332257
– Depreciation of right-of-use assets. . . . . . . . . . . . 7291360 7213063 6798783
– Depreciation and amortisation (excluding right-
of-use assets) . . . . . . . . . . . . . . . . . . . . . . . . . . . 8950072 10106044 10533474
Finance costs net . . . . . . . . . . . . . . . . . . . . . . . . . . . 1708698 1636327 1755606
Income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . 3980922 2574896 3388416
EBITDA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28987966 29441939 32695124
EBITDA margin . . . . . . . . . . . . . . . . . . . . . . . . . . . 10.8% 11.4% 11.5%
– 17 –DEFINITIONS
In this Offering Circular unless the context otherwise requires the following expressions shall have the
following meanings.“2022 Stock Option Incentive the stock option incentive plan approved and adopted by thePlan” Company on 28 April 2022 selected participants including
Directors and members of senior management team key
management members and key staff
“A Share(s)” ordinary domestic shares of RMB1.00 each issued by the
Guarantor which are traded in Renminbi on the Shenzhen Stock
Exchange (Stock Code: 002352.SZ)
“Agency Agreement” the paying conversion and transfer agency agreement to be dated
10 July 2025 and to be entered into between the Issuer the
Guarantor the Trustee China Construction Bank (Asia)
Corporation Limited (中國建設銀行(亞洲)股份有限公司) as
principal paying agent principal conversion agent and principaltransfer agent (collectively in such capacities the “PrincipalAgent”) and as registrar (the “Registrar”) and the other paying
agents transfer agents and conversion agents appointed under it
relating to the Bonds
“Articles of Association” the articles of association of the Guarantor
“Board of Directors” or “Board” board of Directors of the Guarantor
“Board of Supervisors” board of Supervisors of the Guarantor
“Bondholder” or “Holder” a holder of the Bonds
“BVI” the British Virgin Islands
“CFETS” China Foreign Exchange Trade System
“Clearing Systems” Euroclear and Clearstream
“Controlling Shareholder(s)” has the meaning ascribed to it under the Listing Rules and unless
the context otherwise requires refers to Mr. Wang Mingde
Holding and Shenzhen Weishun
“CSRC” China Securities Regulatory Commission (中國證券監督管理委員
會)
“Deed of Guarantee” the deed of guarantee to be dated 10 July 2025 and to be entered
into between the Guarantor and the Trustee relating to the Bonds
– 18 –“DHL” DHL International GmbH. a division of the German logistics
company Deutsche Post DHL which is Europe’s leading postal and
parcel service provider
“Dingtai New Materials” Ma’anshan Dingtai Rare Earth & New Materials Co. Ltd.* (馬鞍
山鼎泰稀土新材料股份有限公司) the predecessor of the Company
“Director(s)” director(s) of the Guarantor
“EIT Law” Enterprise Income Tax Law of the PRC (中華人民共和國企業所得
稅法) as amended supplemented or otherwise modified from time
to time
“ESG” Environmental Social and Corporate Governance
“FVOCI” fair value through other comprehensive income
“FVTPL” fair value through profit or loss
“Group” the Guarantor and its subsidiaries (or the Guarantor and any one or
more of its subsidiaries as the context may require)
“Guarantor” or the “Company” S.F. Holding Co. Ltd. (順豐控股股份有限公司) formerly
registered under the name Maanshan Dingtai Rare Earth & New
Materials Co. Ltd.* (馬鞍山鼎泰稀土新材料股份有限公司) a
joint stock company with limited liability established in the PRC
on 22 May 2003 the A Shares of which have been listed on the
Shenzhen Stock Exchange (stock code: 002352.SZ) and the H
Shares of which have been listed on the Hong Kong Stock
Exchange (stock code: 6936)
“H Share(s)” or “Shares” ordinary foreign shares with a par value of RMB1.00 each issued
by the Guarantor which are traded in HK dollars on the Hong Kong
Stock Exchange (Stock Code: 6936)
“HAVI Group” HAVI Group LP a global supply chain management and marketing
service provider
“HK$” or “HK dollars” Hong Kong dollars the official currency of Hong Kong
“Hong Kong” the Hong Kong Special Administrative Region of the People’s
Republic of China
“IFRS Accounting Standards” International Financial Reporting Standards which include
standards amendments and interpretations promulgated by the
International Accounting Standards Board and the International
Accounting Standards and interpretation issued by the
International Accounting Standards Committee
– 19 –“IIT Law” the Individual Income Tax Law of the PRC (中華人民共和國個人
所得稅法)
“Issuer” SF Holding Investment 2023 Limited a company incorporated in
the BVI on 31 March 2022 with registration number 2095421. It is
an indirect wholly-owned subsidiary of the Guarantor
“KLN” KLN Logistics Group Limited a company listed on the Main
Board of the Hong Kong Stock Exchange (stock code: 0636) an
indirect non-wholly-owned subsidiary of the Company
“Listing Rules” the Rules Governing the Listing of Securities on The Stock
Exchange of Hong Kong Limited (as amended from time to time)
“Main Board” the stock market (excluding the option market) operated by the
Hong Kong Stock Exchange which is independent from and
operated in parallel with the GEM of the Hong Kong Stock
Exchange
“Mingde Holding” Shenzhen Mingde Holding Development Co. Ltd.* (深圳明德控股
發展有限公司) a limited liability company established under the
laws of the PRC on 5 November 1997 one of the Controlling
Shareholders
“Model Code” the Model Code for Securities Transactions by Directors of Listed
Issuers as set out in Appendix 10 to the Listing Rules
“Mr. Wang” Mr. WANG Wei chairman of the Board an executive Director
general manager of the Company and one of the Controlling
Shareholders
“NAFR” National Administration of Financial Regulation of the PRC (中華
人民共和國國家金融監督管理總局) (which was established on the
basis of the China Banking and Insurance Regulatory Commission
(中國銀行保險監督管理委員會))
“Ordinary Shares” the H Shares the A Shares and any fully-paid and non-assessable
shares of any class or classes of the ordinary shares of the
Guarantor authorised after the date of the issue of the Bonds which
have no preference in respect of dividends or of amounts payable
in the event of any voluntary or involuntary liquidation or
dissolution of the Guarantor
“PBOC” People’s Bank of China
“PRC” or “China” for the purposes of this Offering Circular the People’s Republic of
China excluding Hong Kong the Macau Special Administrative
Region and Taiwan
– 20 –“Regulation S” Regulation S under the Securities Act
“RMB” or “Renminbi” Renminbi the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC (中國國
家外匯管理局) or its local branch
“SF Holding (HK)” SF Holding (HK) Limited (順豐控股(香港)有限公司) an indirect
wholly-owned subsidiary of the Company formerly known as SF
Holding Limited (順豐控股有限公司)
“SF Intra-city” Hangzhou SF Intra-city Industrial Co. Ltd. (杭州順豐同城實業股
份有限公司) a company listed on the Main Board of the Hong
Kong Stock Exchange (stock code: 9699) an indirect non-wholly
owned subsidiary of the Company
“SFO” the Securities and Futures Ordinance (Chapter 571 of the Laws of
Hong Kong) as amended supplemented or otherwise modified
from time to time
“SF Holding (Group)” SF Holding (Group) Co. Limited* (順豐控股(集團)股份有限公
司) the predecessor of SF Taisen
“SF REIT” SF Real Estate Investment Trust listed on the Main Board of the
Hong Kong Stock Exchange (stock code: 2191) is an associate of
the Company
“SF Taisen” Shenzhen S.F. Taisen Holding (Group) Co. Ltd.* (深圳順豐泰森控
股(集團)有限公司) previously known as SF Holding (Group) Co.Limited* (順豐控股(集團)股份有限公司) a direct wholly-owned
subsidiary of the Company
“SF Technology” SF Technology Co. Ltd.* (順豐科技有限公司) an indirect wholly-
owned subsidiary of the Company
“Shenzhen Stock Exchange” the Shenzhen Stock Exchange
“Shenzhen Weishun” Shenzhen Weishun Enterprise Management Co. Ltd.* (深圳市瑋順
企業管理有限公司) a limited liability company established under
the laws of the PRC on 31 January 2023 one of the Controlling
Shareholders and owned as to 100% by Mingde Holding as of the
date of this Offering Circular
“State Council” the State Council of the PRC (中華人民共和國國務院)
“State Post Bureau” the State Post Bureau of the PRC (中華人民共和國國家郵政局)
“Subscription Agreement” the subscription agreement dated 25 June 2025 entered into
between the Issuer the Guarantor and Managers
– 21 –“Supervisor(s)” supervisor(s) of the Guarantor
“Trust Deed” the trust deed to be dated 10 July 2025 and to be entered into
between the Issuer the Guarantor and the Trustee
“UK” the United Kingdom
“UPS” United Parcel Service a global leading logistics service provider
“U.S.” or “United States” the United States of America its territories its possessions and all
areas subject to its jurisdiction
“U.S.$” “US$” “USD” “U.S. United States dollars the official currency of the United States ofdollars” or “US dollars” America
“%” per cent.* For identification purpose only
In this Offering Circular the terms “associate” “subsidiaries” and “substantial shareholder” shall have the
meanings given to such terms in the Listing Rules unless the context otherwise requires.Certain amounts and percentage figures included in this Offering Circular have been subject to rounding.Accordingly figures shown as totals in certain tables may not be an arithmetic aggregation of the figures
preceding them. Any discrepancies in any table or chart between the total shown and the sum of the
amounts listed are due to rounding.For ease of reference the names of the PRC established companies or entities laws or regulations have
been included in this Offering Circular in both the Chinese and English languages; in the event of any
inconsistency the Chinese versions shall prevail.– 22 –GLOSSARY OF TECHNICAL TERMS
This glossary of technical terms contains explanations of certain technical terms used in this Offering
Circular in connection with the Company and its business. Such terminology and meanings may not
correspond to standard industry meanings or usages of those terms.“1-to-n growth strategy” the growth and expansion strategy that leverages the Group’s
time-definite express delivery service as the bedrock to incubate
new service offerings enter adjacent logistics segments and
further complement the Group’s integrated capabilities
“3C electronics” computer communication and consumer electronics
“App” application software designed to run on smartphones and other
mobile devices
“B2B” business to business
“B2C” business to customer
“C2C” customer to customer
“CAGR” compound annual growth rate“consolidated air freight grouping together of smaller consignments of goods into a largeservices” consignment for carriage as a larger unit in order to obtain a
favourable rate through various airlines to various destinations“customers with active credit customers that have a credit account with the Group and transactedaccounts” with it within the most recent one-month period among which
substantially all are business accounts
“customs brokerage” the services of handling customs clearance and other customs-
related services for importers and exporters by customs brokers
“customs clearance” the process of clearing imports and exports through customs
“Ezhou cargo hub” the cargo hub located in Ezhou Hubei Province which mainly
comprises of Ezhou Huahu International Airport and the Group’s
logistics complex“Ezhou Huahu International a cargo-focused airport located in Ezhou Hubei Province in whichAirport” the Group holds a minority interest
“first-mile pickup” initial collection of a parcel and transport to the local pickup outlet
– 23 –“freight forwarding” professional intermediary services for enterprises to ensure
efficient connection along the logistics chain and smooth
international transportation which mainly include goods
transportation logistics related documentation and customs
clearance
“FTL” full truckload the transportation of goods that requires a full
truckload“global top four integrated top four integrated logistics service providers globally in terms oflogistics service providers” revenue in 2024
“handheld terminal” a portable electronic device used by couriers to collect and
transmit data relating to delivery and tracking which is often
equipped with barcode scanners and wireless communication
capabilities to facilitate real-time information flow“integrated logistics service logistics service providers that offer a full spectrum of domesticproviders” and international logistics services including but not limited to
express delivery services freight delivery services cold chain
logistics services intra-city on-demand delivery services supply
chain services and international logistics services and provide
one-stop solutions to multinationals large corporations small and
medium enterprises and retail customers
“IoT” Internet of things the collective network of connected devices and
the technology that facilitates communication between devices and
the cloud as well as between devices themselves
“last-mile delivery” transportation of a parcel from the local pickup outlet to the final
delivery destination
“logistics” a comprehensive system-wide view of the entire supply chain as a
single process from raw materials supply through finished goods
distribution. All functions that make up the supply chain are
managed as a single entity rather than managing individual
functions separately
“logistics complex” ultra-large warehouse sorting and transit hub integrating diverse
logistics operations
“LTL” less-than-truckload the transportation of goods that do not require
a full truckload
“parcel volume” the number of parcels processed in a given period
“registered merchants” the accumulated merchant accounts on SF Intra-City platform
– 24 –“retail customer(s)” registered user(s) on the Group’s mobile application and WeChat
Mini-Program among which substantially all are individual
accounts
“SaaS” abbreviation for Software as a Service a business delivery model
in which software is licensed on a subscription basis and is
centrally hosted
“sorting centre” transshipping and operating centres that connect transportation
resources including that for centralised parcel sorting distribution
and transshipment
“Southeast Asia” a subregion of Asia that consists of 11 countries: Brunei
Cambodia Indonesia Laos Malaysia Myanmar the Philippines
Singapore Thailand Timor-Leste and Vietnam
“supply chain” a complex logistics system that consists of facilities that convert
raw materials into finished products and distribute them to end
consumers
“TEU” twenty-foot equivalent unit a standard unit of measurement of the
volume of a container with a length of 20 feet height of eight feet
six inches and width of eight feet
– 25 –RISK FACTORS
Prospective investors of the Bonds should carefully consider the risk factors set forth below as well as the
other information contained elsewhere in this Offering Circular. The risks described below are not the only
ones that may affect the Issuer the Guarantor the Group or the Bonds. Additional risks and uncertainties
which the Issuer and the Guarantor are not aware of or that the Issuer and the Guarantor currently believe
are immaterial may also adversely affect the Group’s financial condition or results of operations. If any
of the possible events described below occur the Group’s financial condition or results of operations could
be materially and adversely affected. In such case the Issuer and the Guarantor may not be able to satisfy
their respective obligations under the Bonds the Guarantee and investors could lose all or part of their
investment. This Offering Circular also contains forward-looking statements that involve risks and
uncertainties. The Group’s actual results could differ materially from those anticipated in these
forward-looking statements as a result of certain factors.RISKS RELATING TO THE GROUP’S BUSINESS AND INDUSTRY
The Group’s business and growth are materially affected by macroeconomic and other factors that
affect demand for logistics services in the countries and regions where it operates.The Group offers integrated logistics services to meet its customers’ needs globally. As such the Group’s
business depends on the continued development of commercial activities in the countries and regions
where it operates. Prospects of commercial activities in the countries and regions where the Group
operates are subject to the influence of a number of macroeconomic and other factors that are beyond its
control such as economic conditions consumption power and disposable income of consumers
urbanisation inflation currency and interest rate fluctuations labour supply development and deployment
of technology government policies as well as political issues including potential military conflicts
political turmoil and social instability. If commercial activities in the countries and regions where the
Group operates do not develop as it expects the Group’s business and prospects could be adversely
impacted.Further the logistics industry is highly sensitive to changes in macroeconomic conditions. During
economic downturns in the countries and regions where the Group operates reduced overall demand for
logistics services will likely exert downward pressures on its service prices and margins. On the other
hand in periods of strong economic growth demand for limited transportation resources can also lead to
increased network congestion and operating inefficiency. In addition as the logistics industry is
labour-intensive it could be difficult for the Group to match its staffing levels to its evolving business
needs in particular during labour shortages resulting from changes in macroeconomic conditions.Moreover as the Group’s directly operated model is capital intensive and it has significant investments
in assets the Group may not be able to nimbly adjust its logistics infrastructure and networks in response
to fluctuations in demand. If any of the foregoing risks were to occur or persist the Group’s business
financial condition and results of operations could be materially and adversely affected.Any service disruption of the Group’s ground fleet air cargo fleet sorting centres warehouses or
service outlets may adversely affect its business operations.The Group’s daily operations heavily rely on the orderly performance of its ground fleet air cargo fleet
sorting centres warehouses and service outlets. Any service disruption due to weather conditions a failure
in the Group’s automated facilities under-capacity during peak parcel volume periods force majeure
events third-party sabotage employee delinquency or strike governmental inspections of properties or
governmental orders that mandate any service halt or temporary or permanent shutdown could adversely
impact its business operations. In case of any service disruption to the Group’s ground fleet and air cargo
fleet parcels will need to be redirected to other flights or transported by other methods and such
– 26 –re-routing of parcels will likely increase transportation costs risks of delay and errors in delivery. In case
of any service disruptions at the Group’s sorting centres warehouses or service outlets parcel sorting or
parcel pickup and delivery at the affected sites may be delayed suspended or stopped. Parcels will need
to be redirected to other nearby sorting centres warehouses or service outlets and such re-routing of
parcels will likely increase risks of delay and errors in delivery. At the same time increased parcel sorting
or pickup and delivery pressure on nearby sorting centres warehouses or service outlets may negatively
affect the Group’s performance incur additional costs and spread adverse effects further across its
network. Any of the foregoing events may result in operational interruptions and slowdowns customer
complaints and reputational damage.The Group may encounter challenges in managing the expansion of its logistics infrastructure and
networks which if not dealt with effectively could materially and adversely affect its business
results of operations financial condition and growth prospects.Deeply rooted in the logistics services industry for 32 years the Group has established an efficient
reliable and synergistic logistics infrastructure network with extensive geographical coverage globally
integrating aviation ground and information networks into one unified service network. As the Group
continues to add logistics and warehouse capability its logistics network becomes increasingly complex
and challenging to operate. There is no assurance that the Group will be able to set up logistics
infrastructure or lease suitable facilities on commercially acceptable terms or at all. Moreover any new
additions to the Group’s logistics infrastructure and networks might not create additional revenue streams
as expected or operate in a cost-efficient manner. The Group may not be able to recruit a sufficient number
of qualified employees in connection with the expansion of its logistics infrastructure. In addition the
expansion of the Group’s logistics infrastructure may strain its managerial financial operational and other
resources. The foregoing and other challenges if not dealt with effectively could materially and adversely
affect the Group’s growth potential business financial condition and results of operations. Even if the
Group manages the expansion of its logistics infrastructure successfully it may not give it the competitive
advantage that it expects.The Group’s historical results of operations and financial performance may not be indicative of its
future growth.The Group has achieved high-quality and sustainable growth during 2022 to 2024. The Group’s revenue
increased from RMB267.5 billion in 2022 to RMB284.4 billion in 2024 representing a CAGR of 3.1%.The Group’s profit for the year attributable to owners of the Company was RMB6.2 billion RMB8.2
billion and RMB10.2 billion in 2022 2023 and 2024 respectively representing a CAGR of 28.3% from
2022. The Group’s EBITDA (non-IFRS measure) increased from RMB29.0 billion in 2022 to RMB32.7
billion in 2024 representing a CAGR of 6.2%. However the Group’s historical results of operations and
financial performance may not be indicative of future growth. As the market and the Group’s business
evolve the Group may modify its operations data and technology sales and marketing solutions and
services. These changes may not achieve expected results and may have a material and adverse impact on
the Group’s results of operations and financial condition. The Group’s expenses may grow faster than its
revenue and the Group’s expenses may increase or may be greater than it expected. There is no assurance
that the Group will be able to achieve similar results or grow at the same speed as it did in the past or at
all. Rather than relying on the Group’s historical operating and financial results to evaluate the Group
potential investors should consider the Group’s business prospects in light of the risks and difficulties it
may encounter as a company operating in emerging markets and dynamic industries including among
other factors (i) macroeconomic and other factors that affect logistics markets in the countries and regions
where it operates (ii) its ability to expand its customer base and to retain and grow the wallet share of
its existing customers (iii) its ability to maintain and expand its logistics infrastructure and networks (iv)
its ability to management and further improve operational efficiency and (v) its ability to execute
acquisitions and investments as well as successful integration. The Group may not be able to successfully
address these or other challenges which could adversely impact its business results of operations and
financial condition.– 27 –The Group’s continuing success depends in significant part on its ability to meet evolving customer
demands and expectations as well as its ability to attract and retain customers.The Group’s continuing success depends in significant part on its ability to continually innovate in
response to intense market competition and evolving customer demands and expectations. The Group may
not be able to successfully address evolving customer demands and its existing logistics infrastructure and
network may not be adaptable enough to accommodate new demands and expectations. The Group may
not be able to respond to challenges swiftly and effectively due to numerous factors some of which are
beyond its control. In addition innovations may not succeed or integrate well with the Group’s existing
systems and infrastructure and even if integrated may not function as expected or may not be able to
enhance its operational efficiency and competitiveness or reduce its operational costs. Any failure on its
part to respond swiftly and effectively to changes in market competition or customer demands may
materially and adversely affect its business financial condition and results of operations.The Group’s success also depends in part on its ability to attract and retain new customers and enhance
engagement with existing customers by providing distinctive and premium services in a cost-effective
manner. Over the years the Group was successful in increasing its cooperation with existing customers.The Group believes that its effective marketing strategies distinctive and premium services and nimble
responses to evolving customer demands have been critical in promoting its services and brand
recognition which in turn drive customer growth and engagement. While the Group currently believes it
can achieve further growth through among other things further penetration and expansion of its customer
base the Group may not be able to effectively and successfully implement its plans and realise its goals.If the Group’s marketing strategies do not work efficiently it may not be able to maintain its selling and
marketing expenses at a reasonable level. In addition if customers do not perceive the Group’s services
and solutions to be distinctive and premium it may not be able to attract and retain customers and increase
their use of its services and solutions. In addition the Group may fail to further diversify its service
offerings pursue new business opportunities or otherwise achieve further business growth. Any of the
aforementioned failures could materially and adversely affect the Group’s business financial condition
and results of operations.Competition in the industries where the Group operates is intense and any failure to compete
effectively could adversely affect its customer base profitability and market share.The industries where the Group operates are highly fragmented and competitive. The Group’s integrated
logistics services encompass a wide range of services and as a result it primarily competes with (i) other
global integrated logistics service providers; (ii) other China-based integrated logistics service providers;
and (iii) single product logistics service providers. In addition to multiple existing market players there
may be new entrants emerging in each of the industries where the Group operates. The Group competes
with them based on a number of factors such as services quality service price business model
operational capabilities and cost control. If the Group cannot adjust its operating strategies and take
effective countermeasures in a timely manner in response to market changes its business growth rate may
slow down and its market share and profitability may decline.Any significant increase in competition may have a material adverse effect on the Group’s revenue and
profitability as well as on its business and prospects. There is no assurance that the Group will be able to
continuously distinguish its services from those of its competitors to preserve and improve its
relationships with various participants in the logistics industry or to increase or even maintain its existing
market share. The Group may lose market share and its financial condition and results of operations may
deteriorate if it fails to compete effectively.– 28 –Furthermore as the Group diversifies its service offerings and further expand its customer base in the
logistics markets in China Asia and globally it may face competition from existing or new players in
those markets. Similarly existing players in an adjacent or sub-market may choose to enter into alliances
with other transportation or logistics service providers leverage their existing infrastructure and expand
their services to penetrate into the Group’s business or serve its existing or potential customers. If these
players succeed in doing so the Group’s business could be adversely affected.Certain of the Group’s current and potential competitors may have greater resources longer operating
histories larger customer bases and greater brand recognition than the Group. They may be acquired by
receive investment from or enter into strategic relationships with established and well-financed
companies or investors that could help enhance such competitors’ competitiveness. Some of the Group’s
competitors in China across Asia or globally may adopt more aggressive pricing policies than it does.Accordingly if the Group cannot effectively control its costs to remain competitive its market share and
revenue may decline. Further the Group’s competitors may make more sizable investment or capital
expenditure or devote greater resources to marketing and promotional campaigns than it does. The Group
may not be able to compete successfully against current or future competitors and competitive pressures
may have a material and adverse effect on the Group’s business financial condition and results of
operations.The Group may face challenges associated with expanding or diversifying its service offerings and
exploring new business.Over the years the Group has further diversified its service offerings such as through the expansion of
its time-definite express service offerings. New service offerings or new lines of business may involve
risks and challenges the Group does not currently face. Such new initiatives may require the Group to
devote significant financial and managerial resources and may not perform as well as expected. The
Group’s existing logistics infrastructure and network may not be adaptable to new service offerings or new
business. For example the Group’s different service offerings may require different deployment of
logistics infrastructure and network different services standards which in turn may require significant
time and costs to implement. The Group may also be inexperienced with the operating models and cost
structures associated with new service offerings or new lines of business. In addition the Group may not
be able to assure adequate service quality and accordingly may receive complaints or costly liability
claims which would harm its overall reputation and financial performance. Further the Group may not
be able to achieve profitability or recoup its investments with respect to any new service offerings or new
lines of business in time or at all.If the Group’s customers reduce their expenditure in third-party logistics services its business
financial condition and results of operations may be adversely affected.As an integrated logistics service provider the Group’s business strategies are partially based on the
assumption that the trend toward outsourcing of logistics and supply chain activities will continue.Third-party service providers like the Group are generally able to provide logistics services more
efficiently than otherwise could be provided “in-house” primarily as a result of its expertise technology
and cost efficiency. However many factors could cause a trend reversal. For example the Group’s
customers may see risks in relying on third-party service providers or they may begin to define logistics
and supply chain activities as within their own core competencies and decide to perform logistics and
supply chain operations themselves. If the Group’s customers are able to improve the capabilities and cost
structure of their in-house logistics and supply chain activities the Group’s logistics services may not be
deemed as an attractive alternative meeting its customers’ demands. If the Group’s customers in-source
significant aspects of its logistics and supply chain operations or if potential new customers decide to
continue to perform their own logistics and supply chain activities the Group’s business financial
condition and results of operations may be materially and adversely affected.– 29 –The Group’s business model involves substantial capital expenditures which may not generate
returns or achieve intended economic benefits in the short term or at all.The Group’s business model involves substantial capital expenditures including expenditures on
purchases of aircraft and equipment as well as construction of warehouses sorting centres and industrial
parks in connection with the growth of its business. As the leading Asia-based integrated logistics service
provider with a directly operated model the Group enjoys greater control over and stability from its
network. However the directly operated model requires the Group to incur higher capital expenditures
than its competitors who rely more on a franchising model.Substantial capital expenditures are associated with certain inherent risks. The amount and timing of
capital expenditures depend on various factors including among other things the projected growth in the
Group’s parcel volume. The Group must estimate its parcel volume and the corresponding requirements
for logistics infrastructure and network and make capital commitments for aircraft and other assets based
on these projections years before they are actually needed. Missing its projections could result in too much
or too little capacity relative to the Group’s parcel volume. Over-capacity could lead to asset dispositions
as well as a negatively impact on the Group’s operating margins while under-capacity could negatively
impact service levels. In addition as a result of the high capital intensity and uncertainties inherent to the
Group’s projections of future capital investment requirements under its directly operated model the Group
may be slower in expanding its logistics infrastructure and network in response to changing market
demand than its competitors who rely more on a franchising model. As a result the Group may lose market
share or business opportunities to its competitors and the Group’s business financial condition and results
of operations may be materially and adversely affected.The Group has historically funded its capital expenditures primarily with cash generated from its operating
activities and proceeds from external debts and other fundraising activities. There is no assurance that
these sources of financing will be sufficient to fund its expansion plans. The Group’s access to external
funding is subject to various factors that are beyond its control including market conditions government
approval credit supply and interest rates. If the Group is unable to secure sufficient external funds to
finance its capital investments the Group’s business financial condition and results of operations could
be materially and adversely affected.Even if the Group has sufficient funding assets that best suit its needs may not be available at reasonable
prices or at all. For example due to local zoning plans or other regulatory requirements land resources
may be scarce in an area that best fits the Group’s network expansion plan. In addition the Group is likely
to incur capital expenditures earlier than the realisation of any of the anticipated benefits and the return
on these investments may be lower or may be realised more slowly than it is expected. Although the
Group’s capital investments may not generate any return in the short term it will still incur financing and
other costs on the capital investments which may materially and adversely affect the Group’s business
operation results financial condition and growth prospects. Moreover actual costs of the Group’s capital
projects may exceed its original budgets. Due to project delays cost overruns market fluctuations or other
unexpected circumstances the Group may not be able to achieve the intended economic benefits or
maintain commercial viability of these projects which in turn may materially and adversely affect the
Group’s business results of operations financial condition and growth prospects. In addition carrying
value of the related assets may be subject to impairment which may adversely affect the Group’s financial
conditions and results of operations. Furthermore the Group’s continued investment in land construction
and delivery infrastructure may put it at a competitive disadvantage against competitors who spend less
on these assets but focus more on improving other aspects of their business that are less capital intensive.– 30 –There is no assurance that the Group could successfully enter into necessary or desirable strategic
alliances acquisitions or minority investments and it may not be able to achieve the anticipated
benefits from the strategic alliances acquisitions or minority investments that it makes.The Group may evaluate and consider strategic investments and acquisitions or enter into strategic
alliances to implement its development strategies such as expanding the breadth and depth of its service
matrix and enhance its competitive advantages. Investments or acquisitions involve numerous risks
including but not limited to: (i) potential failure to achieve the expected results of the integration or
acquisition; (ii) difficulties in and the cost of integrating operations technologies services and
personnel; and (iii) potential write-offs of acquired assets or investments. These transactions will also
divert the management’s time and resources from the Group’s normal course of operations and it may
have to incur unexpected liabilities or expenses. Strategic alliances with third parties on the other hand
could subject the Group to a number of risks including risks associated with non-performance by the
counterparty and an increase in expenses in establishing new strategic alliances any of which could
materially and adversely affect the Group’s business.The Group has historically expanded its businesses in part through acquisitions and the Group may
continue to pursue suitable acquisition opportunities to implement its strategies. For instance the Group
acquired a 51.5% equity interest in KLN in September 2021 to further enhance the strategic layout of its
freight forwarding and international business. However the integration of newly acquired businesses may
be costly and time-consuming and each acquisition could present the Group with risks and challenges in
various respects including but not limited to:
* integrating the operations and personnel of the acquired businesses and information systems
procedures and policies;
* retaining relationships with key employees customers business partners and suppliers of the
acquired businesses;
* successfully entering a business segment or geographic market in which the Group has limited prior
experience;
* achieving the anticipated synergies and strategic or financial benefits from the acquisitions; and
* addressing the economic political regulatory and foreign exchange risks associated with the
relevant jurisdictions where the acquired businesses are located.The Group’s business financial condition and results of operations could be materially and adversely
affected if it is unable to integrate or benefit from the acquired businesses.In addition the Group has acquired and may continue to acquire non-controlling interests in companies
operating as its associates. As the Group do not control their operational and financial policies it is
uncertain whether it will be able to achieve the intended objectives or benefits of those minority
investments. As a result there is no assurance that any of the Group’s historical or future acquisitions or
investments will be successful.– 31 –The Group’s business financial condition and results of operations could be adversely affected if it
experiences any negative publicity that results in severe damage to its brand image or reputation.The Group believes that its brand image and corporate reputation plays an increasingly important role in
enhancing its competitiveness and maintaining its business growth. The Group’s ability to manage its
brand image depends on whether it could successfully provide distinctive and premium services to its
customers conduct marketing activities and manage complaints and events of negative publicity
including those associated with or from its franchisees and maintain positive perception of the Group.Furthermore many other factors some of which are beyond the Group’s control may negatively impact
its brand image and corporate reputation if not properly managed. Service quality issues actual or
perceived even when false or unfounded could tarnish the image of its brand and may cause customers
to use other companies. Also adverse publicity surrounding labour relations environmental concerns
security matters and the like or attempts to connect the Group to these sorts of issues in the countries and
regions where it operates could negatively affect the Group’s overall reputation and acceptance of its
services by customers. Damage to the Group’s reputation and loss of brand equity could reduce demand
for its services and thus have an adverse effect on the Group’s business financial condition and results
of operations and could require additional resources to rebuild its reputation and restore the value of its
brand.In addition the Group’s brand image or reputation may be materially and adversely affected by adverse
news scandals or other incidents associated with the logistics industry. Incidents that cast doubt on the
safety of cargo and parcels or the safety of delivery personnel in the logistics industry including incidents
involving its competitors have been and may continue to be subject to media attention and widespread
coverage. Such incidents may damage the reputation of not only the parties involved but also the logistics
industry in general and the Group even if such parties or incidents have no relation to the Group its
management employees suppliers or other business partners.Changes or slowdown in the e-commerce industry in China and globally could negatively affect the
Group’s business and growth prospects.The Group also serves customers in the e-commerce industry in China and globally. As such the Group’s
business and growth are affected by the viability and prospects of the e-commerce industry in China and
globally. Development of the e-commerce industry in China and globally is affected by a number of
factors most of which are beyond the Group’s control. These factors include:
* the consumption power and disposable income of e-commerce consumers in China and globally as
well as changes in demographics and consumer tastes and preferences;
* the availability penetration reliability and security of e-commerce platforms;
* the selection price and popularity of products offered on e-commerce platforms;
* the emergence of alternative channels or business models that better suit the needs of consumers in
China and globally;
* the development of fulfilment payment and other ancillary services associated with e-commerce;
and
* changes in laws and regulations as well as government policies that govern the e-commerce
industry.Changes or slowdown in the e-commerce industry in China and globally could materially and adversely
affect the Group’s growth and profitability.– 32 –The Group faces risks associated with its international operations.As of 31 December 2024 the Group had an extensive global delivery network covering 206 countries and
regions. Risks associated with the Group’s international operations may include among other things: (i)
changes in economic and political conditions in those markets; (ii) increasing costs and efforts in relation
to compliance with international laws and regulations restrictions or requirements relating to foreign
investment; (iii) increasing expenses relating to trade agreements and taxations; (iv) difficulties in
managing or overseeing its international operations; and (v) complexities relating to compliance with
applicable anti-bribery laws and regulations and export control restrictions and sanctions (economic or
otherwise) imposed by certain countries or self-regulated organisations against dealings with other
countries individuals or entities which may limit the Group’s ability to conduct its business with such
countries individuals or entities or to obtain funding for certain overseas businesses. The occurrence
persistence or consequences of any of these risks may restrict the Group’s ability to operate in the affected
market or reduce the profitability of its operations in that market which in turn would negatively affect
future prospects of the Group’s international operations.The Group’s international operations are also susceptible to uncertainties in the international financial
environment and increased foreign exchange risks stemming from the volatility of foreign exchange rates
and changes of foreign exchange controls. The Group may not be able to adjust its business practices in
time to avoid or mitigate adverse effects from any of the foregoing risks and accordingly the Group’s
business financial condition and results of operations could be materially and adversely affected.The Group’s long-term growth and competitiveness are highly dependent on its ability to control
costs.Compared with its competitors who rely more on the franchising model the Group bears more costs due
to its directly operated business model and therefore its ability to ensure effective cost-control measures
could have a more direct impact on its business. As such in order to maintain competitive pricing and
enhance its profit margins the Group must continually exert greater control over its costs than its
competitors who rely more on the franchising model. The Group has adopted various cost-control
measures and will continue to add new ones as necessary and appropriate. However the measures the
Group has adopted or will adopt in the future may not be as effective as expected. For the years ended 31
December 2022 2023 and 2024 the Group’s gross profit amounted to RMB33.0 billion RMB32.6 billion
and RMB38.9 billion respectively representing a gross profit margin of 12.3% 12.6% and 13.7% for the
same periods respectively. If the Group is not able to effectively control its costs its profitability and cash
flow may be adversely affected.Overall tightening of the labour market increases in labour costs or any possible labour unrest may
adversely affect the Group’s business financial condition and results of operations as the Group
operates in a labour-intensive industry.The Group operates in a labour-intensive industry. The Group’s business requires a substantial number of
staff and it competes with other companies in the same industry and other labour-intensive industries for
labour. Any failure to retain stable competent and dedicated labour may lead to disruption to or delay in
the Group’s services provided to customers. In addition the Group often needs to hire additional or
temporary workers to handle the significant increase in parcel volume following special promotional
events or during peak seasons of e-commerce. Although the Group has not experienced any labour
shortage to date it has observed an overall tightening and increasingly competitive labour market. The
Group has experienced and expects to continue to experience increases in labour costs due to increases
in market salary benefit level and/or its headcount.– 33 –Significant fluctuations in transportation costs may materially and adversely affect the Group’s
business financial condition and results of operations.Transportation costs are a major component of the Group’s cost of revenue. For the years ended 31
December 2022 2023 and 2024 the Group’s transportation costs amounted to RMB106.8 billion
RMB82.9 billion and RMB93.3 billion respectively representing 45.6% 36.7% and 38.0% of the Group’s
total cost of revenue respectively.The Group’s transportation costs are subject to a variety of factors such as fluctuations in the price and
availability of fuel air and sea freight fee rates the imposition of or increases in import or export taxes
vehicle taxes and duties. The price and availability of fuel are subject to political economic and market
factors that are beyond the Group’s control. In the event of significant increases in fuel prices the Group’s
transportation costs may increase and gross profits may decrease if it is unable to adopt any effective cost
control measures or pass on the incremental costs to its customers in the form of service surcharges. In
addition the air and sea freight industries are highly cyclical with prices for and supply of cargo space
affected by many factors such as the level of international trade activities global and regional economic
and political conditions economic sanctions outbreak of war changes in regulatory regimes and extreme
weather conditions. These factors are beyond the Group’s control and the nature timing and degree of
changes in industry conditions are largely unpredictable. The inability to pass on to its customers any
significant increases in transportation costs could therefore materially and adversely affect the Group’s
business financial condition and results of operations.The Group’s results of operations are subject to seasonal fluctuations.The Group experiences seasonality in its business. The Group typically experiences a seasonal surge in
volume of orders during the second and fourth quarters of each year when major online retail and
e-commerce platforms launch special promotional campaigns for example around June 18 of each year.The Group may experience capacity and resource shortages in fulfilling orders during the period of such
seasonal surge in its business. Conversely activity levels across the Group’s business lines are typically
lower around Chinese national holidays including Chinese New Year in the first quarter of each year
primarily due to weaker consumer spending lower user activity levels and decreased availability of
delivery personnel and warehouse staff during these holiday seasons. This pattern may result in
fluctuations in the Group’s operating results and therefore comparing the Group’s results of operations
across the different periods of a given year as an indicator of its performance may not be meaningful and
should not be relied upon as indicators of future performance.Information technology is critical to the Group’s business operations and growth prospects. Any
failure in maintaining protecting and making timely enhancements and upgrades to its information
technology system or introducing innovative additions could adversely affect its business results of
operations financial condition and growth prospects.The satisfactory performance reliability and availability of the Group’s technology system are critical to
its ability to provide high-quality services. The Group relies on its advanced technology systems such as
its end-to-end DataOps one-stop data development platform SF Smart Brain as well as its smart tools and
applications. See “Business – Technology and Research and Development” in this Offering Circular. The
Group’s technology systems support the smooth performance of certain key functions of its business such
as order tracking fleet dispatching and management route planning as well as smart supply chain
services. In addition the maintenance and processing of various operational and financial data is essential
to the Group’s day-to-day operations and formulation of its business strategies. Therefore the Group’s
results of operations and growth prospects depend in part on its ability to maintain and make timely and
– 34 –cost-effective enhancements and upgrades to its technology systems and to integrate technological
innovations that can meet its evolving operational needs. Failure to do so could cause economic losses and
put the Group at a disadvantage to its competitors. There is no assurance that the Group will be able to
keep up with technological developments or that technologies developed by others will not render its
services less competitive.Moreover any interruptions that result in the unavailability or slowdown of the Group’s centralised system
could materially and adversely affect a significant portion if not all of its logistics infrastructure and
network. If the Group cannot successfully execute system maintenance and repair its business operations
could be adversely affected and the Group could be subject to liability claims. Any such occurrences could
disrupt the Group’s services damage its reputation and harm its results of operations.Research and development in new technologies for logistics services are costly and time-consuming
and the outcome is uncertain.The Group’s success and long-term competitiveness depend in part on its ability to develop or adopt new
technologies to enhance its operational efficiency and reduce operational costs. Areas of focus of the
Group’s technological developments include data analyses SF Smart Brain (which focuses on the upgrade
of the digitalised and intelligent logistics network) and smart supply chain services as well as its smart
tools and applications. See “Business – Technology and Research and Development” in this Offering
Circular. For the years ended 31 December 2022 2023 and 2024 the Group’s research and development
expenditures comprising its research and development expenses and additions of development
expenditures amounted to RMB3.5 billion RMB3.4 billion and RMB3.1 billion respectively of which
35.9% 32.1% and 18.1% had been capitalised in the same periods respectively.
The development and commercial application of new technologies is complex time consuming and costly
and the results are unpredictable. There is no assurance that the Group’s research and development
activities will enable it to successfully develop new technologies or otherwise integrate technological
developments into its systems. Even if the Group successfully develops or adopts a new technology there
is no assurance that it will be successfully implemented to enhance its operational efficiency and reduce
operational costs. Competition in the logistics industry is intense and the Group’s competitors may
constantly launch new services and implement new technologies. Accordingly competitive landscape of
the logistics industry may differ significantly from what the Group had projected and technologies the
Group develops or adopts may no longer hold the competitive advantages in enhancing operational
efficiency or reducing operational costs. If any of the new technologies developed adopted or
implemented by the Group fails to perform as anticipated the Group may not be able to recoup its
significant investment in research and development and the Group’s business financial condition and
results of operations may be materially and adversely affected.Compliance with applicable data-related laws and regulations could require additional expenditures
and consequently affect the Group’s business financial condition and results of operations.Laws and regulations governing cybersecurity information security privacy and data protection and the
use of the internet as a commercial medium are rapidly evolving extensive and complex. The important
PRC laws and regulations on data protection data privacy and/or information security currently in effectthat the Group is subject to include among others the Cybersecurity Law (《中華人民共和國網絡安全法》) which took effect on 1 June 2017 the Personal Information Protection Law (《中華人民共和國個人信息保護法》) or the PIPL which took effect on 1 November 2021; and the Data Security Law (《中華人民共和國數據安全法》) which took effect on 1 September 2021. When providing logistics services
the Group may need to process various operational and other data of its customers business partners
employees and other individuals or businesses.– 35 –The interpretation and implementation of these laws and regulations keep evolving. Any potential or
perceived non-compliance with data-related laws and regulations may prevent the Group from using or
providing certain products and services and may result in fines or other penalties such as making certain
required changes to the Group’s business suspending its relevant lines of business taking down its
website or shutting down its operations reputational damages or proceedings or actions against the Group
by regulatory authorities customers or others which may have a material adverse effect on the Group’s
business operation or financial conditions. Furthermore on 24 February 2023 the CSRC released the
Provisions on Strengthening the Confidentiality and Archives Administration Related to the OverseasSecurities Offering and Listing by Domestic Enterprises (《關於加強境內企業境外發行證券和上市相關保密和檔案管理工作的規定》) which came into effect on March 31 2023. However there were no
further explanations or detailed rules or regulations with respect to such opinions or provisions and the
interpretation and implementation of these opinions and provisions may keep evolving.These and other similar legal and regulatory developments could affect how the Group designs its
information systems how it operates its business and how it processes and uses data. As the Group’s
customers may also be required to comply with relevant laws and regulations in the event that the Group’s
services are perceived to be exposing its customers to potential compliance risks demand for its services
might be affected. The Group may incur additional costs to comply with such laws and regulations to meet
the demands of its customers relating to their own compliance with applicable laws and regulations and
to establish and maintain internal compliance policies.The Group may not be able to obtain adequate financing when desired or on favourable terms.The Group needs to make continued investments in equipment land facilities and technological systems
to remain competitive. However there is no assurance that the Group will be able to obtain adequate
financing on commercially reasonably terms or at all if and when required especially if the Group
experiences unsatisfactory results of operations. If adequate financing is not available to the Group as
required the Group’s ability to fund its operations take advantage of potential business opportunities
develop or enhance its logistics infrastructure and network or respond to competitive pressures could be
limited. If the Group fails to obtain necessary funding in a timely manner or on favourable terms it may
be unable to meet the demands of existing and prospective customers which in turn could adversely affect
the Group’s business financial condition and results of operations.The Group faces risks associated with the handling and transportation of parcels and other risks
inherent in the logistics industry such as property damage personal injury and delivery of
prohibited or restricted items.The Group handles a large volume of parcels across its logistics network and have adopted various
internal control policies and measures to manage risks inherent in the handling and transportation of
parcels. The Group faces challenges with respect to the protection and examination of these parcels.Parcels in the Group’s network may be stolen damaged or lost for various reasons and it may be perceived
or found liable for such incidents. In addition the Group may fail to screen parcels and detect unsafe
prohibited or restricted items. Unsafe items such as flammables and explosives toxic or corrosive items
and radioactive materials may injure recipients or its staff or damage the Group’s assets or other parcels
in its network. Furthermore if the Group fails to prevent prohibited or restricted items from entering into
its network or if the Group participates in the transport and delivery of such items it may be subject to
administrative or even criminal penalties and if there is any resulting any personal injury or property
damage the Group may be further liable for civil compensation.– 36 –Delivery of parcels also involves inherent risks. The Group constantly have a large number of aircraft
vehicles and staff in transit and therefore need to face numerous transportation safety issues which may
not be fully covered by the insurances that the Group routinely maintains. From time to time the Group’s
vehicles and staff may be involved in transportation incidents or accidents and the parcels carried by them
may be lost or damaged. The Group’s staff may also get injured during delivery of parcels. In addition
frictions or disputes may occasionally arise from the direct interactions between its pickup and delivery
staff with parcel senders and recipients. Personal injuries or property damages may arise if such frictions
or disputes escalate.Any of the foregoing could disrupt the Group’s services cause it to incur substantial expenses and divert
the time and attention of its management. The Group may face claims and incur significant liabilities if
found liable or partially liable for any personal injuries property damages or economic losses. Claims
against the Group may exceed the amount of its insurance coverage or may not be covered by insurance
at all. Governmental authorities may also impose significant fines on the Group or require it to adopt
costly pre-emptive measures. Furthermore if the Group’s services are perceived to be insecure or unsafe
by its customers its parcel volume may significantly decline and the Group’s business financial condition
and results of operations may be materially and adversely affected.The Group has a limited history of operating cargo airline and civil aviation infrastructure and it
faces risks inherent to the aviation industry such as extensive regulations high fixed costs aircraft
incidents or accidents and the threat of terrorist attacks.The Group established its SF Airlines in 2009 and have a limited history of operating cargo airlines and
civil aviation infrastructure. The Group is exposed to risks inherent to the aviation industry including: (i)
extensive regulations and substantial regulatory influence over the aviation industry rendering the Group
under significant constraints on its flexibility and ability to further develop its air cargo fleet and air
routes; (ii) competition over flight schedules and air routes; (iii) high fixed costs including depreciation
expenses interest expenses pilot training costs and operating lease payments which do not vary
proportionately with cargo volumes actually carried; (iv) terrorist attacks aircraft accidents or incidents
which could result in significant property damages and claims relating to personal injuries or deaths; and
(v) difficulties in obtaining airline insurance with reasonable coverage at commercially feasible prices.Moreover the Group is currently responsible for operating the sorting centre in the Ezhou cargo hub. The
Group is exposed to risks inherent to the operation of civil aviation infrastructure including: (i) extensive
and evolving regulations over civil aviation infrastructure and the potential unfavourable changes in such
regulations such as an increase in aeronautical fees; and (ii) aircraft incidents or accidents the threat of
terrorist attacks or natural disasters that could cause material damage to the civil aviation infrastructure.The occurrence persistence or consequences of any of the foregoing risks may restrict the Group’s ability
to operate its air cargo fleet or civil aviation infrastructure or reduce the profitability of its operations
which in turn could materially and adversely affect the Group’s business financial condition and results
of operations.The regulatory environment for global aviation or other transportation rights may impact the
Group’s operations and increase its operating costs.The Group’s right to provide logistics services involving overseas destinations is subject to government
approvals. In addition the Group must obtain the permission of the relevant overseas jurisdictions to
provide specific flights and services. The Group’s international operations are also subject to current and
potential regulations including certain postal regulations and licensing requirements that restrict make
– 37 –difficult and sometimes prohibit the ability of foreign-owned companies to compete effectively in parts
of the global logistics market. Regulatory or executive actions affecting global aviation or transportation
rights or a failure to obtain or maintain aviation or other transportation rights in important international
markets could impair the Group’s ability to operate its network. Further the Group’s ability to obtain or
maintain aviation or other transportation rights internationally may be adversely affected by changes in
international trade policies and relations.The Group’s operation of SF Airlines is subject to other extensive regulatory and legal compliance
requirements that may result in significant costs. High-profile accidents catastrophes or incidents
involving aircraft may trigger increased regulatory and legal compliance requirements. Requirements can
be issued amended or restated from time to time or can otherwise impact the Group’s ability to efficiently
or fully utilise its aircraft and in some instances could result in the temporary grounding of aircraft types
altogether if the Group fails to comply with the applicable laws and regulations.The Group’s business and reputation may be harmed by unlawful unethical or anticompetitive
conducts within or in connection with its logistics network operations and other activities.The Group has adopted various policies operational manuals and disciplinary measures regarding the
conduct of its employees consultant agents and other third parties. Nonetheless there is no assurance that
such measures would be sufficient to prevent and deter its employees consultant agents or other third
parties from acting unlawfully or unethically.Such misconduct may include non-compliance with applicable laws and regulations pertinent to parcel
collection and delivery processes mishandling of funds or unlawful kickbacks during the Group’s
procurement of raw material or equipment. The Group also has little control over third parties involved
in unlawful unethical or anti-competitive conducts targeted at or in connection with its logistics network
operations and other activities such as non-compliance with laws or third-party sabotage or allegations
intended to harm the Group. The Group may incur substantial monetary losses suffer reputational damage
be subject to administrative penalties and fines have its licenses and permits revoked or even be ordered
by regulatory authorities to suspend its operations due to misconduct. The Group may also be required by
regulatory authorities in the relevant jurisdictions to allocate significant resources and incur additional
costs to prevent any unlawful unethical or anti-competitive conducts by its employees or third parties.The Group endeavours to comply with the anti-monopoly and anti-unfair competition laws and regulationsof the jurisdictions where it operates such as the Anti-Monopoly Law of the PRC (《中華人民共和國反壟斷法》) and the Anti-Unfair Competition Law of the PRC (《中華人民共和國反不正當競爭法》).Nonetheless the Group may be required by competent regulatory authorities to adjust its business
practices or may be subject to penalties such as confiscation of incomes or potential fines if any of its
past or future acquisitions or investments or any other business practices involving the Group is deemed
to be non-compliant with any anti-monopoly and anti-unfair competition laws and regulations. The Group
may also be subject to claims from its competitors or users which could affect its business and operations.The competent regulatory authorities may keep supervising the competition compliance issues and the
Group may receive greater attention from regulators which may increase its compliance costs and subject
the Group to heightened risks and challenges. The Group may have to spend much more personnel cost
and time evaluating and managing these risks and challenges in connection with its products and services
as well as its investments in its ordinary business course to avoid any failure to comply with these laws
and regulations. Any failure or perceived failure by the Group to comply with the anti-monopoly and
anti-unfair competition laws and regulations may result in governmental investigations or enforcement
actions litigations or claims against it and could affect the Group’s business financial condition and
results of operations.– 38 –The Group faces potential risks associated with outsourcing in its business operations.The Group engages service providers that provide pick-up and delivery services to it as well as outsourced
transportation service providers. The Group only enters into agreements with the service providers and
therefore do not have any direct contractual relationship with the personnel from these service providers.Since such personnel are not directly employed by the Group its control over them is more limited as
compared to its own employees. The Group cannot fully rule out the possibility of any personnel from
these service providers failing to operate or perform their duties in accordance with the Group’s policies
and guidelines in which event its market reputation brand image and results of operations could be
adversely affected.If the service providers violate any relevant requirements under the applicable laws and regulations
including labour laws or their employment agreements with the personnel placed with the Group by these
service providers such personnel may claim compensation from the Group as they provide their services
at the Group’s logistics facilities. As a result the Group may incur legal or financial liabilities and the
group’s reputation brand image as well as its business financial condition and results of operations could
be adversely affected.Trade restrictions and changes in international trade policies and relations could reduce the volume
of goods transported globally and adversely affect the Group’s international operations.The Group’s international operations may be affected by trade restrictions implemented by countries or
regions where its customers are located or where its customers’ products are manufactured or sold. For
example the Group is subject to risks relating to changes in trade policies tariff regulations embargoes
or other trade restrictions adverse to its customers’ business. Actions by governments that result in
restrictions on movement of cargo or otherwise could also impede the Group’s ability to carry out its
international operations. In addition international trade and political issues tensions and conflicts may
cause delays and interruptions to cross-border transportation and result in limitations on the Group’s
insurance coverage. If the Group is unable to transport cargo to and from countries with trade restrictions
in a timely manner or at all its business financial condition and results of operations could be materially
and adversely affected.Fluctuations in exchange rates may adversely affect the Group’s results of operations.A substantial portion of the Group’s revenues and cost of sales is denominated in RMB. However as the
Group also operates a part of its business in certain geographic markets outside of mainland China the
Group is subject to risks associated with foreign currency exchange fluctuations.Changes in the value of foreign currencies could affect the results of the Group’s overseas operations
(namely operations outside of mainland China). The Group’s overseas operations recorded revenue
denominated in foreign currencies of RMB58.9 billion RMB34.9 billion and RMB41.6 billion in 2022
2023 and 2024 respectively accounting for 22.0% 13.5% and 14.6% of the Group’s total revenue for the
same years respectively. Foreign currency denominated income from the principal businesses of the
Group’s overseas operations primarily consisted of freight charges. Such income is denominated primarily
in USD. In managing the foreign exchange risks the Group preferentially deploys natural hedges and may
also deploy a netting pool to net-off the foreign exchange risk exposures of account receivables and
account payables in the same currencies. Moreover foreign exchange risks also arise from foreign
currency-denominated debts undertaken by the Group in light of overseas expansion. These debts are
mainly denominated in USD. Based on the foregoing and considering that USD is pegged against HKD
that fluctuates within the band of 7.75 to 7.85 the Group believes its foreign exchange risk exposure is
manageable. In addition where necessary the Group may deploy hedging instruments depending on the
nature of transaction and financial market conditions after conducting a detailed assessment.– 39 –It is difficult to predict how external factors may impact the exchange rate of RMB to HKD USD or other
foreign currencies in the future. Further appreciation of RMB against foreign currencies may affect the
Group’s overseas operations.Over the years the Group has maintained certain hedging policies in an effort to reduce its exposure to
foreign exchange risks and the Group may maintain or further enhance its hedging policies in the future.However the availability and effectiveness of these hedging measures may be limited and the Group may
not be able to adequately cover its exposure or at all.Security breaches and attacks against the Group’s system and network and any failure to protect
confidential and proprietary information could damage its reputation and adversely affect its
business financial condition and results of operations.The Group relies on technologies to provide high-quality logistics services. However the Group’s
technology operations are vulnerable to potential disruptions arising from human errors natural disasters
power failures computer viruses spam attacks unauthorised access and other similar events. Disruptions
to or instability of the Group’s technology or external technology that supports the offering of its services
and solutions could materially harm its business and reputation.The Group’s cybersecurity measures may not detect or prevent all attempts to compromise its systems
including distributed denial-of-service attacks viruses malicious software break-ins phishing attacks
social engineering security breaches or other attacks and similar disruptions that may jeopardise the
security of information stored in and transmitted by the Group’s systems or that it otherwise maintains.Breaches of the Group’s cybersecurity measures could result in unauthorised access to its systems
misappropriation of information or data deletion or modification of customer information or a
denial-of-service or other interruption to its business operations. As techniques used to obtain
unauthorised access to or sabotage systems change frequently and may not be known until launched
against the Group it may be unable to anticipate or implement adequate measures to protect against these
attacks. For the years ended 31 December 2022 2023 and 2024 the Group had not been subject to these
types of attacks that had materially and adversely affected its business operations. However there can be
no assurance that the Group would not in the future be subject to such attacks that may result in material
damages or remediation costs. If the Group is unable to avert these attacks and security breaches it could
be subject to significant legal and financial liability the Group’s reputation would be harmed and it could
sustain substantial revenue loss from lost sales and customer dissatisfaction.In addition although the Group has adopted various measures and technologies that allow it to instantly
detect potential cyber-attacks and protect its data and information networks it remains possible that the
Group cannot anticipate or prevent rapidly evolving types of cyber-attacks.Cyber-attacks may target the Group its customers or the information infrastructure on which it depends.Actual or anticipated attacks and risks may cause the Group to incur significantly higher costs including
costs to deploy additional personnel and network protection technologies train employees and engage
third-party experts and consultants. Cybersecurity breaches may harm the Group’s reputation and
business and materially and adversely affect its financial condition and results of operations.The Group’s business generates and processes a large quantity of personal and transactional data. The
Group faces inherent risks when handling and protecting such large volumes of data including protecting
the data stored in its system detecting and prohibiting unauthorised data share and transfer preventing
attacks on its system by outside parties or fraudulent behaviour or improper use by its employees and
maintaining and updating its database. Any system failure security breach or third-party attacks or
attempts to illegally obtain the data that results in any actual or perceived release of user data could
damage the Group’s reputation and brand deter current and potential customers from using its services
damage its business and expose the Group to potential legal liability.– 40 –The Group is subject to various PRC laws and regulations relating to the collection use storage
processing and security of personally information with respect to its customers and employees including
regulatory requirements by competent authorities relating to such data. Further PRC regulators have beenincreasingly focused on regulation in the areas of data security and data protection. For details see “–Risks Relating to The Group’s Business and Industry – Compliance with applicable data-related laws and
regulations could require additional expenditures and consequently affect the Group’s business financialcondition and results of operations”.Any deficiencies in the telecommunications and Internet infrastructure in the jurisdictions where the
Group’s operate could impair the functioning of its technology system and its business operations.The Group’s business depends on the performance and reliability of the telecommunications and Internet
infrastructure in the jurisdictions where it operates. The availability and reliability of its website mobile
application customer service hotline and technology system depend on telecommunications carriers and
other third-party providers for communications and storage capacity including bandwidth and server
storage among other things. If the Group is unable to enter into and renew agreements with these
providers on acceptable terms or if any of the Group’s existing agreements with such providers are
terminated as a result of its breach or otherwise the Group’s ability to provide its services to its customers
could be adversely affected. In addition any service interruptions at the underlying external
telecommunications service providers such as the Internet data centres and broadband carriers could
result in interruptions to the Group’s services. Frequent service interruptions could frustrate customers and
discourage them from using its services which could cause the Group to lose customers and could harm
its operating results.Some of the Group’s services utilise third-party applications and services that it does not control. In
addition the Group faces risks related to regulatory and public scrutiny on its third-party service
providers. If such parties their associates and/or network members are subject to regulatory or
public scrutiny such as investigations and negative publicity the Group’s reputation business and
results of operations may be adversely affected.The Group utilises third-party applications and services to ensure the smooth performance of certain
functions of its business. For example the Group collaborates with social media access portal providers
for embedding its mini-programs and payment processing providers. The Group also depend in part on
mobile operating systems such as Android and iOS and their respective application marketplaces to make
its applications available to merchants consumers the Group’s employees and couriers. Any interruption
or delay most of which are beyond the Group’s control in the functionality of these third-party
applications and services may lead to interruptions to the Group’s system website or mobile application
slowdown or unavailability delays or errors in transaction processing loss of data or the inability to
accept and fulfil orders. In addition if any third-party application and service providers withdraw their
authorisation to use from the Group or if their services become limited restricted curtailed or less
effective in any way or otherwise become unavailable to the Group for any other reasons the Group’s
customer base and customer engagement may be harmed. The Group may not be able to promptly find
alternative ways to offer services in a timely reliable and cost-effective manner or at all which in turn
may materially and adversely affect the Group’s business financial condition and results of operations.In addition the Group relies on major third-party payment channels to facilitate and collect customers’
payment for its services. The Group is subject to various risks and uncertainties associated with these
third-party online payment channels. Any disruption to their payment services could materially and
adversely affect the Group’s payment collection and in turn its results of operations. Further when it
comes to online payment transactions through third-party payment channels secured transmission of
– 41 –customers’ confidential information is essential for maintaining customer confidence. The Group do not
have control over the data security measures of the third-party payment channels and their security
measures may not be adequate at present or may not remain adequate in light of the expected increased
use of online payment systems. Furthermore these payment channels are subject to various laws and
regulations regulating electronic funds transfers and virtual currencies which could change or be
reinterpreted in a way that will materially and adversely affect their compliance. If these payment channels
experience any non-compliance incidents they may be subject to fines or penalties charge higher
transaction fees due to regulatory or commercial reasons or even suspend or terminate their operations
with or without prior notice to the Group which in turn would materially and adversely affect the Group’s
performance and results of operations.Furthermore the Group engages third-party service providers for certain professional services such as
audit and legal services. The Group’s third-party service providers and/or their associates may from time
to time be subject to regulatory and public scrutiny which includes complaints to regulatory agencies
investigations negative media coverage and malicious allegations.The Group may not have effective or sufficient control over its franchisees. Any breach of the
franchise agreements or any violation of relevant laws and regulations by its franchisees may have
a negative impact on the Group’s business operations and reputation.The Group maintains direct control of its operations with minimal reliance on franchisees. The Group
identifies and selects the franchisees in compliance with the requirements under relevant laws and
regulations as well as its internal guidelines. The Group also enters into franchise agreements with its
franchisees which require them to among other things maintain all required permits licenses and
certificates recruit qualified staff and implement its pricing policies. In addition while the Group’s
franchise agreements stipulate a franchisee’s obligations there is no assurance that the franchisees will
fully fulfil their contractual obligations or strictly follow its guidelines. Moreover the Group may not be
able to ensure the franchisees’ full compliance with relevant laws and regulations. If the Group’s
franchisees fail to operate in accordance with its franchise agreements or violate any relevant laws and
regulations in the relevant jurisdictions the Group’s reputation business financial condition and results
of operations may be adversely affected.The Group faces risks associated with force majeure events severe weather conditions and other
natural disasters health epidemics and other outbreaks which could significantly disrupt the
Group’s business operations.The Group’s business could be adversely affected by severe weather conditions and natural disasters or the
outbreak of avian influenza severe acute respiratory syndrome H1N1 H7N9 the COVID-19 pandemic
or any other epidemics. Any of such occurrences could cause the Group to incur additional costs and cause
severe disruption to its daily operations and may even require a temporary closure of the Group’s business
or facilities. Such closures may disrupt the Group’s business operations and adversely affect its results of
operations. In particular the Group’s couriers are generally exposed to public environments and are
relatively susceptible towards outbreak of public health threats. The Group’s business operations could be
disrupted if its couriers or employees are suspected of having contagious disease or condition since the
Group could require such couriers or other employees to be quarantined. Infection prevention and control
measures could adversely affect the Group’s operations and the operations of its customers and in turn
affect the Group’s financial condition and results of operations. The Group’s operations could also be
disrupted if its suppliers customers or business partners were affected by such natural disasters or health
epidemics.– 42 –The Group’s success depends in significant part on the continuing efforts of its senior management
and other key personnel and the Group’s business operations would be adversely affected if it fails
to retain them.The Group depends to a significant degree on the continued services of its experienced senior management
and other key personnel. In particular the Group relies on the expertise and experience of its general
manager and other members of its senior management team. The Group has adopted various talent
retention measures. Nonetheless there is no assurance that the Group’s senior management and other key
personnel will always be able to or willing to continue their employment with the Group. In that case
the Group may not be able to replace them in a timely manner or at all. The Group may incur additional
costs to recruit and retain qualified replacements. The Group’s business may be severely disrupted and the
Group’s financial condition and results of operations may be materially and adversely affected. The Group
enters into confidentiality and non-compete agreements with its key personnel. However in the event that
any of the Group’s senior management or other key personnel joins a competitor or forms a competing
business the Group may lose customers know-how key professionals or other staff members. The Group
provides no assurance that it will be able to successfully enforce its contractual rights included in the
employment agreements it has entered into with its senior management and other key personnel. As a
result the Group’s business may be severely disrupted.There is no assurance that the Group will continue attracting training motivating and retaining
qualified personnel.The Group intends to hire and retain additional qualified employees to support its business operations and
drive future expansion. The Group’s future success depends to a significant extent on its ability to attract
train and retain qualified staff particularly management and operational staff with expertise in the
logistics industry or other areas it expands into. The Group’s experienced mid-level managers are
instrumental in executing its business plans implementing its business strategies and supporting its
business operations and growth and there is no assurance that it will be able to attract or retain these
qualified staff.There is no assurance that the Group could continue maintaining its corporate culture.Since the Group’s inception its corporate culture has been defined by its mission vision and values and
the Group believes that its culture has been critical to its success. In particular the Group’s corporate
culture has helped it to serve its customers attract retain and motivate employees and create value for
its shareholders. The Group faces a number of challenges that may affect its ability to maintain its
corporate culture such as:
* competitive pressures to move in directions that may divert the Group from its mission and values;
* the continued challenges of an ever-changing business environment;
* potential pressure from the public markets to focus on short-term results instead of long-term value
creation; and
* the increasing need to develop expertise in new areas of business that affect the Group.If the Group is not able to maintain its corporate culture or if its culture fails to deliver the long-term
results the Group expects to achieve its business results of operations financial condition and prospects
may be materially and adversely affected.– 43 –The Group may not be able to prevent unauthorised use of or other forms of infringement on its
intellectual property which could harm the Group’s business and competitive position.The Group regards its trademarks domain names trade secrets proprietary technologies and other
intellectual property as critical to its business. The Group relies on a combination of intellectual property
laws and contractual arrangements to protect its proprietary rights. However the Group may not be able
to register maintain and enforce its intellectual property rights in a timely manner or at all under the laws
and regulations in the countries and regions where it operates. Confidentiality agreements and license
agreements may be breached by counterparties and there may not be adequate remedies available to the
Group for any such breach. Policing any unauthorised use of or other forms of infringement on the
Group’s intellectual property is difficult and costly and the steps it has taken may be inadequate to prevent
the misappropriation of the Group’s intellectual property. In the event that the Group resorts to litigation
to enforce its intellectual property rights such litigation could result in substantial costs and a diversion
of its managerial and financial resources. The Group cannot provide any assurance that it will prevail in
such litigation. In addition the Group’s trade secrets may be leaked or otherwise become available to or
be independently discovered by its competitors. Any failure in protecting or enforcing its intellectual
property rights could have a material adverse effect on the Group’s business financial condition and
results of operations.The Group may be subject to intellectual property infringement claims which may be expensive to
defend and may disrupt its business operations.There is no assurance that the Group’s operations or any aspects of its business do not or will not infringe
upon or otherwise violate patents copyrights or other intellectual property rights held by third parties. The
Group may be subject to legal proceedings and claims relating to the intellectual property rights of others.In addition there may be other third-party intellectual property that is infringed by the Group’s services
or solutions the services or solutions provided by third-party merchants through its logistics infrastructure
and network or other aspects of the Group’s business. There could also be existing patents of which the
Group is not aware that its services or solutions may inadvertently infringe. There is no assurance that
holders of patents purportedly relating to some aspects of its technology platform or business if any such
holders exist would not seek to enforce such patents against the Group. Further the application and
interpretation of patent laws and the procedures and standards for granting patents in the countries and
regions where the Group operates may keep evolving and there is no assurance that relevant courts or
regulatory authorities would agree with its analysis. If the Group is found to have violated the intellectual
property rights of others it may be subject to liability for its infringement activities or may be prohibited
from using such intellectual property and the Group may incur licensing fees or be forced to develop
alternatives of its own. In addition the Group may incur significant expenses and may be forced to divert
management’s time and other resources from its business and operations to defend against these
third-party infringement claims regardless of their merits. Successful infringement or licensing claims
made against the Group may result in significant monetary liabilities and may materially disrupt its
business and operations by restricting or prohibiting its use of the intellectual property in question. Finally
the Group uses open-source software in connection with its services and solutions. Companies that
incorporate open-source software into their services and solutions have from time to time faced claims
challenging the ownership of open-source software and compliance with open-source license terms. As a
result the Group could be subject to suits by parties claiming ownership of what it believes to be
open-source software or noncompliance with open-source licensing terms. Some open-source software
licenses may require users who distribute open-source software as part of their software to publicly
disclose all or part of the source code to such software and make available any derivative works of the
open-source code on unfavourable terms or at no cost. Any requirement to disclose the Group’s source
code or pay damages for breach of contract could be harmful to its business financial condition and results
of operations.– 44 –Economic sanctions anti-corruption and anti-money laundering laws may expose the Group to
potential compliance risks.The Group is subject to economic sanctions anti-corruption anti-bribery anti-money laundering and other
relevant laws and regulations in the countries and regions where it has business operations. The Group
faces significant risks if it fails to comply with the applicable laws. Any violation of applicable economic
sanctions anti-corruption anti-bribery anti-money laundering or other laws or regulations could result in
governmental or regulatory investigations civil or criminal fines or other sanctions whistleblower
complaints and adverse publicity which could have an adverse effect on its reputation business operating
results and prospects. In addition responding to any enforcement action may result in a significant
diversion of management’s attention and significant defence costs and other professional fees.The United States and other jurisdictions or organisations including the European Union and the United
Nations have through executive orders passing of legislation or other governmental means implemented
measures that impose economic sanctions against certain countries or jurisdictions or against targeted
industry sectors groups of companies or persons and/or organisations within these countries or
jurisdictions. There can be no assurance that the Group will be able to prevent or detect all inadvertent
business dealings with sanctioned parties or the dispatch of freight to higher-risk or prohibited end-uses.The Group cannot predict the interpretation or implementation of government policies in the United States
at the federal state or local levels or any policy of the European Union the United Nations and other
applicable jurisdictions with respect to any current or future activities by the Group or its third-party
business partners in countries subject to international sanctions and with sanctioned persons. As a result
there is no assurance that the Group’s future business will be free of risk under sanctions implemented in
these jurisdictions or that the Group will conform its business to the expectations and requirements of the
authorities of the United States or any other government or organisation that with or without jurisdiction
over its business assert the right to impose sanctions on an extraterritorial basis. The Group’s business and
reputation could be adversely affected if the authorities of the United States the European Union the
United Nations or any other government or organisation were to determine that any of the Group’s
activities constitutes a violation of the sanctions they impose or provide a basis for a sanctions designation
of the Group. In addition as many sanction programs are constantly evolving new requirements or
restrictions could come into effect which might increase scrutiny of the Group’s business or result in
additional compliance risks.Any litigation legal and contractual disputes claims or administrative proceedings against the
Group could be costly and time-consuming to defend or settle and could result in negative publicity.The Group’s business is subject to the risk of disputes claims or legal proceedings brought by customers
suppliers employees government agencies and others in the forms of private actions administrative
proceedings regulatory actions or other litigation. The outcome of such proceedings can be difficult to
assess or quantify.Claimants in such proceedings may seek recovery of large or indeterminate amounts and the magnitude
of potential losses relating to such disputes may remain unknown for a substantial period of time. The cost
of defending future disputes or proceedings may be significant and could negatively affect the Group’s
results of operations if changes to its business operations are required. There could also be negative
publicity associated with such disputes or proceedings regardless of whether the allegations are valid or
whether the Group is ultimately found liable. As a result any significant dispute or proceeding could
adversely affect the Group’s business results of operations financial condition or reputation.– 45 –The Group’s insurance coverage may not be sufficient to cover all losses associated with its business
operations.The Group maintains various insurance policies to safeguard against risks and unexpected events. The
Group maintains various insurance policies to safeguard against risks and unexpected events in relation
to its business operations such as motor vehicle and non-motor vehicle liability insurance cargo
insurance parcel-related insurance and warehouse insurance. The Group do not maintain business
interruption insurance key-man insurance or terrorist attack insurance which is generally in line with
industry practices. There is no assurance that the Group’s insurance coverage is sufficient to prevent it
from any loss or that the Group will be able to successfully claim its losses under its current insurance
policies on a timely basis or at all. If the Group incurs any loss that is not covered by its insurance
policies or the compensated amount is significantly less than its actual loss the Group’s business
financial condition and results of operations could be materially and adversely affected.The Group’s business operations could be interrupted by any failures to renew the current leases or
locate desirable alternatives for its facilities or challenges to its use of certain leased properties by
governmental authorities or other third parties.The Group may not be able to successfully extend or renew such leases upon expiration of the current term
on commercially reasonable terms or at all and may therefore be forced to relocate from the affected
properties. This could disrupt its operations and result in significant relocation expenses which could
adversely affect the Group’s business financial condition and results of operations. The Group may not
be able to locate desirable alternative sites for its facilities as the Group’s business continues to grow and
failure in relocating its operations when required could adversely affect the Group’s business and
operations. In addition the Group competes with other businesses for premises at certain locations or of
comparable sizes. As a result even if the Group could extend or renew the respective leases rental
payments may significantly increase as a result of the high demand for the leased properties.In general the Group conducts customary due diligence on relevant real estate properties before entering
into lease agreements in accordance with market practice. Nevertheless there is no assurance that the
Group’s reviews surveys or inspections would have revealed all defects or deficiencies affecting its leased
properties including the titles thereof. The lessors of certain of the Group’s leased properties have not
provided it with their property ownership certificates or any other documentation proving their right to
lease those properties to the Group. If these lessors are not the owners of the properties and they have not
obtained consents or approval for sub-lease from the owners or their lessors or permits from the relevant
governmental authorities the Group’s leases could be invalidated. Neither is there assurance that the
lessors have taken all necessary actions to ensure mandatory fire-control and explosion insurance file
fire-control registration or satisfy relevant requirements under applicable laws and regulations. Also in the
event that the actual use of the Group’s leased properties is inconsistent with the designated use of
premises as stated in the relevant ownership certificate the relevant lease agreements may be deemed to
be in breach of the law and therefore void. If any of the foregoing occurs the Group may have to
renegotiate the leases with the owners or other parties who have the right to lease the properties or to find
alternative sites that are as commercially viable and the terms of the new leases may be less favourable
to the Group. The Group provides no assurance that it will be able to find suitable replacement sites on
terms acceptable to it on a timely basis or at all or that the Group will not be subject to material liability
resulting from third parties’ challenges on its use of such properties. In addition a portion of the Group’s
leasehold interests have not been registered with the relevant PRC governmental authorities as required
by relevant PRC laws. The failure to register leasehold interests may expose the Group to potential fines.– 46 –Title defects with respect to or encumbrances on certain land and buildings may cause interruptions
to the Group’s business operations.As of the date of this Offering Circular the Group had entered into contracts for the assignment of two
parcels of state-owned construction land use right and had fully settled the payment for the grant of the
right to these two parcels of land. The Group is in the process of obtaining land use right certificates for
these two parcels of land where no construction activities had been carried out yet on these two parcels
of land. However time required for obtaining these certificates is subject to uncertainties. In addition as
of the date of this Offering Circular the Group has certain properties with each having a GFA exceeding
1000 sq.m. that had not obtained ownership certificates in the PRC. The Group has not received any
material adverse decisions from relevant government authorities relating to those defects as of the date of
this Offering Circular. However until the Group obtains use or ownership rights to such land and
buildings it could be compelled to return the land to the relevant government authority while the buildings
located on such land could be confiscated or demolished. Moreover certain land use rights and the
buildings the Group owns have been mortgaged to banks as collaterals for its outstanding loans. In the
event that the mortgage holder forecloses on the mortgage and transfers the property to a third party the
Group may be forced to relocate these facilities. This could disrupt the Group’s operations and result in
additional costs which could adversely affect its business financial condition and results of operations.The Group has granted and may continue to grant share incentives which may result in increased
share-based payments.The Company historically adopted certain share option incentive plans for the purpose of awarding
eligible participants who contribute to the Group’s success and provide long-term incentives for
employees to deliver long-term shareholder returns. The Group recognises share-based payments in other
reserves and its consolidated statements of profit or loss based on awards ultimately expected to vest after
considering its estimated forfeitures in accordance with IFRS Accounting Standards. In addition certain
of the Group’s subsidiaries have also adopted share option incentive plans. For details see Note 33 to the
2024 Financial Statements.
The Group may incur additional share-based compensation payment expenses if it grants share incentives
in the future. The Group believes the granting of share-based compensation is of significant importance
to its ability to attract and retain key personnel and employees and it may continue to grant share-based
compensation to employees in the future. As a result the Group’s share-based payments may increase
which may have an adverse effect on the Group’s results of operations.The Group is exposed to certain uncertainties and risks in relation to the fair value changes of its
financial assets.Determination of the fair value changes of the Group’s financial assets requires the use of estimates that
are based on unobservable inputs and/or other estimates and judgments and therefore inherently involves
uncertainties. The Group uses unobservable inputs such as discount for lack of marketability and expected
rate of return in determining the fair values of its financial assets including but not limited to its financial
assets at FVTPL and financial assets at FVOCI. Such determination requires the Group to make material
estimates which may be subject to material changes and therefore inherently involves uncertainties. The
Group uses its judgment to select a variety of methods and make assumptions that are mainly based on
market conditions existing as of the respective valuation dates. These valuation methodologies that the
Group uses involve management judgment and are inherently uncertain. Changes in these unobservable
inputs and other estimates and judgments could affect the fair value of certain assets including the
Group’s financial assets at FVTPL and financial assets at FVOCI which in turn may adversely affect the
Group’s results of operations.– 47 –Further the Group is exposed to certain financial risks including credit risk and price risk in relation to
the fair value changes of its financial assets. For details see Note 3.1 to the 2024 Financial Statements.In terms of price risks the Group is exposed to equity price risk mainly arising from investments held by
it that are classified either as FVTPL or FVOCI that will not be sold within one year.The Group may record impairments of non-current assets such as its intangible assets (other than
goodwill) and goodwill.The Group may record impairments of non-current assets such as its intangible assets (other than
goodwill) and goodwill adversely affecting its financial condition and results of operations. The Group
reviews its non-current assets including its intangible assets (other than goodwill) whenever events or
changes in circumstances indicate that the carrying amount of an asset may no longer be recoverable.When these events occur the Group measures impairment by comparing the carrying value of the asset
to the recoverable amount of such asset which is the greater of the fair value less costs of disposal and
the value in use. If the recoverable amount is less than the carrying amount of such asset the Group
recognises an impairment loss based on the recoverable amount of such asset. The application of
impairment test to the Group’s non-current assets including its intangible assets (other than goodwill)
requires management judgement.Furthermore the Group determines whether goodwill is impaired at least on an annual basis. This requires
an estimate of the recoverable amount which is the higher of its value in use and its fair value less costs
of disposal. The Group uses the value in use of the cash-generating unit to which the goodwill is allocated
to determine the recoverable amount. The cash flow projections used to determine the value in use of a
cash-generating unit is based on assumptions such as revenue growth rates long term growth rate gross
margin rates and discount rate applied to the projected cash flows. These assumptions may be affected by
unexpected changes in future market or economic conditions. If the Group’s estimates and judgements are
inaccurate the recoverable amount determined could be inaccurate and the impairment recognised may not
be adequate and the Group may need to record additional impairments in the future.Divestitures of businesses and assets may have a material and adverse effect on the Group’s business
and financial condition.The Group disposed of certain subsidiaries for the years ended 31 December 2022 2023 and 2024 and
recorded gains on disposal of investments in subsidiaries of RMB32.3 million RMB268.2 million and
RMB80.6 million respectively. Such gains were non-recurring in nature. The Group may undertake partial
or complete divestitures or other disposal transactions in the future in connection with certain of its
businesses and assets particularly the ones that are not closely related to its core focus areas or might
require excessive resources or financial capital in pursuit of its business objectives. These decisions are
largely based on the assessment of the Group’s management of the business models and likelihood of
success of these businesses. However the Group’s judgment could be inaccurate and it may not achieve
the desired strategic and financial benefits from these transactions. The Group’s financial results could be
adversely affected by the impact from the loss of earnings and corporate overhead contribution/allocation
associated with divested businesses.Potential investors should not place undue reliance on financial information which is not audited or
reviewed.This Offering Circular contains the audited consolidated financial statements of the Group as at and for
the years ended 31 December 2023 and the year ended 31 December 2024 being the latest available
audited financial statements of the Group.– 48 –The financial information of the Group for the three months ended 31 March 2025 disclosed elsewhere in
this Offering Circular is derived from the Group’s management accounts. See “Recent Developments”. The
Group’s management accounts have not been audited or reviewed by independent auditors. As such any
such financial information should not be referred to or relied on by potential investors to provide the same
quality of information associated with any audited or reviewed information and the financial information
of the Group for the three months ended 31 March 2025 may not be indicative of the Group’s actual
financial condition or results of operations for any period (including the financial year ending 31
December 2025). Potential investors should exercise caution when using such data to evaluate the Group’s
financial condition and results of operations and must not place undue reliance on such financial
information. Such financial information may be adjusted or restated to address subsequent changes in
accordance with accounting standards the Group’s accounting policies and/or applicable laws and
regulations affecting the Group’s financial reporting or to reflect subsequent comments given by the
independent auditors during the course of their audit or review. Such adjustments or restatements may
cause discrepancies between the information with respect to a particular period or date contained in the
Group’s management accounts and its audited or reviewed financial statements. There can be no assurance
that had an audit or a review been conducted in respect of such financial information the information
presented therein would not have been materially different.RISKS RELATING TO DOING BUSINESS IN THE COUNTRIES AND REGIONS WHERE THE
GROUP OPERATES
Changes in the economic political or social conditions or government policies in the countries and
regions where the Group operates could affect its business financial condition and results of
operations.A substantial part of the Group’s assets and operations are located in China. In addition the Group
operates its business in a number of other geographic markets across Asia and globally. Accordingly the
Group’s business financial condition and results of operations could also be influenced by political
economic and social conditions in these markets. Economic growth in each of the Group’s geographic
markets has been uneven both geographically and among various sectors within any one of the relevant
economies. Any economic downturn whether actual or perceived further decrease in economic growth
rates or an otherwise uncertain economic outlook in the Group’s geographic markets or any other market
in which the Group may operate could affect its business financial condition and results of operations.Changes in the economic or political environment could increase the Group’s costs increase its exposure
to legal and business risks disrupt the Group’s operations and affect its results of operations.Any downturn in regional or global economy or deterioration of geopolitical environment could
affect the Group’s business financial condition and results of operations.The growth of the regional and global economy has slowed in recent years. It remains uncertain whether
and for how long the regional and global economic downturn will persist. There are considerable
uncertainties over the long-term effects of the monetary and fiscal policies adopted by the central banks
and financial authorities of some of the world’s leading economies. There have been concerns over the
Russia-Ukraine war the Israel-Hamas conflict and Israel-Iran conflict as well as unrest and terrorist
threats in certain countries and regions which have resulted in volatility in oil and other markets. In
addition the Red Sea crisis which began on 19 October 2023 disrupted international maritime trade and
the global supply chain. With the Suez Canal of the Red Sea being a critical conduit for approximately
30% of the world’s container traffic the crisis has since been causing surges in shipping costs. While the
Red Sea crisis has deescalated to a certain extent as of the date of this Offering Circular the situation
remains volatile. Regional economic conditions are sensitive to global economic conditions changes in
domestic economic and political policies as well as the expected overall economic growth rate.– 49 –It is unclear that whether these challenges and uncertainties will be effectively managed or resolved and
what effects they may have on the global political and economic conditions in the long term. Any
economic downturn or slowdown or negative business sentiment could have an indirect potential impact
on the Group’s industry. In addition continued turbulence in the international markets may adversely
affect the Group’s ability to access capital markets to meet liquidity needs. As a result the Group’s
business operations and financial performance may be adversely affected.Any uncertainties embedded in the legal systems of certain geographic markets where the Group
operates could affect its business financial condition and results of operations.Legal systems of the geographic markets where the Group operates vary significantly from jurisdiction to
jurisdiction. Some jurisdictions have a civil law system based on written statutes and others are based on
common law. Unlike the common law system prior court decisions under the civil law system may be
cited for reference but have limited precedential value.The Group is subject to certain uncertainties embedded in the legal systems of some geographic markets
where it operates. Laws and regulations that are recently enacted may not sufficiently cover all aspects of
economic activities in such markets. In particular the interpretation and enforcement of these laws and
regulations are subject to future implementations and the application of some of these laws and
regulations to the Group’s businesses is not settled. Since local administrative and court authorities are
authorised to interpret and implement statutory provisions and contractual terms it may be difficult to
evaluate the outcome of administrative and court proceedings and the level of legal protection the Group
has in many of the geographic markets where it operates. Local courts may have discretion to reject
enforcement of foreign awards or arbitration awards. These uncertainties may affect the Group’s judgment
on the relevance of legal requirements and its ability to enforce its contractual rights or claims. In addition
the regulatory uncertainties may be exploited through unmerited or frivolous legal actions claims
concerning the conduct of third parties or threats in attempt to extract payments or benefits from the
Group.Furthermore many of the legal systems in the geographic markets where the Group operates are based in
part on their respective government policies and internal rules some of which are not published on a
timely basis or at all and may have retroactive effects. There are other circumstances where key regulatory
definitions are unclear imprecise or missing or where interpretations that are adopted by regulators are
inconsistent with interpretations adopted by a court in analogous cases. As a result the Group may not be
aware of its violation of certain policies or rules until sometime after the violation. In addition
administrative and court proceedings in certain of the Group’s geographic markets may be protracted
resulting in substantial costs and diversion of resources and management attention.It is possible that a number of laws and regulations may be adopted or construed to be applicable to the
Group in its geographic markets and elsewhere that could affect its businesses and operations. Scrutiny
and regulations of the industries in which the Group operates may further increase and it may be required
to devote additional legal and other resources to addressing these regulations. Changes in current laws or
regulations or the imposition of new laws and regulations in the Group’s geographic markets may slow the
growth of the logistics industry and affect the Group’s business financial condition and results of
operations.Investors may have limited recourse in effecting services of legal process or enforcing overseas
judgments against the Group the Directors the Supervisors and senior management.A substantial part of the Group’s assets and a majority of the Directors the Supervisors and senior
management are located in China. As a result it may not be possible for investors to effect services of
process upon the Company or Directors Supervisors or senior management who reside in China. China
has not entered into treaties or arrangements providing for the recognition and enforcement of judgments
made by courts of most other jurisdictions.– 50 –On 14 July 2006 the Supreme People’s Court of the PRC and Hong Kong entered into the Arrangement
on Reciprocal Recognition and Enforcement of Judgments in Civil and Commercial Matters by the Courts
of the Mainland and of the Hong Kong Special Administrative Region Pursuant to Choice of CourtAgreements between Parties Concerned (《關於內地與香港特別行政區法院相互認可和執行當事人協議管轄的民商事案件判決的安排》) (the “2006 Arrangement”). Under the 2006 Arrangement where any
designated PRC court or any designated Hong Kong court has made an enforceable final judgment
requiring payment of money in a civil or commercial case under a choice of court agreement in writing
any party concerned may apply to the relevant PRC court or Hong Kong court for recognition and
enforcement of the judgment. On 18 January 2019 the Supreme People’s Court of the PRC and
Hong Kong entered into the Arrangement on Reciprocal Recognition and Enforcement of Judgments in
Civil and Commercial Matters by the Courts of the Mainland and of the Hong Kong Special
Administrative Region (《關於內地與香港特別行政區法院相互認可和執行民商事案件判決的安排》)
(the “2019 Arrangement”) which seeks to establish a mechanism with greater clarity and certainty for
recognition and enforcement of judgments in wider range of civil and commercial matters between the
PRC court and Hong Kong court. The 2019 Arrangement took effect on 29 January 2024 and superseded
the 2006 Arrangement.Certain of the Group’s foreign exchange transactions are subject to regulatory requirements over
foreign currency conversion.Conversion and remittance of foreign currencies are subject to certain foreign exchange regulations. It
cannot be guaranteed that under a certain exchange rate the Group would have sufficient foreign exchange
to meet its foreign exchange needs. For example under the PRC current foreign exchange regulation
system foreign exchange transactions under the current account conducted by the Group including the
payment of dividends do not require advance approval from the SAFE; however the Group is required
to present relevant documentary evidence of such transactions and conduct such transactions at designated
foreign exchange banks within the PRC that have the licenses to carry out foreign exchange business.Foreign exchange transactions under the capital account however normally need to be approved by or
registered with the SAFE or their local branch unless otherwise permitted by law. Any insufficiency of
foreign exchange may restrict the Group’s ability to obtain sufficient foreign exchange for dividend
payments to its shareholders the payment of principal under the Bonds to the Bondholders or satisfy any
other foreign exchange obligation. If the Group fails to obtain approvals from the SAFE to convert RMB
into any foreign exchange for any of the above purposes the Group’s potential offshore capital
expenditure plans its ability to satisfy its obligations under the Bonds and even its business may be
affected. Moreover non-compliance with any applicable foreign exchange regulations could subject it to
administrative penalties and fines and could affect the Group’s business and reputation.The Group’s payment of dividends is subject to restrictions under applicable laws and regulations.As the Company is a holding company it relies on dividends from its subsidiaries for cash requirements
including services of any debts the Group may incur. However the payment of dividends is subject to
restrictions under applicable laws and regulations. For example under current PRC law dividends may be
paid only out of the Group’s PRC subsidiaries’ accumulated after-tax profits if any determined in
accordance with PRC accounting standards and regulations. Moreover each of the Group’s PRC
subsidiaries is required to set aside at least 10% of its after-tax profits each year if any to fund certain
statutory reserves except where such reserve has reached 50% of its registered capital. These reserves are
not distributable as cash dividends. In addition in the future if any of the Group’s subsidiaries incurs debt
on its own behalf the instruments governing the debt may impose restrictions on its ability to pay
dividends or other payments to the Company. The inability of the Group’s subsidiaries to distribute
dividends or other payments to the Company could significantly affect the amount of liquidity available
to supply the development and growth of the Group’s business and the Company’s obligations under the
Bonds.– 51 –The Group’s offshore subsidiaries may be treated as a resident enterprise for PRC tax purposes.Under the PRC Enterprise Income Tax Law (《中華人民共和國企業所得稅法》) and the Regulation on theImplementation of the Enterprise Income Tax Law of China (《中華人民共和國企業所得稅法實施條例》) enterprises established under the laws of jurisdictions outside of China with “de facto managementbodies” located in China may be considered PRC tax resident enterprises for tax purposes and may be
subject to the PRC enterprise income tax at the rate of 25% on their global income. In addition the Notice
Regarding the Determination of Chinese-Controlled Offshore Incorporated Enterprises as PRC TaxResident Enterprises on the Basis of De Facto Management Bodies (《國家稅務總局關於境外註冊中資控股企業依據實際管理機構標準認定為居民企業有關問題的通知》) or Circular 82 specifies that certain
Chinese-controlled offshore incorporated enterprises defined as enterprises incorporated under the laws
of foreign countries or territories and that have PRC enterprises or enterprise groups as their primary
controlling shareholders will be classified as resident enterprises if all of the following conditions are
met: (i) senior management personnel and departments that are responsible for daily production operation
and management are located mainly within China; (ii) financial and personnel decisions are subject to
determination or approval by bodies or persons in China; (iii) key properties accounting books company
seal and minutes of board meetings and shareholders’ meetings are located or kept within China; and (iv)
at least half of the directors with voting rights or senior management reside within China. The State
Administration of Taxation of the PRC or SAT has subsequently provided further guidance on the
implementation of Circular 82.Although the Group’s offshore subsidiaries have substantive business operations in the countries or
regions where they located as the Company is a PRC enterprise the Group’s offshore subsidiaries may
be questioned by the competent regulatory authorities and if its offshore subsidiaries are deemed PRC
resident enterprises they could be subject to the EIT at 25% on their global income except that the
dividends they receive from its PRC subsidiaries if any may be exempt from the EIT to the extent suchdividend income constitutes “dividends received by a PRC resident enterprise from its directly investedentity that is also a PRC resident enterprise.” Nonetheless it remains subject to future interpretation as to
what type of enterprise would be deemed a “PRC resident enterprise” for such purposes. The EIT on its
subsidiaries’ global income could significantly increase the Group’s tax burden and affect its cash flows
and profitability.The Group’s operations are subject to and may be affected by changes in tax laws and regulations
in the countries and regions where it operates.The EIT Law imposes a tax rate of 25% on business enterprises. Some of the Group’s subsidiaries are
entitled to preferential tax treatment. To the extent there are any changes in the laws and regulations
governing preferential tax treatment or increases in the Group’s effective tax rate due to any other reasons
the Group’s tax liability would increase correspondingly. In addition the PRC government may amend or
restate regulations on income withholding value-added and other taxes. Non-compliance with the PRC
tax laws and regulations may also result in penalties or fines imposed by relevant tax authorities.Adjustments or changes to PRC tax laws and regulations and tax penalties or fines could affect the Group’s
businesses financial condition and results of operations.The Group also operate in countries and regions overseas and are subject to various taxes. Due to the fact
that the tax environment can be different in different jurisdictions and that the regulations regarding
various taxes including but not limited to corporate income tax are complex the Group’s international
operations may expose it to risks associated with the overseas tax policy changes. Dealing with such
regulatory complexities and changes may require the Group to divert more managerial and financial
resources which in turn could affect its results of operations.– 52 –Discontinuation of any government grants or preferential tax treatments could affect the Group’s
financial condition and results of operations.In the past the Group has received various forms of government financial incentives and preferential tax
treatments in accordance with applicable laws and regulations in China. For the years ended 31 December
2022 2023 and 2024 the Group recorded government grants of RMB2.3 billion RMB2.0 billion and
RMB679.2 million respectively. In addition several COVID-19 related government policy supports such
as one-off subsidies for social insurance and tax relief and waiver of toll charges have also contributed
to the Group’s financial performance in the past. However the timing amount and criteria of government
financial incentives are determined within the authorised discretion of the local governments and cannot
be predicted with certainty before the Group actually receives any financial incentive. Local governments
may decide to reduce or eliminate incentives at any time. There is no assurance that the continued
availability of the government incentives the Group currently enjoys. Any reduction or elimination of such
incentives could affect the Group’s results of operations.Several jurisdictions in which the Group operates impose restrictions on foreign ownership of
businesses. Changes in relevant laws and regulations or policies could affect the Group’s business
financial condition and results of operations.Foreign investors are subject to restrictions on foreign ownership in certain industries in several
jurisdictions where the Group operates such as Malaysia and Indonesia. The governments of these
jurisdictions in which the Group operates may re-evaluate or amend the relevant laws and regulations or
policies and changes in the laws and regulations or policies including their application or interpretation
could require the Group to remove or amend its existing arrangements or reduce its voting or economic
interests in any existing or future subsidiaries and associates in these jurisdictions. Any such removal
amendment or reduction could affect the Group’s ability to successfully implement its business strategies
and operate in the relevant jurisdictions. Furthermore there is no assurance that the Group’s subsidiaries
or associates will be able to comply with any new restrictions on foreign ownership because compliance
may be affected by whether other shareholders are considered domestic or foreign investors as determined
in accordance with the applicable laws and regulations. If foreign ownership restrictions are determined
to have been violated penalties could be imposed and relevant licenses or agreements could be cancelled
or voided. Any of these events could affect the Group’s business financial condition and results of
operations.RISKS RELATING TO THE BONDS THE GUARANTEE THE SHARES AND THE OFFERING
The Bonds and the Guarantee will be effectively subordinated to all of the Issuer’s and the
Guarantor’s secured debt.The Bonds and the Guarantee will be general senior unsecured obligations. The Bonds and the Guarantee
will be effectively subordinated to all the secured indebtedness of the Issuer and the Guarantor to the
extent of the value of the assets securing such indebtedness. In addition the Bonds and the Guarantee will
subject to some limitations permit the Issuer and the Guarantor to incur additional secured indebtedness
in connection with bank and other financing arrangements.In the event of bankruptcy liquidation reorganisation or other winding-up the assets of the Issuer and the
Guarantor that secure the secured indebtedness of the Issuer and the Guarantor will be available to pay
obligations on the Bonds or under the Guarantee only after all secured indebtedness together with accrued
interest has been repaid. If the Issuer or the Guarantor is unable to repay its secured indebtedness its
lenders could foreclose on substantially all the assets of the Issuer and the Guarantor which serve as
– 53 –collateral. Under such circumstances the secured lenders of the Issuer or as the case may be the
Guarantor would be entitled to be repaid in full from the proceeds of the liquidation of those assets before
those assets would be available for distribution to other creditors including holders of the Bonds. Holders
of the Bonds will participate in the proceeds of the liquidation of the remaining assets of the Issuer or as
the case may be the Guarantor rateably with holders of the unsecured indebtedness of the Issuer or as the
case may be the Guarantor that is deemed to be of the same class as the Bonds and potentially with all
of the other general creditors of the Issuer and or as the case may be the Guarantor.Claims by holders of the Bonds are structurally subordinated to creditors of the subsidiaries of the
Issuer and the Guarantor.The ability of the Issuer and the Guarantor to make payments in respect of the Bonds and the Guarantee
depends largely upon the receipt of dividends distributions and interest of advances from their
subsidiaries. The ability of the subsidiaries of the Issuer and the Guarantor to pay dividends and other
amounts to the Issuer and the Guarantor may be subject to such subsidiaries’ profitability and applicable
laws. Payments under the Bonds are structurally subordinated to all existing and future liabilities and
obligations of each of the subsidiaries of the Issuer and the Guarantor. Claims of creditors of such
companies will have priority as to the assets of such companies over the Issuer the Guarantor and its
creditors including holders of the Bonds.There may not be a liquid market for the Bonds and Bondholders may not be able to sell their Bonds
at an attractive price or at all.The Bonds will be a new issue of securities for which there is currently no trading market. Although
application will be made to the Hong Kong Stock Exchange for the listing of and permission to deal in
the Bonds the Issuer and the Guarantor cannot assure investors as to the liquidity of the Bonds that an
active trading market will develop or that the Issuer and the Guarantor will be able to maintain a listing
of the Bonds on the Hong Kong Stock Exchange. None of the Managers are obligated to make a market
in the Bonds and any such market making if commenced may be discontinued at any time at the sole
discretion of the Managers. Accordingly there is no assurance that a liquid trading market for the Bonds
will develop or be sustained. If an active trading market for the Bonds does not develop or is not sustained
the market price and liquidity of the Bonds may be adversely affected.Even if an active trading market were to develop the Bonds could trade at prices that might be lower than
the initial offering price. Future trading prices of the Bonds will depend on many factors including but
not limited to:
* prevailing interest rates and interest rate volatility;
* the market for similar securities;
* the operating and financial results of the Issuer and the Guarantor;
* the publication of earnings estimates or other research reports and speculation in the press or the
investment community;
* the market price of the Bonds; or
* changes in the Group’s industry and competition and general market and economic conditions.Accordingly Bondholders may not be able to sell their Bonds at an attractive price or at all and may incur
losses on their investments.– 54 –The Trustee may request the Bondholders to provide an indemnity and/or security and/or
prefunding to its satisfaction.In certain circumstances including giving of notice to the Issuer and the Guarantor pursuant to Condition
9 (Events of Default) of the Terms and Conditions and the taking of steps actions or proceedings pursuant
to Condition 13 (Enforcement) of the Terms and Conditions the Trustee may request Bondholders to
provide an indemnity and/or security and/or prefunding to its satisfaction before it takes steps and/or
actions and/or institutes proceedings on behalf of Bondholders. The Trustee shall not be obliged to take
any such steps and/or actions and/or to institute any such proceedings if it is not indemnified and/or
secured and/or prefunded to its satisfaction. Negotiating and agreeing to an indemnity and/or security
and/or prefunding can be a lengthy process and may affect when such steps and/or actions can be taken
and/or such proceedings can be instituted. The Trustee may not be able to take steps and/or actions and/or
institute proceedings notwithstanding the provision of an indemnity and/or security and/or prefunding to
it in breach of the terms of the Trust Deed and/or the Terms and Conditions and in such circumstances
or where there is uncertainty or dispute as to the applicable laws or regulations to the extent permitted by
the agreements and the applicable law it will be for the Bondholders to take such steps and/or actions
and/or institute such proceedings directly.Bondholders will have no rights as holders of the Shares prior to conversion of the Bonds but are
subject to changes made with respect to the Shares.Unless and until the Bondholders acquire the Shares upon conversion of the Bonds Bondholders will have
no rights with respect to the Shares including any voting rights or rights to receive any regular dividends
or other distributions with respect to the Shares. Upon conversion of the Bonds these holders will be
entitled to exercise the rights of holders of the Shares only as to actions for which the applicable record
date occurs after the date of conversion. However such Bondholders are subject to all changes affecting
the Shares. For example in the event that an amendment is proposed to the Articles of Association
requiring shareholder approval and the record date for determining the shareholders of record entitled to
vote on the amendment occurs prior to the date of conversion of the Bonds for such Shares and (as
applicable) the date of registration by the relevant Bondholder as the holder thereof that Bondholder
would not be entitled to vote on the amendment but would nevertheless be subject to any resulting changes
in the powers preferences or special rights that affect the Shares after conversion.There is a limited period during which the Bondholders may convert their Bonds.Subject as provided in the Terms and Conditions Conversion Right under the Terms and Conditions may
only be exercised in certain limited circumstances (subject to any applicable fiscal or other laws or
regulations and as further provided in the Terms and Conditions) at any time on and after the 41st day after
the Issue Date up to the close of business (at the place where the bond certificate evidencing such Bond
is deposited for conversion) on the date falling 10 working days prior to the Maturity Date (both days
inclusive) or if such Bond shall have been called for redemption by the Issuer before the Maturity Date
then up to and including the close of business (at the place aforesaid) on a date no later than 10 working
days (at the place aforesaid) prior to the date fixed for redemption thereof. If the Conversion Right is not
exercised by Bondholders during the Conversion Period the Bonds will be redeemed at 100.5 per cent.of its principal amount on the Maturity Date unless the Bonds are previously redeemed converted or
purchased and cancelled in accordance with the Terms and Conditions.– 55 –Securities law restrictions on the resale and conversion of the Bonds and the resale of the Shares
issuable upon their conversion may limit Bondholders’ ability to sell the Bonds in the United States.The Bonds and the Shares into which the Bonds are convertible have not been and will not be registered
under the Securities Act any state securities laws or the securities laws of any other jurisdiction. Unless
and until they are registered the Bonds and the Shares issuable upon conversion may not be offered sold
or resold except pursuant to an exemption from registration under the Securities Act and applicable state
laws or in a transaction not subject to such laws. The Bonds are being offered and sold outside the U.S.in reliance on Regulation S under the Securities Act. The Issuer is not required to register the Bonds and
the Shares into which the Bonds are convertible under the terms of the Bonds. Hence future resales of the
Bonds and the Shares into which the Bonds are convertible may only be made pursuant to an exemption
from registration under the Securities Act and applicable state laws or in a transaction not subject to such
laws.The Issuer and the Guarantor will follow the applicable corporate disclosure standards for debt
securities listed on the Hong Kong Stock Exchange which may be different from those applicable to
companies in certain other countries.The Issuer and the Guarantor will be subject to reporting obligations in respect of the Bonds to be listed
on the Hong Kong Stock Exchange. The disclosure standards imposed by the Hong Kong Stock Exchange
may be different from those imposed by securities exchanges in other countries or regions. As a result the
level of information that is available may not correspond to what investors in the Bonds are accustomed
to or may expect.The Bondholders may be subject to tax on their income or gain from the Bonds.Prospective investors of the Bonds are advised to consult their own tax advisers concerning the overall tax
consequences of the acquisition ownership or disposition (including upon conversion of the Bonds) of the
Bonds or the Shares. (See “Taxation” for certain PRC and Hong Kong tax consequences.)
Gains on the transfer of the Bonds and Premium may be subject to income tax under PRC tax laws.Under the EIT Law and its implementation rules gains on the transfer of the Bonds may be subject to
income tax under PRC tax laws if the Bonds are deemed to be equity interests and such capital gains are
regarded as having been sourced from the PRC.Under the EIT Law a non-resident enterprise shall pay PRC enterprise income tax on its income sourced
from inside the PRC including the gains derived from the disposal of equity interests in a PRC enterprise.However it is not clear whether the Bonds would be deemed as equity interests by the PRC taxation
authorities and such capital gains would be regarded as sourced from the PRC. If the Bonds are deemed
as equity interests and such capital gains are regarded as sourced from the PRC by the PRC taxation
authorities any gains realised on the transfer of the Bonds by holders who are deemed under the EIT Law
as non-resident enterprises would be subject to PRC enterprise income tax. Under the EIT Law a
“non-resident enterprise” means an enterprise established under the laws of a jurisdiction other than the
PRC and whose actual administrative organisation is not in the PRC which has established offices or
premises in the PRC or which has not established any offices or premises in the PRC but has obtained
incomes derived from sources within the PRC. In addition there is uncertainty as to whether gains realised
on the transfer of the Bonds by non-resident PRC individual holders will be subject to PRC individual
income tax. If such gains are subject to PRC income tax the 10 per cent. enterprise income tax rate and
20 per cent. individual income tax rate will apply respectively unless there is an applicable tax treaty or
arrangement that reduces or exempts such income tax. The taxable income will be the balance of the total
income obtained from the transfer of the Bonds minus all costs and expenses that are permitted under PRC
tax laws to be deducted from the income.– 56 –If a Holder being a non-resident enterprise or non-resident individual is required to pay any PRC income
tax on gains on the transfer of the Bonds the value of the relevant Holders’ investment in the Bonds may
be materially and adversely affected. See “Taxation – PRC”. Under the IIT Law a “non-residentindividual” means any non-resident PRC individual who is neither domiciled in the PRC nor residing in
the PRC or who is not domiciled in the PRC but has resided in China for less than aggregate of 183 days
within a tax year.If any of the Issuer the Guarantor or any of their respective subsidiaries is unable to comply with
the restrictions and covenants in its debt agreements there could be a default under the terms of
these agreements which could cause repayment of its debt to be accelerated.If any of the Issuer the Guarantor or any of their respective subsidiaries is unable to comply with the
restrictions and covenants or its current or future debt obligations and other agreements there could be
a default under the terms of those agreements. In the event of a default under these agreements the holders
of the debt could terminate their commitments to lend accelerate repayment of the debt and declare all
outstanding amounts due and payable or terminate the agreements as the case may be. As a result a
default under one debt agreement may cause the acceleration of repayment of not only such debt but also
other debt including the Bonds or result in a default under the Issuer’s or the Guarantor’s or such
subsidiary’s other debt agreements. If any of these events occur there is no assurance that the Issuer or
the Guarantor will have sufficient assets and cash flow to repay in full all of its indebtedness or that the
Issuer or the Guarantor would be able to find alternative financing. Even if the Issuer of the Guarantor
could obtain alternative financing it cannot guarantee that it would be on terms that are favourable or
acceptable to the Issuer or the Guarantor.The Issuer and the Guarantor may not have the ability to redeem the Bonds.Bondholders may require the Issuer subject to certain conditions to redeem for cash some or all of theirBonds upon a transaction or event constituting a Relevant Event as described under “Terms and Conditionsof the Bonds – Redemption Purchase and Cancellation – Redemption for Relevant Events”. The Issuer or
the Guarantor may not have sufficient funds or other financial resources to make the required redemption
in cash at such time or the ability to arrange necessary financing on acceptable terms or at all. The Issuer’s
or the Guarantor’s ability to redeem the Bonds in such event may also be limited by the terms of other debt
instruments. Failure to repay repurchase or redeem tendered Bonds by the Issuer or the Guarantor would
constitute an Event of Default under the Bonds which may also constitute a default under the terms of
other indebtedness held by the Issuer or the Guarantor.The Bonds may be redeemed at the option of the Issuer which may adversely affect the trading price
and liquidity of the Bonds and may subject Bondholders to reinvestment risks.Subject to certain conditions the Bonds may be redeemed at the Issuer’s option at their Early Redemption
Amount (as defined in the Terms and Conditions) if at any time the aggregate principal amount of the
Bonds outstanding is less than 10 per cent of the aggregate principal amount originally issued (including
any Bonds issued pursuant to Condition 15 (Further Issues) of the Terms and Conditions) but prior to theMaturity Date. See “Terms and Conditions of the Bonds – Redemption Purchase and Cancellation –Redemption at the Option of the Issuer”. As a result the trading price of the Bonds may be affected when
this option of the Issuer becomes exercisable. Accordingly Bondholders may not be able to sell their
Bonds at an attractive price. Therefore exercise of the Issuer’s option to redeem the Bond could have a
material adverse effect on the trading price and liquidity of the Bonds. In addition the Bondholders may
not be able to reinvest the redemption proceeds at an effective interest rate and may only be able to do
so at a significantly lower rate. Potential investors should consider reinvestment risk in light of other
investments available at that time.– 57 –Short selling of the Shares by Bondholders could materially and adversely affect the market price
of the Shares.The issuance of the Bonds may result in downward pressure on the market price of the Shares. Investors
in convertible securities may seek to hedge their exposure in the underlying equity securities often
through short selling of the underlying equity securities or similar transactions. Any short selling and
similar hedging activity could place significant downward pressure on the market price of the Shares
thereby having a material adverse effect on the market value of the Shares owned by an investor as well
as on the trading price of the Bonds.The market value of the Bonds may fluctuate.Trading prices of the Bonds are influenced by numerous factors including the results of operations and/or
the financial condition and business strategy (in particular further issuance of debt or corporate events
such as share sales reorganisations takeovers or share buybacks) of the Group and/or the subsidiaries
and/or associated companies of the Group political economic financial regulatory and any other factors
that can affect the capital markets the industry the Group and/or the subsidiaries and/or associated
companies of the Group generally. Adverse economic developments in Hong Kong and China as well as
countries in which the Group and/or the subsidiaries and/or associated companies of the Group operate or
have business dealings could have a material adverse effect on the Hong Kong economy and the results
of operations and/or the financial condition of the Group and/or the subsidiaries and/or associated
companies of the Group.In addition the market price of the Bonds is expected to be affected by fluctuations in the market price
of the Shares. There can be no certainty as to the effect if any that future issues or sales of Shares or
the availability of such Shares for future issue or sale will have on the market price of the Shares
prevailing from time to time and therefore on the market price of the Bonds. Disposals of Shares by
shareholders or a perception in the market that such disposals could occur could adversely affect the
prevailing market price of the Shares and the Bonds.Changes in interest rates may have an adverse effect on the price of the Bonds.The Bonds will not bear interest. The Bondholders may suffer unforeseen losses due to fluctuations in
interest rates. Generally a rise in interest rates may cause a fall in the prices of the Bonds resulting in
a capital loss for the Bondholders. Conversely when interest rates fall the prices of the Bonds may rise.The Bondholders may enjoy a capital gain.The return on the Bonds may decrease due to inflation.The Bondholders may suffer erosion on the return of their investments due to inflation. The Bondholders
would have an anticipated rate of return based on expected inflation rates on the purchase of the Bonds.An unexpected increase in inflation could reduce the actual returns.The Bonds may not be a suitable investment for all investors under applicable laws and regulations.Each potential investor in the Bonds must determine the suitability of that investment in light of its own
circumstances. In particular each potential investor should:
* have sufficient knowledge and experience to make a meaningful evaluation of the Bonds the merits
and risks of investing in the Bonds and the information contained in this Offering Circular or any
applicable supplement;
– 58 –* have access to and knowledge of appropriate analytical tools to evaluate in the context of its
particular financial situation an investment in the Bonds and the impact such investment will have
on its overall investment portfolio;
* have sufficient financial resources and liquidity to bear all of the risks of an investment in the Bonds
including where the currency for principal or interest payments is different from the potential
investor’s currency;
* understand thoroughly the terms of the Bonds and be familiar with the behaviour of any relevant
indices and financial markets; and
* be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for
economic interest rate and other factors that may affect its investment and its ability to bear the
applicable risks.The Bonds are complex financial instruments. Sophisticated institutional investors generally do not
purchase complex financial instruments as stand-alone investments. They purchase complex financial
instruments as a way to reduce risk or enhance yield with an understood measured and appropriate
addition of risk to their overall portfolios. A potential investor should not invest in the Bonds which are
complex financial instruments unless it has the expertise (either alone or with the help of a financial
adviser) to evaluate how the Bonds will perform under changing conditions the resulting effects on the
value of the Bonds and the impact this investment will have on the potential investor’s overall investment
portfolio.Additionally the investment activities of certain investors are subject to investment laws and regulations
that impose an approval requirement on or restrict certain investments. Each potential investor should
consult its legal advisers to determine whether and to what extent (a) it is legally permitted to invest in
the Bonds (b) the Bonds can be used as collateral for applicable types of borrowing and (c) other
restrictions apply to its purchase of any Bonds. Financial institution investors should consult their legal
advisers or the appropriate regulators to determine the appropriate treatment of Bonds under any
applicable risk-based capital or similar rules.For example on 28 October 2024 the U.S. Department of Treasury issued the Provisions Pertaining to
U.S. Investments in Certain National Security Technologies and Products in Countries of Concern to
implement the Executive Order 14105 which came into effect on 2 January 2025 (the “Final Rules”). U.S.persons (as defined under the Final Rules) are prohibited from knowingly engaging in or are required to
notify the U.S. Treasury (i.e. “prohibited transaction” and “notifiable transaction” as such terms aredefined in the Final Rules) regarding a broad range of investment transactions in entities in “countries ofconcern” (presently limited to mainland China Hong Kong and Macau) that are engaged in activities
related to semiconductors and microelectronics quantum information technologies and artificial
intelligence systems (together “Covered Activities”). Investments by U.S. persons that are affected by the
Final Rules include among others acquisition of an equity interest or contingent equity interest in a
“Covered Foreign Person” (as defined in the Final Rules) and conversion of a contingent equity interest
into an equity interest in a Covered Foreign Person such as an investment in convertible securities of an
entity engaging in a Covered Activity and the subsequent conversion of the securities. Debt financing that
affords or will afford investors who are U.S. persons an interest in profits of a Covered Foreign Person
the right to appoint members of the board of directors (or equivalent) of a Covered Foreign Person or
other comparable financial or governance rights characteristic of an equity investment but not typical of
a loan is also regulated by the Final Rules.– 59 –In addition on 21 February 2025 U.S. President Donald J. Trump issued a memo entitled the “AmericaFirst Investment Policy” (the “America First Memo”). The America First Memo states that Executive
Order 14105 is under review by the Administration and that the review will consider new or expanded
restrictions on United States outbound investment in China in sectors such as semiconductors artificial
intelligence quantum biotechnology hypersonics aerospace advanced manufacturing directed energy
and other areas implicated by China’s national Military-Civil Fusion strategy. The America First Memo
also states that the review will consider applying restrictions on investment types including private equity
venture capital greenfield investments corporate expansions and investments in publicly traded
securities from sources including pension funds university endowments and other limited-partner
investors.As of the date of this Offering Circular the Guarantor believes that it is not a “Covered Foreign Person”
and the investments in the Bonds will not constitute a “notifiable transaction” or a “prohibitedtransaction”. However the Final Rules became effective only recently and are only accompanied by
limited guidance from the U.S. Treasury. There is no guarantee that certain aspects of the business
activities of the Guarantor are not Covered Activities under the Final Rules. If the Guarantor is found to
be a Covered Foreign Person a U.S. person investor may need to assess its obligations under the Final
Rules for example making a post-transaction report to the U.S. Treasury or evaluating potential risks
when exercising the exchange rights of the Bonds.In addition the change in U.S. presidential administration evolving national security-related concerns
technological developments and geopolitical events could impact implementation of result in enactment
of additional laws and regulations and give rise to changes to the Final Rules and/or the America First
Memo and/or other regulations which could take place during the life of the Bonds. Such changes could
result in potential impacts on the Group’s operations and transactions that it enters into in the future. They
could also impact the exercise of the exchange rights of the Bonds by investors which in turn affect the
liquidity and value of the Bonds. Investors should exercise caution on any potential investment restrictions
or compliance obligations that may result from such changes in the future. If the Guarantor becomes a
Covered Foreign Person as a result of its business expansion during the life of the Bonds and no exceptions
are available under the applicable laws and regulations exchange of the Bonds by U.S. persons may be
subject to the notification requirement or prohibited under the Final Rules.Modification and waivers may be made in respect of the Terms and Conditions the Deed of
Guarantee and the Trust Deed by the Trustee without the consent of the holders of the Bonds.The Terms and Conditions will contain provisions for calling meetings of Bondholders to consider matters
affecting their interests generally. These provisions will permit defined majorities to bind all Bondholders
including Bondholders who did not attend and vote at the relevant meeting and Bondholders who voted
in a manner contrary to the majority.The Terms and Conditions will further provide that the Trustee may but shall not be obliged to agree
without the consent of the Bondholders to any modification of the Trust Deed the Deed of Guarantee the
Bonds and/or the Agency Agreement which in the opinion of the Trustee is of a formal minor or technical
nature or is made to correct a manifest error or to comply with any mandatory provisions of law.In addition the Trustee may also without the consent of the Bondholders agree to any modification
(except as mentioned in the Trust Deed) and any waiver or authorisation of any breach or proposed breach
of the Bonds the Trust Deed the Deed of Guarantee or the Agency Agreement (other than a proposed
breach or a breach relating to the subject of certain reserved matters) if in the opinion of the Trustee the
interests of the Bondholders will not be materially prejudiced thereby.– 60 –Exchange rate risks and exchange controls may affect an investor’s returns on the Bonds.Investment in the Bonds presents certain risks relating to currency conversions if an investor’s financial
activities are denominated principally in a currency or currency unit (the “Investor’s Currency”) other
than HK dollars. These include the risk that exchange rates may significantly change (including changes
due to devaluation of the HK dollars or revaluation of the Investor’s Currency) and the risk that authorities
with jurisdiction over the Investor’s Currency may impose or modify exchange controls. An appreciation
in the value of the Investor’s Currency relative to HK dollars would decrease (i) the Investor’s
Currency-equivalent yield on the Bonds; (ii) the Investor’s Currency-equivalent value of the principal
payable on the Bonds; and (iii) the Investor’s Currency-equivalent market value of the Bonds. Government
and monetary authorities may impose (as some have done in the past) exchange controls that could
adversely affect an applicable exchange rate. As a result investors may receive less principal than
expected or no principal.Legal investment considerations may restrict certain investments.The investment activities of certain investors are subject to legal investment laws and regulations or
review or regulation by certain authorities. Each potential investor should consult its legal advisers to
determine whether and to what extent:
* the Bonds are legal investments for it;
* the Bonds can be used as collateral for various types of borrowing; and
* any other restrictions apply to its purchase or pledge of the Bonds.Financial institutions should consult their legal advisers or the appropriate regulators to determine the
appropriate treatment of the Bonds under any applicable risk-based capital or similar rules.The Guarantor’s subsidiaries jointly controlled entities and associated companies are subject to
restrictions on the payment of dividends and the repayment of intercompany loans or advances to
the Guarantor its jointly controlled entities and associated companies.The Guarantor depends on the receipt of dividends and the interest and principal payments on
intercompany loans or advances from its subsidiaries jointly controlled entities and associated companies
to satisfy its obligations including its obligations under the Bonds. The ability of the Guarantor’s
subsidiaries jointly controlled entities and associated companies to pay dividends and make payments on
intercompany loans or advances to their shareholders is subject to among other things distributable
earnings cash flow conditions restrictions contained in the articles of association of these companies
applicable laws and restrictions contained in the debt instruments of such companies. The Guarantor
cannot assure that its subsidiaries jointly controlled entities and associated companies will have
distributable earnings or will be permitted to distribute their distributable earnings to it as it anticipates
or at all. In addition dividends payable to it by these companies are limited by the percentage of its equity
ownership in these companies. Further if any of these companies raise capital by issuing equity securities
to third parties dividends declared and paid with respect to such shares would not be available to the
Guarantor to make payments on the Bonds. These factors could reduce the payments that the Guarantor
receives from its subsidiaries jointly controlled entities and associated companies which would restrict
its ability to meet its payment obligations under the Bonds.PRC laws and regulations permit payment of dividends only out of accumulated profits as determined in
accordance with PRC accounting standards and regulations. The PRC subsidiaries jointly controlled
entities and associated companies of the Guarantor are also required to set aside a portion of their post-tax
profits according to PRC accounting standards and regulations to fund certain reserves that are not
distributable as cash dividends.– 61 –If the Guarantor fails to complete registration with SAFE in connection with the Guarantee there
may be logistical and practical hurdles for cross-border payments under the Guarantee.The Guarantor will unconditionally and irrevocably guarantee the due and punctual payment of all sums
from time to time payable by the Issuer in respect of the Bonds and under the Trust Deed. Such Guarantee
will be contained in the Deed of Guarantee to be executed on the Issue Date. The Guarantor is required
to register or caused to be registered the Deed of Guarantee with SAFE in accordance with and within
the time period prescribed by the Provisions on the Foreign Exchange Administration Rules on
Cross-border Security (《跨境擔保外匯管理規定》) promulgated by SAFE. If the Guarantor fails to
complete registration with SAFE there may be logistical and practical hurdles at the time of remittance
of funds (if any cross-border payment is to be made by the Guarantor under the Guarantee) as domestic
banks may require evidence of registration with SAFE in connection with the Guarantee prior to giving
effect to any such remittance.There may be filing or other requirements of the CSRC or other PRC government authorities in
relation to the issuance of the Bonds or further capital raising activities.On 17 February 2023 the CSRC released the Trial Administrative Measures of Overseas Securities
Offering and Listing by Domestic Companies (《境內企業境外發行證券和上市管理試行辦法》) and
supporting guidelines (together the “CSRC Filing Rules”) which came into effect on 31 March 2023.The CSRC Filing Rules will regulate both direct and indirect overseas offering and listing of PRC
domestic companies’ securities by adopting a filing-based regulatory regime. The CSRC Filing Rules state
that any post-listing follow-on offering by an issuer in an overseas market including issuance of shares
convertible bonds and other similar securities shall be subject to filing requirement within three business
days after the completion of the offering. The Guarantor has been advised that it is required to go through
filing procedures with the CSRC after the completion of this Offering of the Bonds and for its future
offerings and listing of its securities in an overseas market under the CSRC Filing Rules for this offering.The CSRC Filing Rules provide that an overseas offering and listing including the follow-on offering of
convertible bonds is prohibited under any of the following circumstances: if (i) such securities offering
and listing is explicitly prohibited by provisions in laws administrative regulations and relevant state
rules; (ii) the intended securities offering and listing may endanger national security as reviewed and
determined by competent authorities under the State Council in accordance with law; (iii) the domestic
company intending to make the securities offering and listing or its controlling shareholder(s) and the
actual controller have committed relevant crimes such as corruption bribery embezzlement
misappropriation of property or undermining the order of the socialist market economy during the latest
three years; (iv) the domestic company intending to make the securities offering and listing is currently
under investigation for suspicion of criminal offences or major violations of laws and regulations and no
conclusion has yet been made thereof; or (v) there are material ownership disputes over equity held by the
domestic company’s controlling shareholder(s) or by other shareholder(s) that are controlled by the
controlling shareholder(s) and/or actual controller (the “Forbidden Circumstances”). In addition in the
process of filing where the issuer may be under any of the Forbidden Circumstances the CSRC may
solicit the opinions of the competent government authorities under the State Council.The Guarantor will comply with applicable filing requirements as appropriate. However the Guarantor
cannot assure that it is able to meet such requirements obtain such permit of filing from the relevant
government authorities or complete such filing in a timely manner or at all. In addition it cannot
guarantee that new rules or regulations promulgated in the future will not impose any additional
requirements on the Guarantor. If it is determined that the Guarantor is subject to any approval filing
other governmental authorisation or requirements from the CSRC or other PRC government authorities
the Guarantor may fail to obtain such approval or meet such requirements in a timely manner or at all.Such failure may subject the Guarantor to fines penalties or other sanctions which may have a material
adverse effect on its business and financial condition.– 62 –Bondholders have limited anti-dilution protection.The Conversion Price will be adjusted in the event that there is a consolidation sub-division or
reclassification capitalisation of profit or reserves capital distributions other dilutive events or uponchange of control but only in the situations and only to the extent provided in “Terms and Conditions ofthe Bonds – Conversion – Adjustments to Conversion Price” and “Terms and Conditions of the Bonds –Conversion – Adjustments upon Change of Control”. There is no requirement that there should be an
adjustment for every corporate or other event that may affect the value of the Ordinary Shares. Events in
respect of which no adjustment is made may adversely affect the market price of the Ordinary Shares and
therefore adversely affect the market price of the Bonds.The conversion of some or all of the Bonds will dilute the ownership interest of existing shareholders.The conversion of some or all of the Bonds will dilute the ownership interest of existing shareholders of
the Guarantor. Any sales in the public market of the Shares issuable upon such conversion or exercise or
the perception that such sale may occur could adversely affect prevailing market prices of the Shares and
the Bonds. In addition the existence of the Bonds may encourage short selling by market participants
because the conversion of the Bonds could depress the market price of the Shares.Enforcement of shareholder rights.Currently the primary sources of shareholder rights are the Articles of Association the PRC Company
Law (《中華人民共和國公司法》) (the “PRC Company Law”) the PRC regulations and the listing rules
of the Hong Kong Stock Exchange and the Shenzhen Stock Exchange which among other things impose
certain standards of conduct fairness requirements and disclosure requirements on the Guarantor the
Directors and the substantial shareholders. In general these rights are not relatively as broad as those
applicable to companies incorporated in the U.S. the UK and many European countries. To the
Guarantor’s knowledge there has not been any published report of judicial enforcement in the PRC by
holders of H Shares of their rights under constituent documents of joint stock limited companies or the
PRC Company Law or in the application or interpretation of the PRC or Hong Kong regulatory provisions
applicable to PRC joint stock limited companies. Being under different legal systems it is possible that
the Guarantor’s shareholders may not enjoy the full protections to which they may be entitled in a different
jurisdiction.China does not have treaties providing for the reciprocal recognition and enforcement of judgments of
courts with the U.S. the UK or most European countries and therefore recognition and enforcement in
China of judgments of a court in any of these jurisdictions in relation to any matter not subject to a binding
arbitration provision may not be assured.The insolvency laws of the BVI the PRC and other local insolvency laws may differ from those of
another jurisdiction with which the holders of the Bonds are familiar.As the Issuer is incorporated under the laws of the BVI any insolvency proceeding relating to the Issuer
even if brought in other jurisdictions would likely involve BVI insolvency laws the procedural and
substantive provisions of which may differ from comparable provisions of the local insolvency laws of
jurisdictions with which the Bondholders are familiar. Similarly as the Guarantor is incorporated under
the laws of the PRC any insolvency proceeding relating to the Guarantor even if brought in other
jurisdictions would likely involve PRC insolvency laws the procedural and substantive provisions of
which may differ from comparable provisions of the local insolvency laws of jurisdictions with which the
Bondholders are familiar. There is no assurance that investors in the Bonds will be able to receive the same
protection under the insolvency laws of the BVI or the PRC as those in their respective home jurisdictions.– 63 –Future issuances of the Ordinary Shares or equity-related securities may depress the trading price
of the H Shares.Any issuance of the Guarantor’s equity securities after this Offering could dilute the interest of the existing
shareholders and could substantially decrease the trading price of the H Shares. The Guarantor may issue
equity securities in the future for a number of reasons including to finance its operations and business
strategy (including in connection with acquisitions strategic collaborations or other transactions) to
adjust its ratio of debt-to-equity to satisfy its obligations upon the exercise of outstanding warrants
options or other convertible bonds or for other reasons. Sales of a substantial number of the H Shares or
other equity-related securities in the public market (or the perception that such sales may occur) could
depress the market price of the H Shares. The Guarantor cannot predict the effect that future sales of the
H Shares or other equity-related securities would have on the market price of the H Shares. In addition
the price of the H Shares could be affected by possible sales of the H Shares by investors who view the
Bonds as a more attractive means of obtaining equity participation in the Guarantor and by hedging or
engaging in arbitrage trading activity involving the Bonds.The Bonds will initially be represented by a Global Certificate and holders of a beneficial interest
in the Global Certificate must rely on the procedures of the relevant Clearing System.The Bonds will initially be represented by a Global Certificate. Such Global Certificate will be depositedwith a common depositary for Euroclear and Clearstream (each of Euroclear and Clearstream a “ClearingSystem”). Except in the circumstances described in the Global Certificate investors will not be entitled
to receive definitive Bonds. The relevant Clearing System will maintain records of the beneficial interests
in the Global Certificate. While the Bonds are represented by the Global Certificate investors will be able
to trade their beneficial interests only through the Clearing Systems.While the Bonds are represented by a Global Certificate the Issuer will discharge its payment obligations
under the Bonds by making payments to the common depositary for Euroclear and Clearstream for
distribution to their account holders. A holder of a beneficial interest in the Global Certificate must rely
on the procedures of the relevant Clearing System to receive payments under the Bonds. None of the
Issuer the Trustee or the Agents or any of their respective directors officers employees agents
representatives affiliates or advisers or any person who controls any of them has any responsibility or
liability for the records relating to or payments made in respect of beneficial interests in the Global
Certificate.Holders of beneficial interests in a Global Certificate will not have a direct right to vote in respect of the
Bonds. Instead such holders will be permitted to act only to the extent that they are enabled by the
relevant Clearing System to appoint appropriate proxies.Ratings of the Bonds may not reflect all risks and may be changed at any time which may adversely
affect the value of the Bonds.The Bonds are expected to be assigned a rating of “A-” by Standard & Poor’s Ratings Services a rating
of “A3” by Moody’s Investor Service Inc. and a rating of “A-” by Fitch Ratings Inc.. One or more
independent credit rating agencies may assign credit ratings to an issue of the Bonds. The ratings represent
the opinions of the rating agencies and their assessment of the ability of the Issuer to perform its
obligations under the Bonds and the credit risks in determining the likelihood that payments will be made
when due under the Bonds. Such ratings may not reflect the potential impact of all risks related to
structure market additional factors discussed above and other factors that may affect the value of the
Bonds. A credit rating is not a recommendation to buy sell or hold securities and may be revised or
withdrawn by the rating agency at any time. There can be no assurance that the ratings assigned to any
Bonds will remain in effect for any given period or that the ratings will not be lowered suspended or
– 64 –withdrawn by the rating agencies in the future if in their judgment the circumstances so warrant. Neither
the Issuer nor the Guarantor is obligated to inform holders of the Bonds of any such suspension revision
downgrade or withdrawal. A suspension downgrade or withdrawal of the ratings of any Bonds at any time
may materially and adversely affect the market price of the Bonds and the Issuer’s ability to access the
debt capital markets.A change in English law which will govern the Bonds may adversely affect Bondholders.The Terms and Conditions will be governed by English law. No assurance can be given as to the impact
of any possible judicial decision or change English law or administrative practice after the date of issue
of the Bonds.It may be difficult to effect service of process or to enforce any judgments obtained from non-PRC
courts against the Group or its management residing in the PRC.The Terms and Conditions and the transaction documents will be governed by English law and the Issuer
and the Guarantor will submit to the exclusive jurisdiction of the Hong Kong courts. However most
companies in the Group are incorporated in the PRC and a substantial amount of the Group’s assets and
companies are located in the PRC. Therefore investors may encounter difficulties in effecting service of
process from outside the PRC upon the Group or its management.Moreover due to the difference in legal systems investors may experience difficulties in effecting service
of legal process and enforcing foreign judgments in the PRC as is the case in many other jurisdictions.The PRC has not entered into treaties or arrangements providing for the recognition and enforcement of
judgments made by the courts in most other jurisdictions. Therefore recognition and enforcement in the
PRC of judgments of a court in any of these non-PRC jurisdictions as is the case in many other
jurisdictions may be difficult.On 18 January 2019 the Supreme People’s Court of the PRC and the Hong Kong government signed the
2019 Arrangement. The 2019 Arrangement has been implemented in Hong Kong by the Mainland
Judgments in Civil and Commercial Matters (Reciprocal Enforcement) Ordinance (Cap. 645) which came
into operation on 29 January 2024. The 2019 Arrangement applies to judgments made on or after 29
January 2024.Unlike other bonds issued in the international capital markets where holders of such bonds would typically
not be required to submit to an exclusive jurisdiction the Bondholders will be deemed to have submitted
to the exclusive jurisdiction of the Hong Kong courts. Thus the Bondholders’ ability to initiate a claim
outside Hong Kong will be limited.Under the 2019 Arrangement where the Hong Kong courts have given a legally effective judgment in a
civil and commercial matter any party concerned may apply to the relevant People’s Court of the PRC for
recognition and enforcement of the judgment subject to the provisions limits procedures and other terms
and requirements of the 2019 Arrangement. The recognition and enforcement of a Hong Kong court
judgment could be refused if the relevant People’s Court of the PRC considers that the enforcement of such
judgment is contrary to the basic principles of laws of the PRC or the social and public interests of the
PRC. While it is expected that the relevant People’s Courts of the PRC will recognise and enforce a
judgment given by a Hong Kong court and governed by English law there can be no assurance that such
courts will do so for all such judgments as there is no established practice in this area.– 65 –TERMS AND CONDITIONS OF THE BONDS
The following subject to completion and amendment and other than the words in italics is the text of the
Terms and Conditions of the Bonds which will appear on the reverse of each of the definitive certificates
evidencing the Bonds:
The issue of HK$2950000000 in aggregate principal amount of zero coupon guaranteed convertible
bonds due 2026 (the “Bonds” which term shall include unless the context requires otherwise any further
bonds issued in accordance with Condition 15 and consolidated and forming a single series therewith) of
SF Holding Investment 2023 Limited (the “Issuer”) was authorised by resolutions passed in a meeting of
the Issuer held on 25 June 2025 and the guarantee of the Bonds and the right of conversion into H Shares
(as defined in Condition 5.1.5) of S.F. Holding Co. Ltd. (順豐控股股份有限公司) (the “Guarantor”) were
authorised by resolutions of the board of directors of the Guarantor passed on 25 June 2025. The Bonds
are constituted by a trust deed (as amended and/or supplemented from time to time the “Trust Deed”)
dated 10 July 2025 (the “Issue Date”) and made between the Issuer the Guarantor and China Construction
Bank (Asia) Corporation Limited (中國建設銀行(亞洲)股份有限公司) (the “Trustee” which term shall
where the context so permits include all other persons for the time being acting as trustee or trustees under
the Trust Deed) as trustee for itself and the holders of the Bonds. The Issuer and the Guarantor have
entered into a paying conversion and transfer agency agreement (as amended and/or supplemented from
time to time the “Agency Agreement”) dated 10 July 2025 with the Trustee China Construction Bank
(Asia) Corporation Limited (中國建設銀行(亞洲)股份有限公司) as principal paying agent principal
conversion agent and principal transfer agent (collectively in such capacities the “Principal Agent”
which expression shall include any successor principal agent appointed from time to time in connection
with the Bonds) and as registrar (the “Registrar” which expression shall include any successor registrar
appointed from time to time in connection with the Bonds) and the other paying agents transfer agents
and conversion agents appointed under it (each a “Paying Agent” a “Transfer Agent” or a “ConversionAgent” (as applicable) and together with the Registrar and the Principal Agent the “Agents”) relating to
the Bonds. For the avoidance of doubt references to the “Paying Agents” the “Transfer Agents” or as
the case may be the “Conversion Agents” each include the Principal Agent and any successor and
additional Paying Agent Transfer Agent or as the case may be Conversion Agent appointed from time
to time in connection with the Bonds. References to the “Principal Agent” the “Registrar” and the
“Agents” below are references to the principal agent the registrar and the agents for the time being for
the Bonds. These terms and conditions (the “Conditions”) include summaries of and are subject to the
detailed provisions of the Trust Deed which includes the form of the Bonds. The Bonds have the benefit
of a deed of guarantee (as amended and/or supplemented from time to time the “Deed of Guarantee”)
to be dated 10 July 2025 and made between the Guarantor and the Trustee. For so long as any Bond is
outstanding copies of the Trust Deed the Deed of Guarantee and the Agency Agreement are available (i)
for inspection by the Bondholders (as defined in Condition 1.4) at all reasonable times during normal
business hours (being between 9.00 a.m. and 3.00 p.m. from Monday to Friday (other than public
holidays)) at the principal place of business in Hong Kong of the Trustee being at the Issue Date at 3/F
CCB Tower 3 Connaught Road Central Central Hong Kong following prior written request and proof of
holding and identity to the satisfaction of the Trustee or (ii) electronically to the requesting Bondholder
from the Principal Agent following prior written request and proof of holding and identity to the
satisfaction of the Principal Agent. The Bondholders are entitled to the benefit of are bound by and are
deemed to have notice of all the provisions of the Trust Deed and the Deed of Guarantee and are deemed
to have notice of those provisions of the Agency Agreement applicable to them.All capitalised terms that are not defined in these Conditions will have the meanings given to them in the
Trust Deed.– 66 –1 STATUS; GUARANTEE; FORM DENOMINATION AND TITLE
1.1 Status
The Bonds constitute direct unsubordinated unconditional and (subject to the provisions of
Condition 3.1) unsecured obligations of the Issuer and shall at all times rank pari passu and without
any preference or priority among themselves. The payment obligations of the Issuer under the Bonds
shall save for such exceptions as may be provided by mandatory provisions of applicable law and
subject to Condition 3.1 at all times rank at least equally with all of its other present and future
direct unsubordinated unconditional and unsecured obligations.
1.2 Guarantee
The Guarantor has unconditionally and irrevocably guaranteed the due payment of all sums
expressed to be payable by the Issuer under the Bonds and the Trust Deed. The Guarantor’s
obligations in respect of the Bonds and the Trust Deed (the “Guarantee”) are contained in the Deed
of Guarantee. The Guarantee constitutes direct unsubordinated unconditional and (subject to the
provisions of Condition 3.1) unsecured obligations of the Guarantor.
1.3 Form and Denomination
The Bonds are issued in registered form in the specified denomination of HK$2000000 each and
integral multiples of HK$1000000 in excess thereof (an “Authorised Denomination”). A bond
certificate (each a “Certificate”) will be issued to each Bondholder in respect of its registered
holding of Bonds. Each Certificate will be numbered serially with an identifying number which will
be recorded on the relevant Certificate and in the register of Bondholders (the “Register”) which the
Issuer will procure to be kept by the Registrar.Upon issue the Bonds will be represented by a Global Certificate registered in the name of a
nominee of and deposited with a common depositary for Euroclear Bank SA/NV (“Euroclear”) as
operator of the Euroclear System and Clearstream Banking S.A. (“Clearstream”). The Conditions
are modified by certain provisions contained in the Global Certificate.Except in the limited circumstances described in the Global Certificate owners of interests in Bonds
represented by the Global Certificate will not be entitled to receive definitive Certificates in respect
of their individual holdings of Bonds. The Bonds are not issuable in bearer form.
1.4 Title
Title to the Bonds passes only by transfer and registration in the Register as described in Condition
2. The holder of any Bond will (except as otherwise required by law or as ordered by a court of
competent jurisdiction) be treated as its absolute owner for all purposes (whether or not it is overdue
and regardless of any notice of ownership trust or any interest in it or any writing on or the theft
or loss of the Certificate issued in respect of it) and no person will be liable for so treating the
holder. In these Conditions “Bondholder” and (in relation to a Bond) “holder” means the person
in whose name a Bond is registered.– 67 –2 REGISTRATION AND TRANSFERS OF BONDS; ISSUE OF CERTIFICATES
2.1 Register
The Issuer will cause the Register to be kept at the specified office of the Registrar outside the United
Kingdom and Hong Kong in accordance with the terms of the Agency Agreement on which shall be
entered the names and addresses of the holders of the Bonds and the particulars of the Bonds held
by them and of all transfers redemptions and conversions of the Bonds. Each Bondholder shall be
entitled to receive only one Certificate in respect of its entire holding of Bonds.
2.2 Transfers
Subject to Conditions 2.5 and 2.6 and the terms of the Agency Agreement a Bond may be transferred
in whole or in part in an Authorised Denomination by delivery of the Certificate issued in respect
of that Bond with the form of transfer on the back duly completed and signed by the holder or his
attorney duly authorised in writing to the specified office of the Registrar or of any of the Transfer
Agents and any other evidence as the Registrar or any Transfer Agent may require. No transfer of
a Bond will be valid or effective unless and until entered on the Register. A Bond may be registered
only in the name of and transferred only to a named person.Transfers of interests in the Bonds evidenced by the Global Certificate will be effected in accordance
with the rules and procedures of the relevant clearing systems.
2.3 Delivery of New Certificates
2.3.1 Each new Certificate to be issued upon a transfer of Bonds will within seven business days of
receipt by the Registrar or as the case may be any Transfer Agent of the original Certificate
and the form of transfer duly completed and signed be made available for collection at the
specified office of the Registrar or such Transfer Agent or if so requested in the form of
transfer be mailed by uninsured mail at the risk of the holder entitled to the Bonds to the
address specified in the form of transfer. The form of transfer is available at the specified office
of the Registrar and each Transfer Agent.
2.3.2 Where only part of a principal amount of the Bonds (being that of one or more Bonds) in
respect of which a Certificate is issued is to be transferred converted redeemed or
repurchased a new Certificate in respect of the Bonds not so transferred converted redeemed
or repurchased will within seven business days of delivery of the original Certificate to the
Registrar or any Transfer Agent be made available for collection at the specified office of the
Registrar or such Transfer Agent or if so requested in the form of transfer be mailed by
uninsured mail at the risk of the holder of the Bonds not so transferred converted redeemed
or repurchased to the address of such holder appearing on the Register.
2.3.3 For the purposes of this Condition 2.3 “business day” shall mean a day other than a Saturday
Sunday or public holiday on which commercial banks are generally open for business in the
city in which the specified office of the Registrar (if a Certificate is deposited with it in
connection with a transfer or conversion) or the Agent with whom a Certificate is deposited in
connection with a transfer or conversion is located.– 68 –2.4 Formalities Free of Charge
Registration of a transfer of Bonds and issuance of new Certificates will be effected without charge
subject to (i) the person making such application for transfer paying or procuring the payment of any
taxes duties assessments and other governmental charges in connection therewith (or the giving of
such indemnity and/or security and/or pre-funding as the Issuer the Registrar or the relevant Transfer
Agent may require) (ii) the Registrar being satisfied in its absolute discretion with the documents
of title and/or identity of the person making the application and (iii) the relevant Agent being
satisfied that the Regulations (as defined in Condition 2.6) have been complied with.
2.5 Restricted Transfer Periods
No Bondholder may require the transfer of a Bond to be registered (i) during the period of seven days
ending on (and including) the dates for payment of any principal pursuant to these Conditions
(including any date of redemption made pursuant to Condition 7); (ii) after a Conversion Notice (as
defined in Condition 5.2.1) has been delivered with respect to such Bond; or (iii) after a Relevant
Event Put Exercise Notice (as defined in Condition 7.4) has been deposited in respect of such Bond
each such period being a “Restricted Transfer Period”.
2.6 Regulations
All transfers of Bonds and entries on the Register will be made subject to the detailed regulations
(the “Regulations”) concerning transfer and registration of Bonds the initial form of which is
scheduled to the Agency Agreement (the “Regulations”). The Regulations may be changed by the
Issuer with the prior written approval of the Trustee and the Registrar or by the Registrar with the
prior written approval of the Trustee. A copy of the current Regulations will be made available (free
of charge to the Bondholder) for inspection by any Bondholder following written request and
satisfactory proof of holding and identity to the satisfaction of the Registrar at all reasonable times
during normal business hours at the specified office of the Registrar.
3 COVENANTS
3.1 Negative Pledge
So long as any of the Bonds remains outstanding (as defined in the Trust Deed):
(a) the Issuer itself will not create or have outstanding any mortgage charge lien pledge or other
security interest (each a “Security Interest”) upon or with respect to any of its present or
future business undertaking assets or revenues (including any uncalled capital) of the Issuer
to secure any Relevant Indebtedness (as defined below) unless the Issuer in the case of the
creation of a Security Interest before or at the same time and in any other case promptly takes
any and all action necessary to ensure that:
(i) all amounts payable by it under the Bonds and the Trust Deed are secured by the Security
Interest equally and rateably with the Relevant Indebtedness to the satisfaction of the
Trustee; or
(ii) such other Security Interest or other arrangement (whether or not it includes the giving
of a Security Interest) is provided as is approved by an Extraordinary Resolution (as
defined in the Trust Deed) of the Bondholders; and
– 69 –(b) the Guarantor will not and the Guarantor will procure that none of its Principal Subsidiaries
(other than the Guarantor’s Listed Subsidiaries and Subsidiaries of a Listed Subsidiary of the
Guarantor) will create or have outstanding any Security Interest upon or with respect to any
of the present or future business undertaking assets or revenues (including any uncalled
capital) of the Guarantor and/or any of its Principal Subsidiaries to secure any Relevant
Indebtedness unless the Guarantor in the case of the creation of the Security Interest before
or at the same time and in any other case promptly takes any and all action necessary to
ensure that:
(i) all amounts payable by it under the Deed of Guarantee are secured by the Security Interest
equally and rateably with the Relevant Indebtedness to the satisfaction of the Trustee; or
(ii) such other Security Interest or other arrangement (whether or not it includes the giving
of a Security Interest) is provided as is approved by an Extraordinary Resolution of the
Bondholders.The foregoing restriction will not apply to:
(a) any Security Interest which is existing on the Issue Date by the Issuer the Guarantor and
any of their subsidiaries associated companies affiliates and/or related companies;
(b) any Security Interest on assets which is existing at the time of the acquisition thereof by
the Issuer the Guarantor or any of the Principal Subsidiaries;
(c) any Security Interest which is mandatory pursuant to applicable laws or required as a
prerequisite for obtaining governmental approvals;
(d) any Security Interest provided in connection with any present and future issuance of asset
backed securities by the Guarantor or any of the Principal Subsidiaries;
(e) any Security Interest provided in respect of any present and future issuance of assets
backed securities made by a special purpose vehicle where the Guarantor or any of the
Principal Subsidiaries is the originator of the underlying assets;
(f) any Security Interest which is existing over assets of a newly acquired company which
becomes a Principal Subsidiary; and
(g) the renewal extension or replacement of any Security Interest pursuant to the foregoing
(a) through (f) above.
3.2 Provision of Information
For so long as any Bond remains outstanding:
(a) the Issuer and the Guarantor will each furnish the Trustee with a Compliance Certificate in
accordance with the Trust Deed on which the Trustee may conclusively rely as to such
compliance and the Guarantor shall prepare and supply to the Trustee and make available for
inspection by any Bondholder in each case within 150 days after the end of each financial year
for the time being (which is at the Issue Date 31 December) the audited financial statements
of the Guarantor (including but not limited to the statement of profit or loss statement of other
– 70 –comprehensive income statement of financial position statement of changes in equity and
statement of cash flows each on a consolidated basis together with accompanying notes)
prepared in accordance with the International Financial Reporting Standards as issued by the
International Accounting Standards Board (“IFRS Accounting Standards”) (audited by an
internationally recognised firm of accountants) together with the relevant audit report thereto
for and as at the last financial year and if such financial statements shall be in the Chinese
language the Guarantor shall also provide (i) an English translation of the same translated by
(A) an internationally recognised firm of accountants; or (B) a professional translation service
provider; and (ii) a certificate in English signed by an Authorised Signatory (as defined in the
Trust Deed) of the Guarantor certifying that such English translation is complete and accurate;
and
(b) the Guarantor shall prepare and supply to the Trustee and make available for inspection by any
Bondholder within 90 days after the end of each financial half-year for the time being (which
is at the Issue Date 30 June) the unaudited semi-annual financial statements of the Guarantor
(including but not limited to the balance sheet income statement cash flow statement and
statement of changes in owner’s equity each on a consolidated basis together with
accompanying notes) prepared in accordance with IFRS Accounting Standards (reviewed by
an internationally recognised firm of accountants) and if such financial statements shall be in
the Chinese language the Guarantor shall also provide (i) an English translation of the same
translated by (A) an internationally recognised firm of accountants; or (B) a professional
translation service provider; and (ii) a certificate in English signed by an Authorised Signatory
of the Guarantor certifying that such English translation is complete and accurate
provided that if at any time the capital stock of the Guarantor is listed for trading on a recognised
stock exchange the Guarantor may furnish the Trustee as soon as they are available and in any event
within 30 days after any financial reports of the Guarantor are filed with the stock exchange on which
the Guarantor’s capital stock is at such time listed for trading with copies of any financial reports
of the Guarantor filed with such stock exchange in lieu of the Guarantor’s audited financial reports
and the Guarantor’s unaudited financial statements referred to in this Condition 3.2 and if such
financial reports shall be in the Chinese language together with (i) an English translation of the same
translated by (A) an internationally recognised firm of accountants or (B) a professional translation
service provider; and (ii) a certificate in English signed by an Authorised Signatory of the Guarantor
certifying that such English translation is complete and accurate.
3.3 Registration of the Deed of Guarantee
The Guarantor undertakes that it will (i) register or cause to be registered with SAFE the Deed of
Guarantee in accordance with and within the time period prescribed by the Provisions on the
Foreign Exchange Administration Rules on Cross border Security (《跨境擔保外匯管理規定》)promulgated by SAFE on 12 May 2014 and became effective from 1 June 2014 (the “Cross-borderSecurity Registration”) and any implementation rules as issued by SAFE from time to time (ii) use
its best endeavours to complete the Cross-border Security Registration and obtain a registration
record from SAFE on or before the Registration Deadline (as defined in Condition 7.4.5) and (iii)
comply with all applicable PRC laws and regulations in relation to the Deed of Guarantee.– 71 –3.4 CSRC Post-Issuance Filings
The Guarantor undertakes to file or cause to be filed with the CSRC (as defined below) within the
relevant prescribed timeframes after the Issue Date the requisite information and documents inrespect of the Bonds in accordance with the CSRC Filing Rules (as defined below) (the “CSRCPost-Issuance Filings” which for the avoidance of doubt includes the Initial CSRC Post-Issuance
Filing (as defined in Condition 3.5 below)) and comply with the continuing obligations under the
CSRC Filing Rules and any implementation rules as issued by the CSRC from time to time.
3.5 Notification of Completion of Cross-border Security Registration and Submission of the Initial
CSRC Post-Issuance Filing
The Guarantor shall:
3.5.1 (i) file or cause to be filed the CSRC Filing Report and other requisite information and
documents in respect of the Bonds that are required to be filed with the CSRC within three PRCBusiness Days after the Issue Date in accordance with the CSRC Filing Rules (the “InitialCSRC Post-Issuance Filing”);
3.5.2 within ten PRC Business Days after the later of (i) the submission of the Initial CSRC
Post-Issuance Filing and (ii) receipt of the registration certificate from SAFE (or any other
document evidencing the completion of the Cross-border Security Registration issued by
SAFE) provide the Trustee with (a) a certificate (substantially in the form scheduled to the
Trust Deed) in English signed by an Authorised Signatory confirming (A) the submission of the
Initial CSRC Post-Issuance Filing and (B) the completion of the Cross-border Security
Registration; and (b) copies of (A) the relevant documents evidencing the Initial CSRC
Post-Issuance Filing (if any) and (B) the SAFE registration certificate and other documents (if
any) evidencing the completion of the Cross-border Security Registration (the documents in (a)
and (b) of this Condition 3.5.2 together the “Registration Documents”).In addition the Guarantor shall within ten PRC Business Days after the Registration Documents are
delivered to the Trustee give notice to the Bondholders (in accordance with Condition 16)
confirming the submission of the Initial CSRC Post-Issuance Filing and the Cross-border Security
Registration.The Trustee may rely conclusively on the Registration Documents and shall have no obligation or
duty to monitor or assist with or ensure the Initial CSRC Post-Issuance Filing or the Cross-border
Security Registration is submitted or completed respectively or to verify the accuracy content
completeness validity and/or genuineness of any Registration Documents or any certificates
confirmations or other documents in relation to or in connection with the Initial CSRC Post-Issuance
Filing and/or the Cross-border Security Registration or to translate or procure the translation into
English of the Registration Documents or any certificates confirmations or other documents in
relation to or in connection with the Initial CSRC Post-Issuance Filing or the Cross-border Security
Registration or to review or verify the accuracy of any English translation thereof or to give notice
to the Bondholders confirming the completion of the Initial CSRC Post-Issuance Filing and the
Cross-border Security Registration and the Trustee shall not be liable to Bondholders or any other
person for not doing so.– 72 –3.6 Definitions
For the purposes of these Conditions:
“BVI” means the British Virgin Islands;
“Compliance Certificate” means a certificate of the Issuer or the Guarantor (as the case may be)
signed by one Authorised Signatory of the Issuer or the Guarantor (as the case may be) that having
made all reasonable enquiries to the best of the knowledge information and belief of the Issuer or
the Guarantor (as the case may be) as at a date (the Certification Date as defined in the Trust Deed)
not more than five days before the date of the certificate: (a) no Event of Default or Potential Event
of Default had occurred since the Certification Date of the last such certificate or (if none) the date
of the Trust Deed or if such an event had occurred giving details of it; and (b) each of the Issuer
and the Guarantor (as the case may be) has complied with all its obligations under the Trust Deed
the Deed of Guarantee and the Bonds to which it is a party;
“CSRC” means the China Securities Regulatory Commission;
“CSRC Filing Rules” means the Trial Administrative Measures of Overseas Securities Offering and
Listing by Domestic Companies (境內企業境外發行證券和上市管理試行辦法) and supporting
guidelines issued by the CSRC on 17 February 2023 as amended supplemented or otherwise
modified from time to time;
“CSRC Filing Report” means the filing report of the Issuer in relation to the issuance of the Bonds
which will be submitted to the CSRC within three PRC Business Days after the Issue Date pursuant
to Articles 13 and 16 of the CSRC Filing Rules;
“Hong Kong” means the Hong Kong Special Administrative Region of the People’s Republic of
China;
“Hong Kong dollars” “HK dollars” and “HK$” mean the lawful currency of Hong Kong;
“Listed Subsidiary” means a Subsidiary whose shares are at the relevant time listed on any
internationally or nationally recognised stock exchange;
“Person” means any individual corporation partnership limited liability company joint venture
trust unincorporated organisation or government or any agency or political subdivision thereof;
“Potential Event of Default” means a continuing event or circumstance which could with the
giving of notice lapse of time issue of a certificate and/or fulfilment of any other requirement
provided for in Condition 9 become an Event of Default;
“PRC” means the People’s Republic of China which for the purpose of these Conditions excludes
Hong Kong the Macau Special Administrative Region of the People’s Republic of China and
Taiwan;
“PRC Business Day” means a day (other than a Saturday or Sunday) on which commercial banks
are open for general business in the PRC;
– 73 –“Relevant Indebtedness” means any present or future indebtedness (whether being principal
premium interest or other amounts) incurred outside of the PRC for or in respect of any notes
bonds debentures debenture stock loan stock or other securities which are for the time being or are
capable of being quoted listed or ordinarily dealt in or traded on any stock exchange over-the-
counter or other securities market (which for the avoidance of doubt does not include bilateral
loans syndicated loans or club deal loans); and
“Subsidiary” means in relation to any person (the first person) at any particular time any other
person (the second person) (i) in which the first person owns or controls (either directly or through
one or more other Subsidiaries) more than 50 per cent. of the issued share capital or other ownership
interest having ordinary voting power to elect directors managers or trustees of the second person
or (ii) which at any time has its accounts consolidated with those of the first person or which under
the laws regulations or generally accepted accounting principles should have its accounts
consolidated with those of the first person.
4 INTEREST
The Bonds are zero coupon and do not bear interest unless upon due presentation thereof payment
of principal and premium (if any) is improperly withheld or refused. In such event such unpaid
amount shall bear interest at the rate of 2.5 per cent. per annum (both before and after judgment) until
whichever is the earlier of (i) the day on which all sums due in respect of such Bond up to that day
are received by or on behalf of the relevant holder and (ii) the day falling seven days after the Trustee
or the Principal Agent has notified Bondholders of receipt of all sums due in respect of all the Bonds
up to that seventh day (except to the extent that there is failure in the subsequent payment to the
relevant holders under these Conditions).If interest is required to be calculated for a period of less than one year it will be determined on the
basis of a 360-day year consisting of 12 months of 30 days each and in the case of an incomplete
month the number of days elapsed.
5 CONVERSION
5.1 Conversion Right
5.1.1 Conversion Right and Conversion Period: Subject as hereinafter provided and in accordance
with the provisions of the Trust Deed Bondholders have the right to convert their Bonds into
H Shares credited as fully paid at any time during the Conversion Period referred to below.Subject to and upon compliance with these Conditions the right of a Bondholder to convert any
Bond into H Shares is called the “Conversion Right”. The number of H Shares to be issued
on conversion of a Bond will be determined by dividing the principal amount of the Bond to
be converted by the Conversion Price (as defined in Condition 5.1.3) in effect on the
Conversion Date (as defined in Condition 5.2.1). A Conversion Right may only be exercised
in respect of an Authorised Denomination for one or more Bonds. If more than one Bond held
by the same holder is converted at any one time by the same holder the number of H Shares
to be issued upon such conversion will be calculated on the basis of the aggregate principal
amount of the Bonds to be converted.– 74 –Subject to and upon compliance with these Conditions (including without limitation Condition
5.1.4) the Conversion Right attaching to any Bond may be exercised at the option of the
holder thereof at any time on and after the 41st day after the Issue Date up to the close of
business (at the place where the Certificate evidencing such Bond is deposited for conversion)
on the date falling 10 working days prior to the Maturity Date (as defined in Condition 7.1)
(both days inclusive) or if such Bond shall have been called for redemption by the Issuer before
the Maturity Date then up to and including the close of business (at the place aforesaid) on a
date no later than 10 working days (at the place aforesaid) prior to the date fixed for redemption
thereof; provided that no Conversion Right may be exercised in respect of a Bond where the
holder shall have exercised its right to require the Issuer to redeem or repurchase such Bond
pursuant to Condition 7.4 or during a Restricted Conversion Period (both dates inclusive) (as
defined below); provided further that the Conversion Right is exercised subject to any
applicable fiscal or other laws or regulations or as hereafter provided in these Conditions (the
“Conversion Period”).In accordance with the below paragraphs of this Condition 5.1.1 exercise of Conversion Rights
is restricted in relation to any Bond during the period (i) commencing for an annual
shareholder general meeting of the Guarantor on the date falling 20 days prior to that meeting
and ending on the date of that meeting or for an extraordinary shareholder general meeting of
the Guarantor on the date falling 15 days prior to that meeting and ending on the date of that
meeting; or (ii) commencing the date falling five working days prior to the record date set by
the Guarantor for the purpose of distribution of any dividend and ending on such record date;
or (iii) commencing on such date and for such period as determined by applicable law fromtime to time that the Guarantor is required to close its register (a “Restricted ConversionPeriod”).If the Conversion Date in respect of a Bond would otherwise fall during a Restricted
Conversion Period such Conversion Date shall be postponed to the first H Share Stock
Exchange Business Day (as defined in Condition 5.8) following the expiry of such Restricted
Conversion Period.If the Conversion Date in respect of the exercise of any Conversion Right is postponed as a
result of the foregoing provision to a date that falls after the expiry of the Conversion Period
such Conversion Date shall be deemed to be the final day of such Conversion Period.For the purpose of this Condition 5.1.1 “working day” means a day other than a Saturday
Sunday or a public holiday on which commercial banks and foreign exchange markets are
generally open for business in the city which the specified office of each of the Principal Agent
and the Registrar is located respectively.
5.1.2 Fractions of H Shares: Fractions of H Shares will not be issued on conversion and no cash
payments or other adjustments will be made in lieu thereof. However if the Conversion Right
in respect of more than one Bond is exercised at any one time such that H Shares to be issued
on conversion are to be registered in the same name the number of such H Shares to be issued
in respect thereof shall be calculated on the basis of the aggregate principal amount of such
Bonds being so converted and rounded down to the nearest whole number of H Shares.Notwithstanding the foregoing in the event of a consolidation or re-classification of H Shares
by operation of law or otherwise occurring after 25 June 2025 which reduces the number of H
Shares outstanding the Issuer will upon conversion of Bonds pay in cash in HK dollars (by
means of a HK dollar cheque drawn on a bank that processes payments in HK dollars or by
transfer to a HK dollar account maintained by the payee in either case in accordance with
instructions given by the relevant Bondholder in the Conversion Notice) a sum equal to such
portion of the principal amount of the Bond or Bonds evidenced by the Certificate deposited
in connection with the exercise of Conversion Rights aggregated as provided in Condition
5.1.1 as corresponds to any fraction of a H Share not issued as a result of such consolidation
or re-classification aforesaid if such sum exceeds HK$100.– 75 –5.1.3 Conversion Price: The price at which H Shares will be issued upon conversion (the
“Conversion Price”) will initially be HK$48.47 per H Share but will be subject to adjustment
in the manner provided in Condition 5.3 and/or Condition 5.6 as applicable.
5.1.4 Revival and/or survival after Default: Notwithstanding the provisions of Condition 5.1.1 if (i)
the Issuer or the Guarantor (as the case may be) shall default in making payment in full in
respect of any Bond which shall have been called or put for redemption on the date fixed for
redemption thereof (ii) any Bond has become due and payable prior to the Maturity Date by
reason of the occurrence of any of the events referred to in Condition 9 or (iii) any Bond is not
redeemed on the Maturity Date in accordance with Condition 7.1 the Conversion Right
attaching to such Bond will revive and/or will continue to be exercisable up to and including
the close of business (at the place where the Certificate evidencing such Bond is deposited for
conversion) on the date upon which the full amount of the moneys payable in respect of such
Bond has been duly received by the Principal Agent or the Trustee and notice of such receipt
has been duly given to the Bondholders in accordance with Condition 16 and notwithstanding
the provisions of Condition 5.1.1 any Bond in respect of which the Certificate and Conversion
Notice are deposited for conversion prior to such date shall be converted on the relevant
Conversion Date notwithstanding that the full amount of the moneys payable in respect of such
Bond shall have been received by the Principal Agent or the Trustee before such Conversion
Date or that the Conversion Period may have expired before such Conversion Date.
5.1.5 Meaning of “Shares”: As used in these Conditions the expression (i) “H Shares” means
ordinary foreign shares with a par value of RMB1.00 each issued by the Guarantor which are
traded in HK dollars on the Hong Kong Stock Exchange; (ii) “A Shares” means ordinary
domestic shares of RMB1.00 each issued by the Guarantor which are traded in Renminbi on
the Shenzhen Stock Exchange; and (iii) “Ordinary Shares” means the H Shares the A Shares
and any other fully-paid and non-assessable shares of any class or classes of the ordinary shares
of the Guarantor authorised after the date of the issue of the Bonds which have no preference
in respect of dividends or of amounts payable in the event of any voluntary or involuntary
liquidation or dissolution of the Guarantor.
5.2 Conversion Procedure
5.2.1 Conversion Notice:
Conversion Rights may be exercised by a Bondholder during the Conversion Period by
delivering the relevant Certificate to the specified office of any Conversion Agent during its
normal business hours (being 9:00 a.m. to 3:00 p.m. Monday to Friday on which commercial
banks are generally open for business in the city of the specified office of the ConversionAgent) accompanied by a duly completed and signed notice of conversion (a “ConversionNotice”) in the form (for the time being current and being substantially in the form scheduled
to the Agency Agreement) obtainable from any Conversion Agent together with (i) the relevant
Certificate; and (ii) certification by the Bondholder in the form obtainable from any
Conversion Agent as may be required under the laws of the PRC Hong Kong or any
jurisdiction in which the specified office of such Conversion Agent is located. Conversion
Rights shall be exercised subject in each case to any applicable fiscal or other laws or
regulations applicable in the jurisdiction in which the specified office of the Conversion Agent
to whom the relevant Conversion Notice is delivered is located.– 76 –If such delivery is made after 3.00 p.m. on any business day or on a day which is not a business
day in each case in the place of the specified office of the Conversion Agent such delivery
shall be deemed for all purposes of these Conditions to have been made on the next business
day following such day. If such delivery is made during a Restricted Conversion Period such
delivery shall be deemed for all purposes of these Conditions to have been made on the H Share
Stock Exchange Business Day following (in the place of the specified office of the Conversion
Agent) the last day of such Restricted Conversion Period unless such date shall fall outside the
Conversion Period.Any determination as to whether any Conversion Notice has been duly completed and properly
delivered shall be made by the relevant Conversion Agent and shall save in the case of
manifest error be conclusive and binding on the Issuer the Guarantor the Trustee the Agents
and the relevant Bondholder.A Conversion Notice once delivered shall be irrevocable and may not be withdrawn without
the Issuer’s consent.The conversion date in respect of a Bond (the “Conversion Date”) shall be deemed to be the
H Share Stock Exchange Business Day immediately following the date of the surrender of the
Certificate in respect of such Bond and delivery of such Conversion Notice and if applicable
any such certificate and/or any payment to be made or indemnity given under these Conditions
in connection with the exercise of such Conversion Right.
5.2.2 Stamp Duty etc.: A Bondholder delivering a Certificate in respect of a Bond for conversion
must pay directly to the relevant authorities or party any taxes and duties including capital
stamp issue excise transfer registration and other similar taxes and duties and transfer costs
(“Duties”) in any applicable jurisdiction arising on conversion (other than any Duties payable
in the PRC or Hong Kong or if relevant in the place of the Alternative Stock Exchange in
respect of the allotment and issue of H Shares and listing of the H Shares on the Hong Kong
Stock Exchange or the Alternative Stock Exchange (as the case may be) on conversion which
shall be payable by the Issuer or the Guarantor such Duties being the “Issuer Duties”) (such
Duties and Issuer Duties are collectively known as “Taxes”). The Issuer (failing which the
Guarantor) will pay all other expenses arising from the issue of H Shares on conversion of the
Bonds and all charges (together the “Conversion Expenses”) of the Agents and the share
transfer agent for the H Shares (the “Share Transfer Agent”). The Bondholder (and if
different the person to whom the H Shares are to be issued) must declare in the relevant
Conversion Notice that any amounts payable to the relevant tax authorities or party in
settlement of Duties (other than the Issuer Duties) payable pursuant to this Condition 5.2.2
have been paid.If the Issuer or the Guarantor shall fail to pay any Issuer Duties or Conversion Expenses the
relevant holder shall be entitled to tender and pay the same and the Issuer and the Guarantor
as a separate and independent stipulation jointly and severally covenant to reimburse and
indemnify each Bondholder in respect of any payment thereof and any penalties payable in
respect thereof.Such Bondholder must also pay all if any Duties (other than Issuer Duties) imposed on it and
arising by reference to any disposal or deemed disposal of a Bond or interest therein in
connection with the exercise of Conversion Rights by it.Neither the Trustee nor the Agents shall be responsible for determining whether such Taxes or
Conversion Expenses are payable or the amount thereof and none of them shall be responsible
or liable for any failure by the Issuer the Guarantor or any Bondholder to pay any such amount.– 77 –5.2.3 Registration:
(i) As soon as practicable and in any event not later than seven H Share Stock Exchange
Business Days (excluding any H Share Stock Exchange Business Days that fall within a
Restricted Conversion Period) after the Conversion Date the Guarantor will in the case
of Bonds converted on exercise of the Conversion Right and in respect of which a duly
completed Conversion Notice has been delivered and the relevant Certificate and
certification and amounts payable by the relevant Bondholder deposited or paid as
required by Conditions 5.2.1 and 5.2.2 register the person or persons designated for the
purpose in the Conversion Notice as holder(s) of the relevant number of H Shares in the
Guarantor’s H share register and will if the Bondholder has also requested in the
Conversion Notice and to the extent permitted under applicable law and the rules and
procedures of the Central Clearing and Settlement System of Hong Kong (“CCASS”)
take all action reasonably necessary to enable the H Shares to be delivered through
CCASS for so long as the H Shares are listed on the Hong Kong Stock Exchange; or will
make such certificate or certificates available for collection at the office of the
Guarantor’s share registrar in Hong Kong (currently at Tricor Investor Services Limited
17/F Far East Finance Centre 16 Harcourt Road Hong Kong) notified to Bondholders
in accordance with Condition 16 or if so requested in the relevant Conversion Notice
cause its share registrar to mail (at the risk and if sent at the request of such person
otherwise than by ordinary mail at the expense of the person to whom such certificate
or certificates are sent) such certificate or certificates to the person and at the place
specified in the Conversion Notice together (in either case) with any other securities
property or cash required to be delivered upon conversion and such assignments and other
documents (if any) as may be required by law to effect the transfer thereof.(ii) The delivery of the H Shares to the converting Bondholder (or such person or persons
designated in the relevant Conversion Notice) in the manner contemplated in Condition
5.2.3(i) will be deemed to satisfy the Issuer’s obligation to pay any amounts under such
converted Bonds. The person or persons designated in the Conversion Notice will become
the holder of record of the number of H Shares issuable upon conversion with effect from
the date he is or they are registered as such in the Guarantor’s register of members for H
shares (the “Registration Date”). The H Shares issued upon exercise of the Conversion
Rights will be fully paid up and will in all respects rank pari passu with and within the
same class as the H Shares in issue on the relevant Registration Date except for any right
excluded by mandatory provisions of applicable law. Save as set out in these Conditions
a holder of H Shares issued on exercise of the Conversion Rights shall not be entitled to
any rights distributions or other payments the record date or due date for the
establishment of entitlement for which precedes the relevant Registration Date.(iii) If (a) the Registration Date in relation to any Bond shall be on or after the record date for
any issue distribution grant offer or other event that gives rise to the adjustment of the
Conversion Price pursuant to Condition 5.3 and/or Condition 5.6 (as applicable) and (b)
the Conversion Date in relation to such exercise of the Conversion Right shall be before
the date on which such adjustment to the Conversion Price becomes effective under the
relevant Condition (any such adjustment a “Retroactive Adjustment”) upon the
relevant adjustment to the Conversion Price becoming effective under the relevant
Condition the Guarantor shall procure the issue to the converting Bondholder (in
accordance with the instructions contained in the Conversion Notice (subject to anyapplicable laws or regulations)) such additional number of H Shares (“Additional H– 78 –Shares”) as together with the H Shares issued or to be issued on conversion of the
relevant Bond is equal to the number of H Shares which would have been required to be
issued on conversion of such Bond if the relevant adjustment to the Conversion Price
under the relevant Condition had been made and become effective on or immediately
prior to the relevant Conversion Date and in such event and in respect of such Additional
H Shares references in this Condition 5.2.3(iii) to the Conversion Date shall be deemed
to refer to the date upon which the Retroactive Adjustment becomes effective
(notwithstanding that the date upon which it becomes effective falls after the end of the
Conversion Period).
5.3 Adjustments to Conversion Price
Upon the occurrence of any of the following events described below the Conversion Price will be
adjusted as follows:
5.3.1 Consolidation Subdivision or Re-classification: If and whenever there shall be an alteration
to the nominal value of the H Shares as a result of consolidation subdivision or re-
classification the Conversion Price shall be adjusted by multiplying the Conversion Price in
force immediately before such alteration by the following fraction:
A
B
Where:
A is the nominal amount of one H Share immediately after such alteration; and
B is the nominal amount of one H Share immediately before such alteration.Such adjustment shall become effective on the date the alteration takes effect.
5.3.2 Capitalisation of Profits or Reserves:
(i) If and whenever the Guarantor shall issue Ordinary Shares of any class credited as fully
paid to the holders of such Ordinary Shares (“Ordinary Shareholders”) by way of
capitalisation of profits or reserves including Ordinary Shares of such class paid up out
of distributable profits or reserves and/or share premium account (except any Scrip
Dividend) and which would not have constituted a Capital Distribution the Conversion
Price shall be adjusted by multiplying the Conversion Price in force immediately before
such issue by the following fraction:
A
B
Where:
A is the aggregate nominal amount of the issued Ordinary Shares immediately before
such issue; and
B is the aggregate nominal amount of the issued Ordinary Shares immediately after
such issue.– 79 –Such adjustment shall become effective on the date of issue of such Ordinary Shares or
if a record date is fixed therefor immediately after such record date; provided that if there
are different effective dates for different classes of Ordinary Shares the effective date of
the H Shares shall prevail.(ii) In the case of an issue of Ordinary Shares of any class by way of a Scrip Dividend where
the aggregate value of such Ordinary Shares by way of a Scrip Dividend as determined
by reference to the Current Market Price on the date of announcement of the terms of such
Scrip Dividend multiplied by the number of such Ordinary Shares issued exceeds 105 per
cent. of the amount of the Relevant Cash Dividend or the relevant part thereof and which
would not have constituted a Capital Distribution the Conversion Price shall be adjusted
by multiplying the Conversion Price in force immediately before the issue of such Scrip
Dividend by the following fraction:
A + B
A + C
Where:
A is the aggregate nominal amount of the issued Ordinary Shares of all classes
immediately before such issue;
B is the aggregate nominal amount of such Scrip Dividend multiplied by a fraction of
which (i) the numerator is the amount of the whole or the relevant part of the
Relevant Cash Dividend and (ii) the denominator is such aggregate Current Market
Price of the Scrip Dividend issued in lieu of the whole or the relevant part of the
Relevant Cash Dividend; and
C is the aggregate nominal amount of such Scrip Dividend
or by making such other adjustment as an Independent Financial Advisor shall certify to
the Trustee is fair and reasonable.Such adjustment shall become effective on the date of issue of such Ordinary Shares or
if a record date is fixed therefor immediately after such record date; provided that if there
are different effective dates for different classes of Ordinary Shares the effective date of
H Shares shall prevail.
5.3.3 Capital Distributions: If and whenever the Guarantor shall pay or make any Capital
Distribution to the Ordinary Shareholders (except to the extent that the Conversion Price falls
to be adjusted under Condition 5.3.2 above) the Conversion Price shall be adjusted by
multiplying the Conversion Price in force immediately before such Capital Distribution by the
following fraction:
A – B
A
Where:
A is the aggregate number of Ordinary Shares of all classes in issue multiplied by their
respective Current Market Price per Ordinary Share of such class on the date on which
the Capital Distribution is first publicly announced; and
B is the Fair Market Value of the aggregate Capital Distribution.– 80 –Such adjustment shall become effective on the date that such Capital Distribution is actually
made or if a record date is fixed therefor immediately after such record date provided that if
there are different effective dates for different classes of Ordinary Shares the effective date of
the H Shares shall prevail. For the purpose of the above Fair Market Value shall (subject as
provided in the definition of “Fair Market Value” (as defined in Condition 5.8)) be determined
as at the date on which the Capital Distribution is first publicly announced or if later the first
date on which the Fair Market Value of the relevant Capital Distribution is capable of being
determined as provided herein.In making any calculation pursuant to this Condition 5.3.3 such adjustments (if any) shall be
made as an Independent Financial Advisor may consider appropriate to reflect (i) any
consolidation or subdivision of the Ordinary Shares (ii) issues of Ordinary Shares by way of
capitalisation of profits or reserves or any like or similar event (iii) the modification of any
rights to dividends of Ordinary Shares or (iv) any change in the fiscal year of the Guarantor.For the avoidance of doubt the final dividend to be paid by the Guarantor in respect of the year
ended 31 December 2024 (which has been approved by the shareholders of the Guarantor on
13 June 2025) will not give rise to an adjustment of the Conversion Price pursuant to this
Condition.
5.3.4 Rights Issues of Shares or Options over Shares: If and whenever the Guarantor shall issue
Ordinary Shares of one or more classes to all or substantially all Ordinary Shareholders of such
classes by way of rights or issue or grant to all or substantially all Ordinary Shareholders of
such classes by way of rights options warrants or other rights to subscribe for purchase or
otherwise acquire any Ordinary Shares of such classes in each case at a consideration less than
95 per cent. of the Current Market Price per H Share on the date of the first public
announcement of the terms of the issues or grants the Conversion Price shall be adjusted by
multiplying the Conversion Price in force immediately before such issues or grants by the
following fraction:
A + B1 + B2
A + C1 + C2
Where:
A is the aggregate number of Ordinary Shares of all classes in issue immediately before
such announcement;
B1 is the number of Ordinary Shares of one class which the aggregate consideration (if any)
receivable for the Ordinary Shares of such class issued by way of rights or for the options
or warrants or other rights issued or granted by way of rights and for the total number of
Ordinary Shares of such class comprised therein would subscribe for purchase or
otherwise acquire at such Current Market Price per Ordinary Share of the class;
B2 where applicable is the number of Ordinary Shares of a second class which the aggregate
consideration (if any) receivable for the Ordinary Shares of such class issued by way of
rights or for the options or warrants or other rights issued or granted by way of rights and
for the total number of Ordinary Shares of such class comprised therein would subscribe
for purchase or otherwise acquire at such Current Market Price per Ordinary Share of the
class;
– 81 –C1 is the aggregate number of Ordinary Shares of one class issued or as the case may be
comprised in the issue or grant; and
C2 where applicable is the aggregate number of Ordinary Shares of a second class issued or
as the case may be comprised in the issue or grant.Such adjustment shall become effective on the date of issue of such Ordinary Shares or issue
or grant of such options warrants or other rights (as the case may be) or where a record date
is set the first date on which the Ordinary Shares are traded ex-rights ex-options or
ex-warrants as the case may be; provided that if there are different effective dates for different
classes of Ordinary Shares the effective date of H Shares shall prevail.
5.3.5 Rights Issues of Other Securities: In respect of each class of Ordinary Shares if and
whenever the Guarantor shall issue any securities (other than Ordinary Shares or options
warrants or other rights to subscribe for purchase or otherwise acquire Ordinary Shares) to all
or substantially all Ordinary Shareholders of such class by way of rights or issue or grant to
all or substantially all Ordinary Shareholders of such class by way of rights options warrants
or other rights to subscribe for purchase or otherwise acquire any securities (other than
Ordinary Shares or options warrants or other rights to subscribe for purchase or otherwise
acquire Ordinary Shares) the Conversion Price shall be adjusted by multiplying the
Conversion Price in force immediately before such issue or grant by the following fraction:
A – B
A
Where:
A is the aggregate Ordinary Shares of all classes in issue multiplied by their respective
Current Market Price per Ordinary Share on the date on which the terms of such issue or
grant are publicly announced; and
B is the Fair Market Value of the aggregate securities rights options or warrants (as the
case may be) attributable to the Ordinary Shares.Such adjustment shall become effective on the date of issue of the securities or the issue or
grant of such rights options or warrants (as the case may be) or where a record date is set the
first date on which the Ordinary Shares are traded ex-rights ex-options or ex-warrants as the
case may be provided that if there are different effective dates for different classes of Ordinary
Shares the effective date of the H Shares shall prevail. For the purpose of the above Fair
Market Value shall (subject as provided in the definition of “Fair Market Value” (as defined
in Condition 5.8)) be determined as at the date on which the terms of such issue or grant is first
publicly announced or if later the first date on which the Fair Market Value of the aggregate
rights attributable to the Ordinary Shares in relation to such issue or grant is capable of being
determined as provided herein.– 82 –5.3.6 Issues at Less than Current Market Price: If and whenever the Guarantor shall issue
(otherwise than as mentioned in Condition 5.3.4 above) any Ordinary Shares (other than H
Shares issued on the exercise of Conversion Rights or on the exercise of any other rights of
conversion into or exchange or subscription for Ordinary Shares) or issue or grant (otherwise
than as mentioned in Condition 5.3.4 above) options warrants or other rights (other than the
Conversion Rights under the Bonds which excludes any further bonds issued pursuant to
Condition 15) to subscribe for purchase or otherwise acquire Ordinary Shares of one or more
classes in each case at a consideration which is less than 95 per cent. of the Current Market
Price per H Share on the date of announcement of the terms of such issues the Conversion
Price shall be adjusted by multiplying the Conversion Price in force immediately before such
issues by the following fraction:
A + B1 + B2
A + C1 + C2
Where:
A is the aggregate number of Ordinary Shares of all classes in issue immediately before the
issue of such additional Ordinary Shares of such class or the grant of such options
warrants or other rights to subscribe for purchase or otherwise acquire any Ordinary
Shares of such class;
B1 is the number of Ordinary Shares of one class which the aggregate consideration (if any)
receivable for the issue of such additional Ordinary Shares of such class would purchase
at the Current Market Price per Ordinary Share of such class;
B2 where applicable is the number of Ordinary Shares of a second class which the aggregate
consideration (if any) receivable for the issue of such additional Ordinary Shares of such
class would purchase at the Current Market Price per Ordinary Share of such class;
C1 is the aggregate number of Ordinary Shares of one class issued or as the case may be
the maximum number of Ordinary Shares of such class to be issued on the exercise of
such options warrants or other rights at the initial exercise price or rate; and
C2 where applicable is the aggregate number of Ordinary Shares of a second class issued
or as the case may be the maximum number of Ordinary Shares of such class to be issued
on the exercise of such options warrants or other rights at the initial exercise price or
rate.References to additional Ordinary Shares in the above formula shall in the case of an issue by
the Guarantor of options warrants or other rights to subscribe or purchase Ordinary Shares
mean such Ordinary Shares to be issued assuming that such options warrants or other rights
are exercised in full at the initial exercise price or rate on the date of issue or grant of such
options warrants or other rights.Such adjustment shall become effective on the date of issue of such additional Ordinary Shares
or as the case may be the issue or grant of such options warrants or other rights; provided that
if there are different effective dates for different classes of Ordinary Shares the effective date
of the H Shares shall prevail.– 83 –5.3.7 Other Issues at less than Current Market Price: Save in the case of an issue of securities
arising from a conversion or exchange of other securities in accordance with the terms
applicable to such securities themselves falling within this Condition 5.3.7 if and whenever the
Guarantor or any of its Subsidiaries (otherwise than as mentioned in Condition 5.3.4 Condition
5.3.5 or Condition 5.3.6) or (at the direction or request of or pursuant to any arrangements with
the Guarantor or any of its Subsidiaries) any other company person or entity shall issue any
securities (other than the Bonds which shall be deemed to exclude any further bonds issued
pursuant to Condition 15) which by their terms of issues carry rights of conversion into or
exchange or subscription for Ordinary Shares of one or more classes to be issued by the
Guarantor upon conversion exchange or subscription in each case at a consideration which is
less than 95 per cent. of the Current Market Price per H Share on the date of announcement of
the terms of issues of such securities the Conversion Price shall be adjusted by multiplying the
Conversion Price in force immediately before such issues by the following fraction:
A + B1 + B2
A + C1 + C2
Where:
A is the aggregate number of Ordinary Shares of all classes in issue immediately before
such issue;
B1 is the number of Ordinary Shares of one class which the aggregate consideration
receivable by the Guarantor for the Ordinary Shares of such class to be issued on
conversion or exchange or on exercise of the right of subscription attached to such
securities would purchase at such Current Market Price per Ordinary Share of such class;
B2 where applicable is the number of Ordinary Shares of a second class which the aggregate
consideration receivable by the Guarantor for the Ordinary Shares of such class to be
issued on conversion or exchange or on exercise of the right of subscription attached to
such securities would purchase at such Current Market Price per Ordinary Share of such
class;
C1 is the maximum number of Ordinary Shares of one class to be issued on conversion or
exchange of such securities or on the exercise of such rights of subscription attached
thereto at the initial conversion exchange or subscription price or rate; and
C2 where applicable is the maximum number of Ordinary Shares of a second class to be
issued on conversion or exchange of such securities or on the exercise of such rights of
subscription attached thereto at the initial conversion exchange or subscription price or
rate.Such adjustment shall become effective on the date of issue of such securities.– 84 –5.3.8 Modification of Rights of Conversion etc.: If and whenever there shall be any modification
of the rights of conversion exchange subscription purchase or acquisition attaching to any
such securities as are mentioned in Condition 5.3.7 (other than in accordance with the terms
of such securities) so that the consideration per Ordinary Share of one or more classes (for the
number of Ordinary Shares of such classes available on conversion exchange subscription
purchase or acquisition following the modification) is reduced and in each case is less than
95 per cent. of the Current Market Price per H Share on the date of announcement of the
proposals for such modifications the Conversion Price shall be adjusted by multiplying the
Conversion Price in force immediately before such modifications by the following fraction:
A + B1 + B2
A + C1 + C2
Where:
A is the aggregate number of Ordinary Shares of all classes in issue immediately before
such modification;
B1 is the number of Ordinary Shares of one class which the aggregate consideration
receivable by the Guarantor for the Ordinary Shares of such class to be issued on
conversion or exchange or on exercise of the right of subscription purchase or acquisition
attached to the securities so modified would purchase at the Current Market Price per
Ordinary Share of such class or if lower the existing conversion exchange subscription
purchase or acquisition price of such securities;
B2 where applicable is the number of Ordinary Shares of a second class which the aggregate
consideration receivable by the Guarantor for the Ordinary Shares of such class to be
issued on conversion or exchange or on exercise of the right of subscription purchase or
acquisition attached to the securities so modified would purchase at the Current Market
Price per Ordinary Share of such class or if lower the existing conversion exchange
subscription purchase or acquisition price of such securities;
C1 is the maximum number of Ordinary Shares of one class to be issued on conversion or
exchange of such securities or on the exercise of such rights of subscription purchase or
acquisition attached thereto at the modified conversion exchange subscription purchase
or acquisition price or rate but giving credit in such manner as an Independent Financial
Advisor considers appropriate (if at all) for any previous adjustment under this Condition
5.3.8 or Condition 5.3.7; and
C2 where applicable is the maximum number of Ordinary Shares of a second class to be
issued on conversion or exchange of such securities or on the exercise of such rights of
subscription purchase or acquisition attached thereto at the modified conversion
exchange subscription purchase or acquisition price or rate but giving credit in such
manner as an Independent Financial Advisor considers appropriate (if at all) for any
previous adjustment under this Condition 5.3.8 or Condition 5.3.7.Such adjustment shall become effective on the date of modification of the rights of conversion
exchange subscription purchase or acquisition attaching to such securities.– 85 –5.3.9 Other Offers to Ordinary Shareholders: In respect of each class of Ordinary Shares if and
whenever the Guarantor or any of its Subsidiaries or (at the direction or request of or pursuant
to any arrangements with the Guarantor or any of its Subsidiaries) any other company person
or entity issues sells or distributes any securities in connection with an offer pursuant to which
the Ordinary Shareholders of such class generally are entitled to participate in arrangements
whereby such securities may be acquired by them (except where the Conversion Price falls to
be adjusted under Condition 5.3.4 Condition 5.3.5 Condition 5.3.6 or Condition 5.3.7) the
Conversion Price shall be adjusted by multiplying the Conversion Price in force immediately
before such issue by the following fraction:
A – B
A
Where:
A is the aggregate Ordinary Shares in issue multiplied by their respective Current Market
Price per Ordinary Share on the date on which the terms of such issue sale or distribution
of securities are first publicly announced; and
B is the Fair Market Value of the portion of the aggregate rights attributable to the Ordinary
Shares.Such adjustment shall become effective on the date of issue sale or distribution of the
securities or if a record date is fixed therefor immediately after such record date or if later
the first date upon which the Fair Market Value of the relevant securities is capable of being
determined as provided herein provided that if there are different effective dates for different
classes of Ordinary Shares the effective date of the H Shares shall prevail. For the purpose ofthe above Fair Market Value shall (subject as provided in the definition of “Fair MarketValue” (as defined in Condition 5.8)) be determined as at the date on which the terms of such
issue sale or distribution of securities are first publicly announced or if later the first date on
which the Fair Market Value of the portion of the aggregate rights attributable to the Ordinary
Shares is capable of being determined as provided herein.
5.3.10 Other Events: If the Guarantor determines in its sole discretion that an adjustment should be
made to the Conversion Price as a result of one or more events or circumstances not referred
to in this Condition 5.3 the Issuer or the Guarantor shall at its own expense consult an
Independent Financial Advisor to determine as soon as practicable what adjustment (if any) to
the Conversion Price is fair and reasonable to take account thereof if the adjustment would
result in a reduction in the Conversion Price and the date on which such adjustment should
take effect and upon such determination by the Independent Financial Advisor such adjustment
(if any) shall be made and shall take effect in accordance with such determination.
5.3.11 Further Classes of Ordinary Shares: In the event that the Guarantor has more than two
classes of Ordinary Shares outstanding at any time the formulae set out in this Condition 5.3
shall be restated to take into account such further classes of Ordinary Shares so that “B1 + B2”
and “C1 + C2” shall become “B1 + B2 + B3” and “C1 + C2 + C3” and “B3” and “C3” shall have
the same meaning as “B1” and “C1” respectively but by reference to a third class of Ordinary
Shares and so on
– 86 –provided that where the events or circumstances giving rise to any adjustment pursuant to this
Condition 5.3 have already resulted or will result in an adjustment to the Conversion Price or where
the events or circumstances giving rise to any adjustment arise by virtue of events or circumstances
which have already given rise or will give rise to an adjustment to the Conversion Price such
modification (if any) shall be made to the operation of the provisions of this Condition 5.3 as may
be advised by the Independent Financial Advisor to be in its opinion appropriate to give the intended
result. Notwithstanding the foregoing the per Ordinary Share value of any such adjustment shall not
exceed the per Ordinary Share value of the dilution in the Ordinary Shareholders’ interest in the
Guarantor’s equity caused by such events or circumstances.
5.4 Undertakings
5.4.1 The Guarantor has undertaken in the Trust Deed inter alia that so long as any Bond remains
outstanding save with the approval of an Extraordinary Resolution (as defined in the Trust
Deed) of the Bondholders:
(i) it will use its commercially reasonable endeavours (a) to maintain a listing for the H
Shares on the Hong Kong Stock Exchange (b) to obtain and maintain a listing for all the
H Shares issued on the exercise of the Conversion Rights attaching to the Bonds on the
Hong Kong Stock Exchange and (c) if the Guarantor is unable to obtain or maintain such
listing to obtain and maintain a listing for all the issued H Shares on such Alternative
Stock Exchange as the Guarantor may from time to time determine and will forthwith
give notice to the Bondholders in accordance with Condition 16 of the listing or delisting
of the H Shares (as a class) by any of such stock exchange;
(ii) it will pay the expenses of the issue and delivery of and all expenses of obtaining listing
for H Shares arising on conversion of the Bonds (save for the Duties to be borne by any
Bondholder as described in Condition 5.2.2);
(iii) it will not make any reduction of its registered share capital or any uncalled liability in
respect thereof or of any share premium account or capital redemption reserve fund
(except in each case as permitted by law (including but not limited to repurchase or
cancellation of its shares (a) pursuant to any share incentive or share option schemes of
the Guarantor; (b) as a result of its shareholders’ dissent to the Guarantor’s merger or
segregation in a shareholders’ meeting and request the Guarantor to repurchase its shares;
(c) for the protection of the interests of the Guarantor’s shareholders; and (d) as permitted
by laws and regulations and the Guarantor’s articles of association) provided that all or
any part of the corporate action(s) comprising the reduction results in an adjustment to
the Conversion Price then in effect or would otherwise be taken into account for the
purposes of determining whether such an adjustment should be made pursuant to
Condition 5); and
(iv) it will use all commercially reasonable endeavours to maintain the listing of the Bonds
on the Hong Kong Stock Exchange.For the avoidance of doubt no adjustment will be made to the Conversion Price as a result of
any reduction of registered share capital in connection with any cancellation (before or after
the Issue Date) of Ordinary Shares repurchased in accordance with applicable laws and listing
rules prior to the Issue Date.– 87 –5.4.2 In the Trust Deed the Guarantor has undertaken with the Trustee inter alia that so long as any
Bond remains outstanding save with the approval of an Extraordinary Resolution of the
Bondholders:
(i) it will issue H Shares to Bondholders on exercise of Conversion Rights and ensure that
at all times it has the ability to issue free from pre-emptive or other similar rights such
number of H Shares as would enable the Conversion Rights and all other rights of
subscription and exchange for and conversion into H Shares to be satisfied in full and will
ensure that all H Shares delivered upon conversion of the Bonds will be duly and validly
issued as fully-paid; and
(ii) it will not make any offer issue or distribution or take any action the effect of which
would be to reduce the Conversion Price below the par value of the H Shares of the
Guarantor provided always that the Guarantor shall not be prohibited from purchasing its
H Shares to the extent permitted by law.
5.4.3 The Issuer and the Guarantor have also given certain other undertakings in the Trust Deed for
the protection of the Conversion Rights.
5.5 Notice of Change in Conversion Price
The Issuer (failing which the Guarantor) shall give notice to the Hong Kong Stock Exchange to the
Trustee and each Conversion Agent in writing and to the Bondholders in accordance with Condition
16 of any change in the Conversion Price. Any such notice relating to a change in the Conversion
Price shall set forth the event giving rise to the adjustment the Conversion Price prior to such
adjustment the adjusted Conversion Price and the effective date of such adjustment.
5.6 Adjustment upon Change of Control
If a Change of Control (as defined in Condition 7.4.5(ii)) shall have occurred the Issuer shall give
notice of that fact to the Bondholders (the “Change of Control Notice”) in accordance with
Condition 16 and to the Trustee and the Agents in writing within 14 days after it becomes aware of
such Change of Control. Following the giving of a Change of Control Notice upon any exercise of
Conversion Rights such that the relevant Conversion Date falls within the period of 30 days
following the later of (i) the relevant Change of Control and (ii) the date on which the Change of
Control Notice is given to Bondholders (such period the “Change of Control Conversion Period”)
the Conversion Price shall be adjusted in accordance with the following formula:
NCP = OCP/(1 + (CP x c/t))
Where:
NCP = the Conversion Price after such adjustment;
OCP = the Conversion Price before such adjustment. For the avoidance of doubt OCP for the
purposes of this Condition 5.6 shall be the Conversion Price applicable on the relevant
Conversion Date in respect of any conversion pursuant to this Condition 5.6;
– 88 –Conversion Premium (“CP”) = 15.0 per cent. expressed as a fraction;
c = the number of days from and including the first day of the Change of Control Conversion
Period to but excluding the Maturity Date; and
t = the number of days from and including the Issue Date to but excluding the Maturity Date
provided that the Conversion Price shall not be reduced pursuant to this Condition 5.6 below the
level permitted by applicable laws and regulations from time to time (if any).If the last day of a Change of Control Conversion Period shall fall during a Restricted Transfer
Period or a Restricted Conversion Period as the case may be the Change of Control Conversion
Period shall be extended such that its last day will be the fifteenth day following the last day of the
Restricted Transfer Period or the Restricted Conversion Period as the case may be.On the H Share Stock Exchange Business Day immediately following the last day of the Change of
Control Conversion Period the Conversion Price shall be re-adjusted to the Conversion Price in
force immediately before the adjustment to the Conversion Price during the Change of Control
Conversion Period.
5.7 Provisions Relating to Changes in Conversion Price
5.7.1 Minor Adjustments: On any adjustment the resultant Conversion Price if not an integral
multiple of one Hong Kong cent shall be rounded down to the nearest Hong Kong cent. No
adjustment shall be made to the Conversion Price if such adjustment (rounded down if
applicable) would be less than one per cent. of the Conversion Price then in effect. Any
adjustment not required to be made and/or any amount by which the Conversion Price has been
rounded down shall be carried forward and taken into account in any subsequent adjustment
and such subsequent adjustment shall be made on the basis that the adjustment not required to
be made had been made at the relevant time and/or as the case may be that the relevant
rounding down had not been made. Notice of any adjustment shall be given by the Issuer to the
Bondholders in accordance with Condition 16 and to the Trustee and the Agents in writing in
each case as soon as practicable after the determination thereof.
5.7.2 Decision of an Independent Financial Advisor: If any doubt shall arise as to whether an
adjustment falls to be made to the Conversion Price or as to how an adjustment to the
Conversion Price under Condition 5.3 or Condition 5.6 should be made and following
consultation between the Issuer the Guarantor and an Independent Financial Advisor a written
opinion of such Independent Financial Advisor in respect thereof shall be conclusive and
binding on the Issuer the Guarantor the Bondholders the Trustee and the Agents save in the
case of manifest error. Notwithstanding the foregoing the per H Share value of any such
adjustment shall not exceed the per H Share value of the dilution in the shareholders’ interest
in the Guarantor’s equity caused by such events or circumstances.
5.7.3 Minimum Conversion Price: Notwithstanding the provisions of this Condition 5 the Guarantor
undertakes that: (i) the Conversion Price shall not in any event be reduced to below the nominal
or par value of the H Shares as a result of any adjustment hereunder unless under applicable
law then in effect the Bonds may be converted at such reduced Conversion Price into legally
issued fully paid and non-assessable H Shares; and (ii) it shall not take any action and shall
procure that no action is taken that would otherwise result in an adjustment to the Conversion
Price to below such nominal or par value or any minimum level permitted by applicable laws
or regulations.– 89 –5.7.4 Reference to “fixed”: Any references herein to the date on which a consideration is “fixed”
shall where the consideration is originally expressed by reference to a formula which cannot
be expressed as an actual cash amount until a later date be construed as a reference to the first
day on which such actual cash amount can be ascertained.
5.7.5 Multiple Events: Where more than one event which gives or may give rise to an adjustment to
the Conversion Price occurs within such a short period of time that in the opinion of an
Independent Financial Advisor the foregoing provisions would need to be operated subject to
some modification in order to give the intended result such modification shall be made to the
operation of the foregoing provisions as may be advised by such Independent Financial Advisor
to be in its opinion appropriate in order to give such intended result.
5.7.6 Upward/Downward Adjustment: No adjustment involving an increase in the Conversion Price
will be made except in the case of a consolidation or re-classification of the H Shares as
referred to in Condition 5.3.1. The Issuer or the Guarantor may at any time and for a specified
period of time only following notice being given to the Trustee and the Agents in writing and
to the Bondholders in accordance with Condition 16 reduce the Conversion Price subject to
Condition 5.7.3.
5.7.7 Trustee Not Obliged to Monitor or Make Calculations: Neither the Trustee nor any Agent shall
be under any duty to monitor whether any event or circumstance has happened or exists which
may require an adjustment to be made to the Conversion Price or to make any calculation or
determination (or verification thereof) in connection with the Conversion Price and/or any
adjustments to it or any determinations advice or opinions made or given in connection
therewith and none of them will be responsible or liable to Bondholders or any other person
for any loss arising from any failure by it to do so or for any delay by the Issuer the Guarantor
or any Independent Financial Advisor in making any calculation or determination or any
erroneous calculation or determination in connection with the Conversion Price.
5.7.8 Employee Share Option Schemes: No adjustment will be made to the Conversion Price when
Ordinary Shares or other securities (including rights or options) are issued offered exercised
allotted appropriated modified or granted to or for the benefit of employees (including
directors) of the Guarantor or any of its Subsidiaries pursuant to any employee share scheme
or plan (and which employee share scheme or plan is in compliance with if applicable the
Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited or
if applicable the Stock Listing Rules of the Shenzhen Stock Exchange or if relevant the listing
rules of the Alternative Stock Exchange) (“Share Scheme Options”) unless any issue or grant
of Share Scheme Options (which but for this provision would have required adjustment
pursuant to Condition 5) would result in the total number of Ordinary Shares which may be
issued upon exercise of all Share Scheme Options granted during the 12-month period up to and
including the date of such issue or grant representing in aggregate more than two per cent. of
the average of the issued and outstanding Ordinary Shares during such 12-month period. For
the avoidance of doubt any Ordinary Shares issued in excess thereof and only such Ordinary
Shares issued in excess thereof shall be subject to adjustment to the Conversion Price and
taken into account in determining such adjustment as set out in Condition 5.3.– 90 –5.7.9 Consideration Receivable: For the purpose of any calculation of the consideration receivable
or price pursuant to Condition 5.3.4 Condition 5.3.6 Condition 5.3.7 and Condition 5.3.8 the
following provisions shall apply:
(i) the aggregate consideration receivable or price for Ordinary Shares of a class issued for
cash shall be the amount of such cash;
(ii) (a) the aggregate consideration receivable for Ordinary Shares of a class to be issued on
the conversion exercise or exchange of any options warrants or other rights or securities
(or following any modification thereof) shall be deemed to be the consideration received
or receivable by the Guarantor for any such options warrants or other rights or securities
(or following any modification thereof); (b) the aggregate consideration receivable for
Ordinary Shares of a class to be issued on the exercise of rights of subscription attached
to any such securities (or following any modification thereof) shall be deemed to be that
part (which may be the whole) of the consideration received or receivable by the
Guarantor for such securities (or following any modification thereof) which is attributed
by the Guarantor to such rights of subscription or if no part of such consideration is so
attributed to the Fair Market Value of such rights of subscription as at the date of the
announcement of the terms of issue or modification of such securities plus in the case of
each of (a) and (b) above the additional minimum consideration (if any) to be received
by the Guarantor on the conversion exercise or exchange of such options warrants or
other rights or securities (or following any modification thereof) or on the exercise of
such rights of subscription; and (c) the consideration per Ordinary Share of a class
receivable by the Guarantor on the conversion exercise or exchange of or on the exercise
of such rights of subscription attached to such options warrants or other rights or
securities (or following any modification thereof) shall be the aggregate consideration
referred to in (a) or (b) above (as the case may be) divided by the number of Ordinary
Shares of such class to be issued on such conversion or exchange or exercise at the initial
conversion exchange or subscription price or rate;
(iii) if the consideration or price determined pursuant to (i) or (ii) above of this Condition
5.7.9 (or any component thereof) shall be expressed in a currency other than HK dollars
it shall be converted into HK dollars at the Prevailing Rate on the relevant date;
(iv) in determining the consideration or price pursuant to the above no deduction shall be
made for any commissions or fees (howsoever described) or any expenses paid or
incurred for any underwriting placing or management of the issue of the relevant
Ordinary Shares of a class or securities or options warrants or rights or otherwise in
connection therewith;
(v) the consideration or price shall be determined as provided above on the basis of the
consideration or price received receivable paid or payable regardless of whether all or
part thereof is received receivable paid or payable by or to the Guarantor or another
entity as appointed by the Guarantor;
(vi) if as part of the same transaction Ordinary Shares of a class shall be issued or issuable
for a consideration receivable in more than one or in different currencies then the
consideration receivable per Ordinary Share of such class shall be determined by dividing
the aggregate consideration (determined as aforesaid and converted if and to the extent
not in HK dollars into HK dollars as aforesaid) by the aggregate number of Ordinary
Shares so issued; and
– 91 –(vii) neither the Trustee nor the Agents shall be under any duty to determine calculate or
verify any entitlement of any Bondholder to any amount payable upon or following the
exercise of any Conversion Right and none of them will be responsible or liable to any
Bondholder or any other person for any loss arising from any failure to do so.
5.8 Definitions
For the purposes of these Conditions:
“Alternative Stock Exchange” means at any time in the case of the H Shares if they are not at
that time listed and traded on the Hong Kong Stock Exchange the principal stock exchange or
securities market on which such H Shares are then listed or quoted or dealt in;
“Closing Price” means in respect of an Ordinary Share of a class for any Trading Day the closing
market price quoted by the principal stock exchange or securities market on which the Ordinary
Shares of such class are then listed admitted to trading or quoted or dealt in and in the case of the
A Shares shall (unless otherwise determined at the relevant time) mean the Shenzhen Stock
Exchange and in the case of the H Shares shall (unless otherwise determined at the relevant time)
mean the Hong Kong Stock Exchange;
“Current Market Price” means in respect of an Ordinary Share of a class on a particular date the
average of the daily Closing Price on each of the 20 consecutive Trading Days ending on and
including the Trading Day immediately preceding such date and (if necessary) translated into HK
dollars at the Prevailing Rate as at the relevant date; provided that:
(A) for the purposes of determining the Current Market Price pursuant to Conditions 5.3.4 or 5.3.6
in circumstances where the relevant event relates to an issue of Ordinary Shares if at any time
during the said 20 Trading Day-period (which may be on each of such 20 Trading Days) the
Ordinary Shares of such class shall have been quoted ex-dividend (or ex- any other entitlement)
and/or during some other part of that period (which may be on each of such 20 Trading Days)
the Ordinary Shares of such class shall have been quoted cum-dividend (or cum- any other
entitlement) then:
(i) if the Ordinary Shares of such class to be issued or transferred and delivered do not rank
for the dividend (or entitlement) in question the Closing Price on the dates on which the
Ordinary Shares of such class shall have been based on a price cum-dividend (or cum-any
other entitlement) shall for the purpose of this definition be deemed to be the amount
thereof reduced by an amount equal to the Fair Market Value of any such dividend or
entitlement per Ordinary Shares of such class; or
(ii) if the Ordinary Shares of such class to be issued or transferred and delivered rank for the
dividend or entitlement in question the Closing Price on the dates on which the Ordinary
Shares of such class shall have been based on a price ex-dividend (or ex-any other
entitlement) shall for the purpose of this definition be deemed to be the amount thereof
increased by the Fair Market Value of any such dividend or entitlement per Ordinary
Shares of such class;
– 92 –(B) for the purpose of determining the Current Market Price of any Ordinary Shares of any class
which are to be issued or may be issued pursuant to a Scrip Dividend pursuant to Condition
5.3.2(ii) if on any day during the said 20 Trading Day-period the Volume Weighted Average
Price of the Ordinary Shares of such class shall have been based (A) on a price cum the
Relevant Cash Dividend (and/or any other dividend or other entitlement which the Ordinary
Shares of such class that may be issued pursuant to terms of such Scrip Dividend do not rank
for) the Volume Weighted Average Price of an Ordinary Share of such class on any such day
shall for the purposes of this definition be deemed to be the amount thereof reduced by an
amount equal to the Fair Market Value of the Relevant Cash Dividend (and/or such other
dividend or other entitlement) (as at the date of first public announcement of the terms of such
Relevant Cash Dividend) per Ordinary Share of such class entitled to the Relevant Cash
Dividend (and/or such other dividend or other entitlement) or (B) on a price ex- the Relevant
Cash Dividend the Volume Weighted Average Price of an Ordinary Share of such class on any
such day shall for the purposes of this definition be deemed to be the amount thereof (x)
multiplied by the sum of one and the number of Ordinary Shares of such class which are to be
issued or may be issued pursuant to such Scrip Dividend per Ordinary Share of such class
entitled to the Relevant Cash Dividend and (y) reduced by the Fair Market Value of the
Relevant Cash Dividend (as at the date of first public announcement of the terms of such
Relevant Cash Dividend) per Ordinary Share of such class entitled to the Relevant Cash
Dividend; and
(C) for any other purpose if any day during the said 20 Trading Day-period was the ex-date in
relation to any dividend (or any other entitlement) the Volume Weighted Average Prices that
shall have been based on a price cum- such dividend (or cum- such entitlement) shall for the
purpose of this definition be deemed to be the amount thereof reduced by an amount equal to
the Fair Market Value of any such dividend (or other entitlement) per Ordinary Share of such
class as at the date of first public announcement of the terms of such dividend (or other
entitlement);
“Capital Distribution” means on a per Ordinary Share basis
(i) any distribution of assets in specie by the Guarantor for any financial period whenever paid or
made and however described (and for these purposes a distribution of assets in specie includes
without limitation an issue of Ordinary Shares or other securities credited as fully or partly
paid by way of capitalisation of reserves but excludes any Ordinary Shares credited as fully
paid to the extent an adjustment to the Conversion Price is made in respect thereof under
Condition 5.3.2(i) and a Scrip Dividend adjusted for under Condition 5.3.2(ii)); and
(ii) any cash dividend or distribution on a gross basis (including without limitation the relevant
cash amount of a Scrip Dividend) of any kind by the Guarantor for any financial period
(whenever paid and however described) translated into HK dollars at the Prevailing Rate as at
the effective date of the relevant adjustment to the Conversion Price
provided that a purchase or redemption of Ordinary Shares by or on behalf of the Guarantor (or a
purchase of Ordinary Shares by or on behalf of a Subsidiary of the Guarantor) shall not constitute
a Capital Distribution unless the weighted average price (before expenses) on any one day in respect
of such purchases exceeds the Current Market Price of the Ordinary Shares by more than five per
cent. either (a) on that date or (b) where an announcement has been made of the intention to
purchase Ordinary Shares at some future date at a specified price on the Trading Day immediately
preceding the date of such announcement and if in the case of either (a) or (b) of this definition the
– 93 –relevant day is not a Trading Day the immediately preceding Trading Day in which case such
purchase or redemption shall be deemed to constitute a Capital Distribution in an amount equal to
the amount by which the aggregate consideration paid (before expenses) in respect of such Ordinary
Shares purchased or redeemed exceeds the product of 105 per cent. of such Current Market Price and
the number of Ordinary Shares so purchased or redeemed;
“Fair Market Value” means with respect to any asset security option warrant or other right on any
date the fair market value of that asset security option warrant or other right as determined by an
Independent Financial Advisor on the basis of commonly accepted market valuation method and
taking into account such factors as it considers appropriate provided that an Independent Financial
Advisor will not be required to determine the fair market value where (i) the Capital Distribution is
paid in cash in which case the fair market value of such cash Capital Distribution per Ordinary Share
of the relevant class shall be the amount of such cash Capital Distribution per Ordinary Share of such
class determined as at the date of announcement of such cash Capital Distribution and (ii) any other
amounts are paid in cash in which case the fair market value of such cash amount shall be the
amount of cash and (iii) options warrants or other rights or securities are or will upon issuance be
publicly traded in a market of adequate liquidity (as determined by such Independent Financial
Advisor) the fair market value of such options warrants or other rights or securities shall equal the
arithmetic mean of the daily closing prices of such options warrants or other rights or securities
during the period of five trading days on the relevant market commencing on the first such trading
day such options warrants or other rights or securities are publicly traded. Such amounts if
expressed in a currency other than HK dollars shall be translated into HK dollars (a) in the case of
any cash Capital Distribution at the average benchmark exchange rate between Renminbi and HK
dollars expressed to be used in respect of such cash Capital Distribution and (b) in any other case
at the Prevailing Rate on such date. In addition in the case of provisos (i) and (ii) above of this
definition the Fair Market Value shall be determined on a gross basis and disregarding any
withholding or deduction required to be made for or on account of tax and disregarding any
associated tax credit;
“Hong Kong Stock Exchange” means The Stock Exchange of Hong Kong Limited or any successor
thereto;
“H Share Stock Exchange Business Day” means any day (other than a Saturday or Sunday) on
which the Hong Kong Stock Exchange or the Alternative Stock Exchange (as the case may be) is
open for the business of dealing in securities;
“Independent Financial Advisor” means an independent investment bank or licensed financial
advisor or institution of international repute (acting as an expert) selected and appointed at its own
cost by the Issuer or the Guarantor and notified in writing to the Trustee. The Trustee shall not be
responsible for or under any obligation to appoint an Independent Financial Advisor and shall have
no responsibility or liability for verifying any calculation determination certification advice or
opinion made given or reached by it;
“Prevailing Rate” means in respect of any currency on any day the spot exchange rate between the
relevant currencies prevailing as at or about 12:00 noon (Hong Kong time) on that date as appearing
on or derived from the Relevant Page or if such a rate cannot be determined at such time the rate
prevailing as at or about 12:00 noon (Hong Kong time) on the immediately preceding day on which
such rate can be so determined provided that in the case of any cash Capital Distribution in respect
of the H Shares the “Prevailing Rate” shall be deemed to be the average benchmark exchange rate
between Renminbi and HK dollars calculated in the manner as announced by the Guarantor on the
– 94 –Hong Kong Stock Exchange from time to time being as at the Issue Date the average of the medium
rate of Renminbi to HK dollars as announced by the People’s Bank of China for five working days
preceding (and including) the date on which such cash Capital Distribution are declared at the
relevant annual general meeting;
“Relevant Cash Dividend” means the aggregate cash dividend or distribution declared by the
Guarantor including any cash dividend in respect of which there is any Scrip Dividend;
“Relevant Page” means the relevant Bloomberg BFIX page (or its successor page) or if there is no
such page on the relevant Reuters HKDFIX page (or its successor page) or such other information
service provider that displays the relevant information;
“Scrip Dividend” means Ordinary Shares of any class issued in lieu of the whole or any part of any
Relevant Cash Dividend being a dividend which the Ordinary Shareholders concerned would or
could otherwise have received and which would not have constituted a Capital Distribution (and for
the avoidance of doubt no adjustment is to be made under Condition 5.3.3 in respect of the amount
by which the Current Market Price of the Ordinary Shares exceeds the Relevant Cash Dividend or
the relevant part thereof but without prejudice to any adjustment required in such circumstances to
be made under Condition 5.3.2);
“Shenzhen Stock Exchange” means The Shenzhen Stock Exchange;
“Trading Day” means in respect of an Ordinary Share of a class a day when the principal stock
exchange of such Ordinary Share is open for dealing business and in the case of the A Shares shall
(unless otherwise determined at the relevant time) mean the Shenzhen Stock Exchange and in the
case of the H Shares shall (unless otherwise determined at the relevant time) mean the Hong Kong
Stock Exchange; provided that for the purposes of any calculation where a Closing Price is required
if no Closing Price is reported for one or more consecutive dealing days such day or days will be
disregarded in any relevant calculation and shall be deemed not to have been dealing days when
ascertaining any period of dealing days; and
“Volume Weighted Average Price” means in relation to an H Share for any H Share Stock
Exchange Business Day the order book volume-weighted average price of an H Share for such HShare Stock Exchange Business Day appearing on or derived from Bloomberg screen page “6936 HKEquity VAP” (or its successor page) or if not available on any of such screens from such other
source as shall be determined in good faith and in a commercially reasonable manner using a
volume-weighted average method to be appropriate by an Independent Financial Advisor provided
that for any H Share Stock Exchange Business Day where such price is not available or cannot
otherwise be determined as provided above the Volume Weighted Average Price of an H Share in
respect of such H Share Stock Exchange Business Day shall be the Volume Weighted Average Price
determined as provided above on the immediately preceding H Share Stock Exchange Business Day
on which the same can be so determined.References to any issue or offer or grant to Ordinary Shareholders “as a class” or “by way of rights”
shall be taken to be references to an issue or offer or grant to all or substantially all Ordinary
Shareholders other than Ordinary Shareholders by reason of the laws of any territory or
requirements of any recognised regulatory body or any other stock exchange or securities market in
any territory or in connection with fractional entitlements it is determined not to make such issue
or offer or grant.– 95 –6 PAYMENTS
6.1 Principal
Payment of principal and interest (if any) will be made by transfer to the registered account of the
Bondholder except in the case of any amount payable directly by the Issuer or the Guarantor (as the
case may be) pursuant to Condition 5 where any amounts payable consequent upon the exercise of
its Conversion Right by a Bondholder will be made by HK dollar cheque drawn on a bank that
processes payments in HK dollars and mailed to the address of the Bondholder or by transfer to a
HK dollar account maintained by the payee in either case in accordance with instructions given by
the relevant Bondholder in its Conversion Notice. Payment of principal will only be made after
surrender of the relevant Certificate at the specified office of any of the Agents.If an amount which is due on the Bonds is not paid in full the Registrar will annotate the Register
with a record of the amount (if any) in fact paid.References in these Conditions the Trust Deed and the Agency Agreement to principal in respect of
any Bond shall where the context so permits be deemed to include a reference to any premium
payable thereon.So long as the Bonds are represented by the Global Certificate and the Global Certificate is held on
behalf of Euroclear or Clearstream (each a “relevant clearing system”) each payment in respect
of the Global Certificate will be made to the person shown as the holder thereof in the Register at
the close of business (in the relevant clearing system) on the Clearing System Business Day before
the due date for such payment where “Clearing System Business Day” means a weekday (Monday
to Friday inclusive) except December 25 and January 1.
6.2 Registered Accounts
For the purposes of this Condition 6 a Bondholder’s registered account means the HK dollar account
maintained by or on behalf of it with a bank that processes payments in HK dollars details of which
appear on the Register at the close of business on the fifth Payment Business Day (as defined in
Condition 6.6) before the due date for payment and a Bondholder’s registered address means its
address appearing on the Register at that time.
6.3 Fiscal Laws
All payments are subject in all cases to (i) any applicable fiscal or other laws and regulations in the
place of payment but without prejudice to the provisions of Condition 8 and (ii) any withholding or
deduction required pursuant to an agreement described in Section 1471(b) of the U.S. Internal
Revenue Code of 1986 as amended (the “Code”) or otherwise imposed pursuant to Sections 1471
through 1474 of the Code any regulations or agreements thereunder any official interpretations
thereof or (without prejudice to the provisions of Condition 8) any law implementing an
intergovernmental approach thereto. No commissions or expenses shall be charged to the
Bondholders in respect of such payments.– 96 –6.4 Payment Initiation
Payment instructions (for value on the due date or if that is not a Payment Business Day for value
on the first following day which is a Payment Business Day) will be initiated on the due date for
payment (or if it is not a Payment Business Day the immediately following Payment Business Day)
or in the case of a payment of principal if later on the Payment Business Day on which the relevant
Certificate is surrendered at the specified office of an Agent.
6.5 Delay in Payment
Bondholders will not be entitled to any interest (if any) or other payment for any delay after the due
date in receiving the amount due if the due date is not a Business Day or if the Bondholder is late
in surrendering its Certificate (if required to do so).
6.6 Payment Business Day
In this Condition 6 “Payment Business Day” means a day other than a Saturday Sunday or public
holiday on which commercial banks and foreign exchange markets are generally open for business
in Hong Kong and the city in which the specified office of the Principal Agent is located and in the
case of the surrender of a Certificate in the place where the Certificate is surrendered.
6.7 Rounding
When making payments to Bondholders fraction of one cent will be rounded to the nearest cent (half
a cent being rounded upwards).
6.8 Appointment of Agents
The initial Agents and their initial specified offices are listed below. The Issuer and the Guarantor
reserve the right at any time with the prior written approval of the Trustee to vary or terminate the
appointment of any Agent and appoint additional or replacement Agents provided that the Issuer
shall at all times maintain (i) a Principal Agent (ii) a Registrar (iii) a Transfer Agent (which may
be the Principal Agent) (iv) a Conversion Agent (which may be the Principal Agent) and (v) such
other agents as may be required by the stock exchange on which the Bonds may be listed in each
case as approved in writing by the Trustee.Notice of any changes in any Agent or their specified offices will promptly be given by the Issuer
or the Guarantor to the Bondholders in accordance with Condition 16.
7 REDEMPTION PURCHASE AND CANCELLATION
7.1 Maturity
Unless previously redeemed converted or purchased and cancelled as provided herein the Issuerwill redeem each Bond at 100.5 per cent. of its principal amount on 8 July 2026 (the “MaturityDate”). The Issuer may not redeem the Bonds at its option prior to that date except as provided in
Condition 7.2 or Condition 7.3 below (but without prejudice to Condition 9).– 97 –7.2 Redemption at the Option of the Issuer
7.2.1 The Issuer may having given not less than 30 nor more than 60 days’ notice (an “OptionalRedemption Notice”) to the Bondholders the Trustee and the Principal Agent (which notice
will be irrevocable) redeem all but not some only of the Bonds at their Early Redemption
Amount if at any time the aggregate principal amount of the Bonds outstanding is less than 10
per cent. of the aggregate principal amount originally issued (including any Bonds issued
pursuant to Condition 15).Upon the expiry of the Optional Redemption Notice the Issuer will be bound to redeem the
relevant Bonds at their principal amount.
7.2.2 The Trustee and the Agents shall have no obligation to confirm whether the circumstances
giving rise to a right for the Issuer to redeem under this Condition 7.2 have in any case arisen
and none of them shall be liable to the Bondholders or any other person for not doing so.
7.3 Redemption for Taxation Reasons
7.3.1 At any time the Issuer may having given not less than 30 nor more than 60 days’ notice to the
Trustee the Principal Agent and the Bondholders (which notice shall be irrevocable) redeemall but not some only of the Bonds at their Early Redemption Amount (the “Tax RedemptionDate”) if the Issuer satisfies the Trustee immediately prior to the giving of such notice that (i)
the Issuer (or if the Guarantee was called the Guarantor) has or will become obliged to pay
Additional Tax Amounts as provided or referred to in Condition 8 as a result of any change in
or amendment to the laws or regulations of the PRC or the BVI or in each case any political
subdivision or any authority thereof or therein having power to tax or any change in the
general application or official interpretation of such laws or regulations which change or
amendment becomes effective on or after 25 June 2025 and (ii) such obligation cannot be
avoided by the Issuer (or as the case may be the Guarantor) taking reasonable measures
available to it provided that no such notice of redemption shall be given earlier than 90 days
prior to the earliest date on which the Issuer (or as the case may be the Guarantor) would be
obliged to pay such Additional Tax Amounts were a payment in respect of the Bonds then due.Prior to the publication of any notice of redemption pursuant to this Condition 7.3.1 the Issuer
shall deliver to the Trustee (a) a certificate signed by one Authorised Signatory of the Issuer
(or as the case may be of the Guarantor) stating that the obligation referred to in (i) above
of this Condition 7.3.1 cannot be avoided by the Issuer (or as the case may be the Guarantor)
having taken reasonable measures available to it and (b) an opinion of independent legal or tax
advisors of recognised standing in form and substance satisfactory to the Trustee to the effect
that such change or amendment has occurred (irrespective of whether such amendment or
change is then effective) and the Issuer (or as the case may be the Guarantor) has or will
become obliged to pay such Additional Tax Amounts as a result of such change or amendment
and the Trustee shall be entitled to accept such certificate and opinion as sufficient evidence
thereof in which event the same shall be conclusive and binding on the Bondholders.
7.3.2 On the Tax Redemption Date the Issuer shall redeem the Bonds at the Early Redemption
Amount provided that redemption under this Condition 7.3 may not occur within seven days
of the end of a Restricted Transfer Period but otherwise may occur whenever the Conversion
Right is expressed in these Conditions to be exercisable.– 98 –7.3.3 If the Issuer gives a notice of redemption pursuant to this Condition 7.3 each Bondholder will
have the right to elect that his Bond(s) shall not be redeemed and that the provisions of
Condition 8 shall not apply in respect of any payment of principal or interest (if any) to be
made in respect of such Bond(s) which falls due after the relevant Tax Redemption Date
whereupon no Additional Tax Amounts shall be payable in respect thereof pursuant to
Condition 8 and payment of all amounts shall be made subject to the deduction or withholding
of the taxation required to be withheld or deducted by the government of the PRC or the BVI
or in each case any authority thereof or therein having power to tax. For the avoidance of
doubt any Additional Tax Amounts which had been payable in respect of the Bonds as a result
of the laws or regulations of the government of the PRC or the BVI or in each case any
authority thereof or therein having power to tax prior to 25 June 2025 will continue to be
payable to such Bondholders. To exercise such right the holder of the relevant Bond must
complete sign and deposit at the specified office of any Paying Agent during normal business
hours (being between 9.00 a.m. and 3.00 p.m. from Monday to Friday (other than public
holidays)) a duly completed and signed notice of election substantially in the form scheduled
to the Agency Agreement obtainable from the specified office of any Paying Agent together
with the Certificate evidencing the Bonds on or before the day falling 10 days prior to the Tax
Redemption Date. Such notice of election once delivered shall be irrevocable and may not be
withdrawn without the Issuer’s consent.
7.4 Redemption for Relevant Events
7.4.1 Following the occurrence of a Relevant Event (as defined in Condition 7.4.5) the holder of
each Bond will have the right at such holder’s option to require the Issuer to redeem all or
some only of such holder’s Bonds on the Relevant Event Put Date (as defined below) at the
Early Redemption Amount as at the Relevant Event Put Date. To exercise such right the holder
of the relevant Bond must complete sign and deposit at the specified office of any Paying
Agent during normal business hours (being between 9.00 a.m. and 3.00 p.m. from Monday to
Friday (other than public holidays)) a duly completed and signed notice of redemption
substantially in the form scheduled to the Agency Agreement obtainable from the specified
office of any Paying Agent (a “Relevant Event Put Exercise Notice”) together with the
Certificate evidencing the Bonds to be redeemed by not later than 30 days following a Relevant
Event or if later 30 days following the date upon which notice thereof is given to Bondholders
by the Issuer in accordance with Condition 16. The “Relevant Event Put Date” shall be the
fourteenth day after the expiry of such period of 30 days as referred to above in this Condition
7.4.1.
7.4.2 A Relevant Event Put Exercise Notice once delivered shall be irrevocable and may not be
withdrawn without the Issuer’s consent. The Issuer shall redeem the Bonds which form the
subject of the Relevant Event Put Exercise Notices delivered as aforesaid (subject to delivery
of the relevant Certificates) on the Relevant Event Put Date.
7.4.3 None of the Trustee or the Agents shall be required to monitor or take any steps to ascertain
whether a Relevant Event or any event which could lead to the occurrence of a Relevant Event
has occurred or may occur and none of them shall be liable to Bondholders or any other person
for not doing so.– 99 –7.4.4 Not later than 14 days after becoming aware of a Relevant Event the Issuer shall procure that
notice regarding the Relevant Event shall be delivered to Bondholders (in accordance with
Condition 16) and to the Trustee and the Principal Agent in writing stating:
(i) the Relevant Event Put Date;
(ii) the date of such Relevant Event and briefly the events causing such Relevant Event;
(iii) the date by which the Relevant Event Put Exercise Notice must be given;
(iv) the redemption amount and the method by which such amount will be paid;
(v) the names and addresses of all Paying Agents;
(vi) briefly the Conversion Right and the then current Conversion Price;
(vii) the procedures that Bondholders must follow and the requirements that Bondholders must
satisfy in order to exercise their rights under this Condition 7.4 or their Conversion Right;
and
(viii) that a Relevant Event Put Exercise Notice once validly given may not be withdrawn
without the Issuer’s consent.
7.4.5 For the purposes of this Condition 7.4:
(i) a “Change of Control” occurs when: (a) any Person or Persons (other than Mr. Wang Wei
and/or his Related Persons) acting together directly or indirectly acquires control of the
Guarantor; (b) Mr. Wang Wei and/or his Related Persons together with any voting rights
controlled directly or indirectly by Mr. Wang Wei and/or his Related Persons including
through any voting consent agreement cease(s) to be the single largest group of holders
directly or indirectly of the voting rights of the Guarantor; or (c) the Guarantor
consolidates with or merges into or sells or transfers all or substantially all of the
Guarantor’s assets to any other Person or Persons acting together;
(ii) “control” in respect of any Person means (i) the ownership or control of 50.1 per cent.or more of the voting rights of the issued share capital of such person or (ii) the right to
appoint and/or remove all or the majority of the members of such person’s board of
directors or other governing body whether obtained directly or indirectly and whether
obtained by ownership of share capital the possession of voting rights contract or
otherwise;
(iii) a “Delisting” occurs when the H Shares cease to be listed or admitted to trading on the
Hong Kong Stock Exchange or the Alternative Stock Exchange (as the case may be);
– 100 –(iv) an “H Share Suspension in Trading” means the suspension in trading of the H Shares
for a period of 30 consecutive H Share Stock Exchange Business Days; “Person”
includes any individual company corporation firm partnership joint venture
undertaking association organisation trust state or agency of a state (in each case
whether or not being a separate legal entity) but does not include the Guarantor’s board
of directors or any other governing board and does not include the Guarantor’s
Subsidiaries;
(v) a “No Registration Event” occurs when the Release Condition is not complied with on
or before the Registration Deadline;
(vi) “Registration Deadline” means the day falling 180 Registration Deadline Business Days
after the issue date of the Bonds;
(vii) “Registration Deadline Business Day” for the purposes of this definition means a day
other than a Saturday or Sunday on which banks are open for business and settlement in
Shenzhen;
(viii) “Related Person” means with respect to any shareholder (i) any trusts established for the
benefit of such shareholders and/or their immediate family members and/or siblings (ii)
any of their executors and/or beneficiaries of their estate (iii) any companies in which
they control directly or indirectly 50.0 per cent. or more of the voting rights or have the
ability to appoint and/or remove a majority of the members of the board of directors or
other governing body or (iv) their extended family members;
(ix) “Release Condition” means the receipt by the Trustee of: (a) a certificate in substantially
the form set forth in the Trust Deed signed by an Authorised Signatory of the Guarantor
confirming (x) the completion of the Cross-border Security Registration; and (y) that no
Event of Default has occurred and is continuing; and (b) a copy of the relevant SAFE
registration certificate and other documents (if any) evidencing the completion of the
Cross-border Security Registration certified as true by an Authorised Signatory of the
Guarantor;
(x) a “Relevant Event” means the occurrence of either (a) a Change of Control; (b) a
Delisting; (c) a H Share Suspension in Trading or (d) a No Registration Event;
(xi) “SAFE” means the State Administration of Foreign Exchange of the PRC or its local
branch; and
(xii) “voting rights” means the right generally to vote at a general meeting of shareholders of
a specified person.– 101 –7.5 Early Redemption Amount
For the purposes of these Conditions: the “Early Redemption Amount” of a Bond for each
HK$1000000 principal amount of the Bonds is the amount determined to represent for the
Bondholder on the relevant date for determination of the Early Redemption Amount (the
“Determination Date”) a gross yield of 0.5 per cent. per annum calculated on a semi-annual basis.The applicable Early Redemption Amount for each HK$1000000 principal amount of Bonds is
calculated in accordance with the following formula rounded (if necessary) to two decimal places
with 0.005 being rounded upwards (provided that if the date fixed for redemption is a Semi-annual
Date (being each of the dates set out in the left hand column in the table below) such Early
Redemption Amount shall be as set out in the right hand column in the table below in respect of such
Semi-annual Date):
Early Redemption Amount = Previous Redemption Amount × (1 + r/2)d/p
where
Previous Redemption Amount = the Early Redemption Amount for each HK$1000000 principal
amount on the Semi-annual Date immediately preceding the date fixed for redemption as set out
below (or if the Bonds are to be redeemed prior to the first Semi-annual Date HK$1000000):
Early Redemption
Semi-annual Date Amount
(HK$)
10 January 2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1002500
r = 0.5 per cent. expressed as a fraction;
d = number of days from and including the immediately preceding Semi-annual Date (or if
the Bonds are to be redeemed on or before the first Semi-annual Date from and including
the Issue Date) to but excluding the date fixed for redemption calculated on the basis
of a 360-day year consisting of 12 months of 30 days each and in the case of an
incomplete month the number of days elapsed;
p = 180.
7.6 Purchases
The Issuer the Guarantor or any of their respective Subsidiaries may subject to applicable laws and
regulations at any time and from time to time purchase Bonds at any price in the open market or
otherwise. The Bonds so acquired while held by or on behalf of the Issuer the Guarantor or any such
Subsidiary shall not entitle them to convert the Bonds in accordance with these Conditions nor shall
such Bonds be deemed to be outstanding for the purposes of among other things calculating
quorums at meetings of the Bondholders and exercising any voting rights with respect to such Bonds
and Condition 9 and Condition 13.
7.7 Cancellation
All Bonds which are repurchased redeemed or converted or purchased by or on behalf of the Issuer
the Guarantor or any of their respective Subsidiaries will forthwith be cancelled. Certificates in
respect of all Bonds cancelled will be forwarded to or to the order of the Registrar and such Bonds
may not be reissued or resold.– 102 –7.8 Redemption Notices
All notices to Bondholders given by or on behalf of the Issuer pursuant to this Condition 7 will be
irrevocable and will be given in accordance with Condition 16 specifying: (i) the Conversion Price
as at the date of the relevant notice; (ii) the last day on which Conversion Rights may be exercised;
(iii) the principal and/or premium (if any) payable; (iv) the date fixed for redemption; (v) the manner
in which redemption will be effected; and (vi) the aggregate principal amount of the Bonds
outstanding as at the latest practicable date prior to the publication of the notice.If more than one notice of redemption is given (being a notice given by either the Issuer or a
Bondholder pursuant to these Conditions) the first in time shall prevail.Neither the Trustee nor any of the Agents shall be responsible for calculating or verifying the
calculations of any amount payable on redemption of the Bonds pursuant to this Condition 7 or have
any duty to verify the accuracy content completeness validity and/or genuineness of any
certificates confirmations or documents in relation to or in connection to any such redemption or the
exercise of any right of redemption or to require redemption and none of them shall be liable to the
Bondholders or any other person for not doing so.
8 TAXATION
8.1 All payments made by or on behalf of the Issuer (or as the case may be the Guarantor) in respect
of the Bonds (or in the case of the Guarantor the Guarantee) will be made free from any set-off
counterclaim restriction or condition and will be made without deduction or withholding for or on
account of any present or future taxes duties assessments or governmental charges of whatever
nature imposed levied collected withheld or assessed by or on behalf of the PRC or the BVI or
in each case any authority thereof or therein having power to tax unless deduction or withholding
of such taxes duties assessments or governmental charges is compelled by law. Where such
withholding or deduction is made by the Issuer or the Guarantor (as the case may be) by or within
the PRC up to and including the aggregate rate applicable on 25 June 2025 (the “Applicable Rate”)
the Issuer or the Guarantor (as the case may be) will increase the amounts paid by it to the extent
required so that the net amount received by Bondholders equals the amounts which would otherwise
have been receivable by them had no such withholding or deduction been required. If the Issuer or
the Guarantor (as the case may be) is required to make a deduction or withholding in respect of PRC
tax in excess of the Applicable Rate or any BVI deduction or withholding is required in such eventthe Issuer or the Guarantor (as the case may be) shall pay such additional amounts (“Additional TaxAmounts”) as will result in receipt by the Bondholders of such amounts as would have been received
by them had no such withholding or deduction been required except that no Additional Tax Amounts
shall be payable in respect of any Bond or the Guarantee:
8.1.1 to a holder (or to a third party on behalf of a holder) who is subject to such taxes duties
assessments or governmental charges in respect of such Bond by reason of his having some
connection with the PRC or the BVI as the case may be otherwise than merely by holding the
Bond or by the receipt of amounts in respect of the Bond or where the withholding or deduction
could be avoided by the holder making a declaration of non-residence or other similar claim
for exemption to the appropriate authority which such holder is legally capable and competent
of making but fails to do so; or
– 103 –8.1.2 (in the case of a payment of principal) if the Certificate in respect of such Bond is surrendered
more than 30 days after the Relevant Date except to the extent that the holder would have been
entitled to such additional amount on surrendering the relevant Certificate for payment on the
last day of such period of 30 days.
8.2 “Relevant Date” means whichever is the later of (i) the date on which such payment first becomes
due and (ii) if the full amount payable has not been received by the Trustee or the Principal Agent
on or prior to such due date the date on which the full amount having been so received notice to
that effect shall have been given to the Bondholders and payment made.
8.3 References in these Conditions to principal premium and interest (if any) shall be deemed also to
refer to any additional amounts or premiums which may be payable under these Conditions or any
undertaking or covenant given in addition thereto or in substitution therefor pursuant to the Trust
Deed and the Deed of Guarantee.
8.4 Neither the Trustee nor any Agent shall be responsible for paying any tax duty charges withholding
or other payment referred to in this Condition 8 or for determining whether such amounts are payable
or the amount thereof and none of them shall be responsible or liable for any failure by the Issuer
the Guarantor any Bondholder or any third party to pay such tax duty charges withholding or other
payment in any jurisdiction or to provide any notice or information to the Trustee or any Agent that
would permit enable or facilitate the payment of any principal premium (if any) interest (if any)
or other amount under or in respect of the Bonds or the Guarantee without deduction or withholding
for or on account of any tax duty charge withholding or other payment imposed by or in any
jurisdiction.
9 EVENTS OF DEFAULT
The Trustee at its discretion may and if so requested in writing by the holders of not less than 25
per cent. in aggregate principal amount of the Bonds then outstanding or if so directed by an
Extraordinary Resolution shall (subject in any such case to being indemnified and/or secured and/or
pre-funded to its satisfaction) give notice to the Issuer and the Guarantor that the Bonds are and
they shall accordingly thereby become immediately due and repayable at their Early Redemption
Amount (subject as provided below and without prejudice to the right of Bondholders to exercise the
Conversion Right in respect of their Bonds in accordance with Condition 5) if any of the following
events (each an “Event of Default”) has occurred:
9.1 if default is made in the payment of any principal or premium (if any) due in respect of the
Bonds or any of them; or
9.2 failure by the Guarantor to deliver the H Shares unless such failure is due to a technical or
administrative error and is remedied by the Guarantor within three H Share Stock Exchange
Business Days as and when the H Shares are required to be delivered following conversion of
a Bond; or
9.3 if the Issuer or the Guarantor fails to perform or observe any of its other obligations under these
Conditions the Trust Deed or the Deed of Guarantee (other than where it may give rise to a
right for redemption pursuant to Condition 7.3 for a No Registration Event) and (except in any
case where the Trustee considers the failure to be incapable of remedy when no continuation
or notice as is hereinafter mentioned will be required) the failure continues for a period of 60
days following the service by the Trustee on the Issuer or the Guarantor (as the case may be)
of written notice requiring the same to be remedied; or
– 104 –9.4 if (i) any indebtedness for borrowed money of the Issuer the Guarantor or any of the
Guarantor’s other Subsidiaries becomes due and repayable prematurely by reason of an event
of default (however described); (ii) the Issuer the Guarantor or any of the Guarantor’s other
Subsidiaries fails to make any payment in respect of any indebtedness for borrowed money
upon the expiry of any originally applicable grace period after the due date for payment; or (iii)
the Issuer the Guarantor or any of the Guarantor’s other Subsidiaries fails to make any
payment in respect of any amount payable under any guarantee and/or indemnity given by it
in relation to any indebtedness for borrowed money of any other person upon the expiry of any
originally applicable grace period after the due date for payment; provided that no event
described in this subparagraph shall constitute an Event of Default unless the indebtedness for
borrowed money or other relative liability due and unpaid either alone or when aggregated
(without duplication) with other amounts of indebtedness for borrowed money and/or other
liabilities due and unpaid relative to all (if any) other events specified in (i) through (iii)
inclusive above which have occurred and are continuing amounts to the greater of
U.S.$200000000 (or the equivalent thereof in any other currency) and two per cent. of the
Total Equity of the Guarantor; or
9.5 if any order is made by any competent court or resolution is passed for the winding-up or
dissolution of the Issuer the Guarantor or any of the Principal Subsidiaries save in the case
of any Principal Subsidiary for (i) any voluntary solvent winding-up liquidation or
dissolution; or (ii) any reorganisation whereby the business undertaking and assets of such
Principal Subsidiary are transferred to or otherwise vested in the Guarantor and/or another
Subsidiary of the Guarantor; or
9.6 if (i) the Issuer the Guarantor or any of the Principal Subsidiaries ceases or threatens to cease
to carry on all or substantially all of its business (save (A) in the case of any Principal
Subsidiary where the cessation is for the purposes of a solvent winding-up dissolution
reconstruction merger or consolidation whereby the business undertaking and assets of such
Principal Subsidiary are transferred to or otherwise vested in the Guarantor and/or another
Subsidiary of the Guarantor; (B) in the case of any Principal Subsidiary as a result of a disposal
on arm’s length terms where any consideration resulting from such disposal are vested in the
Guarantor and/or any of its Subsidiaries; or (C) in other circumstances where the cessation is
for the purposes of and followed by a reconstruction amalgamation reorganisation merger or
consolidation on terms approved in writing by the Trustee or by an Extraordinary Resolution);
or (ii) the Issuer the Guarantor or any of the Principal Subsidiaries stops or threatens to stop
payment of or is unable to or admits inability to pay all or substantially all of its debts as
they fall due or is deemed unable to pay all or substantially all of its debts pursuant to or for
the purposes of any applicable law or is adjudicated or found by a court of competent
jurisdiction to be bankrupt or insolvent; or
9.7 if any Security Interest present or future created or assumed by the Issuer the Guarantor or
any of the Principal Subsidiaries becomes enforceable; and (i) proceedings are initiated against
the Issuer the Guarantor or any of the Principal Subsidiaries in relation to all or any substantial
part of the undertaking or assets of the Issuer the Guarantor or any of the Principal
Subsidiaries or (ii) the Issuer the Guarantor or any of the Principal Subsidiaries (or their
respective directors or shareholders) initiates or consents to any judicial proceedings relating
to itself under any applicable liquidation insolvency composition reorganisation or other
similar laws (including the obtaining of a general moratorium in respect of all or any part of
its debts) or (iii) an application is made (or documents filed with a court of competent
jurisdiction) for the appointment of an administrative or other receiver manager administrator
– 105 –or other similar official or an administrative or other receiver manager administrator or other
similar official is appointed in relation to the Issuer the Guarantor or any of the Principal
Subsidiaries or as the case may be in relation to all or any substantial part of the undertaking
or assets of the Issuer the Guarantor or any of the Principal Subsidiaries or an encumbrancer
takes possession of all or any substantial part of the undertaking or assets of the Issuer the
Guarantor or any of the Principal Subsidiaries or a distress execution attachment
sequestration or other process is levied enforced upon or put in force against all or any
substantial part of the undertaking or assets of the Issuer the Guarantor or any of the Principal
Subsidiaries; and in any such case (other than the appointment of an administrator) unless
initiated by the Issuer the Guarantor or any of the Principal Subsidiaries is not discharged or
stayed within 60 days; or
9.8 if the Issuer the Guarantor or any of the Principal Subsidiaries makes a conveyance or
assignment for the benefit of or enters into any composition or other arrangement with its
creditors generally (or any class of its creditors) in respect of all or a substantial part of its
debts except with respect to any of the Principal Subsidiaries where such conveyance or
assignment is made or any such composition or other arrangement is entered into on a solvent
basis; or
9.9 if (i) all or any substantial part of the undertaking assets and revenues of the Issuer the
Guarantor or any of the Principal Subsidiaries is seized or otherwise appropriated by any
person acting under the authority of any national regional or local government or (ii) the
Issuer the Guarantor or any of the Principal Subsidiaries is prevented by any such person from
exercising normal control over all or any substantial part of its undertaking assets and
revenues; provided that no event described in this subparagraph shall constitute an Event of
Default if the Issuer the Guarantor or any of the Principal Subsidiaries receives a commercially
reasonable reimbursement for such a seizure appropriation or prevention from exercising
normal control; or
9.10 if the Issuer ceases to be a subsidiary wholly-owned and controlled directly or indirectly by
the Guarantor; or
9.11 if the Bonds the Deed of Guarantee or the Trust Deed ceases to be or is claimed by the Issuer
or the Guarantor not to be in full force and effect; or
9.12 if any action condition or thing (including the obtaining or effecting of any necessary consent
approval authorisation exemption filing licence order recording or registration) at any time
required to be taken fulfilled or done in order (i) to enable the Issuer and the Guarantor
lawfully to enter into exercise their respective rights and perform and comply with their
respective obligations under the Bonds the Trust Deed and the Deed of Guarantee other than
with regard to the performance and compliance with the obligations thereunder to the extent
that the Issuer or as the case may be the Guarantor has used all reasonable endeavours to
obtain or complete the relevant consent approval authorisation exemption filing licence
order recording or registration as described thereunder (ii) to ensure that those obligations are
legally binding and enforceable and (iii) to make the Bonds the Trust Deed and the Deed of
Guarantee admissible in evidence in the courts of Hong Kong is not taken fulfilled or done;
or
9.13 if any event occurs which under the laws of any competent jurisdiction has or may have in
the Trustee’s opinion an analogous effect to any of the events referred to in subparagraphs 9.5
to 9.9 above.– 106 –For the purposes of this Condition:
“Principal Subsidiary” means any Subsidiary of the Guarantor incorporated in the PRC:
(a) whose revenue or (in the case of a Subsidiary which itself has Subsidiaries) consolidated
revenue as shown by its latest audited income statement are at least 10 per cent. of the
consolidated revenue as shown by the latest audited consolidated income statement of the
Guarantor; or
(b) whose gross assets or (in the case of a Subsidiary which itself has Subsidiaries) consolidated
gross assets as shown by its latest audited balance sheet are at least 10 per cent. of the amount
which equals the amount included in the consolidated gross assets of the Guarantor as shown
by the latest audited consolidated balance sheet of the Guarantor; or
(c) to which is transferred the whole or substantially the whole of the assets of a Subsidiary which
immediately prior to such transfer was a Principal Subsidiary provided that the Principal
Subsidiary which so transfers its assets shall forthwith upon such transfer cease to be a
Principal Subsidiary and the Subsidiary to which the assets are so transferred shall become a
Principal Subsidiary at the date on which the first available audited accounts (consolidated if
appropriate) of the Guarantor prepared as of a date later than such transfer are issued unless
such Subsidiary would continue to be a Principal Subsidiary on the basis of such accounts by
virtue of the provisions of paragraphs (a) or (b) above of this definition;
provided that in relation to paragraphs (a) and (b) above of this definition:
(i) in the case of a corporation or other business entity becoming a Subsidiary after the end of the
financial period to which the latest audited consolidated accounts of the Guarantor relate the
reference to the then latest audited consolidated accounts of the Guarantor for the purposes of
the calculation above shall until audited consolidated accounts of the Guarantor for the
financial period in which the relevant corporation or other business entity becomes a
Subsidiary are issued be deemed to be a reference to 60 the then latest audited consolidated
accounts of the Guarantor adjusted to consolidate the latest audited accounts (consolidated in
the case of a Subsidiary which itself has Subsidiaries) of such Subsidiary in such accounts;
(ii) if at any relevant time in relation to the Guarantor or any Subsidiary which itself has
Subsidiaries no consolidated accounts are prepared and audited revenue or gross assets of the
Guarantor and/or any such Subsidiary shall be determined on the basis of pro forma
consolidated accounts prepared for this purpose by the Guarantor;
(iii) if at any relevant time in relation to any Subsidiary no accounts are audited its revenue or
gross assets (consolidated if appropriate) shall be determined on the basis of pro forma
accounts (consolidated if appropriate) of the relevant Subsidiary prepared for this purpose by
the Guarantor; and
(iv) if the accounts of any subsidiary (not being a Subsidiary referred to in proviso (i) above) are
not consolidated with those of the Guarantor then the determination of whether or not such
subsidiary is a Principal Subsidiary shall be based on a pro forma consolidation of its accounts
(consolidated if appropriate) with the consolidated accounts (determined on the basis of the
foregoing) of the Guarantor.– 107 –A certificate prepared by an Authorised Signatory of the Guarantor that in his or her opinion a
Subsidiary is or is not or was or was not a Principal Subsidiary of the Guarantor in the absence of
manifest error shall be conclusive and binding on the Bondholders and all parties. The certificate
shall if there is a dispute as to whether any Subsidiary of the Guarantor is or is not a Principal
Subsidiary be accompanied by a report by a nationally recognised firm of public accountants
addressed to the Guarantor as to proper extraction of the figures used by the Guarantor in
determining the Principal Subsidiaries of the Guarantor and mathematical accuracy of the
calculation.“Total Equity” means as of any date the total equity attributable to the Guarantor’s shareholders
on a consolidated basis determined in accordance with IFRS Accounting Standards as shown on the
Guarantor’s latest consolidated audited financial statements.
10 PRESCRIPTION
Claims in respect of amounts due in respect of the Bonds will become prescribed unless made within
10 years (in the case of principal) and five years (in the case of default interest if any) from the
Relevant Date in respect thereof.
11 MEETINGS OF BONDHOLDERS MODIFICATION AND WAIVER
11.1 Meetings
The Trust Deed contains provisions for convening meetings of Bondholders to consider any matter
affecting their interests including without limitation the sanctioning by Extraordinary Resolution of
a modification of the Bonds or the provisions of the Trust Deed the Agency Agreement and/or the
Deed of Guarantee. Such a meeting may be convened by the Issuer the Guarantor or the Trustee and
shall be convened by the Trustee if requested in writing to do so by Bondholders holding not less
than 10 per cent. in aggregate principal amount of the Bonds for the time being outstanding and if
it is indemnified and/or secured and/or pre-funded to its satisfaction against all costs and expenses.The quorum at any such meeting for passing an Extraordinary Resolution will be two or more
persons holding or representing over 50 per cent. in aggregate principal amount of the Bonds for the
time being outstanding or at any adjournment of such meeting two or more persons being or
representing Bondholders whatever the principal amount of the Bonds so held or represented unless
the business of such meeting includes consideration of proposals inter alia (i) to modify the due
date for any payment in respect of the Bonds (ii) to reduce or cancel the amount of principal in
respect of the Bonds (iii) to change the currency of payment of the Bonds or (iv) to modify or cancel
the Conversion Rights (except by unilateral and unconditional reduction in the Conversion Price) or
the put options specified in Condition 7 or (v) to modify the provisions concerning the quorum
required at any meeting of the Bondholders or the majority required to pass an Extraordinary
Resolution in which case the necessary quorum for passing an Extraordinary Resolution will be two
or more persons holding or representing not less than 75 per cent. or at any adjourned such meeting
not less than 25 per cent. in aggregate principal amount of the Bonds for the time being outstanding.An Extraordinary Resolution passed at any meeting of Bondholders will be binding on all
Bondholders whether or not they are present at the meeting. The Trust Deed provides that a written
resolution signed by or on behalf of the holders of not less than 90 per cent. of the aggregate
principal amount of Bonds outstanding and/or an Electronic Consent (as defined in the Trust Deed)
shall be as valid and effective as a duly passed Extraordinary Resolution.– 108 –11.2 Modification and Waiver
The Trustee may (but shall not be obliged to) agree without the consent of the Bondholders to (i)
any modification (except as mentioned in Condition 11.1 above and the Trust Deed) to or the waiver
or authorisation of any breach or proposed breach of the Bonds the Agency Agreement the Deed
of Guarantee or the Trust Deed which is not in the opinion of the Trustee materially prejudicial to
the interests of the Bondholders or (ii) any modification to the Bonds the Agency Agreement the
Deed of Guarantee or the Trust Deed which in the Trustee’s opinion is of a formal minor or
technical nature or to correct a manifest error or to comply with mandatory provisions of law. Any
such modification waiver or authorisation will be binding on the Bondholders and unless the
Trustee agrees otherwise any such modification waiver or authorisation will be notified by the
Issuer or the Guarantor to the Bondholders as soon as practicable thereafter.
11.3 Interests of Bondholders
In connection with the exercise of its functions rights powers and discretions (including but not
limited to those in relation to any proposed modification authorisation or waiver) the Trustee shall
have regard to the interests of the Bondholders as a class and shall not have regard to the
consequences of such exercise for individual Bondholders and the Trustee shall not be entitled to
require on behalf of any Bondholder nor shall any Bondholder be entitled to claim from the Issuer
the Guarantor or the Trustee any indemnification or payment in respect of any tax consequences of
any such exercise upon individual Bondholders except to the extent provided for in Condition 8
and/or any undertakings given in addition thereto or in substitution therefor pursuant to the Trust
Deed.
12 REPLACEMENT OF CERTIFICATES
If any Certificate is mutilated defaced destroyed stolen or lost it may be replaced at the specified
office of the Registrar or any Transfer Agent subject to all applicable laws and stock exchange
requirements upon payment by the claimant of such costs as may be incurred in connection
therewith and on such terms as to evidence and such indemnity and/or security as the Issuer and/or
such Agent may require. Mutilated or defaced Certificates must be surrendered before replacements
will be issued.
13 ENFORCEMENT
At any time when the Bonds become due and payable the Trustee may at its discretion and without
further notice take such steps and/or actions and/or institute such proceedings against the Issuer
and/or the Guarantor as it may think fit to enforce the terms of the Trust Deed the Agency
Agreement the Deed of Guarantee and the Bonds but it need not take any such steps and/or actions
and/or institute any such proceedings unless (i) it shall have been so directed by an Extraordinary
Resolution or shall have been so requested in writing by the holders of not less than 25 per cent. in
principal amount of the Bonds then outstanding and (ii) it shall have been indemnified and/or secured
and/or pre-funded to its satisfaction. No Bondholder may proceed directly against the Issuer and/or
the Guarantor unless the Trustee having become bound so to proceed fails to do so within a
reasonable period and such failure is continuing.– 109 –14 INDEMNIFICATION OF THE TRUSTEE
The Trust Deed contains provisions for the indemnification security and pre-funding of the Trustee
and for its relief from responsibility including without limitation from taking proceedings to enforce
payment unless indemnified and/or secured and/or prefunded of its satisfaction. The Trustee is
entitled to enter into business transactions with the Issuer the Guarantor and any entity related
(directly or indirectly) to the Issuer and/or the Guarantor and/or any entity related (directly or
indirectly) to the Issuer and/or the Guarantor without accounting for any profit.The Trustee may rely without liability to Bondholders on any report confirmation or certificate from
or any advice or opinion of any legal counsel accountants financial advisers financial institution
or any other expert whether or not obtained by or addressed to it and whether their liability in
relation thereto is limited (by its terms or by any engagement letter relating thereto entered into by
the Trustee or any other person or in any other manner) by reference to a monetary cap methodology
or otherwise. The Trustee may accept and shall be entitled to rely conclusively on any such report
confirmation certificate advice or opinion in which case such report confirmation certificate
advice or opinion shall be binding on the Issuer the Guarantor and the Bondholders.Whenever the Trustee is required or entitled by the terms of the Trust Deed the Deed of Guarantee
or these Conditions to exercise any discretion or power take any action make any decision or give
any direction the Trustee is entitled prior to exercising any such discretion or power taking any
such action making any such decision or giving any such direction to seek directions from the
Bondholders by way of Extraordinary Resolution and the Trustee shall not be responsible for any
loss or liability incurred by the Issuer the Guarantor the Bondholders or any other person as a result
of any delay in it exercising such discretion or power taking such action making such decision or
giving such direction as a result of seeking such direction from the Bondholders or in the event that
no direction is given to the Trustee by the Bondholders.None of the Trustee or any of the Agents shall be responsible for the performance by the Issuer the
Guarantor and any other person appointed by the Issuer and/or the Guarantor in relation to the Bonds
of the duties and obligations on their part expressed in respect of the same and unless it has written
notice from the Issuer or the Guarantor to the contrary the Trustee and each Agent shall assume that
the same are being duly performed. None of the Trustee or any Agent shall be liable to any
Bondholder or any other person for any action taken by the Trustee or such Agent in accordance with
the instructions of the Bondholders. The Trustee shall be entitled to rely on any direction request
or resolution of Bondholders given by holders of the requisite principal amount of Bonds outstanding
or passed at a meeting of Bondholders convened and held in accordance with the Trust Deed or as
otherwise provided for in the Trust Deed and/or the Conditions. Neither the Trustee nor any of the
Agents shall be under any obligation to ascertain whether any Relevant Event Event of Default or
Potential Event of Default has occurred or may occur or monitor compliance by the Issuer or the
Guarantor with the provisions of the Trust Deed the Agency Agreement the Deed of Guarantee or
these Conditions.Each Bondholder shall be solely responsible for making and continuing to make its own independent
appraisal and investigation into the financial condition creditworthiness condition affairs status
and nature of the Issuer the Guarantor and their respective Subsidiaries and the Trustee shall not
at any time have any responsibility for the same and each Bondholder shall not rely on the Trustee
in respect thereof.– 110 –15 FURTHER ISSUES
The Issuer may from time to time without the consent of the Bondholders create and issue further
bonds having the same terms and conditions as the Bonds in all respects (or in all respects except
for the issue date and the timing for complying with the requirements set out in these Conditions in
relation to the Initial CSRC Post-Issuance Filing and the Cross-border Security Registration and the
timing of any subsequent notices relating thereto to the Trustee and the Bondholders) and so that
such further issue shall be consolidated and form a single series with the Bonds. Such further bonds
shall be constituted by a deed supplemental to the Trust Deed.
16 NOTICES
All notices to Bondholders shall be validly given if mailed to them at their respective addresses in
the register of Bondholders maintained by the Registrar or published in a leading newspaper having
general circulation in Asia and so long as the Bonds are listed on the Hong Kong Stock Exchange
and the rules of that stock exchange so require published in a leading newspaper having general
circulation in Hong Kong (which is expected to be the South China Morning Post). Any such notice
shall be deemed to have been given on the later of the date of such publication and the seventh day
after being so mailed as the case may be.As long as the Bonds are represented by the Global Certificate and the Global Certificate is held on
behalf of Euroclear or Clearstream or an alternative clearing system notices to Bondholders may
be given by delivery of the relevant notice to Euroclear or Clearstream or the alternative clearing
system for communication by it to entitled accountholders in substitution for notification as required
by the Conditions and such delivery shall be deemed to be valid for all purposes of the Conditions.
17 CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999
No person shall have any right to enforce any term or condition of the Bonds under the Contracts
(Rights of Third Parties) Act 1999 but this is without prejudice to the rights of Bondholders as
contemplated in Condition 13.
18 GOVERNING LAW AND JURISDICTION
18.1 Governing Law
The Bonds the Trust Deed the Agency Agreement and the Deed of Guarantee and any
non-contractual obligations arising out of or in connection with them are governed by and shall be
construed in accordance with English law.
18.2 Jurisdiction
The courts of Hong Kong are to have exclusive jurisdiction to settle any disputes which may arise
out of or in connection with the Bonds the Deed of Guarantee the Trust Deed and/or the Agency
Agreement and accordingly any legal action or proceedings arising out of or in connection with the
Bonds the Deed of Guarantee the Trust Deed and/or the Agency Agreement (“Proceedings”) may
be brought in such courts. Each of the Issuer and the Guarantor irrevocably submits to the
jurisdiction of the courts of Hong Kong and waives any objection to Proceedings in such courts on
the ground of venue or on the ground that the Proceedings have been brought in an inconvenient
forum.– 111 –18.3 Agent for Service of Process
The Issuer has irrevocably appointed in the Trust Deed the Guarantor as its agent in Hong Kong and
the Guarantor has irrevocably agreed to accept service of process at the Guarantor’s principal place
of business in Hong Kong (currently at 9/F Asia Logistics Hub – SF Centre 36 Hong Wan Road
Tsing Yi New Territories Hong Kong) for it and on its behalf in any Proceedings in Hong Kong.
18.4 Waiver of Immunity
Each of the Issuer and the Guarantor hereby waives any right to claim sovereign or other immunity
from jurisdiction or execution and any similar defence and irrevocably consents to the giving of any
relief or the issue of any process including without limitation the making enforcement or
execution against any property whatsoever (irrespective of its use or intended use) of any order or
judgment made or given in connection with any Proceedings.– 112 –SUMMARY OF PROVISIONS RELATING TO THE BONDS IN GLOBAL FORM
The Global Certificate will contain provisions which apply to the Bonds in respect of which the Global
Certificate is issued some of which modify the effect of the Terms and Conditions set out in this Offering
Circular. Terms defined in the Terms and Conditions have the same meaning in the paragraphs below. The
following is a summary of those provisions.The Bonds will be evidenced by a Global Certificate registered in the name of a nominee of and deposited
with a common depositary for Euroclear and Clearstream.PROMISE TO PAY
Under the Global Certificate the Issuer promises to pay such principal interest and such other sums and
additional amounts (if any) as may be payable under the Terms and Conditions on the Bonds to the holder
of the Bonds on such date or dates as the same may become payable in accordance with the Terms and
Conditions.Each payment will be made to or to the order of the person whose name is entered on the Register at the
close of business on the Clearing System Business Day immediately prior to the due date for payment
where “Clearing System Business Day” means a weekday (Monday to Friday inclusive) except for 25
December and 1 January.EXCHANGE OF BONDS REPRESENTED BY GLOBAL CERTIFICATE
Owners of interests in the Bonds in respect of which the Global Certificate is issued will be entitled to
have title to the Bonds registered in their names and to receive individual definitive Certificates
(“definitive Certificates”) if either Euroclear or Clearstream (or any other clearing system selected by the
Issuer and approved in writing by the Trustee the Principal Paying Agent and the Registrar (an
“Alternative Clearing System”) through which the Bonds are held is closed for business for a continuous
period of 14 days (other than by reason of holidays statutory or otherwise) or announces an intention
permanently to cease business or does in fact do so. In such circumstances the Issuer at its own expense
will cause sufficient individual definitive Certificates to be executed and delivered to the Registrar for
completion authentication and despatch to the relevant holders of the Bonds. A person with an interest in
the Bonds in respect of which the Global Certificate is issued must provide the Registrar not less than 30
days’ notice at its specified office of such holder’s intention to effect such exchange and a written order
containing instructions and such other information as the Issuer and the Registrar may require to complete
execute and deliver such individual definitive Certificates.TRUSTEE’S POWERS
In considering the interests of the Bondholders while the Global Certificate is registered in the name of
a nominee for a clearing system or clearing systems the Trustee may to the extent it considers it
appropriate to do so in the circumstances but without being obligated to do so (a) have regard to any
information as may have been made available to it by or on behalf of the relevant clearing system or its
operator as to the identity of its accountholders (either individually or by way of category) with
entitlements in respect of the Bonds and (b) consider such interests on the basis that such accountholders
were the holders of the Bonds in respect of which the Global Certificate is issued.– 113 –CONVERSION
Subject to the requirements of Euroclear and Clearstream (or as the case may be any Alternative Clearing
System) the Conversion Rights attaching to the Bonds in respect of which the Global Certificate is issued
may be exercised by the presentation thereof to or to the order of the Principal Agent of one or more
Conversion Notices duly completed by or on behalf of a holder of a book-entry interest in such Bonds.Deposit of the Global Certificate with the Principal Agent together with the relevant Conversion Notice(s)
shall not be required. The exercise of the Conversion Right shall be notified by the Principal Agent to the
Registrar and the holder of the Global Certificate.NOTICES
So long as the Bonds are evidenced by the Global Certificate and the Global Certificate is held on behalf
of Euroclear and Clearstream or any Alternative Clearing System notices to holders of the Bonds may be
given by their being delivered to Euroclear and Clearstream or as the case may be any Alternative
Clearing System for communication by it to accountholders entitled to an interest in the Bonds rather than
by publication as required by the Terms and Conditions and shall be deemed to have been given on the
date of delivery to Euroclear and Clearstream or as the case may be any Alternative Clearing System.TRANSFERS
Transfers of beneficial interests in the Bonds represented by the Global Certificate will be effected through
the records of Euroclear and Clearstream (or as the case may be any Alternative Clearing System) and
their respective participants in accordance with the rules and procedures of Euroclear and Clearstream (or
as the case may be any Alternative Clearing System) and their respective direct and indirect participants.CANCELLATION
On cancellation of any Bond represented by the Global Certificate that is required by the Terms and
Conditions to be cancelled (other than upon its redemption) the details of such cancellation will be entered
in the records of the relevant Clearing Systems in accordance with the rules and procedures of Euroclear
and Clearstream (or any Alternative Clearing System as the case may be) and upon any such entry being
made the principal amount of the Bonds recorded in the records of the relevant Clearing Systems and
represented by the Global Certificate will be reduced by the aggregate principal amount of the Bonds so
cancelled.MEETINGS
For the purposes of any meeting of Bondholders each holder of the Bonds represented by the Global
Certificate shall (unless the Global Certificate represents only one Bond) be treated as two persons for the
purposes of any quorum requirements of a meeting of Bondholders and as being entitled to one vote in
respect of each HK$1000000 in principal amount of the Bonds for which the Global Certificate is issued.BONDHOLDER’S REDEMPTION
The Bondholder’s redemption options in Condition 7.4 (Redemption for Relevant Events) of the Terms and
Conditions may be exercised by the holder of the Global Certificate giving notice to the Principal Agent
of the principal amount of Bonds in respect of which the relevant option is exercised and presenting the
Global Certificate for endorsement or exercise within the time limits specified in the Terms and
Conditions.– 114 –Notice of exercise received within the time limits specified in the Terms and Conditions by the Principal
Agent from or on behalf of a holder of a book-entry interest in the relevant Bonds will be accepted by the
Issuer as having been given by the holder as to the principal amount of Bonds in respect of which it is
given (but without double counting) and whether or not the Global Certificate is presented for
endorsement therewith.REDEMPTION AT THE OPTION OF THE ISSUER
The options of the Issuer provided for in Conditions 7.2 (Redemption at the Option of the Issuer) and 7.3
(Redemption for Taxation Reasons) of the Terms and Conditions shall be exercised by the Issuer giving
notice to the Bondholders and to Euroclear and Clearstream (or as the case may be any Alternative
Clearing System) (or procuring that such notice is given on its behalf) within the time limits set out in and
containing the information required by the Terms and Conditions.– 115 –USE OF PROCEEDS
The net proceeds from this offering after the deduction of fees commissions and expenses payable in
connection with this offering will be approximately HK$2900.6 million. The Company intends to use its
proceeds from the issuance of the Bonds for the purposes of strengthening the Group’s international and
cross-border logistics capabilities for research and development of advanced technologies and digital
solutions for enhancing capital structure and for general corporate purposes.– 116 –CAPITALISATION AND INDEBTEDNESS OF THE GUARANTOR
The following table sets forth on an actual basis the Guarantor’s borrowings and capitalisation as at 31
December 2024 and as adjusted to give effect to the issuance of the Bonds in this offering before deducting
the Manager’s commissions and other estimated expenses payable by the Guarantor in connection with the
Offering. The table should be read in conjunction with the financial statements and the accompanying
notes included elsewhere or incorporated by reference in this Offering Circular.As at 31 December 2024
Actual As adjusted
(Unaudited)
(RMB’000) (HK$’000)(3) (RMB’000) (HK$’000)(3)
Short-term bank borrowings . . . . . . . . . . . 18365122 19831888 18365122 19831888
Long-term bank borrowings. . . . . . . . . . . . 26319260 28421299 26319260 28421299
Bonds to be issued(1) . . . . . . . . . . . . . . . . – – 2731818 2950000
Total indebtedness . . . . . . . . . . . . . . . . . . 44684382 48253188 47416200 51203188
Equity
Share capital . . . . . . . . . . . . . . . . . . . . . . 4986187 5384419 4986187 5384419
Treasury shares. . . . . . . . . . . . . . . . . . . . . -758081 -818627 -758081 -818627
Reserves . . . . . . . . . . . . . . . . . . . . . . . . . 48624934 52508460 48624934 52508460
Retained earnings . . . . . . . . . . . . . . . . . . . 39140246 42266258 39140246 42266258
Total equity . . . . . . . . . . . . . . . . . . . . . . . 91993286 99340510 91993286 99340510
Total capitalisation(2). . . . . . . . . . . . . . . . 136677668 147593698 139409486 150543698
Notes:
(1) In accordance with International Accounting Standards 32 “Financial Instruments: Presentation” a convertible bond
that can be converted to equity shares at the option of the holder which is accounted for as compound financial
instruments contains both a liability component and an equity component. For purpose of the capitalisation and
indebtedness table and illustration the gross proceeds the Group is expecting to receive from the issuance of the Bonds
(before deducting the underwriting commission and other estimated expenses in relation to the issuance of the Bonds)
will be assumed as the liability component and no allocation to the equity component will be made.
(2) Total capitalisation equals the aggregate of the total indebtedness and total equity.
(3) For convenience only the translation of Renminbi amounts into Hong Kong dollar amounts has been made at the rate
of RMB0.92604 to HK$1.00 the central parity rate of Renminbi published by CFETS as authorised by the PBOC on
31 December 2024.
Except as disclosed elsewhere in this Offering Circular there has been no material change in the
Guarantor’s capitalisation and indebtedness since 31 December 2024.– 117 –DESCRIPTION OF THE ISSUER
FORMATION
The Issuer is a BVI business company with limited liability incorporated under the BVI Business
Companies Act 2004 (as amended) of the British Virgin Islands on 31 March 2022. The Issuer’s
registration number is 2095421. Its registered office is located at Ritter House Wickhams Cay II PO Box
3170 Road Town Tortola VG1110 British Virgin Islands. The Issuer is an indirect wholly-owned
subsidiary of the Guarantor.BUSINESS ACTIVITY
The Issuer was established for the purpose of issuing the Bonds and on-lending the proceeds to the Group
and/or its subsidiaries or affiliates. As of the date of this Offering Circular the Issuer since its
incorporation has not engaged in any material activities other than those relating to the proposed issuance
of the Bonds and the on-lending of the proceeds thereof to the Group and/or its subsidiaries or affiliates
and the authorisation of documents and agreements referred to in this Offering Circular to which it is or
will be a party.FINANCIAL STATEMENTS
Under British Virgin Islands law the Issuer is not required to publish condensed or annual financial
statements. The Issuer has not published and does not propose to publish any financial statements. The
Issuer is however required to keep proper books of accounts as are necessary to give a true and fair view
of the state of the Issuer’s affairs and to explain its transactions. Effective from 1 January 2023 the issuer
is also required to file a financial annual return with its registered agent within 9 months after the end of
each year to which the financial annual return relates.DIRECTORS
The directors of the Issuer are Chit Ho and Bee Ti Ooi. The directors of the Issuer do not hold any shares
or options to acquire shares of the Issuer.SHARE CAPITAL
The Issuer is authorised under its memorandum of association to issue a maximum of 50000 shares with
no par value each of a single class and 10000 shares have been issued to and is held by SF Holding (HK).The register of members of the Issuer is maintained at its registered office in the British Virgin Islands.No part of the equity securities of the Issuer is listed or dealt on any stock exchange and no listing or
permission to deal in such securities is being or is proposed to be sought.– 118 –DESCRIPTION OF THE GUARANTOR
OVERVIEW
The Group is a leading global integrated logistics service provider (i.e. logistics service provider that
offers a full spectrum of domestic and international logistics services including but not limited to express
delivery services freight delivery services cold chain logistics services intra-city on-demand delivery
services supply chain services and international logistics services and provides one-stop solutions to
multinationals large corporations small and medium enterprises and retail customers) and was the largest
player in China and Asia and the fourth largest player globally in terms of revenue in 2024. The Group
is a Fortune Global 500 company with market leadership in five logistics sub-segments in China and four
in Asia offering a complete range of logistics services including express freight cold chain intra-city
on-demand supply chain solutions and international logistics services.The Group has a premium brand that is widely recognised for its services and was the only logistics
company recognised as one of the Top Five Most Admired Chinese Companies by Fortune Magazine in
2024. As of 31 December 2024 the Group had an extensive global delivery network covering 206
countries and regions supported by 110 aircraft and over 200000 vehicles. The Group is also a
technology-driven company with 4180 patents and patent applications as of 31 December 2024 and
continuously leverages on proprietary technologies to deliver innovative solutions and execution
excellence. The Group had over 2.3 million customers with active credit accounts and over 730 million
retail customers as of 31 December 2024.The Group’s business model has three key attributes: direct operations integrated capabilities and
third-party independence. First the Group directly operates the entire end-to-end delivery process from
first-mile pickup to last-mile delivery. This enables strong operational control high network visibility and
agile resource allocation to support industry-leading speed cost and reliability. Second the Group’s
integrated capabilities enable it to offer a full-spectrum of services standardised or customised to address
a full range of customers’ logistics needs. Third the Group is the only integrated logistics service provider
of scale in China that is independent of major e-commerce platforms allowing it to serve its customer base
impartially capture new opportunities and build long-term sustainable relationships.China Express Logistics Invest in the Future Global Integrated Logistics
Time Period 1993 - 2012 2012 - 2023 2023 - Future
Geography China China and Asia China Asia and Global
Build a strong foundation Incubate new products Harvest prior investment
Strategic Establish market leadership Invest in infrastructure Enhance profitability
Focus Country Building Global
Leadership Build our brand Capabilities Gain market share Expansion Strengthen cost discipline
The Group has dedicated over three decades to building its logistics network and investing in logistics
infrastructure which has given it a unique position today in Asia. Its flagship product is time-definite
express which it has a dominant market leadership position in China. Leveraging its time-definite
capabilities it employs an “1-to-n” growth strategy to enter into adjacent products and geographies in a
strategic and cost-effective manner. Following this strategy its capabilities and product offerings are
becoming increasingly comprehensive and sophisticated expanding from time-definite to economy
express from small light-weight items to large heavy parcels from standard delivery to specialised
services with temperature or humidity precision from China to Asia and then to the world.For the years ended 31 December 2022 2023 and 2024 the Group’s revenue was RMB267.5 billion
RMB258.4 billion and RMB284.4 billion respectively and its gross profit which equals revenue less cost
of revenue was RMB33.0 billion RMB32.6 billion and RMB38.9 billion respectively.– 119 –HISTORY AND DEVELOPMENT
Founded in 1993 the Group’s business originated in Guangdong Province providing express delivery
services in the Pearl River Delta and its services network has further expanded to cover other parts of
China since 1996 and overseas markets since 2010. Throughout its three decades of operation the Group
has through expansion into new business segments and collaborations with reputable international
logistics service providers such as UPS DHL and HAVI Group expanded into various links within the
logistics services value chain. The Group has also expanded its geographical footprint to cover not only
the rest of China but also the global market. The Group’s business has been listed on the Shenzhen Stock
Exchange (stock code: 002352.SZ) since 23 January 2017 through the Material Asset Restructuring. The
Company was listed on the Hong Kong Stock Exchange (stock code: 6936) since 27 November 2024.The following table sets out a summary of the Group’s key development milestones.
1993 . . . . . . . . . . The Group was founded in Shunde Guangdong Province.
Late 1990s . . . . . . The Group launched the courier incentive model which tied courier compensation
to the number of parcels delivered and delivery fees.
2004 . . . . . . . . . . Mr. Wang through his controlled entity acquired the entire share capital in Shenzhen
Chengxingye International Delivery Limited (深圳市成興業國際運輸有限公司)
which became the Group’s operating entity. The company name of Shenzhen
Chengxingye International Delivery Limited* (深圳市成興業國際運輸有限公司)
was changed to S.F. Express Limited (順豐速運有限公司).
2009 . . . . . . . . . . S.F. Airlines Co. Ltd* (順豐航空有限公司) was established in March.
2010 . . . . . . . . . . The Group expanded into the international market through the launch of its
Singapore business.
2013 . . . . . . . . . . The Group became an integrated logistics service provider by expanding into new
business segments of cold chain and pharmaceutical logistics and the LTL freight.
2016 . . . . . . . . . . Obtained official approval from CSRC for the asset swap between all assets and
liabilities of Dingtai New Materials and 100% of the equity interests of SF Holding
(Group) which was the holding entity of the Group’s business at the time such that
upon completion of the Material Asset Restructuring Dingtai New Materials shall
hold the entire equity interest in SF Holding (Group) and the Group shall achieve
a listing on the Shenzhen Stock Exchange using Dingtai New Materials as the listing
entity (the “Material Asset Restructing”).
2017 . . . . . . . . . . The Group’s business was listed on the Shenzhen Stock Exchange (stock code:
002352.SZ) in January through the Material Asset Restructuring and the name of
the Company was changed to S.F. Holding Co. Ltd. in February of 2017.
2018 . . . . . . . . . . The Group completed the acquisition of 75% shareholding interest in SXH China
Logistics (formerly named as SF\HAVI China Logistics) a company engaged in
cold chain business in mainland China Hong Kong and Macau from HAVI China
Holding LLC in July to further expand its business into cold chain logistics.The Group completed the acquisition of the relevant express business assets of
Guangdong Xinbang Logistics Co. Ltd. to establish “SX Freight” as its independent
LTL freight brand using the franchising model.
2019 . . . . . . . . . . The Group completed the acquisition of the supply chain business of Deutsche Post
DHL Group in mainland China Hong Kong and Macau in February.– 120 –2021 . . . . . . . . . . SF REIT was listed on the Main Board of the Hong Kong Stock Exchange in May
(stock code: 2191). Upon the listing of SF REIT the Group indirectly held 35% of
the total real estate investment trust units in issue of SF REIT.The Group completed the acquisition of a 51.5% stake in KLN a company listed on
the Main Board of the Hong Kong Stock Exchange (stock code: 0636) and KLN
became a member of the Group in September.The Company completed a private A Shares placement in November raising gross
proceeds of approximately RMB20.0 billion.SF Intra-city a subsidiary of the Company that operates its intra-city on-demand
delivery services was spun off and listed on the Main Board of the Stock Exchange
in December (stock code: 9699).
2022 . . . . . . . . . . The Group became a Fortune Global 500 Company and was ranked first out of
Chinese Top 50 Private Logistics Enterprises by the China Federation of Logistics
and Purchasing.
2023 . . . . . . . . . . The Ezhou cargo hub the first dedicated air cargo hub in Asia officially commenced
operation of the logistics complex therein in September 2023.
2024 . . . . . . . . . . The Company was listed on the Hong Kong Stock Exchange (stock code: 6936) in
November.–121––122–
GROUP STRUCTURE
The following chart presents a simplified structure of the Group and the shareholding of the Issuer as at 31 December 2024:
Mr. WANG Wei
99.90%
Mingde Holding
(PRC)
100%
Shenzhen Weishun Mr. LEE Carmelo
(PRC) Mr. HO Chit Ms. WANG Xin Mr. XU Bensong Ka Sze Mr. LIU Jilu Other A Shareholders H Shareholders
2.01%51.38%0.002%0.003%0.001%0.001%0.72%42.48%3.41%
the Guarantor
(PRC)
100%
SF Taisen
(PRC)
100%100%100%100%76.51%100%
Anhui S.F. Telecommunication Shenzhen S.F. Freight Shenzhen Shunlu
S.F. Express Co. Ltd.* SF Airlines Company Ltd.* SF Holding (HK) Corporation* 23.49%
順豐速運有限公司 順豐航空有限公司 Service Co. Ltd.* Logistics Co. Ltd.*Other subsidiaries 安徽順豐通訊服務有限公司 (Hong Kong) 深圳順豐快運股份有限公司 (深圳順路物流有限公司)
(PRC) (PRC)
(PRC) (PRC) (PRC)
100%100%100%
S.F. Holding Group Finance Shenzhen Fengtai E-commerce Industrial SF Technology Co. Ltd.*
Company Limited* Park Asset Management Ltd.*
深圳市豐泰電商產業園 順豐科技有限公司 Other subsidiaries順豐控股集團財務有限公司
資產管理有限公司 (PRC)(PRC)
(PRC)
80.95%100%100%
Beijing SF Intra-city Advance Harmony
Technology Co. Ltd.* Celestial Ocean Holdings Company
北京順豐同城科技有限公司 Investment Limited Other subsidiariesLimited
(PRC) (British Virgin Islands) (Cayman Islands)
8.18%37.45%12.76%0.10%100%
Flourish Harmony
100% Holdings Company Limited
(益和控股有限公司)
SF Intra-city (Cayman Islands)
(Stock Code: 9699) 51.52%
(PRC)
KLN
(Stock Code: 0636)
(Bermuda)
the Issuer
(British Virgin Islands)STRENGTHS
The Group believes that the following competitive strengths contribute to its success and differentiate it
from its competitors:
Asia’s Largest Integrated Logistics Service Provider
The Group is Asia’s largest integrated logistics service provider offering a comprehensive range of
end-to-end logistics solutions. In particular the Group was Asia’s largest and globally the fourth largest
integrated logistics service provider in terms of revenue in 2024. In addition the Group was the only
provider among the global top four integrated logistics service providers to be based in Asia which is the
largest and fastest growing logistics market. With its market leadership the Group is able to capture theregion’s most attractive growth opportunities. For instance the Group’s flagship product “time-definiteexpress” captures the strong momentum from emerging e-commerce and parcel return services as well as
the increasing consumption of mid to high-end goods and fresh foods. Furthermore the Group is a market
leader in China across the vast majority of logistics sub-segments including express LTL freight delivery
cold-chain logistics third-party intra-city on-demand delivery and non-state owned independent third-
party supply chain solutions in terms of revenue in 2024. The Group is also Asia’s largest provider of
overall express delivery LTL freight delivery intra-city on-demand in terms of revenue in 2024. In
addition the Group had the largest international operation among Asia-based integrated logistics service
providers in terms of revenue in 2024.The Group has the most extensive global network among Asia-based logistics service providers:
* Air cargo fleet. As of 31 December 2024 the Group was the largest shipper of air cargo in China
accounting for 31.1% of the air cargo volume in China. As of the same date the Group operated the
largest cargo aircraft fleet in Asia of 110 all-cargo aircraft and the largest number of domestic and
international routes among Asia-based logistics service providers.* Cargo hub. The Ezhou cargo hub is the first dedicated air cargo hub in Asia and fourth in the world
which is of strategic value and scarce position. It is expected to become an international hub that
connects the world especially as a bridge to connect Southeast Asia and Europe. The Ezhou cargo
hub adopts the hub-and-spoke model which will enable the Group to further expand its network
coverage bring even higher time-definiteness achieve higher operational efficiency and lower its
costs.* Ground. As of 31 December 2024 the Group operated over 100000 line-haul and short-haul trucks
and over 100000 first and last-mile delivery vehicles globally the largest fleet in Asia supporting
the broadest road coverage in the region. The Group also has the most extensive network of service
outlets and largest couriers team in Asia extending its fast reliable and customer-centric services
into businesses and communities throughout the region.* Rail. The Group operated on the largest number of high-speed rail lines and international routes
among Asian logistics service providers as of 31 December 2024 enabling the most extensive
railroad coverage in Asia.* Sea. The Group was the third largest Asia-based ocean freight forwarder in terms of TEU in 2024.* Logistics parks and warehouses. The Group operates various logistics parks strategically located
across Asia as well as more than 750 warehouses in the PRC with an aggregate area exceeding 7.4
million sq.m. and more than 950 warehouses overseas with an aggregate area exceeding 2.5 million
sq.m. as of 31 December 2024.– 123 –Winning Business Model – Directly Operated Integrated and Independent
The Group is the only sizable integrated logistics service provider in Asia that maintains direct control and
independence of its operations and without any affiliation with e-commerce platforms. The Group
believes its business model creates sustainable competitive advantages.* End-to-end direct operations enabling strong network control and premium services. The Group
directly controls and operates the entire delivery process from first-mile pickup to last-mile delivery.The Group’s full integration of air ground and information networks coupled with end-to-end
process management provides the Group with enhanced operational control to unify strategy and
execution across its networks and optimise resource allocation. The Group is able to enhance
efficiency of its network through multi-network synergies (多網融通) where it integrates pertinent
resources across multiple networks to create one cohesive logistics network. The Group provides
both standardised and bespoke products with consistent high quality and minimal incremental costs.* Integrated capabilities addressing a larger market opportunity achieving greater customer wallet
share and stronger product synergies
o Larger market opportunity. With its integrated capabilities the Group provides a full spectrum
of logistics services and therefore address a larger market opportunity. With established
capabilities across product segments and industry verticals the Group strategically selects
areas of focus which it believes will outpace broader industry growth.o Greater customer wallet share. The Group has a symbiotic relationship with its customers. As
they scale the Group provides incrementally more solutions that seamlessly integrate with
their operations to address their evolving needs. In this process the Group grows with them
capturing greater wallet share while also helping them grow their businesses.o Modular bespoke products. As the breadth and depth of its logistics services grow the Group
is able to consolidate multiple standardised modules to create bespoke solutions and serve
diverse logistics needs empowering the entire supply chain of its customers.o Service synergies. Leveraging its information network to share resources and infrastructure
across its aviation network and ground network the Group enjoys greater economies of scale
and synergies across its service offerings.* Third-party independence fostering deeper relationships with a diverse customer base. The Group
is the only player among the leading integrated logistics service providers in China to maintain
independence from e-commerce platforms and merchants. As the e-commerce landscape evolves
rapidly in Asia the Group’s platform-neutral position ensures that it can serve a broad customer base
impartially and enables deeper relationships over time. Compared with its global and domestic
peers the Group generally has lower customer and industry concentration.* Business expansion enabling continued industry leadership. The attractive economics of the
Group’s flagship time-definite express product and directly operated model have enabled it to
employ a highly adaptable and flexible “1-to-n” expansion strategy to cost-efficiently incubate new
products and successfully disrupt adjacent logistics segments.– 124 –o LTL Freight. Based on its time-definite express practices the Group introduced widespread
adoption of door-to-door deliveries. This provided its customers with significant additional
value and allowed the Group to become Asia’s LTL freight market leader in terms of revenue
in only six years.o Cold-chain. With similar service precision requirements to time-definite express the Group’s
existing logistics network excelled at handling the exacting delivery requirements of perishable
goods. The Group became Asia (excluding Japan)’s cold-chain market leader in terms of
revenue in just five years.o Intra-city on-demand. As the Group’s existing express network was designed to specifically
meet stringent time-specific demands it was able to build an intra-city on-demand business
quickly and with ease. The intra-city on-demand business also provided cost-efficiencies to the
Group’s overall business through resource sharing to improve utilisation. The Group became
Asia’s leader among third-party intra-city on-demand delivery service providers in terms of
revenue in five years.o International logistics. With ownership and control over critical cross-border logistics
resources such as first-mile and last-mile networks customs clearance capabilities air fleet and
overseas warehousing the Group integrates this with its domestic logistics know-hows to offer
cross-border solutions.The Group’s winning business model enables it to command above-the-industry pricing for its
time-definite and bespoke products among the leading Asian players. At the same time leveraging the
synergies across its network and resource allocation advantages the Group is able to offer standard
products such as economy express with highly competitive pricing.Global Gateway Connecting Asia and the World
The Group acts as a global gateway connecting China and Asia integrating Asian local markets and
bridging Asia with the rest of the world. As the only Asia-based player among the global top four
integrated logistics service providers the Group benefits from the tailwinds in Asia the largest and fastest
growing logistics market. In this region the Group has accumulated extensive resources including
extensive local networks broad connectivity strong brand recognition and talented teams. With these
unique assets the Group is well positioned to replicate its success from China across Asia and globally.The Group’s acquisition and integration of KLN in 2021 has successfully elevated its global strategy and
operations to a new level.* Strong local expertise and network across Asia.o First and last-mile network in China and Southeast Asia. The Group is the only logistics
service provider among the global top four integrated logistics service providers to have a
directly controlled and operated network across both China and Asia supported by its
capability to connect these regions by air. The Group also has broad first and last-mile
capabilities in China and Southeast Asia to capture cross-border express demand. Southeast
Asia represents a major and one of the fastest growing logistics markets in Asia attributable
to its strong economic growth continued improvements in logistics infrastructure and growing
importance in the global supply chain.– 125 –o Deep penetration into Southeast Asian markets. The Group has a strong presence in Southeast
Asian markets supported by its well-established local networks local connectivity and
operational know-how. The Group has established a leadership position in Southeast Asia
among integrated players in terms of revenue in 2024. Moreover with a leading network in
Southeast Asia and global service capabilities the Group is poised to seize growth
opportunities in the Asia-Pacific region by leveraging its deep integration of supply chains and
the rapid expansion of local and cross-border trade to enhance its international service
capabilities. This strategic positioning enables the Group to progressively expand its network
and achieve global reach.o Unique vantage point in global supply chains. The Group has a unique vantage point in global
supply chains as the only Asia-based company in the global top four integrated logistics service
providers. As over 90% of Fortune 500 companies have significant portion of their supply
chains based in Asia the Group is uniquely positioned to deliver competitive solutions and
capture their logistics demand.* Cost leadership driving price-competitive one-stop solutions. International logistics is highly
complex requiring an expansive global network and multi-model transportation across borders. With
its integrated capabilities the Group offers comparable delivery times at more competitive pricing
than its global peers. The Group’s competitive pricing is enabled by its cost leadership among global
players. This efficient cost structure is supported by its Asian nexus highly integrated network and
large demand volume which enables the Group to support numerous regional routes with greater
scale. Moreover with few players possessing comparable scale and capabilities in Asia the Group
is further distinguished by its ability to deliver one-stop solutions covering international express
cross-border e-commerce parcel delivery to international freight forwarding.* Asset-appropriate approach to deploy resources. With the infrastructure in place the Group adopts
an asset-appropriate approach to deploy its resources for international expansion. To expand into
countries and regions outside of China the Group employs organic growth acquisitions and
partnerships. This approach provides flexibility to adapt to changing market conditions and allocate
resources more efficiently across its network.The Group has achieved rapid expansion in its international business through a combination of organic
growth and acquisitions.Go-to Brand for Differentiated and Premium Services
“Let me SF this to you” has become synonymous with “Let me express mail this to you.” In China the
Group’s household brand name has become a commonly used verb for time-definite express. The Group’s
name has also become associated with premium services. Many retailers actively advertise their exclusive
use of SF delivery to convey service quality.The Group’s fast reliable and customer-centric services are made possible by its directly operated team
of couriers who are its brand ambassadors and high-frequency touch points for customers. As of 31
December 2024 the Group’s services were supported by the largest courier team among all logistics
players in Asia. As a testament to its leadership in time-definite express and exceptional services the
Group has been ranked first in overall customer satisfaction for 16 consecutive years (2009 to 2024) first
in delivery timeliness (within 48 hours) for nine consecutive years (2013 to 2021) and first in delivery
punctuality (within 72 hours) for nine consecutive years (2013 to 2021) by the State Post Bureau. The
State Post Bureau has not published new rankings for delivery timeliness and delivery punctuality since
2021.
– 126 –Due to its successful track record in providing premium services the Group has built a reputation for
exceeding customer expectations. As a result the Group has accumulated the most extensive customer
base across major industry verticals in Asia with high customer loyalty and stickiness. The Group has
expanded its offerings to grow with its customers and meet their evolving demands. The Group is a highly
dependable logistics partner supporting its customers through the ups and downs of their business cycles.For details see “– The Group’s Customers and Customer Services – The Group’s Customers”. The Group
also provides specialised services that cater to diverse scenarios. Leveraging on its integrated capabilities
these solutions are bespoke to the Group’s customers but standardised to its operations with minimal or
low customisation cost. Examples include:
* Fresh and seasonal food. The Group is the first designated logistics service provider to deliver live
Yangcheng Lake hairy crabs through express delivery. This is enabled by its sophisticated capability
to maintain highly precise temperature and humidity during the delivery process. In addition the
Group introduced the first-ever automated binding machine for hairy crabs an innovation that has
improved timeliness and reduced costs. The Group is a leader in this market with significant market
share in terms of shipping volume of Yangcheng Lake hairy crabs in China in 2024.* Pharmaceuticals. The Group strives to be the pacesetter in pharmaceutical logistics services which
often require strict standards of safety condition monitoring delivery time and full process
coordination. The Group is among the very few logistics players globally to offer one-stop and
highly reliable vaccine transportation solutions featuring designated transportation vehicles
enhanced vaccine safety protection and temperature control.* Luxury. The Group was the first to provide luxury time-definite express “SF Shangpai” (順豐尚派)
a delivery service with couriers dressed in tailored suits and trained in brand storytelling.Technology and Innovation Driven Operations
The Group is a technology-driven logistics service provider and leverages proprietary technologies and
innovations to digitise internal management enhance operational efficiencies and expand its business.Data-driven management and digitised operations. The Group harnesses advanced technologies and
digital solutions to manage the full cycle of its end-to-end logistics operations covering pre-planning
monitoring and post-review. During pre-planning the Group utilises intelligent systems to accurately
forecast package volumes and scientifically allocate resources; during monitoring it tracks business
performance in real-time and makes necessary adjustments swiftly; during post-review the Group
conducts meticulous analysis to distil data insights and continuously iterates and refines its operations.The Group has embedded technologies in every aspect of its operations to drive operational excellence:
* First-mile pickup and last-mile delivery. The Group employs a data-driven approach to empower its
first-mile pickup and last-mile delivery services. To maximise efficiency of its courier team the
Group’s management system dispatches tasks to its couriers dynamically based on data insights
including their skills anticipated volume total working hours and potential delivery challenges
among other factors.* Transportation. The Group has adopted a digitised dispatch scheduling and management system that
optimises efficiency for its land air and multimodal transportation. For example its intelligent
scheduling system takes into account every factor including network capacity route planning
service requirements and weather conditions and then adjusts resources dynamically and
accordingly.– 127 –* Sorting centres. The Group has deployed a site management system for intelligent planning decision
making and dynamic allocation of on-site resources during the transit process. With this technology
setup the Group is able to perform numerous simulations to refine its operational strategies before
strategy implementation and hence substantially lower costs and enhance efficiency at its sorting
centres.In addition the Group has adopted a smart finance management system which employs advanced data
modelling and analytics to help business teams identify potential cost-reduction areas enable effective
operational management and assist in operational decision making.Address complex logistics scenarios and empower customers’ supply chains. The Group’s proprietary
technologies enable it to provide innovative solutions to address diverse and complex logistics scenarios.The Group also provides its technology to its customers as a service making their supply chains more
efficient.* Address complex scenarios. The Group’s high level of digitisation enables it to address new and
complex logistics needs across a wide range of industry verticals and provide practical solutions. The
Group is able to address a wide range of logistics scenarios across online and offline channels for
B2B B2C C2C and B2B2C modes.* Empower customers’ supply chains. The Group offers its proprietary technologies as a service to its
customers to empower their supply chains. For example the Group has deployed its proprietary
Fengzhi Cloud Chain (豐智雲鏈) a cloud-based system for intelligent demand forecasting and
resource optimisation with its customers to great success resulting in faster and more efficient
fulfilment. For further details see “– Technology and Research and Development”.The Group has been widely recognised for its achievements in technological innovations. The Group was
on Fortune Magazine’s Most Influential IoT Innovation List in 2022 and 2023. As of 31 December 2024
the Group had 4180 patents and patent applications and 2505 software copyrights in the fields of
automation big data and smart hardware among others.Visionary Management Promoting a People-centric Culture
The Group’s management team exhibits extraordinary vision. They have guided the Group through
changes that may not yield immediate outcomes but have substantial long-term benefits for instance
being the industry-first transform the business into a directly operated model within the China express
sector. Under their leadership the Group has become Asia’s largest integrated logistics service provider
an achievement through strong execution of organic growth initiatives as well as strategic acquisitions and
partnerships both domestically and internationally. With diverse local and international experience the
Group’s management team also brings multifaceted perspectives to the organisation. Their diverse
backgrounds also create an inclusive culture of learning and collaboration that attracts top talents.The Group’s founder chairman of the Board and chief executive officer Mr. Wang is a highly respected
veteran of the logistics industry. Guided by his vision the Group has anticipated and embraced emerging
trends to shape the future of the logistics industry. Mr. Wang is grounded by the belief that the fulfilment
of its employees drives the satisfaction of its customers which creates a virtuous cycle that empowers both
its employees and customers.– 128 –The Group’s people-centric culture promotes sustainable growth internally and closer relationships with
its customers externally. The Group invests in its couriers and take special care to ensure their well-being
through market-leading compensation continuous training and employee benefits. By nurturing its
couriers with the support and care they deserve they have passed on that same passion and warmth to its
customers. The Group’s couriers play a pivotal role in advancing its culture. Their willingness to go the
extra mile through extending a helping hand to local communities cultivates a deep sense of trust among
its customers.The Group is recognised by Fortune Magazine as one of the Most Admired Chinese Companies for eight
consecutive years (2017 to 2024) making it the only logistics service provider with such international
recognition.STRATEGIES
The Group’s growth journey passed through distinct phases. The Group first established market leadership
in time-definite delivery services and then strategically expanded its service offerings and geographic
coverage. Each step was meticulous and focused on its long-term vision. With its competitive offerings
and executional excellence the Group is well positioned to identify and capture emerging opportunities.The Group is focusing on executing its core strategies and have clear business priorities to continuously
reinforce its competitive moats and achieve long-term sustainable and profitable growth.Further Strengthen and Optimise the Group’s Network and Service Offerings
The Group’s service quality and integrated capabilities are key to its continued success. The Group
endeavours to further enhance its network coverage and improve its network infrastructure. Based on
business needs the Group will continuously optimise and selectively expand its logistics infrastructure
including service outlets sorting centres warehouses and fleets. The Group will continue to develop the
Ezhou cargo hub into a global logistics hub which will enhance the competitiveness of its time-definite
express and cross-border service offerings.The Group aims to continue to expand its service offerings to fulfil new customer demand and offer
bespoke solutions to address customised scenarios. The Group plans to deepen its penetration into
emerging and fast-growing sectors across technology healthcare and financial services. As more industry
verticals require more speedy delivery of their products the Group aims to capture greater demand for
time-definite equivalent services within these segments. Meanwhile the Group performs constant
performance review of its business segments and customer cohorts to optimise resource allocation for core
segments and customers.Continue to Enhance Efficiency and Productivity
The Group is committed to enhancing operational efficiencies and reducing costs throughout its
operations. The Group has multiple clear levers to improve its productivity and focus on multi-network
coordination and operational efficiency enhancement. As its capabilities and services evolve the Group
is able to constantly identify synergistic areas to streamline operations which will lead to sustainable and
profitable growth.To improve its multi-network integration the Group plans to continue to implement unified network
planning and integrate pertinent resources across multiple networks to create one cohesive logistics
network which would increase utilisation avoid repeated investment and enhance economies of scale. In
particular the Group will focus on improving its capabilities and productivity in distribution
– 129 –transportation and last-mile delivery by further optimising the utilisation of its physical facilities and
adopting innovative operational models such as increasing direct dispatch from sorting centres and setting
up more multi-purpose service outlets.To enhance its operational efficiency the Group will continue to deploy automation equipment in its
facilities to increase handling capacity while reducing manpower. In addition the Group intends to further
optimise personnel management through increasing digitisation and finetuning incentive programs.Continue to Invest in Technology to Build a Smart Logistics Network and Offer Pioneering Solutions
The Group will continue to promote the end-to-end digitisation of its logistics network to drive greater
automation and efficiencies. Through its “SF Smart Brain” the Group plans to continually upgrade its
smart systems from demand planning collection transportation distribution to delivery. The Group will
continue to promote the digitisation of the entire industry supply chain system through more seamless
integration of its supply chain with its customers’ operations.The Group endeavours to continuously push the limits of conventional logistics to offer pioneering
solutions through technology innovation. Through strengthening its capabilities in technologies including
automation blockchain and cloud computing the Group expects to address more complex scenarios and
provide more customised solutions reinforcing its competitiveness. In line with its goal to become a
leader in green logistics the Group will continue to develop innovative technologies to improve energy
efficiency and promote wider adoption of green packaging.Expand its International and Cross-Border Capabilities
The Group aims to become the global leader in logistics. With Chinese enterprises expanding globally as
well as global multinational corporations expanding and diversifying their supply chain across emerging
Asian countries the international logistics has significant opportunities for structural transformation
especially to leading and Asia-based integrated logistics service providers. To that end the Group will
further enhance its global and cross-border capabilities through expanding network coverage in Asia and
the rest of the world while maintaining a flexible approach in deploying resources. The Group will deepen
its footprint in existing international markets such as Southeast Asia and increase its presence in new
markets with high growth. The Group will also enhance network connectivity and density within its Asia
network and between its Asia and global logistics network.The Group’s aim is to become the go-to logistics partner globally driving its customers’ success on a
global scale. The Group intends to further enhance the breadth and depth of its international offerings
specifically by enhancing cross-border capabilities and providing integrated overseas warehousing and
distribution services. The Group targets to offer more premier logistics solutions overseas as it view its
quality of services as a key differentiator. Further the Group aims to stay agile to adapt to the change in
demand of its customers’ supply chains. The Group will also selectively pursue acquisitions investments
and partnerships that are accretive to its strategy to become the global logistics leader.Grow Business and Consumer Mindshare as “the One in Asia”The Group strives to grow its business and consumer mindshare by establishing its brand image as “theOne in Asia” meaning that whenever businesses and consumers have a need for an end-to-end integrated
logistics solution in Asia SF is the first name they think of.– 130 –The Group believes that it is well equipped to accomplish this relative to its peers and aims to leverage
its existing business positioning to achieve this. The Group will actively promote its strengths in:
* Full coverage. The Group has broad geographic service and industry coverage. The Group covered
206 countries and regions globally as of 31 December 2024 has integrated logistics capabilities and
serve a client base spread across all industry verticals.* Strong network. The Group directly controls and operates its network across China and Asia with
broad first and last-mile capabilities in China and Southeast Asia and utilised its logistics complex
in the Ezhou cargo hub the only dedicated air cargo hub in Asia to enhance its global connectivity
capabilities. This is evidenced by over 45% of 2024 Fortune China 500 companies being customers
of the Group’s international logistics services in 2024.* Deep relationships. The Group served 484 of the Top 500 Enterprises in China in 2024 and has the
highest coverage of blue-chip customers among integrated logistics service providers in Asia. The
Group has formed deep relationships with its customers by growing together with them expanding
its service offerings to meet their evolving demands and becoming a one-stop logistics solutions
provider to serve businesses and consumers.* Seamless integration. The Group’s business model is fully integrated across geography service and
customers to realise synergies and efficiently utilise resources.Based on the above the Group believes that it has clear and distinctive advantages to deliver an
ever-improving customer experience and subsequently capitalise on the opportunity to expand mindshare
and grow its business.THE GROUP’S BUSINESS MODEL
The Group’s business model combines direct operations integrated capabilities and third-party
independence enabling it to maintain control and autonomy over its operations offer a wide portfolio of
service offerings and serve customers impartially.Directly Operated Model
The Group’s operations pivot around a directly operated model integrating aviation ground and
information networks under one unified command. The Group directly operates the entire delivery process
from first-mile pickup to last-mile delivery with minimum reliance on franchisees. This model ensures
strong operational control and high visibility over its entire logistics network and infrastructure including
service outlets sorting centres warehouses and line-haul transport empowering it to effectively allocate
resources and deliver speedy and reliable services. For example the Group fully integrates resources
across its aviation and ground network with its data network to efficiently serve its entire portfolio of
services. In addition with direct operations the Group is able to ensure business resilience and sustain
service quality throughout changing business environments and market conditions.– 131 –Integrated Capabilities
Anchored by its directly operated model the Group delivers a comprehensive portfolio of logistics and
supply chain solutions to a diverse customer base globally. Leveraging its time-definite capabilities as a
foundation the Group has expanded strategically into economy express freight delivery cold chain
logistics intra-city on-demand delivery and supply chain and international services catering to the
evolving and diverse logistics needs of its customers across industry verticals. The Group has been
building its capabilities in a strategic meticulous and cost-effective way leveraging its established
competitive strengths and networks to enter adjacent products. This approach unlocks network synergies
and optimises resource allocation simultaneously reinforcing the foundation of the Group’s time-definite
delivery and fostering the growth of its other businesses. The following diagram illustrates the full cycle
of the Group’s integrated service offerings:
Pick-up Sorting & transportation Delivery
Express Business customers/ Service outlets Hubs and Hubs and Service outlets Recipients
Retail customers sorting centers sorting centers
freight and
cold chain
First-mile Short-haul Line-haul Short-haul Last-mile
Individual 1 Place delivery order/individual services
Customers SF Intra-city 2
1 Place delivery order/tailored solutions Order dispatch
Intra-city
on-demand Consumers Place shopping Merchants Rider3 4 Recipientsor food orders
Collection Delivery
Procurement and manufacturing solutions Distribution solutions Consumption and after-sales solutions
Overseas Bonded Factories Domestic Regional Stores Enterprise
Supply chain Offlinesuppliers warehouse distribution hubs distribution centers recipients
service
Domestic Warehouse OEM Overseas E-commerce Online Individual
suppliers manufacturers distribution hubs distribution centers recipients
Domestic Cross-border Overseas
Enterprise/Retail
International customers
Domestic hubs and Line-haul Overseas hubs and Consignee
Pick-up sorting centers shipping sorting centers
delivery
Cross-border
service Custom Custom DeliveryE-commerce platform clearance clearance
Pick-up
Place order
Domestic Cross-border Overseas
Documentation Documentation
International 1 Transportation 2 Warehousing & 3 3 2 Warehousing & 1 Transportationpreparation and Air/Ocean preparation andarrangement ground handling customs clearance customs clearance ground handling arrangement
freight Business Trucking Terminal Customs Carriers/ Customs Terminal Trucking Consignee
forwarding customers company operator broker Shipping lines broker operator company
service1
Note: The Group’s international services in general adopt an asset-appropriate approach. In particular its international
freight forwarding service is asset-light whereby majority of transportation needs are provided by external carriers
and customs clearance is partly outsourced to external customs brokers.With a comprehensive portfolio of logistics and supply chain solutions the Group can select and combine
its capabilities which are operationally standardised to the Group to provide differentiated and tailored
solutions to address the specific logistics needs of its customers across various industries. As a result the
number of its customers with active credit accounts amounted to approximately 2.3 million as of 31
December 2024.– 132 –Leveraging its integrated capabilities on top of its existing standardised products and tailored solutions
the Group is able to further provide its customers with versatile industry-specific packaged solutions
designed specifically for various industries with wide applicability and replicability. With its industry
experience and in-depth engagement with large-scale enterprises spanning across various industries the
Group is able to spot logistics challenges confronted by small and medium enterprises that are common
among the industry and their unmet logistics needs. Therefore the Group has distilled its existing
standardised products and tailored solutions into industry-specific packaged solutions that can be widely
applied. Simplified industry-specific packaged solutions offer standardised logistics services to a vast
number of small and medium enterprises making it easier to scale and mass roll out. This strategic
approach will further enhance customer satisfaction and loyalty expand the Group’s customer base and
deepen its wallet share and market share across various industry verticals. The Group believes the
implementation of versatile industry-specific packaged solutions will not only meet broad customer needs
but also fortify its competitive edge in the logistics industry driving sustainable growth.Independent Third-party Logistics Service Provider
The express delivery industry in China has grown rapidly due to the rise of e-commerce platforms. As new
e-commerce platforms and merchants continue to emerge they generally prefer logistics partners that are
not affiliated with incumbent e-commerce players to form long-term trusted relationships free of potential
conflicts of interest perceived or otherwise. Unlike the majority of its domestic Chinese peers the Group
is positioned in the industry as an independent third-party logistics service provider neutral to platforms
and merchants. The Group is not affiliated with any e-commerce platform which enables it to provide
impartial services to all of its customers. The Group aims to provide unbiased inclusive high-quality
services to all its partners and empower their success.The Group’s unique business model combining direct operations integrated services capabilities and
third-party independence has enabled it to achieve today’s success as an industry frontrunner and will
further empower the Group to capture evolving customer needs and continue its expansion.THE GROUP’S VALUE PROPOSITION
The Group delivers differentiated and exceptional value to its customers and its operations.Value Proposition to its Customers
* Superior timeliness and service quality with execution excellence: The Group’s dedication to
ensuring superior timeliness and providing top-notch services has positioned it as a logistics industry
leader. Even in challenging conditions like bad weather or peak hours the Group strives to use every
means to ensure service quality and deliver a satisfactory customer experience. Additionally the
Group’s dedicated account managers serve as the main coordinators to integrate various logistics
teams for seamless execution and direct customer services. This collaborative effort enhances
communication resolves inefficiencies and guarantees a uniform customer experience. The Group’s
relentless commitment to service quality does not only meet customers’ logistics requirements but
also contributes significantly to their own operational success and therefore deepens relationship
with its customers.* One-stop solution to address diverse needs: The Group’s customers operate in multiple regions and
span across a vast number of industries requiring diverse logistics services of all kinds. The Group’s
integrated services offer a one-stop solution and freeing its customers from liaising with multiple
logistics providers. This efficient approach effectively caters to its customers’ increasingly diverse
and sophisticated demands.– 133 –* Tailored solutions to unlock value: By providing comprehensive and integrated service offerings
the Group is able to gain better insights on its customers’ specific logistics needs and pain points.This approach allows it to offer customised optimised solutions to enhance supply chain efficiency
and unlock value for its customers.* Technological empowerment: The Group empowers its customers with technological capabilities
digital solutions and data insights to drive their strategic decision making and optimise operational
efficiency. The Group is committed to continually advancing its technology capabilities and
investing in research and development to provide digitised and intelligent logistics services.Value Proposition to its Operations
* Strong operational control: The Group directly operates the entire end-to-end delivery process
from first-mile pickup to last-mile delivery with minimum reliance on franchisees. This enables
strong operational control high network visibility and agile resource allocation to support its
industry-leading speed cost and reliability. Empowered by the centralised control over its networks
and resources the Group is able to address customers’ demands promptly and effectively ensuring
a seamless experience.* Integrated capabilities to address complex requirements and capture new market
opportunities: The Group’s integrated capabilities have allowed it to continuously tap into new
logistics segments and geographies to capture new growth opportunities and extend market
leadership. Moreover the Group’s comprehensive service offerings have opened up cross-selling
opportunities enabling it to offer complementary services and deepen wallet share with its existing
customers. As a testament to the success of its strategy the Group has transformed from China’s
premier time-definite express service provider to a global integrated logistics leader in less than ten
years.* Network synergies and economies of scale: The Group’s integrated service offerings allow it to
unify its networks resulting in increasing economies of scale and network synergies. The integration
of the Group’s networks enables it to streamline line-haul routes boost loading capacity and
enhance time efficiency leading to improvement of overall operational efficiency. The Group also
adopts a unique “large and small parcel integration” strategy to optimise distribution efficiency. By
merging networks for different parcel sizes the Group achieves greater synergies and fosters a
flexible seamless logistics process that caters to its customers’ diverse needs.* Early-mover advantage in securing infrastructure: As the early mover in integrated logistics the
Group has secured scarce or difficult-to-acquire resources to build its robust infrastructure including
cargo-focused logistics hub large air cargo fleets air traffic rights and exclusive airport slots. For
instance in China where licenses for operating a cargo airline are stringently regulated and prime
take-off and landing slots are limited the Group has secured an advantageous position that is
challenging for new entrants to replicate even with substantial financial resources. This early-mover
advantage amplified by its extensive global networks and prime warehouse and sorting centre
locations underpins the unique strength of its business operations.* Data-driven and digitised operations: The Group is deeply committed to leveraging advanced
technologies to digitise its operations and enhance its capabilities. Empowered by its proprietary
technologies the Group is able to forecast demand accurately allocate resources optimally make
decisions intelligently and continuously drive operational efficiency.– 134 –THE GROUP’S SERVICE OFFERINGS
Over the past decade with its “1-to-n” expansion strategy the Group has quickly transformed from
China’s leading time-definite express delivery service provider into a leading global integrated logistics
service provider. The Group offers a diverse spectrum of service offerings that cover various
manufacturing and consumption scenarios. The diagram below summarises major categories of the
Group’s service offerings:
Express and freight delivery Intra-city
Time-definite express Economy Cold chain and Intra-cityFreight delivery
express pharmaceuticals on-demand
* Door-to-door delivery * Cost-effective and * Door-to-door * Customized cold * On-demand
services through air and quality guaranteed delivery of bulky chain logistics city-wide delivery
ground transportation door-to-door and heavy items services services
Business delivering everything delivery services
description from consumer goods
to manufacturing
components
Service radius * Nationwide * Nationwide * Nationwide * Nationwide * Intra -city
Timeliness * Typically same day * Without strict time * Depends on * Depends on * Average delivery
next morning and next sensitivity customers' customers' time of
day deliveries requirements. requirements approximately
* Swift response time: Provides more 30 minutes
Couriers guaranteed to time-definite
arrive at the sender's delivery services
location within one hour compared to other
of order placement freight delivery
* Industry-leading service providers
collection and dispatch with a guaranteed
frequency: up to eight delivery time for
collections and seven freight delivery
dispatches each day
irrespective of holidays
Business * B2B B2C C2C * B2C * B2B B2C * B2B B2C * B2B B2C C2C
models
Market focus * High-end * Mid to high-end * Mid to high-end * Mid to high-end * Mid to high-end
Major customers * Retail customers * E-commerce * Business customers * Business customers * Retail customers
served * Business customers in platforms and across wide range in food agricultural * Business
consumer business merchants of industries for products and customers in food
and industrial sectors manufacturing and pharmaceuticals and beverage
commercial
distribution such as sectors groceries 3C
home appliance electronics and
furniture and B2B apparel sectors
and B2C heavy
goods e-commerce
Supply chain and international
Supply chain International delivery International freight forwarding
Business * High-quality integrated and tailored * International express delivery * Freight forwarding services offering
description supply chain solutions that cover services: time-definite international comprehensive freight
the full spectrum of the supply chain express services to serve urgent transportation
of our customers delivery needs across borders
* Cross-border e-commerce delivery
services: cost-effective delivery
services catering to logistics needs
of cross-border e-commerce
platforms
* Overseas local express delivery
services: local express delivery
services mainly in Southeast Asia
countries
Service radius * Global * Global * Global
Business models * B2B B2C * B2B B2C C2C * B2B
Market focus * Mid to high-end * Mid to high-end * Mid to high-end
Major customers * Business customers primarily in * Business customers primarily in * Cross-border business customers
served electric vehicle new energy manufacturing import and export and
live-streaming e-commerce and cross-border e-commerce sectors and
new retail industries retail customers
– 135 –The following table sets forth the Group’s revenue breakdown by business segment for the years indicated:
Year ended 31 December
202220232024
RMB’000 % RMB’000 % RMB’000 %
Express and freight
delivery segment(1) . . . 169764860 63.5 186890137 72.4 200162392 70.4
Time-definite express
services . . . . . . . . . . . . 105696512 39.5 115456067 44.7 122205976 43.0
Economy express
services . . . . . . . . . . . . 25551306 9.6 25051548 9.7 27251227 9.6
Freight delivery services . 27917012 10.4 33078821 12.8 37641125 13.2
Cold chain and
pharmaceutical
logistics services . . . . . 8612665 3.2 10312988 4.0 9812161 3.5
Others(2). . . . . . . . . . . . . 1987365 0.8 2990713 1.2 3251903 1.1
Intra-city on-demand
delivery segment . . . . 6567057 2.4 7371250 2.8 9010521 3.2
Intra-city on-demand
delivery services . . . . . 6436102 2.4 7249500 2.8 8872800 3.1
Others(2). . . . . . . . . . . . . 130955 0.0 121750 0.0 137721 0.0
Supply chain and
international segment . 89916599 33.6 62859302 24.3 74000342 26.0
Supply chain and
international services . . 87866143 32.8 59978741 23.2 70492482 24.8
Others(2). . . . . . . . . . . . . 2050456 0.8 2880561 1.1 3507860 1.2
Undistributed units(3) . . 1241898 0.5 1288714 0.5 1246804 0.4
Total . . . . . . . . . . . . . . . 267490414 100.0 258409403 100.0 284420059 100.0
Notes:
(1) The Group adjusted its reportable segments in 2023 by merging two segments previously named as “express deliverysegment” and “freight delivery segment” into “express and freight delivery segment.” As a result the Group’s
segment information for the years ended 31 December 2022 has been restated see Note 5 to the 2024 Financial
Statements.
(2) Others primarily represents the Group’s ancillary non-logistics services such as sales of goods provided under the
banner of the relevant segment. Primarily incidental to the Group’s comprehensive supply chain solutions the Group
at times provided as per its key accounts’ requests certain raw materials and machineries.
(3) Undistributed units primarily include the Group’s non-principal businesses such as leasing and provision of
technology services.Express and Freight Delivery Services
The Group’s express and freight delivery services primarily include time-definite express services
economy express services freight delivery services and cold chain and pharmaceuticals logistics services
in mainland China Hong Kong and Macau.Time-definite Express Services
The Group’s time-definite express services launched when the concept was relatively unknown to Chinese
customers offers efficient door-to-door delivery for retail and business customers including mid to
high-end brands with a precise delivery time commitment. By delivering everything from consumer goods
to manufacturing components the Group serves a broad spectrum of industry verticals and operate under
diverse scenarios. The Group’s time-definite express services maintain a focus on consumer goods while
simultaneously support business parcel and industrial delivery.– 136 –The Group’s time-definite express services mainly comprise SF speedy express and SF standard express.SF speedy express provides guaranteed next-day delivery between most urban areas in the PRC. In
addition it offers same-day option for deliveries to certain destinations. The Group’s inter-city SF speedy
express is delivered through air and high-speed railway transportation to meet the time-definite delivery
guarantee. The Group also introduced a cross-provincial door-to-door delivery services for bulk cargo
through air transportation. SF standard express provides customers with a delivery services characterisedby “better price guaranteed on-time dependable delivery and broad coverage (價格更優、時效穩定、託寄無憂、服務範圍廣).” As of 31 December 2024 the Group’s time-definite express services were offered
in more than 320 cities in mainland China Hong Kong and Macau.The Group has redefined the standard for time-definite express in China pioneering the highest standard
for time-definiteness express through its clear and precise arrival time commitments. As part of its
operations the Group offers high-frequency parcel pick-up with couriers guaranteed to arrive at the
sender’s location within one hour of order placement. The Group has been continuously seeking
excellence and improvement. According to the State Post Bureau the Group’s time-definite express
services recorded the shortest delivery time among all time-definite express services in the PRC since
2013.
The Group believes that its exceptional timeliness can be primarily attributed to its ability to offer the
highest collection and dispatch frequency in the express services industry globally. The Group sets the
industry benchmark with its collection and dispatch frequency conducting up to eight collections and
seven dispatches daily and year-round irrespective of holidays. In addition the Group’s extensive
transportation resources contribute to its exceptional timeliness. As of 31 December 2024 the Group was
the largest shipper of air cargo in China with a fleet of 110 all-cargo aircraft. The Group’s air fleet paired
with its access to commercial flight cargo space bolsters its aviation resources. Furthermore the Group’s
ground transportation resources cultivated through a high-frequency operational model for line-haul and
short-haul transportation enable it to achieve incremental growth and heightened hourly efficiency while
maintaining lower costs compared to its competitors who are starting their operations from scratch. In
addition to its transportation resources the Group’s exceptional time definiteness owes much to its
advanced technological capabilities providing critical visibility and precision to its operations.Complementing this is the trusted team of highly trained couriers who ensure each parcel is meticulously
handled from pick-up to delivery and is always in capable hands. The Group’s time-definite express is the
bedrock of its integrated logistics services.As a testament to its differentiated and high quality services the Group has won numerous market
recognitions including from official sources. As published by the State Post Bureau the Group is ranked:
* 1st for 16 consecutive years (2009 to 2024) for overall customer satisfaction;
* 1st for nine consecutive years (2013 to 2021*) in delivery timeliness (within 48 hours); and
* 1st for nine consecutive years (2013 to 2021*) in delivery punctuality (within 72 hours).Note:
* The State Post Bureau has not published new rankings for delivery timeliness and delivery punctuality since 2021.– 137 –With its established logistics infrastructure nationwide coverage and reliable end-point delivery
capabilities the Group offers tailored solutions to meet customers’ time-specific needs. The Group has
consistently been broadening its time-definite express services scenarios including the introduction of
parcel return services for e-commerce platforms in 2021 which enhanced the brand image for its
e-commerce platform customers. For emerging e-commerce platforms the Group’s efficient parcel return
services which leverage its time-definite network and quick pick-up capabilities are crucial to improving
their customer stickiness and repurchase rates by ensuring a smooth parcel return experience.For its time-definite express services the Group generally charges its customers with a delivery fee for
each parcel delivered of which pricing is determined with reference to various factors including among
others time sensitivity distance weight and volume of the delivery and transportation method.Economy Express Services
The Group’s economy express services provide cost-effective quality-assured door-to-door delivery
primarily to e-commerce platforms and merchants focused on both cost and timeliness. Although the
delivery time is not as fast as its time-definite express services as economy express relies mainly on
ground transportation the Group’s economy express services still outperforms comparably priced services
offered by its competitors in terms of delivery speed and service quality. The Group’s economy express
services utilise the marginal capacity of its time-definite express services to ensure optimal resource
utilisation. This is enabled by the Group’s directly operated model and integrated services capabilities. The
Group’s economy express services primarily target mid to high-end e-commerce customers.The Group’s flagship service offering under the economy express services is e-commerce standard
express which provides domestic delivery for e-commerce parcels. The Group’s service offering provides
unique advantages over competitors and directly addresses e-commerce logistics pain points. For example
the Group’s door-to-door e-commerce delivery feature is uncommon among logistics providers and is a
key differentiating factor. The Group has served many leading e-commerce channels to offer large-scale
door-to-door services in China. Moreover as an independent third-party logistics service provider the
Group is not affiliated with e-commerce platforms and merchants. This ensures that the Group has no
conflicting interests and can offer unbiased services to all its e-commerce partners. Therefore the Group
is the partner of choice for emerging e-commerce platforms and merchants as it can help them reduce the
pressures of bundling with traditional e-commerce platforms and avoid close ties with logistics providers
linked to incumbent e-commerce platforms.As at the date of this Offering Circular the Group has operated its economy express services under a
directly operated model. For the Group’s economy express services it generally charges its customers with
a delivery fee for each parcel delivered of which pricing is determined with reference to distance weight
and volume of the delivery.Freight Delivery Services
Since inception in 2013 the Group’s freight delivery services have captured increasing market demand
from business customers across a wide range of industries for manufacturing and commercial distribution
such as home appliance furniture and B2B and B2C heavy goods e-commerce for the delivery of bulky
and heavy items. The Group has continuously expanded its customer base and services scenarios for both
to-B and to-C scenarios.– 138 –The Group’s freight delivery services cater to a broad spectrum of customer needs and market segments.Service offerings under the Group’s freight delivery services primarily include bulky and heavy parcel
delivery services bulky cargo specialised delivery services standard LTL services and standard FTL
services. The Group primarily offers its freight delivery services through SF Freight (順豐快運) under a
directly operated model. SF Freight emphasises the delivery of medium-to high-end products and
differentiated value-added services such as in-home furniture installation service. The Group is
committed to delivering a trusted brand experience with standardised operating procedures including
safety and privacy measures implemented during the course of its operations. This ensures a secure and
comfortable service experience. The Group also offers freight delivery services through a franchising
model SX Freight (順心捷達). SX Freight focuses on cost-sensitive segments offering timely and cost
effective services to serve a broad-based economy market.The Group’s freight delivery services distinguish itself through a set of competitive advantages. First and
foremost the Group prioritises its customers’ convenience offering door-to-door services as opposed to
the more common store-to-store model thereby demonstrating a heightened understanding of customer
needs and operational capabilities. Second regardless of the tiered approach based on time-definiteness
and costs for its freight delivery services the Group is committed to providing more time-definite delivery
services than its competitors. The Group understands the importance of meeting strict timelines and
ensuring the timely delivery of goods including bulky and heavy items. With the assistance of its
technological capabilities the Group managed to achieve optimised logistics processes efficient route
planning and fleet dispatching. As of 31 December 2024 the Group is one of the very few logistics service
providers that provided a guaranteed delivery time for freight delivery services in the PRC. Additionally
the Group offers reliability through consistently punctual deliveries establishing a resilient network for
its customers to rely on. Lastly the Group’s trusted brand name permits it to offer unique value-added
services such as in-home installations which sets the Group apart and cements its status as a premium
brand in the market.The Group’s freight delivery services stand out due to its versatility and applicability in various scenarios
as well as its capabilities to serve to-C scenarios which is rarely seen among freight delivery service
providers. While the majority of freight delivery service providers in the PRC focus primarily on serving
the manufacturing industry the Group has extended its reach to encompass a wide range of consumer
scenarios. For the to-B scenario the Group quickly responds to demands from manufacturers and
merchants for cost-effective and efficient logistics services by creating flexible industry solutions. For
example the Group provides night collection and delivery services for deliveries in industrial areas.Furthermore the Group has enhanced its value-added services capabilities under the to-B scenario and
has also assisted in the relocation of facilities such as schools and hospitals. For the to-C scenario the
Group continues to solidify its end-to-end services capabilities.For the Group’s freight delivery services the Group generally charges its customers with a delivery fee
for each parcel delivered of which pricing is determined with reference to weight volume and distance
of the delivery and transportation method.The Group recognises revenue from time-definite express services economy express services and freight
delivery services based on the progress of the service performed within period which is determined based
on proportion of costs incurred to date to the estimated total costs or days spent to the estimated total days.As of the date of the end of the reporting period the Group re-estimates the progress of the service
performed to reflect the actual status of contract performance. Costs incurred for provision of the aforesaid
services are recognised as costs of revenue when revenue recognised based on the progress of the service
performed within period. For each parcel delivered under the Group’s express services economy express
services and freight delivery services relevant fund flows directly from its customers to the Group.– 139 –Cold Chain and Pharmaceuticals Logistics Services
The Group’s cold chain and pharmaceuticals logistics services address the significant demand for cold
chain logistics in the PRC from customers mainly from the food agricultural products and
pharmaceuticals sectors. The Group’s cold chain and pharmaceuticals logistics services primarily include
fresh and seasonal food logistics services food cold chain logistics services and pharmaceuticals logisticsservices. The Group is ranked first for five consecutive years (2019 to 2023) in the “China Top 100 ColdChain Logistics List” issued by the cold chain logistics professional committee of China Federation of
Logistics and Purchasing. As a testament to the Group’s high-quality services industry expertise and
leadership in cold chain and pharmaceuticals logistics in the PRC the Group has been invited by national
authorities in the PRC including the State Post Bureau and the Ministry of Transport of China to actively
participate in setting national and industry standards for cold chain and pharmaceuticals logistics.The Group’s cold chain and pharmaceutical logistics services possess unique competitive strengths due to
its nationwide network high-quality standards and pioneering industry practices. The Group boasts the
most comprehensive coverage in China across diverse sectors including supermarkets agriculture and
catering. The Group’s technology-driven approach enables real-time remote temperature and humidity
control from warehouse intake to delivery. The Group prides itself as an industry pacesetter and pioneer
for innovative solutions. For example the Group is the first logistics provider to deliver live Yangcheng
Lake hairy crabs introduce an automated crab binding machine for efficiency and operate a dedicated
48-hour cargo flight route for matsutake mushrooms.
For the Group’s cold chain and pharmaceuticals logistics services the Group generally charges its
customers with a delivery fee for each delivery of which pricing is determined with reference to volume
and distance of the delivery transportation method and customers’ specific request on temperature.Fresh and Seasonal Food Logistics Services
Through its fresh and seasonal food logistics services the Group primarily serves agricultural merchants
and farmers in delivering fresh and seasonal food nationwide in the PRC. As of 31 December 2024 the
Group’s fresh and seasonal food logistics services network covered more than 2800 counties across the
PRC. The Group has been actively contributing to the PRC government’s national rural revitalisation
strategy through its efforts in the fresh and seasonal food logistics services. In addition to enhance brand
awareness for its fresh and seasonal food logistics services as well as to streamline the upward channels
of agricultural products the Group cooperates with local government agencies and leading agricultural
product brands to build regional brands of agricultural products such as Yantai cherry Lingnan lychee
Yunnan flowers and Ganzi matsutake.Food Cold Chain Logistics Services
Through its food cold chain logistics services the Group primarily serves businesses such as ice-cream
vendors yogurt suppliers poultry dealers and frozen pastry merchants which deliveries require the
maintenance of strict and precise temperature control. The Group’s infrastructure allows it to deliver dairy
products meats ice cream and fish under strict temperature control requirements typically frozen at
-18°C. The Group is committed to ensuring the utmost quality and freshness of products during transport
to meet and exceed its customers’ expectations.– 140 –Pharmaceuticals Logistics Services
The Group provides tailored logistics services for pharmaceutical companies laboratories and hospitals
and oversees the entire process from warehouse intake to delivery. The Group’s state-of-the art system
offers real-time visibility detailed tracking and temperature monitoring all of which set a new industry
standard. The Group utilises an integrated IoT platform to maintain precise control over diverse
temperature zones from -80°C to 25°C meeting the evolving needs of its pharmaceutical customers and
medical institutions. Notable achievements include its designated vaccine transportation solution that
adheres to national standards. Additionally the Group has launched door-to-door temperature-controlled
services a multi-temperature zone and life-cycle supervision platform. Customers can track their orders
through the Group’s Yilushunxin (醫路順心) platform for an enhanced experience.Intra-city On-demand Delivery Services
The Group’s intra-city on-demand delivery services address customers’ needs across various industries and
product categories. The Group provides intra-city delivery for merchants and consumers with needs for
point-to-point intra-city delivery. Intra-city on-demand delivery services differ from intra-city express
services in many aspects. The average delivery time for intra-city on-demand delivery services is generally
within 30 minutes delivered by one rider. The average delivery time for intra-city express delivery service
generally ranges from half day to one day. In addition express delivery involves multiple intermediate
steps such as first-mile pick-up short-haul transport sorting and last-mile delivery. Multiple personnel
are involved in the delivery process of intra-city express services including couriers drivers and sorting
personnel as applicable and the parcel is generally picked up and delivered by different couriers. In terms
of goods delivered intra-city on-demand delivery services mainly focus on point-to-point deliveries of
items such as food beverages and 3C electronics while intra-city express services mainly focus on parcel
deliveries within the same city.The Group’s intra-city on-demand delivery services are highly responsive to evolving customer needs and
its great growth potential is based on its coverage in both growth and mature scenarios. Main scenarios
covered by the Group’s intra-city on-demand delivery services include food and beverage groceries 3C
electronics and apparel.Intra-City Delivery Services for Merchants
As the go-to third-party on-demand delivery service provider the Group’s intra-city on-demand delivery
services empower merchants with its open and inclusive on-demand delivery network as well as its
professional and comprehensive solution offerings.The Group provides a customer-centric comprehensive services matrix for merchants including local life
services merchants. For key customers of its intra-city on-demand delivery services the Group offers
one-on-one professional consultations and customised solutions. The Group enables merchants to define
and tailors solutions for each of their stores considering product categories peak hours timing
sensitivities and packaging needs. For small- to medium-sized merchants who are typically more price
sensitive the Group primarily offers standardised value-for-money options. In addition to delivery
services the Group shares its technology capabilities and data insights with merchants to improve their
operational efficiency. As a result of the Group’s customer-centric comprehensive services matrix and
technology-empowered operational enhancement solutions the number of registered merchants for its
intra-city on-demand delivery services continued to increase amounting to approximately 330000
470000 and 650000 as of 31 December 2022 2023 and 2024 respectively.
– 141 –Intra-City Delivery Services to ConsumersThe Group offers around-the-clock local on-demand fulfilment solutions to consumers including “Deliverfor Me Fetch for Me Purchase for Me and Solve for Me” services. Riders collect items run errands and
offer other lifestyle services such as picking up and delivering laundry and picking up clothes from local
retail stores for consumers to try-on. Consumers can monitor order fulfilment progress online in real time
and contact the Group through multiple channels for inquiries and complaints. By providing professional
reliable and around-the-clock on-demand services covering varied everyday scenarios the Group acquires
substantial consumer mindshare and enhance consumer loyalty further boosting its brand recognition and
leading to greater growth potential. As a result the number of active consumers for the Group’s intra-city
on-demand delivery services continued to increase amounting to approximately 15.6 million 20.5 million
and 23.4 million as of 31 December 2022 2023 and 2024 respectively.Supply Chain and International Services
Supply Chain Services
The Group provides high-quality integrated supply chain solutions to customers in various industries
covering the full spectrum of the supply chain including procurement production delivery sales and after
sales. The Group has developed tailored supply chain solutions for industries including but not limited
to B2B and B2C e-commerce electric vehicle new energy live-streaming e-commerce and new retail
industries. Moreover through technological capabilities such as automation IoT and logistics mapping
the Group empowers customers’ digitisation and intelligent transformation automation and technological
upgrade of supply chains. The Group’s supply chain solutions assist its customers in accurately predicting
their demand to guide their upfront procurement production storage and sales thereby establishing a
comprehensive supply chain system with timely response efficiency and flexibility.The Group’s supply chain services also present a series of significant advantages. Firstly the Group covers
both B2B and B2C models. The Group’s full-spectrum approach allows it to penetrate into all parts of the
supply chain and extend its supply chain services from Asia to the world. Secondly as many Chinese
manufacturing enterprises are expanding their global presence they are more willing to collaborate with
supply chain service providers with a trusted brand and international capabilities. The Group facilitates the
relocation of global supply chain layouts for its business customers with a particular emphasis on
Southeast Asia. Finally the Group’s positioning as an independent third-party logistics service provider
enables it to serve all platforms underpinning its commitment to providing comprehensive flexible and
efficient solutions.The Group actively works with its customers to develop efficient and accurate smart supply chain
solutions which span the full spectrum of the industry value chain. For example for its e-commerce
platform customers the Group’s supply chain solutions assist them in forming an omni-channel inventory
system enabling them to optimise their business strategies. The Group’s smart supply chain solutions
cover the full cycle of their business needs spanning across marketing and selling commodity
management order and delivery forecasting and replenishment and the establishment of smart stores.The Group’s supply chain services cater to customers’ diverse needs arising from different scenarios
mainly through:
* Fenghao Supply Chain (豐豪供應鏈) which focuses on customers in the automobile consumer
retail technology industrial manufacturing pharmaceutical and health fashion boutiques and
energy sectors. Fenghao Supply Chain aims to assist the Group’s domestic customers in expanding
their operations overseas and help global enterprises establish a local presence in Asia.– 142 –* SXH (順新暉) which focuses on customers in the catering and food industries.* KLN which focuses on customers in overseas countries and regions. The Group’s acquisition of
KLN in September 2021 further enhanced its international supply chain services capabilities.The Group has established a comprehensive overseas warehouse and distribution network globally
including in Asia Europe and America to enhance its localised services capabilities for supply chainservices. For more details of the Group’s overseas warehouse and distribution networks globally see “–The Group’s Network and Infrastructure – Ground Network”.Service fee for the Group’s supply chain services is mainly determined based on a cost-plus pricing basis
of which pricing also takes into account complexity of supply chain solutions provided and specific
requests of customers as well as applicable costs such as warehousing costs and transportation costs.International Delivery Services
The Group is proud to offer comprehensive international delivery services with global reach meeting the
needs of business customers primarily in manufacturing import and export and cross-border e-commerce
sectors and retail customers. The Group’s international delivery services primarily include international
express delivery services cross-border e-commerce delivery services and overseas local express delivery
services. In addition the Group’s international delivery services work hand-in-hand with its international
freight forwarding services creating a synergistic operational model. The Group strategically sells unused
cargo space to customers ensuring optimal utilisation of its outbound and inbound aircraft.The Group’s international express delivery services specialise in time-definite international express
delivery catering to urgent cross-border delivery needs. The network for the Group’s international express
delivery services is supported by its sophisticated smart technologies which allow it to plan and manage
end-to-end delivery routes and optimise various delivery processes. Consequently the Group has
significantly reduced delivery time for international express delivery services exemplifying its
commitment to efficiency and customer satisfaction.Understanding the unique logistics needs of cross-border e-commerce platforms the Group has tailored
its cross-border e-commerce delivery services to provide a comprehensive efficient solution. The Group’s
international delivery services present a robust infrastructure capable of supporting both door-to-door and
port-to-port service models thereby ensuring flexibility and convenience for its e-commerce platform
customers. The Group’s cross-border e-commerce delivery services hold several competitive advantages
which enable it to offer superior services. The Group leverages on its broad network technologies and
deep understanding of global logistics to navigate complexities and meet the time-sensitive demands
associated with cross-border transactions. This customer-centric approach allows the Group to streamline
the entire delivery process making its services the indispensable asset for e-commerce businesses aiming
for global reach.The Group has a robust presence in Southeast Asia where it provides local express delivery services in
many countries therein. The Group’s cross-border e-commerce delivery services operate a door-to-door
model facilitated by frequent air flights and an extensive local delivery network. The Group’s air
connections ensure swift transportation of goods to Southeast Asia while its local delivery capabilities
enable reliable last-mile delivery.As the Group continues to grow and innovate it is constantly looking to expand the coverage of its
services. Over the years the Group opened many new flight paths for its international express services
covering new countries and regions including New Zealand Thailand Vietnam South Korea and
Malaysia.– 143 –International Freight Forwarding Services
The Group’s international freight forwarding services cover all major aspects of the cross-border logistics
process. The Group’s international freight forwarding services adopt an asset-light approach whereby a
majority of transportation needs are provided by external carriers and customs clearance is partly
outsourced to external customs brokers. The Group integrates industry resources to provide integrated
cross-border logistics solutions such as intermodal solutions primarily to cross-border business
customers through a combination of air transportation ground transportation and sea freight to meet
customers’ specific needs in terms of cost transit time and routing. By using a mix of transportation
modes the Group provides customers with more flexible options that can result in lower costs for
transporting cargo while meeting its customers’ specific cost transit time and routing requirements. The
Group also utilises freight forwarding services when it does not possess all logistics network and
infrastructure to complete the delivery itself. For instance the Group opts for freight forwarding services
in sea freight where it does not own the means of transportation and acts solely as a non-vessel operating
common carrier.As an important part of its international freight forwarding services the Group provides customs clearance
services to facilitate the transportation process across borders. The Group has significant expertise in
handling customs and quarantine procedures and has been continuously improving its customs clearance
capabilities. The Group engages customs brokers based in various locations to conduct customs brokerage
and dedicates professionals in various locations who are knowledgeable in trade regulation. This allows
the Group to provide guidance and expert advice on matters relating to customs. The Group maintains a
list of approved customs brokers for numerous locations worldwide. In addition the Authorised Economic
Operator certifications the Group has obtained in the PRC help it streamline the customs clearance process
and improve its end-to-end services capabilities.The Group’s Targeted Industry Verticals
Building on its strong logistics services capabilities the Group has developed industry tailored logistics
services that integrate its service offerings to address the specific needs of industry verticals. The Group
strategically focuses on industry verticals that demonstrate high growth potential. These particular
industry verticals demand more intricate logistics services and have elevated standards for service
requirements. The Group’s alignment with these industry verticals positions it to create tailored solutions
striving for excellence in meeting their complex needs. The Group’s key targeted industry verticals
include:
* Communications and technology industries: By enhancing its comprehensive services capabilities
the Group further solidifies cooperation with key accounts in the communications and technology
industries to meet their growing needs. For example the Group has extended its service coverage to
the front-end production logistics supply chain scenario to draw a blueprint for its customers’
planning and implementation of their supply chain.* Apparel industry: To achieve innovative breakthroughs and sustainable growth in the apparel
industry the Group has been continuously enriching its service offerings. For example to address
a long-outstanding unmet need in the luxury goods industry to extend the ultimate offline servicesexperience to customers online the Group has created an end-to-end standardised “ShangpaiServices (尚派服務)” for a luxury goods customer through technology empowerment and terminal
delivery capabilities. As a result the Group has achieved the two-way empowerment of the SF brand
and this customer’s premium brand image.– 144 –* Consumer goods industry: The Group helps customers in the consumer goods industry reform their
supply chain. Leveraging its warehousing network planning sales forecasting and smart
replenishment attributable to its smart supply chain the Group gradually helps customers achieve the
transition from online inventory management to online and offline inventory management
establishing a supply chain integrating to-B and to-C capabilities.* E-commerce industry: In the e-commerce industry the Group focuses on ensuring a high-quality
customer experience and providing personalised services. The Group has strengthened its parcel
return services for e-commerce platforms and increased its wallet share with various e-commerce
platforms. Empowered by its technologies the Group also integrates its resources like warehousing
express delivery freight delivery and international all-cargo flights to offer end-to-end solutions
from local to cross-border delivery helping its e-commerce customers expand their international
business.* Other high-growth industries: For customers in other high-growth industries such as electric
vehicles new energy live-streaming e-commerce and new retail the Group focuses on large-scale
customers and actively identifies customer needs through multidimensional customer reviews and
key account business planning.PRICING MODEL
Generally the Group maintains a catalogue of standardised pricing for its service offerings which is
mainly determined based on a cost-plus pricing basis. The Group adopts a differentiated pricing model for
solutions customised for its customers based on their requests. For pricing of customised solutions the
Group’s pricing is also determined with reference to various factors.* Express and freight delivery services: pricing for express and freight delivery is determined with
reference to factors such as time sensitivity distance weight and volume of the delivery and
transportation method.* Intra-city on-demand delivery services: the Group uses differentiated pricing models for its intra-city
delivery services to merchants and consumers. For merchants the Group generally charges a fixed
fee for each order as adjusted by variables such as distance weight of the goods and order placement
time. For consumers the Group charges service fees taking into account factors such as region
distance weight of the goods and order placement time.* Supply chain and international services: pricing for the Group’s supply chain services takes into
account complexity of supply chain solutions provided and specific requests of customers as well
as applicable costs such as warehousing costs and transportation costs. Pricing for international
delivery services takes into account factors such as time sensitivity distance weight and volume of
the delivery and transportation method. Pricing for international freight forwarding services takes
into account factors such as prevailing market rates distance weight and volume of the delivery and
transportation method.– 145 –THE GROUP’S NETWORK AND INFRASTRUCTURE
Deeply rooted in the logistics services industry for 32 years the Group has established an efficient
reliable and synergetic logistics infrastructure network with extensive geographical coverage globally
covering 206 countries and regions across six continents integrating aviation ground and information
networks into one unified services network. The Group’s extensive network and comprehensive
infrastructure have laid the foundation for further enhancing its delivery timeliness and integrated logistics
services capabilities which in turn improve customer satisfaction and customer adherence. By
continuously expanding its reach and capabilities the Group is able to meet the growing demands of the
global logistics industry and stay ahead of the global competition.Aviation Network
The Group has a well-established and world-leading aviation network featuring SF Airlines laying the
foundation for its air transportation capabilities. The Group’s comprehensive aviation network enables it
to provide efficient and reliable logistics services to customers around the world. The Group is committed
to further expanding its reach to new destinations and its ongoing investments in its aviation network will
ensure that it continues to maintain the highest standards of safety reliability and speed in its operations.In 2009 the Group established SF Airlines its own cargo airline and became the first private logistics
service provider with a self-operated cargo airline in China. In 2009 the Group became the first private
logistics service provider in China to operate all-cargo aircraft. As of 31 December 2024 the Group
operated a total of 110 all-cargo aircraft consisting of 89 self-operated aircraft and 21 chartered-in
aircraft and such aircraft were skilfully manned by its dedicated crew of 798 highly trained pilots. For the
year ended 31 December 2024 the Group achieved an average of approximately 5200 daily flights
including both of the Group’s self-operated flights and consolidated air freight services. Such
high-frequency air connectivity supported the Group’s proven leadership in speed in the industry. The
Group has built a highly connected and extensive global aviation network that spans across six continents.Moreover the Group has established a dominant presence in Southeast Asia demonstrated by three to four
average daily direct all-cargo flights from the PRC to the region in 2024. In addition the Group had the
highest number of average daily direct all-cargo flights from the PRC to both North America and Europe
in 2024. As a result the Group’s total air cargo volume continued to increase over the years. In 2024 the
Group’s total air cargo volume exceeded 2420000 tons.The Ezhou Cargo Hub
The Ezhou cargo hub is the first dedicated air cargo hub in Asia and fourth in the world which is of
strategic value and scarce position. The hub mainly comprises Ezhou Huahu International Airport and the
Group’s logistics complex. The Ezhou cargo hub is strategically located at the significant economic and
transportation centre in central China through which the Group can reach areas that account for more than
90% of China’s gross domestic product within two-hour flight radiance. It is expected to become an
international hub that connects the world especially as a bridge to connect Southeast Asia and Europe. The
Ezhou cargo hub adopts the hub-and-spoke model which will enable the Group to further expand its
network coverage bring even higher time definiteness achieve higher operational efficiency and lower
the Group’s costs.The Group officially commenced operation of its logistics complex in the Ezhou cargo hub in September
2023. The Group’s logistics complex has an aggregate GFA exceeding 700000 sq.m. and is equipped with
automated machines to support its automated operations.– 146 –Ground Network
The Group’s ground network works in harmony with its aviation network to deliver exceptional logistics
services to its customers. As of 31 December 2024 the Group operated over 100000 line-haul and
short-haul trucks and over 100000 first and last-mile delivery vehicles globally supporting the broadest
road coverage in Asia. The Group also has an extensive network of service outlets and sorting centres in
Asia.Service Outlets
The Group operates an extensive network of service outlets that are strategically located within designated
geographical coverage areas and are responsible for parcel pickup and last-mile delivery services within
their designated areas. As of 31 December 2024 the Group had over 36000 service outlets (including its
directly operated service outlets and other service stations) in the PRC. This enables the Group to provide
fast and reliable logistics services to its customers regardless of their location.Some of the Group’s larger-scale service outlets are also equipped with regional sorting and dispatching
capabilities. The Group constantly monitors the performance of its service outlets and optimise its
operations to ensure that it maintains high levels of customer satisfaction. Most of its overseas service
outlets are strategically located in key international markets including major cities in Southeast Asia
Europe and North America. The Group’s overseas service outlets enable it to effectively offer integrated
logistics services across different countries and regions as well as enhance its local operational
capabilities.Sorting Centres
To ensure seamless integration between the Group’s aviation network and ground network it has
established a series of sorting centres that act as crucial nodes in its integrated network. The Group’s
sorting centres are responsible for collecting parcels from service outlets within their respective
geographical coverage area sorting parcels by delivery destinations and dispatching. The Group adopts
a centralised management strategy for its sorting centres which covers key aspects such as new site
selection existing site expansion and deployment of equipment and facilities used therein with a focus
on optimising the layout and design of its sorting centres to ensure smooth operations and reliable services.The Group’s sorting centres are strategically located to provide convenient access to highways and major
transportation hubs improving its efficiency and reducing operational costs.The Group allocates specific workloads for each level of its sorting centres according to their geographical
coverage and connectivity. As of 31 December 2024 the Group operated 373 sorting centres for its express
and freight delivery services globally. Attributable to its technological capabilities some of the Group’s
sorting centres adopt the automated sorting system and achieve digitised and automated operations
through the deployment of technology-driven solutions. The Group’s application of automated sorting
systems and equipment effectively increased its operational efficiency in its sorting centres. In addition
the Group adopted a centralised waybill tracking system in its sorting centres to monitor real-time parcel
movement status so as to quickly identify the sorting centres in need of additional resources to enhance
their operational efficiency.Transportation Resources
The Group possesses an abundant array of ground transportation resources to ensure its integrated logistics
services capabilities. The Group’s transportation resources mainly consist of road transportation and rail
transportation.– 147 –As of 31 December 2024 the Group’s transportation fleet consisted of over 100000 line-haul and
short-haul trucks and over 100000 first and last-mile delivery vehicles globally. The Group generally
controls the route planning and dispatching of its fleet utilising the capacity of both its in-house
transportation fleet and those of its third-party transportation service providers. The Group engages
third-party transportation service providers to fulfil additional capacity needs. The Group has established
procedures in selecting the third-party transportation service providers it engages with including
reviewing their operating history fleet condition and reliability among other criteria. The Group is
committed to promoting sustainable transportation practices with a focus on reducing its carbon footprint
and using renewable energy vehicles. The Group’s transportation resources are optimised to reduce
emissions and it continuously invests in new technologies and infrastructure to further enhance its
sustainability practices.The Group also provides secure long-distance transportation of parcels through the railway network. As
of 31 December 2024 the Group utilised 240 standard railway routes and 883 high-speed railway lines in
the PRC. In addition as of the same date the Group operated along 303 railway routes reaching 38
overseas countries and regions. In 2024 the Group’s rail transportation network handled a total cargo
volume exceeding 3.2 million tons.Warehouse Infrastructure
The Group’s warehouse infrastructure is a crucial component of its integrated logistics services
capabilities providing a comprehensive range of storage handling and distribution solutions to meet the
diverse needs of its customers.The Group’s warehouse infrastructure covered almost all counties and districts across the PRC. As of 31
December 2024 the Group operated more than 750 warehouses in the PRC with an aggregate area
exceeding 7.4 million sq.m. and more than 950 warehouses with an aggregate area exceeding 2.5 million
sq.m. overseas.Attributable to its proven technology capabilities the Group manages its warehouses effectively and
efficiently. Many of the Group’s warehouses are equipped with advanced automated storage and retrieval
systems for parcels. The extensive application of automated technology which perform tasks 24/7 and
with fewer errors ensures the Group’s speedy delivery during peak seasons.Other Transportation Resources and Infrastructure
The Group’s ground network is further supported by logistics industrial parks and logistics centres across
the PRC and Southeast Asia. These logistics industrial parks provide a range of value-added services
including warehousing sorting packaging and distribution to support its end-to-end logistics solutions.To further supplement its aviation and ground networks the Group cooperates with shipping companies
to enhance its bulk-cargo logistics services capabilities through sea freight. As of 31 December 2024 the
Group had access to over 18000 maritime routes. This extensive sea freight network allows the Group to
provide reliable bulk-cargo logistics services to its customers globally.– 148 –Information Network
The Group’s integrated logistics services capabilities are underpinned by an information network that
connects its aviation and ground networks through a free flow of information to enable effective resource
allocation and for efficient operations. The Group’s information network empowers it to offer intelligent
transportation solutions smart terminal arrangements and accurate forecasting and scheduling which in
turn allows the Group to provide precise and speedy logistics services. Through its commitment to
innovation and investment in technologies the Group’s information network has become a cornerstone of
its competitive edge. The Group is constantly exploring new ways to leverage technology to improve its
service quality enhance its efficiency and deliver greater value to its customers. For more details of the
Group’s technology see “– Technology and Research and Development”.Leveraging its synergetic aviation ground and information networks the Group’s multi-network
integration lays the foundation for its complete end-to-end comprehensive logistics services capabilities.TECHNOLOGY AND RESEARCH AND DEVELOPMENT
Continuous commitment and investment in technology and research and development grants the Grouptechnological capabilities evidenced by international awards such as “World Internet of Things RankingList” by World Internet of Things Convention and “Fortune Magazine’s Most Influential IoT InnovationList” by Fortune Magazine in 2022 and 2023. The Group’s technology not only streamlines and
strengthens its internal management process but also provides its customers with superior services and
enhances their operational efficiency through its technological empowerment.Research and Development
The Group’s unwavering commitment to research and development is deeply ingrained in its DNA to
enhance its integrated logistics services capabilities. The Group’s research and development focuses on
improving its digital and intelligent internal operations and providing smart logistics services and supply
chain solutions to customers. For example in 2003 the Group revolutionised the industry by adopting
handheld terminals which boosted its operational efficiency and facilitated the collection and tracking of
express delivery routing information. In addition The Group invests in emerging technologies such as
blockchain and cloud computing to improve its logistics services capabilities. For example the Group has
developed a forecasting system for predicting demand and optimising supply chain operations.As of 31 December 2024 the Group had a dedicated research and development with more than 4100 staff.The Group has also established research centres focusing on different areas of logistics innovation such
as the computer vision engineering research centre for logistics which is dedicated to developing smart
solutions for logistics. As of 31 December 2024 the Group had 4180 patents and patent applications and
2505 software copyrights demonstrating its commitment to innovation and its focus on enhancing its
logistics services and solutions.Technology
The Group is dedicated to driving its operations with technology and innovations applied primarily
towards enhancing its operational efficiencies and expanding business scale.The Group implements advanced technologies to accelerate its internal digitisation building a smart
logistics supply chain that empowers each step of its operations.– 149 –Expanding Business Scale
The Group employs innovative technologies to support its external growth. In particular the Group
effectively addresses complex scenarios and incubates new service offerings. The Group’s high level of
digitisation enables it to address new and complex logistics needs across a multitude of industry verticals
and practical applications. The Group caters to wide-ranging scenarios across online and offline and
services through diverse business models from B2B B2C C2C to B2B2C. As the Group’s capability to
address complex scenarios increases its ability to rapidly incubate new service offerings also strengthens
as it applies these scenarios on a wider basis across the industry through its highly efficient network.Moreover the Group has introduced numerous innovative smart tools and applications to support its
digitised and intelligent logistics services including:
* SF Cloud Chain (豐智雲鏈). SF Cloud Chain is a cloud-based tool which integrates digital
technologies across the supply chain. It leverages the Group’s supply chain solutions matrix as well
as intelligent algorithms to offer SaaS-based services. It is designed to be flexible and capable of
serving customers in different industries addressing issues in multiple scenarios and adapting to
businesses of different scale. The goal is to provide a one-stop solution for the supply chain enabling
enterprises to quickly achieve the innovation of supply chain management modes. The services
cluster is scalable and can be rapidly deployed to meet the unique needs of each customer making
it an ideal solution for those seeking to streamline their supply chain operations and optimise
efficiency.* SF Trace. SF Trace is an innovative solution that utilises self-developed trustworthy blockchain
technologies and privacy protection algorithms to ensure complete traceability. This technology
combines blockchain and IoT to create a sophisticated tool that leverages the Group’s integrated
logistics services capabilities. With SF Trace enterprises can achieve complete traceability at each
stage of the supply chain.* SF United Store. SF United Store is a comprehensive digital logistics solution aimed at apparel and
fast-moving retail industries. It offers a range of online and offline order fulfilment services
including performance monitoring after-sales services processing and smart logistics management
across various order fulfilment scenarios. As a SaaS-based platform it helps customers complete
comprehensive digital and intelligent transformations and refine business management and control
for improved cost reduction and efficiency.* SF Network. SF Network is a solution that analyses terminal demand and employs multi-factor
considerations multi-scenario configuration and multi-objective calculations to analyse and solve
supply chain network problems. It can provide optimisation solutions for warehouse infrastructure
routes inventory and product selection at the planning level with visualised analysis results. With
SF Network enterprises can address issues such as high transportation costs cross-warehouse
consignment slow delivery times and low customer satisfaction and improve their supply chain
efficiency. The solution is highly adaptable and can be customised to fit the specific needs of each
customer making it a valuable tool for businesses seeking to optimise their supply chain
management.– 150 –THE GROUP’S CUSTOMERS AND CUSTOMER SERVICES
The Group’s Customer Services
The Group believes its customer-centred services deliver an ever-improving customer experience and
improve customer satisfaction enhancing customer loyalty and stickiness. The Group has been constantly
expanding its service offerings to adjust to the continuously evolving needs of its customers.The Group adheres to its “user-centred demand-oriented and experience-based” services philosophy to
ensure efficient punctual and safe services. As a result the Group has won numerous market recognition
including recognition from official sources.The Group’s highly trained and trustworthy couriers are the high-frequency outreach of its logistics
services providing efficient and reliable delivery services to customers every day. Therefore the Group’s
couriers act as the frontline for its customer services. The Group understands the importance of real-time
customer services which is why it offers multiple channels of communication including a call centre
95338 SF App (a mobile application) and WeChat Mini-Program all available 24/7 through a
combination of customer services representatives and self-service assistance. The Group’s designated
call-back team follows up with customers to ensure their needs are met and ensure any problems are
resolved within two days. The Group also conducts customer satisfaction surveys to gather feedback and
improve its services continually.The Group’s Customers
The Group has fostered an extensive customer base covering various industries around the world. The
Group adopts a tiered approach for both business customers and retail customers.The Group serves a wide range of blue-chip business customers across various industries including many
of the Top 500 Enterprises in China. In 2024 484 of these enterprises were its customers and they spread
across all industry verticals. The Group has the highest coverage for blue-chip customers among integrated
logistics service providers in Asia which reflects its commitment to providing high-quality services. The
Group takes a holistic and dynamic approach in assessing customers factoring in current and future
logistics expenditures industry verticals located industry positions and opportunities for integrated
logistics and supply chain optimisation and categorises its business customers into three categories
namely:
* strategic key accounts (“SKA”): mainly blue-chip and leading enterprises in strategically important
industries such as e-commerce and circulation industry communication and high-tech industry
apparel industry and consumer goods industry. In general SKAs not only have high logistics
expenditure but also pose significant strategic value to the Group in the form of expected long-term
mutual growth;
* key accounts (“KA”): large-scale business customers in other industries. KAs demonstrate high
growth and high value and are willing to collaborate with the Group across various scenarios for
mutual benefits; and
* small and medium-sized enterprises: these customers often show high-value potential for future
growth and partnerships with the Group.– 151 –The Group strives to provide tailored solutions for its customers regardless of their size or industry. The
Group’s ability to serve customers across various industries is a testament to the versatility of its services
and its commitment to meeting the evolving needs of its customers. As a result the number of customers
with active credit accounts continued to increase over the years amounting to approximately 2.3 million
as of 31 December 2024. This growth not only showcases the broad appeal of the Group’s services but
also its ability to foster enduring relationships with its customers.The Group also serves a large base of retail customers. The number of its retail customers continued to
increase over the years amounting to approximately 730 million as of 31 December 2024. The Group has
cultivated both online and offline channels for outreach to retail customers to ensure the growth of its retail
business.SF App and WeChat Mini-Program provide easy online access to its retail customers allowing them to
easily place orders and track their express deliveries. SF App offers expanded service offerings to meet
the diverse needs of retail customers. Expanded service offerings through SF App include among others
moving mobile phone maintenance mobile phone replacement and used clothing recycling. In 2022 the
Group also launched a new WeCom channel on WeChat to efficiently respond to retail customers’
questions and improve user engagement. The Group’s efforts to continuously improve its online services
capabilities have led to an increase in the number of total retail users in 2024.The Group offers a wide range of diverse offline services to its retail customers catering to their various
needs. The Group’s extensive network coverage ensures retail customers have access to its services
wherever they are located. The Group’s services tailored for retail customers include among others:
* luggage delivery services;
* holiday gift delivery services; and
* public welfare delivery which allows retail customers to donate goods for charitable purposes.The Group takes pride in having a diverse customer base which means it does not depend on a single
customer and thus has low concentration risk.Key Terms of Agreements with the Group’s Customers
The Group typically signs master service agreements with business customers which cover various terms
including duration scope of services and payment terms among other things. The following table sets
forth a summary of key terms of the master service agreement with its business customers:
Key Terms Description
Duration. . . . . . . . . . . . . . . . . . Typically one year subject to annual automatic renewal unless
objected by either party
Service Type . . . . . . . . . . . . . . One or multiple service offerings of the Group’s integrated logistics
services as the case may be
Payment Terms . . . . . . . . . . . . . Typically monthly settlement
Termination . . . . . . . . . . . . . . . May be terminated by either party upon one-month notice under
certain circumstances
– 152 –The Group’s retail customers primarily enjoy its express and freight delivery services and enter into its
standard express and freight delivery services agreement with the Group at order placement. The duration
for such agreement is on a per transaction basis. For damages and losses caused by the Group losses will
be reimbursed for all insured deliveries subject to the maximum declared value of an insured delivery.EMPLOYEES
The Group’s people-centric culture promotes sustainable growth internally and customer bonding
externally. The Group is dedicated to creating a fair just and open environment for its employees. SF’s
brand name stands for a platform for global shining talents to realise their dreams seeking excellence and
achieving career pride.As of 31 December 2024 the Group had 147189 full-time employees around the world. The following
table sets forth the number of the Group’s full-time employees categorised by region as of 31 December
2024:
Region Number of Employees % of Total
China. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120234 81.7
Asia (excluding China) . . . . . . . . . . . . . . . . . . . . . . . 23951 16.3
Other countries and regions. . . . . . . . . . . . . . . . . . . . 3004 2.0
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147189 100
The following table sets forth the numbers of the Group’s full-time employees categorised by function as
of 31 December 2024:
Function Number of Employees % of Total
Operational . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83061 56.4
Professional(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38700 26.3
Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25428 17.3
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 147189 100
Note:
(1) Primarily include employees responsible for technology research and development administration finance and
marketing.The Group is committed to providing an equal diverse inclusive supportive and rewarding working
environment for its employees. The Group has many labour unions and employee representatives who help
to maintain an open channel of communication with its employees. In addition the Group seeks monthly
feedback from employees and provides hotlines for any issues or concerns they may have.The Group believes in providing a clear career path for its employees which includes various promotion
opportunities and training tailored to employees across functions. The Group’s “Fengyun” training
program is an example of this commitment as it provides career educational and emotional support for
its employees.– 153 –The Group takes recruitment seriously with various channels such as on-campus recruitment internal
referral and online recruitment as well as through recruitment agencies. The Group has established the
SF Recruitment Management Guidelines which set out its recruitment principles standards and
procedures clearly. The Group believes that taking care of its employees is essential which is why it
participates in various governmental statutory employee benefits plans. The Group also provides support
for its employees’ physical and mental health and takes measures to ensure their working safety.The Group has established market-competitive and fair remuneration taking into account working hours
and the complexity of the work involved. The Group has entered into standard labour agreements with its
employees as well as confidentiality and non-compete agreements with its key personnel. The Group
maintains a good working relationship with its employees and the Group has not experienced any material
labour disputes or claims for the years ended 31 December 2022 2023 and 2024.SALES AND MARKETING
The Group’s marketing strategy covers both retaining existing customers and attracting new customers
through its continuous efforts in improving customer experience and loyalty. The Group believes its
top-in-class service quality is its best sales and marketing tool as it has established a dominant mindshare
as the go-to brand of time-definite express services in the PRC. The Group has a premium brand that iswidely recognised for top-notch services and is a commonly used verb in Chinese with “Let me SF thisto you” having become synonymous with “Let me express mail this to you.” In addition many retailers
actively advertise that they exclusively use SF delivery as a way to convey a sense of their services and
product quality to their customers. Customers’ recognition of the Group’s distinctive services helps it
market itself through its brand name.The Group continuously expands its services to attract more customers and it also engages in cross-selling
by offering integrated logistics services and supply chain solutions to its business customers. The Group
also has local offices and overseas agents in overseas countries and regions to maximise its potential for
localised operations.PROCUREMENT AND SUPPLIERS
Procurement
The Group adheres to a transparent procurement policy which emphasises the principles of fairness
justice and openness ensuring it engages in equitable transactions that are in the best interests of all
parties involved. The Group mainly adopts a centralised procurement approach which includes screening
tendering and bidding and procuring various assets consumables and services used in its business
including but not limited to sorting equipment vehicles waybills barcode scanners and uniforms.The Group’s Suppliers
Due to seasonal fluctuation of logistics demand and the imbalanced supply and demand across different
regions the Group leverages outsourced service providers as a constructive supplement to its resources.When there is a shortage in couriers and vehicles outsourced resources could effectively and promptly
satisfy its demand. Outsourcing arrangement is a common market practice in the logistics industry. For the
years ended 31 December 2022 2023 and 2024 some of the Group’s suppliers were service providers for
the above-mentioned services. The Group did not encounter any material labour disputes as a result of the
above-mentioned services for the years ended 31 December 2022 2023 and 2024.– 154 –The Group believes it has sufficient alternative suppliers for its business that can provide it with
substitutes of comparable quality and prices. For the year ended 31 December 2022 2023 and 2024 the
Group did not experience any disruption to its business as a result of any significant shortage or delay in
supply of the related services and products.ESGThe Group has built an ESG management system aligned with its vision of “foster shared growth celebratebetter life.” To that end the Group is committed to strengthening its sustainable logistics supply chain
services taking care of its employees and couriers engaging with broader stakeholders and promoting
rural revitalisation through contributing to the supply side reform of rural industries leveraging its unique
strengths in the logistics industry.As the Group continues to improve its sustainability performance it is honoured to be listed among
Fortune Magazine’s first-ever China’s ESG Influential List in 2022 marking the only express logistics
service provider on the list and to be awarded the same prize subsequently in 2023 and 2024 for three
consecutive years.SEASONALITY
In 2022 2023 and 2024 the Group’s parcel volumes (including domestic express logistics parcel volume
and international shipment volume) amounted to 11.1 billion 12.0 billion and 13.3 billion respectively.The Group’s parcel volumes during the relevant periods were subject to seasonal fluctuation primarily due
to the impact of major shopping events and Chinese New Year. The Group typically experiences a peak
in parcel volumes during shopping events such as China’s online shopping events on 11 November and 18
June and experiences comparatively lower parcel volumes during Chinese New Year. The Group believes
that this pattern is likely to continue in the foreseeable future.INTELLECTUAL PROPERTY
The Group puts a premium on intellectual property protection and strictly complies with applicable laws
and regulations relating to intellectual property in the PRC and overseas. To further improve its
management and protection of intellectual property in 2023 the Group established several new guidelines
including guidelines for the assessment of overseas patent applications and updated its guidelines for
managing patent (software copyright) outcomes and trademark (trade name). As of 31 December 2024 the
Group had 4180 patents and 2505 software copyrights. The Group’s patents primarily relate to smart
devices applied in the logistics industry and software algorithms.For the years ended 31 December 2022 2023 and 2024 the Group had not been subject to any material
intellectual property infringement claims by third parties or suffered any material intellectual property
infringement by third parties.COMPETITION
Global logistics represents an enormous market opportunity. Across the globe there are only around ten
integrated logistics service providers that are able to provide a full spectrum of logistics services. Asia is
currently the largest fastest growing and one of the most fragmented regions in the global logistics
market presenting the most attractive growth prospects.– 155 –Across various services and geographies the Group primarily competes with three major types of logistics
service providers namely other global integrated logistics service providers other China-based integrated
logistics service providers and non-integrated logistics service providers. The Group was Asia’s largest
and the world’s fourth largest integrated logistics service provider in terms of revenue in 2024. In addition
the Group is a market leader in its home market in nearly all of the logistics sub-segments in which it
operates an achievement that is unmatched by any global or Asian player in its respective market. The
Group believes that its core strengths provide it with competitive advantages over existing and potential
competitors.Furthermore as the Group’s business continues to grow rapidly it faces significant competition for highly
skilled personnel. The success of the Group’s growth strategy depends in part on its ability to retain
existing personnel and attract additional highly skilled personnel.PROPERTIES
The Group’s corporate headquarters are located in Shenzhen. As of 31 December 2024 the Group’s owned
buildings and land were primarily used as offices warehouses and logistics industrial parks. The Group’s
logistics complex in the Ezhou cargo hub has an aggregate GFA exceeding 700000 sq.m. As of the same
date the Group’s leased properties were primarily used as offices warehouses service outlets and
logistics industrial parks with relevant lease agreements to expire between 2024 to 2035. The Group
believes that its existing facilities are generally adequate to meet its current needs but it expects to expand
its logistics network by leasing building or purchasing additional properties in the PRC and overseas over
the next several years.As of the date of this Offering Circular the Group is in the process of obtaining land use right certificates
for two parcels of land where no construction activities had been carried out yet on these two parcels of
land. In addition as of the date of this Offering Circular the Group has certain properties with each having
a GFA exceeding 1000 sq.m. that had not obtained ownership certificates in the PRC. For more detailsof the risks and uncertainties associated with such defects see “Risk Factors – Risks Relating to theGroup’s Business and Industry – Title defects with respect to or encumbrances on certain land andbuildings may cause interruptions to the Group’s business operations”.INSURANCE
The Group considers its insurance coverage adequate and in accordance with the commercial practices in
the industries in which it operates. The Group provides social security insurance including pension
insurance work injury insurance maternity insurance medical insurance and unemployment insurance for
its employees. Additionally the Group provides group accident insurance for the couriers it employs and
liability insurance for third-party service providers. The Group does not maintain business interruption
insurance or key-man insurance. The Group’s management evaluates the adequacy of its insurance
coverage from time to time and purchases additional insurance policies as needed.LICENSES AND PERMITS
As of the date of this Offering Circular the Group has obtained all licenses and permits that are material
for its business operations in the PRC and overseas and such licenses and permits are valid and subsisting.– 156 –LEGAL PROCEEDINGS AND COMPLIANCE
Legal Proceedings
The Group may from time to time be subject to various legal claims and proceedings arising in the
ordinary course of its business. As of the date of this Offering Circular the Group has not been and is not
a party to any material legal arbitral or administrative proceedings and the Group is not aware of any
pending or threatened legal arbitral or administrative proceedings against the Group or the Directors that
could individually or in the aggregate have a material adverse effect on its business financial condition
and results of operations.Compliance
The Group keeps abreast of regulatory requirements applicable to its operations. The Group always
endeavours to comply with all applicable laws and regulations and regularly conducts internal inspections
to identify potential risks and promptly addresses these risks once spotted. As of the date of this Offering
Circular the Group has not been and is not involved in any material non-compliance incidents that have
led to fines enforcement actions or other penalties that could individually or in the aggregate have a
material adverse effect on the Group’s business financial condition and results of operations.DATA PRIVACY AND PROTECTION
The Group is dedicated to securing information about its customers’ delivery and protecting its customers’
and employees’ privacy and it strives to provide a safe secure environment for its customers. The Group
is committed to compliance with applicable personal information protection laws regulations and industry
standards. The Group has formulated comprehensive response measures over information system risks.RISK MANAGEMENT AND INTERNAL CONTROL
The Group has established a robust internal control and risk management system to strengthen and
standardise its internal management and to promote its sustainable development.The Group’s risk management is led by the Risk Management Committee of the Board. The risk committee
under the Risk Management Committee of the Board is responsible for the overall management and control
of its risks at the Group level. Its main responsibilities include deliberation and decision-making of the
Group’s risk management system and policies preventing of major risk and responding to major crises.The risk committee reports to the Risk Management Committee of the Board quarterly and annually. The
Group’s chief financial officer is responsible for implementing the Group’s risk management strategy
guiding and evaluating the establishment and improvement of risk management and control mechanisms
in functional departments business departments business units and different regions. The Group’s risk
control compliance department coordinates risk control and compliance work among its different
departments. The leaders of each functional department business department business unit and region are
responsible for related risk control in their work area. They are also responsible for identifying and
evaluating daily risks as well as the implementation of risk management and control measures.– 157 –AWARDS AND RECOGNITION
The Group is recognised for the quality and market reception of its services. The following table sets forth
major awards and recognitions the Group has received over the years:
Year Name of Award or Recognition Awarding Entity
2024. . . . . . . . . . . 415th of Fortune Global 500 Fortune Magazine
2024. . . . . . . . . . . China ESG 50 List Fobest China
2022 – 2024 . . . . . China ESG Influential Listing Fortune Magazine
2017 – 2024 . . . . . Fortune Magazine’s Most Admired Fortune Magazine
Chinese Companies
2022 – 2023 . . . . . 2022 Most Influential IoT Innovation Fortune Magazine
List
2009 – 2024 . . . . . 1st in overall customer satisfaction the State Post Bureau
2013 – 2021* . . . . 1st in delivery timeliness (within 48 the State Post Bureau
hours)
2013 – 2021* . . . . 1st in delivery punctuality (within 72 the State Post Bureau
hours)
2019 – 2023 . . . . . 1st of Chinese Top 50 Private China Federation of Logistics and
Logistics Enterprises Purchasing
Note:
* The State Post Bureau has not published new rankings for delivery timeliness and delivery punctuality since 2021.– 158 –DIRECTORS SUPERVISORS AND SENIOR MANAGEMENT
BOARD OF DIRECTORS
The Board of Directors consists of seven Directors including four executive Directors and three
independent non-executive Directors. Directors are elected for a term of three years and are subject to
re-election provided that the cumulative term of an independent non-executive Director shall not exceed
six consecutive years pursuant to the relevant PRC laws and regulations.The following table sets forth the Directors as of 31 December 2024:
Name Age Position/Title
Wang Wei (王衞) . . . . . . . . . . . . . . . . . 54 Chairman of the Board of Directors Executive
Director
Ho Chit (何捷) . . . . . . . . . . . . . . . . . . . 50 Executive Director
Wang Xin (王欣) . . . . . . . . . . . . . . . . . 52 Executive Director
Xu Bensong (徐本松) . . . . . . . . . . . . . . 39 Executive Director
Chan Charles Sheung Wai (陳尚偉) . . . . 71 Independent Non-Executive Director
Lee Carmelo Ka Sze (李嘉士) . . . . . . . . 64 Independent Non-Executive Director
Ding Yi (丁益) . . . . . . . . . . . . . . . . . . . 60 Independent Non-Executive Director
Executive Directors
Mr. WANG Wei (王衞先生) aged 54 is the founder de facto controller of the Company and was
appointed as chairman of the Board of Directors executive Director general manager and chief executive
officer of the Company. Mr. Wang has also been the chairman of the board of directors and a non-executive
director of KLN since October 2021.Mr. HO Chit (何捷先生) aged 50 graduated from The University of Hong Kong and Tsinghua University.He is a certified public accountant of Hong Kong and an American certified public accountant with
extensive experience in financial management corporate finance auditing and business management. Mr.Ho was a senior manager in the auditing and advisory division of Arthur Andersen and
PricewaterhouseCoopers from 1997 to 2005 the senior financial director of Sohu.com Limited
(SOHU.US) from 2005 to 2008 the chief financial officer of Changyou.com Limited (CYOU.US) from
2009 to 2014 the chief executive officer of Fox Financial Technology Group Limited from 2014 to 2021.
He has been a deputy general manager and the head of finance of the Company since September 2021. Mr.Ho was appointed as a Director of the Company in November 2021 and was re-designated as an executive
Director in August 2023. Mr. Ho served as a non-executive director of KLN from October 2021 to August
2024 and as an executive director and chief strategy officer since September 2024. Mr. Ho has been a
non-executive director and the chairman of the board of directors of SF REIT Asset Management Limited
(the manager of SF REIT) respectively since April 2022 and August 2023.– 159 –Ms. WANG Xin (王欣女士) aged 52 obtained a master’s degree in Business Administration from China
Europe International Business School (CEIBS). Ms. Wang was the senior project manager and the
associate partner of Mercer Management Consulting (now named Oliver Wyman) from 2000 to 2008 a
director of A.T. Kearney (Shanghai) Management Consulting Co. Ltd. from 2008 to 2011 and a senior
partner of Roland Berger Enterprise Management from 2011 to 2021. Ms. Wang served as the assistant
chief executive officer and chief human resources officer of the Company from January 2022 to January
2024 and has been the assistant chief executive officer and chief strategy officer of the Company since
January 2024. She was appointed as a Director since December 2022 and was re-designated as an
executive Director in August 2023. Ms. Wang has also been a director and the chairman of the board of
directors of KEX (KEX.BK) since May 2024.Mr. XU Bensong (徐本松先生) aged 39 obtained a master’s degree in Business Administration from
Sichuan University and an executive master of Business Administration (EMBA) degree from Peking
University. Mr. Xu joined the Group in 2007 and successively held various positions including the
operation manager of Yunnan district senior operation manager of Sichuan district general manager of
Chongqing district head of Group sales centre general manager of Beijing district and assistant chief
operating officer. He was appointed as the chief marketing officer of the Company in May 2024. Mr. Xu
has served as an executive Director of the Company since October 2024.Independent Non-executive Directors
Mr. CHAN Charles Sheung Wai (陳尚偉先生) aged 71 graduated from the University of Manitoba
Canada. Mr. Chan is a member of both the Chartered Professional Accountants of Canada and the Hong
Kong Institute of Certified Public Accountants. Mr. Chan has various experience in auditing finance and
risk management. He was an audit partner of Mainland China & Hong Kong office of Arthur Andersen
a managing partner of audit department of Mainland China & Hong Kong office of
PricewaterhouseCoopers and a senior managing director of Protiviti (a risk management and consulting
firm). Mr. Chan was also a member of the Listing Committee of the Hong Kong Stock Exchange and a
member of the Election Committee for the first Legislative Council of Hong Kong. He was an independent
non-executive director of CITIC SEC (stock codes: 600030.SH 6030) and Bio-heart (stock code: 2185).Mr. Chan is currently serving as an independent non-executive director of Maoyan Entertainment (stock
code: 1896) Hansoh PHARMA (stock code: 3692) and Sun Art Retail (stock code: 6808). Mr. Chan was
appointed as an independent non-executive Director in December 2022.Mr. LEE Carmelo Ka Sze (李嘉士先生) aged 64 obtained a bachelor’s degree and master’s degree in
Laws from The University of Hong Kong. Mr. Lee is qualified as a solicitor in Hong Kong England and
Wales Singapore and the Australian Capital Territory. Mr. Lee has rich legal experience and has been a
partner and senior partner of Woo Kwan Lee & Lo since 1989 and its Managing Partner since 2022. Mr.Lee is also a member of the Campaign Committee of the Community Chest of Hong Kong and the
co-chairman of the Community Chest Corporate Challenge Half Marathon Organising Committee. Mr. Lee
had been a committee member of HKSAR InnoHK Steering Committee of the Innovation and Technology
Commission of Hong Kong the chairman of the Appeal Tribunal Panel (Buildings) one of the members
of chairmen pool of the Listing Review Committee of the Hong Kong Stock Exchange chairman of the
Listing Committee of the Hong Kong Stock Exchange and an independent non-executive director of KWG
Group (stock code: 1813). Mr. Lee is currently serving as an independent non-executive director of China
Mobile (stock codes: 600941.SH 0941) and a non-executive director of Safety Godown (stock code: 0237)
and Playmates (stock code: 0635). Mr. Lee has served as an independent non-executive Director of the
Company since December 2022.– 160 –Dr. DING Yi (丁益博士) aged 60 Ph.D. in Economics of Renmin University of China and Senior
Economist has extensive experience in financial management and served as a lecturer at the School of
Finance of Renmin University of China the deputy general manager of the investment management
department of PICC Group (stock codes: 601319.SH 1339) a director and the assistant general manager
of PICC Asset Management Company Limited* (中國人保資產管理有限公司) the general manager and
chairwoman of Huaneng Capital Services Corporation Ltd. (華能資本服務有限公司) the chairwoman of
Invesco Great Wall Fund Management Company Limited* (景順長城基金管理有限公司). Dr. Ding has
been a director of Tongwei Co. Ltd. (通威股份有限公司) (600438.SH) and independent director of Hua
Xia Bank Co. Limited* (華夏銀行股份有限公司) (600015.SH) and Huatai Asset Management Company
Limited* (華泰資產管理有限公司). Dr. Ding has served as an independent non-executive Director of the
Company since December 2022.BOARD OF SUPERVISORS
The Board of Supervisors consists of four Supervisors including two employee representative
Supervisors.The following table sets forth the Supervisors as of the date of 31 December 2024:
Name Age Position/Title
Wang Jia (王佳) . . . . . . . . . . . . . . . . . . 45 Supervisor
Liu Jilu (劉冀魯) . . . . . . . . . . . . . . . . . 78 Supervisor
Li Juhua (李菊花) . . . . . . . . . . . . . . . . . 45 Employee Representative Supervisor
Zhang Shun (張順) . . . . . . . . . . . . . . . . 33 Employee Representative Supervisor
Ms. WANG Jia (王佳女士) aged 45 graduated from Shenzhen University with a bachelor’s degree in
Economics. She worked at Deloitte Touche Tohmatsu Certified Public Accountants LLP Shenzhen Branch
from 2002 to 2006. She also worked at Ernst & Young (China) Advisory Limited Shenzhen Branch from
2007 to 2014. Ms. Wang joined the Group in 2014 and she successively held various positions within the
Group including the financial planning expert and the head of internal control and is now the head of risk
control and compliance. Ms. Wang has been a Supervisor of the Company since April 2021.Mr. LIU Jilu (劉冀魯先生) aged 78 graduated from Anhui University and specialised his studies in
Economics and Management. Mr. Liu was the person in charge of Ma’anshan Dingtai Metal Products Co.Ltd.* (馬鞍山市鼎泰金屬製品公司) the chairman and general manager of Ma’anshan Dingtai Technology
Co. Ltd.* (馬鞍山市鼎泰科技有限責任公司) and Ma’anshan Dingtai Rare Earth New Materials Co. Ltd.*
(馬鞍山鼎泰稀土新材料股份有限公司) from 1994 to 2016. Mr. Liu has been a Supervisor of the Company
since December 2016.Ms. LI Juhua (李菊花女士) aged 45 obtained a bachelor’s degree in Management from Tongji
University is a Senior Certified Public Accountant in Australia a Fellow of the Chartered Management
Accountants and the Chartered Global Management Accountant. Ms. Li was an accountant and finance
manager of Shanghai Totole Flavoring Food Co. Ltd. under Nestlé from 2002 to 2004 an assistant
accountant and an assistant finance manager of Wal-Mart China’s headquarter from 2004 to 2008 a
finance manager of B&Q Shenzhen from 2008 to 2010 and the financial director of Maoye International
(stock code: 0848) from 2011 to 2012. Ms. Li successively held various key positions within the Group
from May 2012 to December 2023 including the head of accounting department head of tax department
head of financial shared service centre and head of the Chief Financial Officer office. She has also been
assistant to the Chief Financial Officer of the Company since January 2024. She has been a non-executive
director of SF REIT Asset Management Limited (the manager of SF REIT) from August 2023 to April
2024. She is also a non-executive director of SF Intra-city since November 2023. Ms. Li has been an
employee representative Supervisor of the Company since December 2019.– 161 –Mr. ZHANG Shun (張順先生) aged 33 obtained his master’s degree in Economics from Sun Yat-sen
University. He joined the Group in 2015 and successively held various positions including procurement
management senior coordinator operation management senior coordinator the head of culture and
employee relations division and the assistant head of S.F. Express business region and is now the head
of government affairs section of the public affairs department of the Group. Mr. Zhang has been an
employee representative Supervisor of the Company since December 2022.SENIOR MANAGEMENT
The following table sets forth the Company’s senior management as of 31 December 2024:
Name Age Position/Title
Wang Wei (王衞) . . . . . . . . . . . . . . . . . 54 General Manager
Ho Chit (何捷) . . . . . . . . . . . . . . . . . . . 50 Deputy General Manager
Li Sheng (李勝) . . . . . . . . . . . . . . . . . . 58 Deputy General Manager
Zhou Haiqiang (周海強) . . . . . . . . . . . . 47 Deputy General Manager
Geng Yankun (耿豔坤) . . . . . . . . . . . . . 39 Deputy General Manager
Gan Ling (甘玲) . . . . . . . . . . . . . . . . . . 50 Deputy General ManagerFor biographical details of Mr. WANG Wei (王衞先生) – please see the profile of Mr. Wang in “ExecutiveDirectors”.For biographical details of Mr. HO Chit (何捷先生) – please see the profile of Mr. Ho in “ExecutiveDirectors”.Mr. LI Sheng (李勝先生) aged 58 obtained his bachelor of laws from Sichuan Normal University. He
served as a senior regional manager from 1998 to 2005 at Wal-Mart China. He joined the Group in 2005
and successively held various positions including general manager of Hubei region general manager of
Sichuan region vice president of the Group president of Central China operation and president of West
China operation and is currently president and chairman of SF Airlines Company Limited. Mr. Li has been
a director of the SF Foundation since October 2016 and an assistant chief executive officer of the
Company since May 2024. He has been a deputy general manager of the Company since December 2016.Mr. ZHOU Haiqiang (周海強先生) aged 47 joined the Group in 2001 and successively held various
positions including senior manager of general affairs department of East China region operation
headquarters general manager of Hangzhou region deputy president of e-commerce logistics business
unit assistant chief human resources officer and head of Shanghai operations. Mr. Zhou has been an
assistant chief executive officer of the Company since November 2020 the chief human resources officer
of the Company since November 2024 and a deputy general manager of the Company since December
2022.
– 162 –Mr. GENG Yankun (耿豔坤先生) aged 39 graduated from Harbin Institute of Technology and Peking
University with a master’s degree in Engineering. After graduating in 2009 he joined Baidu and was
successively responsible for the technical R&D and management of Baidu Wiki Baidu Knows Baidu
Travel and Baidu LBS among others. He was the chief technology officer of Beijing Xiaodu Information
and Technology Co. Ltd.* (北京小度信息科技有限公司) from 2015 to 2017. He joined the Group in 2017
and currently holds various positions within Group including the chief information and technology officer
of the Company the chairman and chief executive officer of SF Technology and Beijing S.F. Intracity
Technology Co. Ltd. and is responsible for the technology R&D and relevant management. He has been
served as the deputy general manager of the Company since December 2022 and as a non-executive
director of SF Intra-city since September 2023.Ms. GAN Ling (甘玲女士) aged 50 obtained a master’s degree in Business Administration from The
University of Texas at Austin in the United States of America and an executive master of Business
Administration (EMBA) degree from PBCSF Tsinghua University. She has extensive experience in equity
investment public listing and corporate finance. Ms. Gan was an analyst at Coatue Management LLC one
of the Tiger cub funds in New York from 2006 to 2010 the deputy general manager of Maoye
International (stock code: 0848) from 2010 to 2015. She has been a member of the Appeal Review
Committee of the Shenzhen Stock Exchange. She joined the Group in 2015 and serves as a deputy general
manager and the secretary of the Board of Directors of the Company since 2016 a joint company secretary
of the Company since October 2024 and a non-executive director of SF REIT Asset Management Limited
(the manager of SF REIT) since 2022.– 163 –RECENT DEVELOPMENTS
FINANCIAL INFORMATION FOR THE THREE MONTHS ENDED 31 MARCH 2025
For the three months ended 31 March 2025 the Group recorded an increase in operating profit when
compared to the corresponding period in 2024 primarily due to an increase in operating revenue from its
(i) express and freight delivery and (ii) supply chain and international segments. The Group also recorded
an increase in total operating costs for the three months ended 31 March 2025 when compared to the
corresponding period in 2024 primarily due to an increase in (i) operating costs and (ii) sales expenses
as a result of increased market promotion and recruitment of its sales team for business development
opportunities. In addition the Group recorded a decrease in other income primarily due to a reduction in
tax incentives and a decrease in investment income primarily due to disposal of the Group’s subsidiaries.As at 31 March 2025 as compared to their respective balances as at 31 December 2024 the Group
recorded (i) a decrease in total assets primarily due to a decrease in cash and cash equivalents and
accounts receivables and (ii) a decrease in total liabilities primarily due to a decrease in short-term
borrowings accounts payables and employee wages payables.The financial information of the Group as at and for the three months ended 31 March 2025 is prepared
in accordance with generally accepted accounting principles of the PRC and has not been subject to an
audit or review by the Group’s independent auditors and should not be relied upon by investors to provide
the same quality of information associated with audited or reviewed financial information. Potential
investors must exercise caution when using such data to evaluate the Group’s financial condition and
results of operations. Such financial information as at and for the three months ended 31 March 2025
should not be taken as an indication of the Group’s expected financial condition or results of operations
as at and for the full financial year ended 31 December 2025.ISSUE OF RMB500 MILLION ULTRA-SHORT-TERM FINANCING BILLS BY TAISEN
HOLDINGS
The Group’s wholly owned subsidiary S.F. Taisen Holding (Group) Co. Ltd.* (深圳順豐泰森控股(集團)
有限公司) completed the issuance of RMB500 million ultra-short-term financing bills on 3 January 2025.PARTIAL REPURCHASE OF U.S. DOLLAR DENOMINATED GUARANTEED NOTES BY
WHOLLY-OWNED SUBSIDIARIES
SFHI a wholly-owned subsidiary of the Company issued the 2030 Notes in February 2020. SFHI 2021
a wholly-owned subsidiary of the Company issued the 2031 Notes in November 2021 and January 2022.Both the 2030 Notes and the 2031 Notes are unconditionally and irrevocably guaranteed by the Company.On 22 May 2025 SFHI and SFHI 2021 respectively announced the launch of the Offers with a maximum
aggregate acceptance amount up to US$350000000 in principal amount of the 2030 Notes and the 2031
Notes.– 164 –Upon the settlement of the Offers on 4 June 2025 (i) U.S.$101371000 in aggregate principal amount of
the 2030 Notes were purchased and redeemed by SFHI (ii) U.S.$78306000 in aggregate principal
amount of the 2031 Notes were purchased and redeemed by SFHI 2021 and cancelled pursuant to the terms
and conditions of the respective Notes and (iii) U.S.$552838000 in aggregate principal amount of the
2030 Notes and U.S.$641694000 in aggregate principal amount of the 2031 Notes remain outstanding
respectively.REPURCHASE OF A SHARES
The Company held the 13th meeting of the sixth Board of Directors on 29 April 2024 and launched its
2024 A Shares Repurchase Plan whereby the Company would repurchase its A Shares from the secondary
market with its own funds for the purpose of “employee share ownership plan or equity incentives”. The
Company thereafter repurchased the Repurchased Shares pursuant to the 2024 A Shares Repurchase Plan.Pursuant to the 19th meeting of the sixth Board of Directors held on 28 March 2025 and the 2024 annual
general meeting held on 13 June 2025 the purpose of the 2024 A Shares Repurchase Plan was amended
to “cancellation and reduction of share capital”. As of the date of this Offering Circular the Company is
in the process of cancelling the Repurchased Shares.PLACING OF NEW H SHARES UNDER GENERAL MANDATE
Concurrent with the Offering there is an Equity Placement comprising of the issuance of 70000000 H
Shares at a placing price of HK$42.15 per H Share for a total offer size of approximately HK$2950.5
million by way of new share issuance. The Guarantor has entered into a Placing Agreement with Goldman
Sachs (Asia) L.L.C. and Huatai Financial Holdings (Hong Kong) Limited as placing agents. The Equity
Placement is conducted concurrently with the offering of the Bonds but the completion of the issuance of
the Bonds and the Equity Placement are not inter-conditional. The closing for the Follow-on Offering took
place on 4 July 2025.– 165 –MARKET PRICE INFORMATION
The H Shares have been listed on Main Board of the Hong Kong Stock Exchange (Code: 6936) since the
Guarantor’s initial public offering on 27 November 2024. Prior to that time there was no public market
for the Guarantor’s H Shares. Pursuant to the Material Asset Restructuring the Group’s business has been
listed on the Shenzhen Stock Exchange (Code: 002352.SZ) since 23 January 2017.The table below sets forth for the periods indicated the high and low closing prices per H share as
reported on the Hong Kong Stock Exchange and per A Share as reported on the Shenzhen Stock
Exchange:
Closing Share Price
H Shares (HKD per share) A Shares (RMB per share)
Year High Low High Low
(HK$) (RMB)
2023
First quarter ended 31 March 2023 . . . . . . N/A N/A 61.09 51.73
Second quarter ended 30 June 2023 . . . . . . N/A N/A 58.00 44.76
Third quarter ended 30 September 2023 . . . N/A N/A 49.79 40.15
Fourth quarter ended 31 December 2023 . . N/A N/A 42.26 38.43
2024
First quarter ended 31 March 2024 . . . . . . N/A N/A 39.45 34.08
Second quarter ended 30 June 2024 . . . . . . N/A N/A 39.06 34.13
Third quarter ended 30 September 2024 . . . N/A N/A 44.98 33.23
Fourth quarter ended 31 December 2024 . . 34.50 32.35 46.09 40.10
2025
First quarter ended 31 March 2025 . . . . . . 40.50 33.00 44.10 38.53
Second quarter ended 30 June 2025 . . . . . . 46.80 33.00 50.70 40.07
– 166 –EXCHANGE RATE
PRC
The PBOC sets and publishes on a daily basis a base exchange rate with reference primarily to the supply
and demand of Renminbi against a basket of currencies in the market during the prior day. The PBOC also
takes into account other factors such as the general conditions existing in the international foreign
exchange markets. On 21 July 2005 the PRC government introduced a managed floating exchange rate
system to allow the value of the Renminbi to fluctuate within a regulated band based on market supply
and demand and by reference to a basket of currencies. On the same day the value of the Renminbi
appreciated by 2.0 per cent. against the U.S. dollar. The PRC government has since made and in the future
may make further adjustments to the exchange rate system. On 18 May 2007 the PBOC enlarged effective
on 21 May 2007 the floating band for the trading prices in the inter-bank spot exchange market of
Renminbi against the U.S. dollar from 0.3 per cent. to 0.5 per cent. around the central parity rate. This
allows the Renminbi to fluctuate against the U.S. dollar by up to 0.5 per cent. above or below the central
parity rate published by the PBOC. The floating band was further widened to 1.0 per cent. on 16 April
2012. These changes in currency policy resulted in the Renminbi appreciating against the U.S. dollar by
approximately 26.9 per cent. from 21 July 2005 to 31 December 2013. The PBOC authorised the China
Foreign Exchange Trading Centre effective since 4 January 2006 to announce the central parity exchange
rate of certain foreign currencies against the Renminbi on each business day. This rate is set as the central
parity for the trading against the Renminbi in the inter-bank foreign exchange spot market and the
over-the-counter exchange rate for the following business day. On 14 March 2014 the PBOC further
widened the floating band against the U.S. dollar to 2.0 per cent. On 11 August 2015 the PBOC announced
to improve the central parity quotations of Renminbi against the U.S. dollar by authorising market-makers
to provide central parity quotations to the China Foreign Exchange Trading Centre daily before the
opening of the interbank foreign exchange market with reference to the interbank foreign exchange market
closing rate of the previous day the supply and demand for foreign exchange as well as changes in major
international currency exchange rates. Following the announcement by the PBOC on 11 August 2015
Renminbi depreciated significantly against the U.S. dollar. In January and February 2016 Renminbi
experienced further fluctuation in value against the U.S. dollar. The PRC government may adopt further
reforms of its exchange rate system in the future.The table below sets forth for the periods indicated certain information concerning the exchange rates
between Renminbi and U.S. dollars which reflect the central parity rate published by the CFETS as
authorised by the PBOC:
Exchange Rates between Renminbi and U.S. Dollar
Period End Average(1) High Low
(RMB per U.S.$1.00)
2021............................6.37576.44746.5713.3498
2022............................6.96466.75737.2555.3014
2023............................7.08277.05587.2258.7130
2024............................7.18847.11677.1996.0074
2025
January . . . . . . . . . . . . . . . . . . . . . . . . . 7.1698 7.1833 7.1891 7.1696
February . . . . . . . . . . . . . . . . . . . . . . . . 7.1738 7.1711 7.1740 7.1691
March. . . . . . . . . . . . . . . . . . . . . . . . . . 7.1782 7.1737 7.1788 7.1688
April . . . . . . . . . . . . . . . . . . . . . . . . . . 7.2014 7.2034 7.2133 7.1775
May . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1848 7.1950 7.2095 7.1833
June . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1586 7.1757 7.1886 7.1586
Note:
(1) Determined by averaging the rates on the last business day of each month during the relevant year except for monthly
average rates which are determined by averaging the daily rates during the respective months.– 167 –HONG KONG
The HK dollar is freely convertible into the U.S. dollar. Since 1983 the HK dollar has been linked to the
U.S. dollar at the rate of HK$7.80 to U.S.$1.00. The Basic Law of the Hong Kong Special Administrative
Region of the People’s Republic of China (the “Basic Law”) which came into effect on 1 July 1997
provides that no foreign exchange control policies shall be applied in Hong Kong.The market exchange rate of the HK dollar against the U.S. dollar continues to be determined by the forces
of supply and demand in the foreign exchange market. However against the background of the fixed rate
system which applies to the issuance and withdrawal of Hong Kong currency in circulation the market
exchange rate has not deviated significantly from the level of HK$7.80 to U.S.$1.00. The Hong Kong
government has indicated its intention to maintain the link at that rate. Under the Basic Law the HK dollar
will continue to circulate and remain freely convertible. The Hong Kong government has also stated that
it has no intention of imposing exchange controls in Hong Kong and that the HK dollar will remain freely
convertible into other currencies including the U.S. dollar. However the Guarantor cannot assure you that
the Hong Kong government will maintain the link at HK$7.80 to U.S.$1.00 or at all.The table below sets forth for the periods indicated certain information concerning the exchange rates
between Renminbi and Hong Kong dollars which reflect the central parity rate published by the CFETS
as authorised by the PBOC:
Exchange Rates between Hong Kong dollar and U.S. Dollar
Period End Average(1) High Low
(HK$ per U.S.$1.00)
2021............................7.79817.77427.8034.7514
2022............................7.79677.83177.8501.7690
2023............................7.81577.83057.8499.7897
2024............................7.76257.80167.8373.7625
2025
January . . . . . . . . . . . . . . . . . . . . . . . . . 7.7886 7.7827 7.7903 7.7716
February . . . . . . . . . . . . . . . . . . . . . . . . 7.7756 7.7814 7.7928 7.7695
March. . . . . . . . . . . . . . . . . . . . . . . . . . 7.7785 7.7727 7.7785 7.7675
April . . . . . . . . . . . . . . . . . . . . . . . . . . 7.7590 7.7637 7.7842 7.7565
May . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.8401 7.8068 7.8401 7.7509
June . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.8498 7.8484 7.8499 7.8445
Note:
(1) Determined by averaging the rates on the last business day of each month during the relevant year except for monthly
average rates which are determined by averaging the daily rates during the respective months.– 168 –DIVIDENDS
PRINCIPLES FOR PROFIT DISTRIBUTION
The Company’s profit distribution shall emphasise a reasonable return to public shareholders with the
purpose of sustainable development and safeguarding shareholders’ rights and interests maintain the
continuity and stability of profit distribution policies and comply with the relevant provisions of laws and
regulations.WAY OF PROFIT DISTRIBUTION
Dividends can be distributed in the form of cash shares or a combination of both and distribution of
profits by way of cash dividends should be given priority.CONDITIONS FOR CASH DIVIDENDS
For distribution of cash dividends the following conditions shall be satisfied:
1. The distributable profit (i.e. the after-tax profit remaining after making up for the losses and making
contributions to the common reserve fund) realised by the Company in a year is positive;
2. The auditor issues a standard unqualified audit report on the annual financial report of the Company;
and
3. The Company has no material investment plans or significant cash expenditures (except for
fundraising investment projects) within the next 12 months.Material investment plans or significant cash expenditures refer to the total accumulative expenditures for
external investment acquisition of assets or purchase of equipment by the Company within the next 12
months reaching or exceeding 20% of the latest audited net assets of the Company and exceeding RMB50
million.CASH DIVIDEND PAYOUT RATIO AND TIME
Subject to the compliance of the profit distribution principles the maintenance of the normal operation and
the long-term development of the Company where cash distribution conditions are met the Company in
principle makes the cash dividend payment once a year. Cash dividend for each year shall not be less than
10% of the distributable profit realised for that same year the aggregate cash dividend for any three
consecutive years shall not be less than 30% of the average distributable profits realised during such three
years. Under certain conditions the Company may distribute interim dividends according to its actual
operating conditions.When the Company convenes an annual general meeting to consider the annual profit distribution plan
it may consider and approve the conditions maximum proportion and maximum amount of cash dividends
for the interim period of the next year. The maximum amount of interim dividend for the next year
considered at the annual general meeting shall not exceed the net profit attributable to shareholders of the
listed company for the corresponding period. The Board of Directors shall formulate a specific interim
dividend plan in accordance with the resolutions of the shareholders’ general meeting subject to the
conditions of profit distribution.– 169 –The Board has formulated the Shareholders’ Return Plan for 2024-2028 according to which the total
amount of cash dividends of the Company in 2023 accounted for about 35% of the profit attributable to
owners of the Company in that year and the proportion of cash dividends of the Company from 2024 to
2028 will increase steadily on the basis of that in 2023. Decisions to declare or to pay any dividends in
the future will depend on among other things the Company’s profitability operations and development
plans external financing environment costs of capital the Company’s cash flows and other factors that
the Directors may consider relevant.– 170 –SUBSTANTIAL SHAREHOLDERS’ AND DIRECTORS’ AND
CHIEF EXECUTIVES’ INTERESTS
SUBSTANTIAL SHAREHOLDERS
As at 31 December 2024 so far as is known to the Directors the following persons (not being Directors
Supervisors or chief executive of the Company) had or were deemed to have interests or shorts positions
in the shares underlying shares or debentures of the Company which would fall to be disclosed to the
Company and the Hong Kong Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of
the SFO or which were required to be recorded in the register of interests required to be kept by the
Company under section 336 of the SFO:
Approximate
Approximate percentage of
percentage of shareholding in
Name of shareholding in the total issued
substantial Class of Nature of Number of shares the relevant class shares of the
Shareholder shares interest interested(1) of shares Company
Wang Wei(2) . . . . . A Shares Interest of 2661927139 (L) 55.27% 53.39%
controlled
corporation
Mingde Holding(2) . A Shares Beneficial 2561927139 (L) 53.19% 51.38%
owner(3)
A Shares Interest of 100000000 (L) 2.08% 2.01%
controlled
corporation
Morgan Stanley(4) . . H Shares Interest of 11750083 (L) 6.91% 0.24%
controlled 2664973 (S) 1.57% 0.05%
corporation
Morgan Stanley H Shares Interest of 11636083 (L) 6.84% 0.23%
International controlled 1931329 (S) 1.14% 0.04%
Holdings Inc.(4) . . corporation
Morgan Stanley H Shares Interest of 11636083 (L) 6.84% 0.23%
International controlled 1931329 (S) 1.14% 0.04%
Limited(4) . . . . . . corporation
Morgan Stanley H Shares Interest of 11636083 (L) 6.84% 0.23%
Investments controlled 1931329 (S) 1.14% 0.04%
(UK)(4) . . . . . . . corporation
Morgan Stanley & H Shares Beneficial 11636083 (L) 6.84% 0.23%
Co. International owner 1931329 (S) 1.14% 0.04%
plc(4) . . . . . . . . .RWC Asset H Shares Investment 10186000 (L) 5.99% 0.20%
Advisors (US) manager
LLC . . . . . . . . .Notes:
(1) The letter “L” denotes the person’s long position in the shares.
(2) Mr. Wang Wei held the A Shares of the Company through Mingde Holding. Mingde Holding directly held
2561927139 A Shares of the Company and indirectly held 100000000 A Shares of the Company through Shenzhen
Weishun its wholly-owned subsidiary. Mr. Wang held 99.90% of the equity interest in Mingde Holding. Accordingly
Mr. Wang shall be deemed to be interested in the A Shares of the Company held by Mingde Holding under Part XV
of the SFO.– 171 –(3) As at December 31 2024 Mingde Holding held a total of 2561927139 A Shares in the capacity of beneficial owner.Among them an aggregate of another 895600000 A Shares held by Mingde Holding were subject to pledges granted
under certain loan and credit facilities in favour of certain PRC financial institutions regulated by NAFR and/or CSRC.
(4) As at December 31 2024 (i) Morgan Stanley & Co. International plc is a wholly-owned subsidiary of Morgan Stanley
Investments (UK) and Morgan Stanley Investments (UK) is wholly owned by Morgan Stanley International Limited.Morgan Stanley International Limited is a wholly-owned subsidiary of Morgan Stanley International Holdings Inc.and Morgan Stanley International Holdings Inc. is wholly owned by Morgan Stanley. Therefore each of Morgan
Stanley Morgan Stanley International Holdings Inc. Morgan Stanley International Limited and Morgan Stanley
Investments (UK) was deemed to be interested in the H Shares and short positions held by Morgan Stanley & Co.International plc.; (ii) Morgan Stanley Capital Services LLC held 733644 short positions in the Company and is a
wholly-owned subsidiary of Morgan Stanley Domestic Holdings LLC. Morgan Stanley Domestic Holdings LLC is
wholly owned by Morgan Stanley Capital Management LLC and Morgan Stanley Capital Management LLC is
wholly owned by Morgan Stanley. Therefore Morgan Stanley is deemed to be interested in the 733644 short positions
held by Morgan Stanley Capital Services LLC; (iii) Morgan Stanley & Co. LLC was interested in 114000 H Shares
of the Company and is a wholly-owned subsidiary of Morgan Stanley Capital Management LLC. As Morgan Stanley
Capital Management LLC is wholly owned by Morgan Stanley Morgan Stanley is deemed to be interested in the
114000 H Shares held by Morgan Stanley & Co. LLC.
Save as disclosed above as at 31 December 2024 the Directors are not aware of any other person or
corporation having an interest or short position in the shares and underlying shares of the Company which
would require to be disclosed to the Company under the provisions of Divisions 2 and 3 of Part XV of the
SFO or which were recorded in the register required to be kept by the Company pursuant to section 336
of the SFO.DIRECTORS SUPERVISORS AND CHIEF EXECUTIVE OF THE COMPANY
As at 31 December 2024 the interests or short positions of the Directors Supervisors and chief executive
of the Company in the shares underlying shares and debentures of the Company or its associated
corporations (within the meaning of Part XV of the SFO) which (a) were required to be notified to the
Company and the Hong Kong Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO
(including interests and short positions which were held or deemed to have under such provisions of the
SFO); or (b) were required pursuant to section 352 of the SFO to be recorded in the register referred to
therein; or (c) were required to be notified to the Company and the Hong Kong Stock Exchange pursuant
to the Model Code were as follows:
Interest in shares or underlying shares of the Company
Approximate
Approximate percentage of
percentage of shareholding in
Name of Director shareholding in the total issued
Supervisor and Class of Nature of Number of shares the relevant class shares of the
chief executive shares interest interested(1) of shares(2) Company(2)
Wang Wei . . . . . . . A Shares Interest of 2661927139 (L)(3) 55.27% 53.39%
controlled
corporation(3)
Ho Chit . . . . . . . . A Shares Beneficial 488000 (L)(4) 0.01% 0.01%
Owner
Wang Xin . . . . . . . A Shares Beneficial 477000 (L)(5) 0.01% 0.01%
Owner
Xu Bensong. . . . . . A Shares Beneficial 258200 (L)(6) 0.005% 0.005%
Owner
Lee Carmelo A Shares Beneficial 38000 (L) 0.001% 0.001%
Ka Sze. . . . . . . . Owner
– 172 –Notes:
(1) The letter “L” denotes the person’s long position in the shares.
(2) The calculation is based on the issued shares of the Company comprised of 4816186983 A Shares (including A
Shares in the Company’s repurchase securities account) and 170000000 H Shares as at 31 December 2024.
(3) Including (i) 2561927139 A Shares held by Mingde Holding and (ii) 100000000 A Shares held by Shenzhen
Weishun a wholly-owned subsidiary of Mingde Holding. As at 31 December 2024 Mr. Wang held 99.90% of the
equity interests in Mingde Holding. Therefore Mr. Wang shall be deemed to be interested in the A Shares of the
Company held by Mingde Holding under the SFO.
(4) Including (i) 122000 A Shares held by Mr. Ho Chit and (ii) 366000 options granted to Mr. Ho Chit under the 2022
Stock Option Incentive Plan.
(5) Including (i) 172000 A Shares held by Ms. Wang Xin and (ii) 305000 options granted to Ms. Wang Xin under the
2022 Stock Option Incentive Plan.
(6) Including (i) 54200 A Shares held by Mr. Xu Bensong and (ii) 204000 options granted to Mr. Xu Bensong under the
2022 Stock Option Incentive Plan.
Interest in shares or underlying shares of the associated corporation of the Company
Percentage of
Total number the issued
Name of Name of Number of of shares of the share capital of
Director associate Nature of Class of shares associated the associated
Supervisor corporation interest shares interested(1) corporation corporation(2)
Wang Wei. . . Mingde Beneficial Unlisted 113286600 (L) 113400000 99.90%
Holding owner domestic
shares
Wang Wei. . . SF Intra-city Interest in a H Shares 364738662 (L) 745610609 48.92%
controlled Unlisted 171764898 (L) 171764898 100.00%
corporation domestic
and others(2) shares
Wang Wei. . . KLN Interest in a H Shares 972698478 (L) 1807429342 53.82%
controlled
corporation
and others(3)
Notes:
(1) The letter “L” denotes the person’s long position in the shares.
(2) Including 171764898 H Shares and 171764898 domestic shares held by SF Taisen 75000000 H Shares held by
Beijing SF Intra-city Technology Co. Ltd. (北京順豐同城科技有限公司) 117076764 H Shares held by SF Holding
(HK) and 897000 H Shares held by Celestial Ocean Investment Limited. Beijing SF Intra-city Technology Co. Ltd.is a non-wholly owned subsidiary of SF Technology while Celestial Ocean Investment Limited is a wholly-owned
subsidiary of SF Holding (HK) and both SF Technology and SF Holding (HK) are wholly-owned subsidiaries of SF
Taisen. SF Taisen is a wholly-owned subsidiary of the Company and therefore a non-wholly owned subsidiary of
Mingde Holding which is held by Mr. Wang as to approximately 99.90%. As such Mr. Wang is deemed to be
interested in the shares of SF Intra-city which SF Taisen is deemed to be interested in.
(3) Including the subscribed convertible interests in 41489361 shares of KLN which have been repurchased on 27
January 2025 and 931209117 shares of KLN held by Flourish Harmony Holdings Company Limited which is an
indirect wholly-owned subsidiary of the Company through Advance Harmony Holdings Company Limited and SF
Holding (HK). As such Mr. Wang is deemed to be interested in the shares of KLN which SF Holding (HK) is deemed
to be interested in.– 173 –Save as disclosed above and so far as is known to the Directors Supervisors and chief executive of the
Company as at 31 December 2024 none of the Directors Supervisors or chief executive of the Company
had or was deemed to have any other interests or short positions in the shares underlying shares or
debentures of the Company or any of its associated corporations (within the meaning of Part XV of the
SFO) (a) which were required to be notified to the Company and the Hong Kong 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 have under such provisions of the SFO); or (b) which were required pursuant to section 352
of the SFO to be entered in the register referred to therein; or (c) which were required to be notified to
the Company and the Hong Kong Stock Exchange pursuant to the Model Code.– 174 –DESCRIPTION OF THE SHARES
The following information is a summary of certain provisions of the Articles of Association currently
effective and certain other information concerning the Company. This summary does not purport to be
complete and is qualified in its entirety by reference to the Articles of Association and the PRC Company
Law. Any provision of the Articles of Association may be varied by special resolution passed at a general
meeting of shareholders of the Company as approved by the relevant competent authority according to the
applicable laws and rules.GENERAL
The Group was founded in Shunde Guangdong Province in 1993. Pursuant to the Material Asset
Restructuring the Group’s business has been listed on the Shenzhen Stock Exchange (Code: 002352.SZ)
since 23 January 2017. The H Shares have been listed on the Main Board of the Hong Kong Stock
Exchange (Code: 6936) since 27 November 2024.SHARES AND REGISTERED CAPITAL
As of 30 June 2025 the registered share capital of the Company is RMB4992692017. The nominal value
of shares issued by the Company is denominated in RMB with a par value of RMB1.00 each.The shares of the Company shall be issued in an open fair and equal manner. Each share of the same class
shall rank pari passu with each other. Shares of a class in each issuance shall be issued under the same
terms and at the same price. Each of the shares shall be subscribed for at the same price by any entity or
individual.Unless otherwise stipulated by laws administrative regulations the relevant provisions of the securities
regulatory authorities of the place where the Company’s shares are listed and the Hong Kong Stock
Exchange the shares of the Company which have been fully paid may be freely transferred without any
lien attached. The transfer of the Company’s shares shall be conducted in accordance with the applicable
national laws administrative regulations and the listing rules of the place where the Company’s shares are
listed or the relevant provisions of the securities regulatory authorities.INCREASE DECREASE REPURCHASE AND TRANSFER OF SHARES
Increase and Decrease of Shares
According to the operation and development needs of the Company subject to the laws and regulations
the Company may increase the registered capital by the following ways upon approval by way of
resolutions at the shareholders’ general meeting respectively:
(I) public offering of shares;
(II) non-public offering of shares;
(III) distributing bonus shares to existing shareholders;
(IV) converting capital reserve into share capital;
(V) other means stipulated by laws and administrative regulations or approved by government
authorities.– 175 –The Company shall prepare a balance sheet and an inventory list for its assets in the event it is required
to reduce its registered capital. The Company shall notify its creditors within 10 days after the adoption
of the relevant resolution on the reduction of the registered capital and publish announcements in
Securities Times China Securities Journal Shanghai Securities News Securities Daily Juchao
Information Website (http://www.cninfo.com.cn) and HKEXnews (www.hkexnews.hk) as designated by
the Company within 30 days. The creditors may require the Company to repay its debt or provide
corresponding guarantees within 30 days after receiving such notice or if they fail to receive such notice
within 45 days after the publication of such announcement.Repurchase of Shares
The Company may not repurchase its own shares except in any of the following circumstances:
(I) reducing the Company’s registered capital;
(II) merging with other companies holding shares of the Company;
(III) issuing shares under employee stock ownership scheme or share incentive scheme;
(IV) purchasing its shares from Shareholders who have voted against the resolutions on the merger or
division of the Company at a shareholders’ general meeting upon their request;
(V) use of shares for converting the convertible bonds issued by the Company into shares;
(VI) where it is necessary for the Company to maintain its value and protect the interests of the
shareholders.A resolution at the shareholders’ general meeting is required when the Company repurchases its own
shares under the circumstances set out in (I) and (II) above. When the Company repurchases its own shares
under the circumstances set out in (III) (V) and (VI) above a board resolution shall be passed by more
than two-thirds of the directors attending the board meeting provided that it complies with the securities
regulatory rules of the place where the Company’s shares are listed. After the share repurchase the
Company shall adhere to the information disclosure obligations as stipulated in the Securities Law of the
People’s Republic of China the rules of the place where the Company’s shares are listed and the
provisions of other securities regulatory rules.After the Company repurchases its own shares in accordance with the above in case of the circumstance
set out in (I) above the shares shall be cancelled within 10 days from the date of repurchase; in case of
the circumstances set out in (II) and (IV) above the shares shall be transferred or cancelled within 6
months thereafter; and in case of the circumstances set out in (III) (V) and (VI) above the shares held
by the Company in aggregate shall not exceed 10% of the total issued shares of the Company and shall
be transferred or cancelled within 3 years.The Company may repurchase its own shares in one of the following ways:
(I) open centralised trading;
(II) other ways recognised by laws administrative regulations the CSRC and other stock exchanges of
the place where the Company’s shares are listed in compliance with the provisions of applicable
laws administrative regulations departmental rules and securities regulatory rules of the place
where the Company’s shares are listed.– 176 –Transfer of Shares
Shares of the Company held by promoters shall not be transferred within 1 year from the date of
establishment of the Company. Shares issued by the Company prior to the public offering shall not be
transferred within 1 year from the date on which the shares of the Company are listed and traded on the
Hong Kong Stock Exchange and the Shenzhen Stock Exchange.The directors supervisors and senior management members of the Company shall notify the Company of
their holdings of shares in the Company and the changes therein and the shares transferred by them during
each year of their term of office shall not exceed 25% of their total holdings of shares in the Company.The shares in the Company held by them shall not be transferred within 1 year from the date on which
the Company’s shares are listed for trading.The shares in the Company held by them shall not be transferred within half a year after they have
terminated their employment with the Company. Where the listing rules of the place where the Company’s
shares are listed provide otherwise in respect of the restrictions on the transfer of shares of the Company
such rules shall prevail.All H Shares shall be transferred by way of written transfer instrument in standard form or any other
format acceptable to the Board of Directors (including the standard transfer format or form of transfer as
prescribed by the Hong Kong Stock Exchange from time to time. The instruments of transfer may only be
signed by hand or (where the transferor or transferee is a corporation) by an effective company seal. If the
transferor or transferee is a recognised clearing house as defined by the relevant provisions that come into
effect from time to time according to the laws of Hong Kong or its agent the instruments of transfer may
be signed by hand or in a machine-printed format. All instruments of transfer shall be kept at the legal
address of the Company or such places as the Board of Directors may designate from time to time.SHAREHOLDERS AND SHAREHOLDERS’ GENERAL MEETINGS
Shareholders
The Company shall establish a register of shareholders based on the certificates provided by the securities
registration authority and the register of shareholders is sufficient evidence to prove that the shareholders
hold the shares of the Company. The original copy of the register of holders of H Shares listed in Hong
Kong is kept in Hong Kong and is available for inspection by shareholders but the Company may suspend
the registration of shareholders in accordance with the applicable laws and regulations and the securities
regulatory rules of the place where the Company’s shares are listed. In the event that any shareholder
whose name is recorded in or any person who requests to have its name entered in the register of holders
of H Shares loses his/her share certificate(s) he/she may apply to the Company for replacement of new
share certificate(s) in respect thereof. Where a holder of overseas-listed foreign shares loses his/her share
certificate(s) and applies for replacement such application shall be dealt with in accordance with the laws
rules of the stock exchange or other relevant regulations of the place where the original copy of the register
of shareholders of overseas-listed foreign shares is maintained. Shareholders shall enjoy rights and assume
obligations according to the class of shares they hold. Shareholders holding shares of the same class shall
enjoy the same rights and assume the same obligations.Shareholders of the Company enjoy the following rights:
(I) to receive dividends and other forms of interest distributions in proportion to their shareholdings;
(II) to request convene hold and attend or appoint proxies to attend shareholders’ general meetings and
exercise their corresponding voting rights according to laws;
– 177 –(III) to supervise provide recommendations on or make inquiries about the operations of the Company;
(IV) to transfer donate or pledge their shares in accordance with laws administrative regulations and the
Articles of Association;
(V) to inspect the Articles of Association register of shareholders counterfoils of the bonds of the
Company minutes of shareholders’ general meetings resolutions of the board meetings resolutions
of the meetings of Board of Supervisors financial and accounting reports;
(VI) to participate in the distribution of the remaining properties of the Company in proportion to their
shareholdings in the event of the termination or liquidation of the Company;
(VII) to request the Company to acquire their shares for the shareholders who voted against any resolution
adopted at the shareholders’ general meeting concerning the merger or division of the Company;
(VIII) to enjoy other rights stipulated by laws administrative regulations departmental rules the Articles
of Association or securities regulatory rules of the place where the Company’s shares are listed.In the event that any resolution of the shareholders’ general meetings or resolution of the Board of
Directors violates laws or administrative regulations the shareholders shall be entitled to request the
People’s Court to invalidate the said resolution whereas in the case of holders of H Shares the applicable
rules under the Settlement of Disputes chapter of the Articles of Association shall be applied. In the event
that the convening procedure or voting method of the shareholders’ general meeting or the board meeting
violates any of the laws administrative regulations or the Articles of Association or the content of any
resolution violates the Articles of Association the shareholders shall be entitled to request the People’s
Court to revoke the resolution within 60 days upon the date on which the resolution was adopted whereas
in the case of holders of H Shares the applicable rules under the Settlement of Disputes chapter of the
Articles of Association shall be applied.Shareholders of the Company shall assume the following obligations:
(I) to abide by the laws administrative regulations and the Articles of Association;
(II) to pay capital contribution according to the number of shares subscribed for and the method of
subscription;
(III) not to withdraw the shares unless required by the laws and administrative regulations;
(IV) not to abuse their shareholders’ rights to jeopardise the interests of the Company or other
shareholders and not to abuse the status of the Company as an independent legal entity and the
limited liability of shareholders to jeopardise the interests of any creditors of the Company;
(V) to keep business secrets of the Company confidential;
(VI) other obligations imposed by the laws administrative regulations and the Articles of Association.Where any shareholder of the Company abuses the shareholders’ rights and incur losses to the Company
or other shareholders such shareholder shall be liable for the damages according to laws. Where
shareholders of the Company abuse the Company’s status as an independent legal entity and the limited
liability of shareholders for the purposes of evading debts thereby materially impairing the interests of the
creditors of the Company such shareholders shall be jointly and severally liable for the debts owed by the
Company.– 178 –General Provisions for Shareholders’ General Meetings
The shareholders’ general meeting is the power of authority of the Company which shall exercise the
following functions and powers in accordance with the law:
(I) to decide on the Company’s operational policies and investment plans;
(II) to elect or replace the directors and supervisors (other than the employee representatives) and to
decide on matters relating to the remuneration of directors and supervisors;
(III) to examine and approve reports of the Board of Directors;
(IV) to examine and approve reports of the Board of Supervisors;
(V) to examine and approve the Company’s proposed annual financial budget and final accounts;
(VI) to examine and approve the Company’s proposals for profit distribution plans and loss recovery
plans;
(VII) to decide on any increase or reduction of the Company’s registered capital;
(VIII) to decide on the issue of securities or bonds by the Company;
(IX) to decide on matters such as merger division dissolution and liquidation or change of corporate
form of the Company;
(X) to amend the Articles of Association;
(XI) to decide on the purchase of the Company’s shares under the circumstances stipulated in Article 24
(I) and (II) of the Company’s Articles of Association;
(XII) to resolve on the appointment and dismissal of accounting firms by the Company;
(XIII) to examine and approve the provision of guarantees stipulated in Article 42;
(XIV) to examine matters relating to the purchases and disposals of the Company’s material assets within
1 year which exceed 30% of the Company’s latest audited total assets;
(XV) to examine and approve the related transactions which the Company intends to enter into with related
parties with a transaction amount of more than RMB30 million and accounting for more than 5% of
the absolute value of the latest audited net assets of the Company;
(XVI) to examine and approve matters relating to changes in the use of proceeds;
(XVII) to examine and approve the share incentive scheme and employee stock ownership scheme;
(XVIII) to examine other matters as required by the laws administrative regulations departmental rules the
securities regulatory rules of the place where the Company’s shares are listed and the Articles of
Association which shall be decided by the shareholders’ general meeting.– 179 –The following external guarantees of the Company shall be submitted to shareholders’ general meeting for
consideration and approval.(I) any guarantee provided after the total amount of external guarantees of the Company and its
controlled subsidiaries has exceeded 50% of the Company’s latest audited net assets;
(II) any guarantee provided after the total amount of external guarantees of the Company and its
controlled subsidiaries has exceeded 30% of the Company’s latest audited total assets;
(III) the cumulative guarantee amount in the last 12 months has exceeded 30% of the Company’s latest
audited total assets;
(IV) a guarantee provided to a party with a gearing ratio of over 70% as shown in its latest financial
statement;
(V) a single guarantee that exceeds 10% of the Company’s latest audited net assets;
(VI) the guarantee to be provided to shareholders de facto controllers and their related parties;
(VII) other guarantees required by the laws administrative regulations rules securities regulatory rules
of the place where the Company’s shares are listed or other regulatory documents that shall be
considered by the shareholders’ general meeting.The guarantee in item (III) of the preceding paragraph shall be approved by more than two-thirds of the
voting rights held by the shareholders attending the meeting.Where a director general manager other senior management member or other personnel of the Company
fails to perform the procedures for reviewing external guarantees as required and signs a guarantee
contract without authorisation the parties concerned shall be held accountable.Shareholders’ general meetings are classified into annual general meetings and extraordinary general
meetings. The annual general meeting is convened once a year and shall be held within 6 months after the
end of the previous financial year.The Company shall convene an extraordinary general meeting within two months from the date of the
occurrence of any of the following circumstances:
(I) where the number of directors falls short of the number required by the Company Law or less than
two-thirds of the number prescribed in the Articles of Association;
(II) where the unrecovered losses of the Company reach one-third of the total paid-up share capital;
(III) where it is requested by a shareholder individually or shareholders collectively holding more than
10% of the Company’s shares;
(IV) the Board of Directors considers it necessary;
(V) the Board of Supervisors proposes that such a meeting shall be held;
(VI) other circumstances stipulated by laws administrative regulations departmental rules securities
regulatory rules of the place where the Company’s shares are listed and the Articles of Association.– 180 –Convening of Shareholders’ General Meetings
Shareholders who individually or collectively hold more than 10% of the shares of the Company shall have
the right to request the Board of Directors to convene an extraordinary general meeting and shall submit
such request in writing to the Board of Directors. The Board of Directors shall in accordance with the
provisions of laws administrative regulations and the Articles of Association provide written feedback on
whether or not to convene the extraordinary general meeting within 10 days after receiving the request.Where the Board of Directors agrees to convene an extraordinary general meeting it shall issue a notice
of convening the meeting within 5 days after the board passes the resolution and changes to the original
request in the notice shall be subject to the consent of the relevant shareholders. Where the Board of
Directors does not agree to convene an extraordinary general meeting or fails to give feedback within 10
days after receiving the request shareholders who individually or collectively hold more than 10% of the
Company’s shares shall have the right to propose to the Board of Supervisors to hold an extraordinary
general meeting and shall make a written request to the Board of Supervisors.Where the Board of Supervisors agrees to convene an extraordinary general meeting it shall issue a notice
of convening the meeting within 5 days of receiving the request and any changes to the original request
in the notice shall be subject to the consent of the relevant shareholders. Where the Board of Supervisors
fails to issue a notice of the meeting within the prescribed time limit it shall be deemed that the Board
of Supervisors has not convened and presided over the meeting and shareholders who individually or
collectively hold more than 10% of the Company’s shares for more than 90 consecutive days may convene
and preside over the meeting on their own initiatives.Where the Board of Supervisors or shareholders decide to convene a shareholders’ general meeting on
their own initiatives they shall notify the Board of Directors in writing and file the records with the
Shenzhen Stock Exchange at the same time. Prior to the announcement of the resolution of the
shareholders’ general meeting the shareholding of the convening shareholders shall not be less than 10%.The Board of Supervisors or the convening shareholders shall submit the relevant supporting materials to
the Shenzhen Stock Exchange when issuing the notice of the shareholders’ general meeting and the
announcement of the resolution of the shareholders’ general meeting.The expenses necessary for the shareholders’ general meeting convened by the Board of Supervisors or the
shareholders on their own initiatives shall be borne by the Company.A shareholders’ general meeting shall be presided over by the chairman of the Board of Directors. If the
chairman is unable to or fails to perform his/her duties a director jointly elected by more than half of the
directors shall preside over the meeting.The chairman of the Board of Supervisors shall preside over the shareholders’ general meeting that is
convened by the Board of Supervisors. If the chairman of the Board of Supervisors is unable to or fails
to perform his/her duties a supervisor jointly elected by more than half of the supervisors shall preside
over the meeting. A shareholders’ general meeting convened by the shareholders shall be presided over by
a representative elected by the conveners. Where the chairman of the shareholders’ general meeting
violates the rules of procedure when holding the meeting and as a result the shareholders’ general meeting
is unable to continue subject to the consent of the shareholders with more than half of voting rights of
all the shareholders attending the shareholders’ general meeting a person may be nominated in the
shareholders’ general meeting to act as the chairman of the meeting and such meeting may continue.– 181 –Notice of Shareholders’ General Meeting
The convener shall notify all shareholders by way of announcement 21 days prior to the convening of the
annual general meeting and each shareholder shall be notified by way of announcement 15 days prior to
the convening of the extraordinary general meeting. The date of the meeting shall not be included in the
calculation of the commencement period.The notice of a shareholders’ general meeting shall include the following:
(I) the time venue and duration of the meeting;
(II) matters and proposals submitted to the meeting for consideration;
(III) the notice shall state clearly that all shareholders are entitled to attend the shareholders’ general
meeting or appoint proxies in writing to attend and vote at such meeting on their behalf and that such
proxies need not be a shareholder of the Company;
(IV) the shareholding registration date for the shareholders who are entitled to attend the shareholders’
general meeting;
(V) the names and telephone numbers of the contact person for the meeting affairs;
(VI) voting time of and procedures via online or other methods.The notice and supplemental notice of the shareholders’ general meeting shall fully and completely
disclose all the specific contents of all proposals. Where the opinions of an independent non-executive
director are required on matters to be discussed the opinions and reasons thereof shall be disclosed at the
same time when the notice of shareholders’ general meeting and the supplemental notice are issued.Proposals at Shareholders’ General Meetings
When the Company convenes a shareholders’ general meeting the Board of Directors the Board of
Supervisors and shareholders who individually or collectively hold more than 3% of the shares of the
Company shall have the right to put forward proposals to the Company. Shareholders who individually or
collectively hold more than 3% of the shares of the Company may submit a provisional proposal in writing
to the convener 10 days prior to the convening of the shareholders’ general meeting. The convener shall
issue a supplemental notice of the shareholders’ general meeting within 2 days after receiving the proposal
and announce the contents of the provisional proposal. Where the shareholders’ general meeting is
postponed in accordance with the requirements of the securities regulatory rules of the place where the
Company’s shares are listed due to the issuance of a supplemental notice of the shareholders’ general
meeting the convening of the shareholders’ general meeting shall be postponed in accordance with the
provisions of the securities regulatory rules of the place where the Company’s shares are listed.Proxy for the Shareholders’ General Meeting
Shareholders may attend a shareholders’ general meeting in person or may appoint other persons as
his/her proxies to attend and vote on his/her behalf.Individual shareholders attending the meeting in person shall present their personal identity cards or other
valid certificates or documents or proof of shareholding. Proxies attending the meeting shall present their
valid personal identity cards and the proxy forms from the shareholders.– 182 –Where a shareholder is a legal entity its legal representative or proxies authorised by the legal
representative shall attend the meeting. Legal representatives attending the meeting shall present their
personal identity cards and valid documents that can prove their identities as legal representatives. Proxies
authorised to attend the meeting shall present their personal identity cards and the proxy forms in writing
provided by the legal representative of the legal entity shareholder in accordance with the law except for
shareholder who is a recognised clearing house as defined in the relevant ordinances in force from time
to time under the laws of Hong Kong or the securities regulatory rules of the place where the shares of
the Company are listed (the “Recognised Clearing House”).If the shareholder is a Recognised Clearing House the Recognised Clearing House may authorise one or
more persons it deems fit to act as its representative at any shareholders’ general meeting or any meeting
of creditors; however if more than one person is so authorised the power of attorney shall specify the
number and class of shares in respect of which each such person is so authorised. A person so authorised
may act on behalf of the Recognised Clearing House (or its nominees) (no shareholding voucher notarised
authorisation and/or further evidence to the duly authorisation is required) as if such person is an
individual shareholder of the Company.If the proxy form for appointing a voting proxy is signed by another person authorised by the appointing
shareholder the authorisation letter or other authorisation document shall be notarised. The notarised
authorisation letter or other authorisation document together with the proxy form shall be kept at the
domicile of the Company or at such other place as specified in the notice of the meeting.If the appointing shareholder is a legal entity its legal representative or the person authorised by a
resolution of the Board of Directors or other decision-making body shall attend the shareholders’ general
meeting of the Company as the representative of such legal entity shareholder.The proxy form provided by a shareholder to appoint another person to attend a shareholders’ general
meeting shall contain the following particulars:
(I) name of the proxy;
(II) indication of whether voting power is granted;
(III) instruction of voting for against or abstain for each resolution proposed at any shareholders’ general
meeting;
(IV) date of signing the proxy form and the effective period for such appointment;
(V) signature (or seal) of the appointing shareholder. If the appointing shareholder is a legal entity the
seal of the legal entity shall be affixed.The proxy form shall state whether the proxy may vote has he/she thinks fit in the absence of instructions
from the shareholder. If no such instruction is given it is deemed that the proxy of the shareholder may
vote as he/she thinks fit.Voting at the Shareholders’ General Meeting
Resolutions at the shareholders’ general meeting are classified into ordinary resolutions and special
resolutions. An ordinary resolution put forward at a shareholders’ general meeting shall be passed by votes
representing more than half of the voting rights held by the shareholders (including their proxies)
attending the shareholders’ general meeting. Special resolutions put forward at a shareholders’ general
meeting shall be passed by votes representing more than two-thirds of voting rights held by the
shareholders (including their proxies) attending the meeting.– 183 –Shareholders (including proxies) shall exercise their voting rights based on the number of the shares with
voting rights they represent each share shall carry one vote. On a poll shareholders (including proxies)
with two or more votes need not use all their voting rights in the same way. When the shareholders’ general
meeting considers material matters affecting the interests of small and medium-sized investors votes of
small and medium-sized investors shall be counted separately. The separate voting results shall be
disclosed publicly in a timely manner. The Company’s own shares held by the Company do not carry
voting rights and such shares shall not count towards the total number of shares with voting rights present
at shareholders’ general meetings.When related transactions are considered at the shareholders’ general meeting the related shareholders
shall abstain from voting and the voting shares represented by them shall not be included in the total
number of valid votes. The announcement on the resolutions of the shareholders’ general meeting shall
fully disclose the details of voting by non-related shareholders.Where any shareholder is required to abstain from voting on any particular resolution or is restricted to
voting only for (or only against) any resolution in accordance with applicable laws and regulations and the
Listing Rules any vote cast by a shareholder (or his proxy) in contravention of such requirement or
restriction shall not be counted towards the total number of shares with voting rights.If a shareholder’s purchase of shares with voting rights of the Company violates the provisions of Article
63(1) and (2) of the Securities Law of the People’s Republic of China the voting rights of such shares in
excess of the prescribed proportion shall not be exercised and shall not be counted towards the total
number of shares with voting rights present at the shareholders’ general meeting within 36 months after
the purchase.The Board of Directors independent non-executive directors and shareholders holding more than 1% of
the shares with voting rights or investor protection agencies established in accordance with laws
administrative regulations or the regulations of the CSRC may solicit shareholders’ voting rights. The
solicitation of shareholders’ voting rights shall provide full disclosure of information such as specific
voting intentions to the shareholders from whom voting rights are being solicited. The solicitation of
shareholders’ voting rights by way of compensation or disguised compensation is prohibited. Except for
statutory conditions the Company shall not impose minimum shareholding restrictions on the solicitation
of voting rights.The following matters shall be approved by ordinary resolutions at a shareholders’ general meeting:
(I) work reports of the Board of Directors and the Board of Supervisors;
(II) profit distribution plans and loss recovery plans formulated by the Board of Directors;
(III) appointment and dismissal of the members of the Board of Directors and the Board of Supervisors
who are not employee representative their remunerations and the method of payment thereof;
(IV) annual budgets and final accounts report of the Company;
(V) annual report of the Company;
(VI) matters other than those prescribed by laws administrative regulations the securities regulatory
rules of the place where the Company’s shares are listed or the Articles of Association that shall be
approved by special resolutions.– 184 –The following matters shall be approved by special resolutions at the shareholders’ general meeting:
(I) increase or reduction of the registered capital of the Company;
(II) division spin-off merger dissolution and liquidation of the Company or change of corporate form
of the Company;
(III) amendments to the Articles of Association;
(IV) purchase or sale of material assets or guarantees by the Company in excess of 30% of the Company’s
latest audited total assets within a period of 1 year;
(V) share incentive schemes;
(VI) adjustment of profit distribution policy;
(VII) other matters prescribed by the laws administrative regulations securities regulatory rules of the
place where the Company’s shares are listed or the Articles of Association and those matters
determined by ordinary resolutions at a shareholders’ general meeting to have a material impact on
the Company and required to be approved by special resolutions.– 185 –TAXATION
The following summary of certain BVI PRC and Hong Kong tax consequences of the purchase ownership
and disposition of the Bonds is based upon applicable laws regulations rulings and decisions in effect
as at the date of this Offering Circular all of which are subject to change (possibly with retroactive effect).This summary does not purport to be a comprehensive description of all the tax considerations that may
be relevant to a decision to purchase own or dispose of the Bonds and does not purport to deal with
consequences applicable to all categories of investors some of which may be subject to special rules.Neither these statements nor any other statements in this Offering Circular are to be regarded as advice
on the tax position of any holder of the Bonds or any person acquiring selling or otherwise dealing in
the Bonds or on any tax implications arising from the acquisition sale or other dealings in respect of the
Bonds.Persons considering the purchase of the Bonds should consult their own tax advisors concerning the tax
consequences of the purchase ownership and disposition of the Bonds.BVI
The Issuer is exempt from all provisions of the Income Tax Ordinance of the British Virgin Islands.Payments of principal premium or interest (if any) in respect of the Bonds to persons who are not resident
in the British Virgin Islands are not subject to British Virgin Islands tax or withholding tax.Capital gains realised with respect to the Bonds by persons who are not persons resident in the British
Virgin Islands are also exempt from all provisions of the Income Tax Ordinance of the British Virgin
Islands. No estate inheritance succession or gift tax rate duty levy or other charge is payable by persons
who are not resident in the British Virgin Islands with respect to the Bonds.All instruments relating to transactions in respect of the Bonds are exempt from payment of stamp duty
in the British Virgin Islands. This assumes that the Issuer does not hold an interest in real estate in the
British Virgin Islands.PRC
The following summary of certain PRC tax consequences of the purchase ownership and disposition of
Bonds is based upon applicable laws rules and regulations in effect as of the date of this Offering Circular
all of which are subject to change (possibly with retroactive effect). This discussion does not purport to
be a comprehensive description of all the tax considerations that may be relevant to a decision to purchase
own or dispose of the Bonds and does not purport to deal with consequences applicable to all categories
of investors some of which may be subject to special rules. Persons considering the purchase of Bonds
should consult their own tax advisors concerning the tax consequences of the purchase ownership and
disposition of Bonds including such possible consequences under the laws of their country of citizenship
residence or domicile.– 186 –Income Tax
Pursuant to the EIT Law effective on 1 January 2008 and amended on 29 December 2018 and the IIT Law
of the PRC amended on 31 August 2018 and effective on 1 January 2019 and their implementation rules
respectively an income tax is imposed on the interests by way of withholding in respect of the bonds and
is paid by the Issuer (if such interests are regarded as income derived from sources within the PRC under
the EIT Law or the IIT Law as the case may be) to non-resident bondholders including non-resident
enterprises and non-resident individuals. The current rates of such income tax are 20% (for non-resident
individuals) and 10% (for non-resident enterprises) of the gross amount of the interests unless there is an
applicable tax treaty or arrangement that reduces or exempts such income tax.Under the EIT Law and its implementation rules any gains realised on the transfer of the bonds by holders
who are deemed under the EIT Law as non-resident enterprises may be subject to PRC enterprise income
tax if such gains are regarded as incomes derived from sources within the PRC. Under the EIT Law a
“non-resident enterprise” means an enterprise which is established under the laws of a jurisdiction other
than the PRC whose actual administrative organisation is not in the PRC and which has established
offices or premises in the PRC or has not established any offices or premises in the PRC but has obtained
incomes derived from sources within the PRC. In addition there is uncertainty as to whether gains realised
on the transfer of the bonds by individual holders who are not PRC citizens or residents will be subject
to PRC individual income tax under the IIT Law and its implementation rules. If such gains are subject
to PRC income tax the 10% enterprise income tax rate and 20% individual income tax rate will apply
respectively unless there is an applicable tax treaty or arrangement that reduces or exempts such income
tax.If the Issuer is not able to make payments under the Bonds the Guarantor fulfils the payment obligations
of the Guarantee and the PRC tax authority views such payment as an interest income arising within the
territory of the PRC the Guarantor might need to withhold PRC income tax on payments with respect to
the Bonds to non-PRC resident enterprises bondholders at the rate of 10% and to non-PRC resident
individuals bondholders at a rate of 20% unless there is an applicable tax treaty or arrangement that
reduces or exempts such income tax.Value-add Tax
According to the Circular of Full Implementation of Replacing Business Tax with Value-Added Tax
Reform (Caishui [2016] No. 36) (關於全面推行營業稅改徵增值稅試點的通知) (“Circular 36”) the
entities and individuals providing services within the PRC shall be subject to value-added tax (“VAT”).The services are treated as being provided within China where either the service provider or the service
recipient is located in China. The services subject to VAT include the provision of financial services such
as the provision of loans. It is further clarified under Circular 36 that the “loans” refer to the activity of
lending capital for another’s use and receiving the interest income thereon. It is not clear from the
interpretation of Circular 36 whether the provision of loans to the Issuer could be considered as services
provided within the PRC which could be regarded as the provision of financial services subject to VAT.Furthermore there is no assurance that the Issuer will not be treated as resident enterprises under the EIT
Law. PRC tax authorities could take the view that the Bondholders are providing loans within the PRC
because the Issuer is treated as PRC tax residents. In which case the issuance of the Bonds could be
regarded as the provision of financial services within the PRC that is subject to VAT.– 187 –Stamp duty
No PRC stamp duty will be chargeable upon the issue or transfer of the Bonds (as long as the register of
holders of the Bonds is maintained outside the PRC and the issuance and the sale of the Bonds is made
outside of the PRC).HONG KONG
Withholding Tax
No withholding tax is payable in Hong Kong in respect of payments of principal or interest (if any) on
the Bonds or in respect of any capital gains arising from the sale of the Bonds.Profits Tax
Hong Kong profits tax is chargeable on every person carrying on a trade profession or business in Hong
Kong in respect of profits arising in or derived from Hong Kong from such trade profession or business
(excluding profits arising from the sale of capital assets).Interest (if any) on the Bonds may be deemed to be profits arising in or derived from Hong Kong from
a trade profession or business carried on in Hong Kong in the following circumstances:
(i) interest (if any) on the Bonds is derived from Hong Kong and is received by or accrues to a
corporation carrying on a trade profession or business in Hong Kong;
(ii) interest (if any) on the Bonds is derived from Hong Kong and is received by or accrues to a person
other than a corporation carrying on a trade profession or business in Hong Kong and is in respect
of the funds of that trade profession or business;
(iii) interest (if any) on the Bonds is received by or accrues to a financial institution (as defined in the
Inland Revenue Ordinance (Cap. 112) of Hong Kong (the “IRO”)) and arises through or from the
carrying on by the financial institution of its business in Hong Kong; or
(iv) interest (if any) on the Bonds is received by or accrues to a corporation other than a financial
institution and arises through or from the carrying on in Hong Kong by the corporation of its
intra-group financing business (within the meaning of section 16(3) of the IRO).Sums received by or accrued to a financial institution by way of gains or profits arising through or from
the carrying on by the financial institution of its business in Hong Kong from the sale disposal or
redemption of Bonds will be subject to Hong Kong profits tax. Sums received by or accrued to a
corporation other than a financial institution by way of gains or profits arising through or from the
carrying on in Hong Kong by the corporation of its intra-group financing business (within the meaning of
section 16(3) of the IRO) from the sale disposal or other redemption of Bonds will be subject to Hong
Kong profits tax.Sums derived from the sale disposal or redemption of Bonds will be subject to Hong Kong profits tax
where received by or accrued to a person other than a financial institution who carries on a trade
profession or business in Hong Kong and the sum has a Hong Kong source unless otherwise exempted.The source of such sums will generally be determined by having regard to the manner in which the Bonds
are acquired and disposed of.– 188 –In addition with effect from 1 January 2024 pursuant to various foreign-sourced income exemption
legislation in Hong Kong (the “FSIE Amendments”) certain specified foreign-sourced income (including
interest dividend disposal gain or intellectual property income in each case arising in or derived from
a territory outside Hong Kong) accrued to an MNE entity (as defined in the FSIE Amendments) carrying
on a trade profession or business in Hong Kong is regarded as arising in or derived from Hong Kong and
subject to Hong Kong profits tax when it is received in Hong Kong. The FSIE Amendments also provide
for relief against double taxation in respect of certain foreign-sourced income and transitional matters.In certain circumstances Hong Kong profits tax exemptions (such as concessionary tax rates) may be
available. Investors are advised to consult their own tax advisors to ascertain the applicability of any
exemptions to their individual position.Stamp Duty
No Hong Kong stamp duty will be chargeable upon the issue or transfer of a Bond.– 189 –SUBSCRIPTION AND SALE
The Issuer and the Guarantor have entered into a subscription agreement with Goldman Sachs (Asia)
L.L.C. and Huatai Financial Holdings (Hong Kong) Limited as Managers dated 25 June 2025 (the
“Subscription Agreement”) pursuant to which and subject to certain conditions contained in the
Subscription Agreement the Issuer has agreed to sell to the Managers and the Managers have agreed to
severally but not jointly subscribe and pay for the aggregate principal amount of the Bonds set forth
opposite their respective names below.Principal amount
of the Bonds to
be subscribed
(HK$)
Goldman Sachs (Asia) L.L.C. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2360000000
Huatai Financial Holdings (Hong Kong) Limited . . . . . . . . . . . . . . . . . . . . . . . . . . 590000000
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2950000000
The Subscription Agreement provides that the Issuer and the Guarantor will jointly and severally
indemnify the Managers and their affiliates against certain liabilities in connection with the offer and sale
of the Bonds. The Subscription Agreement provides that the obligations of the Managers are subject to
certain conditions precedent and entitles the Managers to terminate it in certain circumstances prior to
payment being made to the Issuer.The Managers or their respective affiliates may purchase the Bonds or the H Shares for their own account
and enter into transactions including without limitation credit derivatives including asset swaps
repackaging and credit default swaps relating to the Bonds or the H Shares at the same time as the offer
and sale of the Bonds or in secondary market transactions. Such transactions would be carried out as
bilateral trades with selected counterparties and separately from any existing sale or resale of the Bonds
or the H Shares to which this Offering Circular relates (notwithstanding that such selected counterparties
may also be purchaser of the Bonds). The Managers or their respective affiliates have engaged in and may
in the future engage in investment banking and other commercial dealings in the ordinary course of
business with the Issuer the Guarantor or their respective subsidiaries or affiliates from time to time. The
Managers may receive customary fees and commissions for these transactions. The Managers or certain
of their respective affiliates may purchase Bonds or the H Shares and be allocated Bonds or the H Shares
for asset management and/or proprietary purposes but not with a view to distribution. In addition to the
transactions noted above the Managers and their respective affiliates may from time to time engage in
other transactions with and perform services for the Issuer the Guarantor or their respective subsidiaries
or affiliates in the ordinary course of their business. In addition the Managers and certain of their
respective subsidiaries and affiliates may hold shares or other securities in the Issuer or the Guarantor as
beneficial owners on behalf of clients or in the capacity of investment advisers.Furthermore it is possible that a significant proportion of the Bonds may be initially allocated to and
subsequently held by a limited number of investors. If this is the case the trading price and liquidity of
trading in the Bonds may be constrained. The Issuer the Guarantor and the Managers are under no
obligation to disclose the extent of the distribution of the Bonds amongst individual investors otherwise
than in accordance with any applicable legal or regulatory requirements.– 190 –Each of the Issuer and the Guarantor has agreed in the Subscription Agreement that neither the Issuer the
Guarantor nor any person acting on its or their behalf will (a) effect or arrange or procure placement of
allot or issue or transfer out of treasury or offer to allot or issue or transfer out of treasury or grant any
option right or warrant to subscribe for or enter into any transaction which is designed to or might
reasonably be expected to result in any of the aforesaid (whether by actual disposition or effective
economic disposition due to cash settlement or otherwise) directly or indirectly any equity securities of
the Guarantor or any securities convertible into or exercisable or exchangeable for equity securities of
the Guarantor (b) enter into any swap or similar agreement that transfers in whole or in part the economic
risk of ownership of such Ordinary Shares whether any such transaction described in (a) or (b) above is
to be settled by delivery of Ordinary Shares or such other securities in cash or otherwise or (c) publicly
announce an intention to effect any such transaction in any such case without the prior written consent
of the Managers between the date hereof and the date which is 90 days after the Issue Date (both dates
inclusive); except for (i) the Bonds and the New Shares issued on conversion of the Bonds (ii) any
Ordinary Shares or other securities (including rights or options) which are issued offered exercised
allotted appropriated modified or granted to or for the benefit of employees (including directors) of the
Guarantor or any of its subsidiaries pursuant to the Share Schemes or (iii) the issuance of the 70000000
new H Shares to be placed pursuant to the Placing Agreement dated 25 June 2025 between the Guarantor
Goldman Sachs (Asia) L.L.C. and Huatai Financial Holdings (Hong Kong) Limited as the placing agents.Concurrent with the Offering there is an Equity Placement comprising of the issuance of 70000000 H
Shares at a placing price of HK$42.15 per H Share for a total offer size of approximately HK$2950.5
million by way of new share issuance. The Guarantor has entered into a Placing Agreement with Goldman
Sachs (Asia) L.L.C. and Huatai Financial Holdings (Hong Kong) Limited as placing agents. The Equity
Placement is conducted concurrently with the offering of the Bonds but the completion of the issuance of
the Bonds and the Equity Placement are not inter-conditional. The closing for the Follow-on Offering took
place on 4 July 2025.Notice to capital market intermediaries and prospective investors pursuant to paragraph 21 of the
Hong Kong SFC Code of Conduct – Important Notice to CMIs (including private banks): This notice
to CMIs (including private banks) is a summary of certain obligations the SFC Code imposes on CMIs.Certain CMIs may also be acting as OC for this offering and are subject to additional requirements under
the SFC Code.Prospective investors who are the directors employees or major shareholders of the Issuer the Guarantor
a CMI or its group companies would be considered under the SFC Code as having an Association with the
Issuer the Guarantor the CMIs or the relevant group company. CMIs should specifically disclose whether
their investor clients have any Association when submitting orders for the Bonds. In addition private
banks should take all reasonable steps to identify whether their investor clients may have any Associations
with the Issuer the Guarantor or any CMI (including its group companies) and inform the Managers
accordingly.CMIs are informed that the marketing and investor targeting strategy for this offering includes institutional
investors sovereign wealth funds pension funds hedge funds family offices and high net worth
individuals in each case subject to the selling restrictions set out elsewhere in this Offering Circular.CMIs should ensure that orders placed are bona fide are not inflated and do not constitute duplicated
orders. CMIs should enquire with their investor clients regarding any orders which appear unusual or
irregular. CMIs should disclose the identities of all investors when submitting orders for the Bonds (except
for omnibus orders where underlying investor information may need to be provided to the OCs when
submitting orders). Failure to provide underlying investor information for omnibus orders where required
to do so may result in that order being rejected. CMIs should not place “X-orders” into the order book.– 191 –CMIs should segregate and clearly identify their own proprietary orders (and those of their group
companies including private banks as the case may be) in the order book and book messages.CMIs (including private banks) should not offer any rebates to prospective investors or pass on any rebates
provided by the Issuer the Guarantor. In addition CMIs (including private banks) should not enter into
arrangements which may result in prospective investors paying different prices for the Bonds.The SFC Code requires that a CMI disclose complete and accurate information in a timely manner on the
status of the order book and other relevant information it receives to targeted investors for them to make
an informed decision. In order to do this the Managers in control of the order book should consider
disclosing order book updates to the CMIs.When placing an order for the Bonds private banks should disclose at the same time if such order is
placed other than on a “principal” basis (whereby it is deploying its own balance sheet for onward selling
to investors). Private banks who do not provide such disclosure are hereby deemed to be placing their
order on such a “principal” basis. Otherwise such order may be considered to be an omnibus order
pursuant to the SFC Code.In relation to omnibus orders when submitting such orders CMIs (including private banks) that are
subject to the SFC Code should disclose underlying investor information in respect of each order
constituting the relevant omnibus order (failure to provide such information may result in that order being
rejected). Underlying investor information in relation to omnibus orders should consist of:
* The name of each underlying investor;
* A unique identification number for each investor;
* Whether an underlying investor has any “Associations” (as used in the SFC Code);
* Whether any underlying investor order is a “Proprietary Order” (as used in the SFC Code);
* Whether any underlying investor order is a duplicate order.Underlying investor information in relation to omnibus order should be sent to:
SyndicateExecutionHK@ny.email.gs.com and ProjectPhoenix2026@htsc.com.To the extent information being disclosed by CMIs and investors is personal and/or confidential in nature
CMIs (including private banks) agree and warrant: (A) to take appropriate steps to safeguard the
transmission of such information to the OCs; and (B) that they have obtained the necessary consents from
the underlying investors to disclose such information to the OCs. By submitting an order and providing
such information to the OCs each CMI (including private banks) further warrants that it and the
underlying investors have understood and consented to the collection disclosure use and transfer of such
information by the OCs and/or any other third parties as may be required by the SFC Code including to
the Issuer the Guarantor relevant regulators and/or any other third parties as may be required by the SFC
Code for the purpose of complying with the SFC Code during the bookbuilding process for this offering.CMIs that receive such underlying investor information are reminded that such information should be used
only for submitting orders in this offering. The Managers may be asked to demonstrate compliance with
their obligations under the SFC Code and may request other CMIs (including private banks) to provide
evidence showing compliance with the obligations above (in particular that the necessary consents have
been obtained). In such event other CMIs (including private banks) are required to provide the Managers
with such evidence within the timeline requested.– 192 –GENERAL
The distribution of this Offering Circular or any offering material and the offering sale or delivery of the
Bonds is restricted by law in certain jurisdictions. Therefore persons who may come into possession of
this Offering Circular or any offering material are advised to consult with their own legal advisers as to
what restrictions may be applicable to them and to observe such restrictions. This Offering Circular may
not be used for the purpose of an offer or invitation in any circumstances in which such offer or invitation
is not authorised. No action has been taken or will be taken in any jurisdiction that would permit a public
offering of the Bonds or possession or distribution of this Offering Circular or any amendment or
supplement thereto or any other offering or publicity material relating to the Bonds in any country or
jurisdiction where action for that purpose is required.UNITED STATES
The Bonds the Guarantee and the Shares to be issued upon conversion of the Bonds have not been and
will not be registered under the Securities Act and subject to certain exceptions may not be offered or
sold within the United States.The Bonds the Guarantee and the Shares to be issued upon conversion of the Bonds are being offered and
sold outside of the United States in reliance on Regulation S.In addition until 40 days after the commencement of the offering of the Bonds and the Guarantee an offer
or sale of the Bonds the Guarantee or the Shares to be issued upon conversion of the Bonds within the
United States by any dealer (whether or not participating in the Offering) may violate the registration
requirements of the Securities Act.PROHIBITION OF SALES TO THE EEA RETAIL INVESTORS
Each of the Managers has represented and agreed that it has not offered sold or otherwise made available
and will not offer sell or otherwise make available any Bonds to any retail investor in the European
Economic Area. For the purposes of this provision:
(a) the expression “retail investor” means a person who is one (or more) of the following:
(i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as amended
“MiFID II”); or(ii) a customer within the meaning of Directive (EU) 2016/97 (as amended the “InsuranceDistribution Directive”) where that customer would not qualify as a professional client as
defined in point (10) of Article 4(1) of MiFID II.(b) the expression an “offer” includes the communication in any form and by any means of sufficient
information on the terms of the offer and the Bonds to be offered so as to enable an investor to decide
to purchase or subscribe for the Bonds.– 193 –PROHIBITION OF SALES TO UK RETAIL INVESTORS
Each of the Managers has represented and agreed that it has not offered sold or otherwise made available
and will not offer sell or otherwise make available any Bonds to any retail investor in the UK. For the
purposes of this provision:
(a) the expression “retail investor” means a person who is one (or more) of the following:
(i) a retail client as defined in point (8) of Article 2 of Regulation (EU) No 2017/565 as it forms
part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (“EUWA”); or
(ii) a customer within the meaning of the provisions of the Financial Services and Markets Act
2000 (the “FSMA”) and any rules or regulations made under the FSMA to implement Directive
(EU) 2016/97 where that customer would not qualify as a professional client as defined in
point (8) of Article 2(1) of Regulation (EU) No 600/2014 as it forms part of domestic law by
virtue of the EUWA.UNITED KINGDOM
Each of the Managers has represented and agreed that:
(a) (i) it is a person whose ordinary activities involve it in acquiring holding managing or disposing
of investments (as principal or agent) for the purposes of its business and (ii) it has not offered or
sold and will not offer or sell the Bonds other than to persons whose ordinary activities involve them
in acquiring holding managing or disposing of investments (as principal or as agent) for the
purposes of their businesses or who it is reasonable to expect will acquire hold manage or dispose
of investments (as principal or agent) for the purposes of their businesses where the issue of the
Bonds would otherwise constitute a contravention of Section 19 of the FSMA by the Issuer;
(b) it has only communicated or caused to be communicated and will only communicate or cause to be
communicated an invitation or inducement to engage in investment activity (within the meaning of
the FSMA) received by it in connection with the issue or sale of the Bonds in circumstances in which
Section 21(1) of the FSMA does not apply to the Issuer or the Guarantee; and
(c) it has complied and will comply with all applicable provisions of the FSMA with respect to anything
done by it in relation to the Bonds in from or otherwise involving the UK.HONG KONG
Each of the Managers has represented and agreed that:
(i) it has not offered or sold and will not offer or sell in Hong Kong by means of any document any
Bonds other than (a) to “professional investors” as defined in the SFO and any rules made under the
SFO; or (b) in other circumstances which do not result in the document being a “prospectus” as
defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) of Hong
Kong (the “C(WUMP)O”) or which do not constitute an offer to the public within the meaning of
the C(WUMP)O; and
– 194 –(ii) it has not issued or had in its possession for the purposes of issue and will not issue or have in its
possession for the purposes of issue whether in Hong Kong or elsewhere any advertisement
invitation or document relating to the Bonds which is directed at or the contents of which are likely
to be accessed or read by the public of Hong Kong (except if permitted to do so under the securities
laws of Hong Kong) other than with respect to Bonds which are or are intended to be disposed of
only to persons outside Hong Kong or only to “professional investors” as defined in the SFO and any
rules made under the SFO.PRC
Each of the Managers has represented and agreed that the Bonds are not being offered or sold and may
not be offered or sold directly or indirectly in the People’s Republic of China (for such purposes not
including the Hong Kong and Macau Special Administrative Regions or Taiwan) except as permitted by
applicable laws of the People’s Republic of China.SINGAPORE
Each of the Managers has acknowledged that this Offering Circular has not been registered as a prospectus
with the Monetary Authority of Singapore. Accordingly each of the Managers has represented and agreed
that it has not offered or sold any Bonds or caused the Bonds to be made the subject of an invitation for
subscription or purchase and will not offer or sell any Bonds or cause the Bonds to be made the subject
of an invitation for subscription or purchase and has not circulated or distributed nor will it circulate or
distribute this Offering Circular or any other document or material in connection with the offer or sale
or invitation for subscription or purchase of the Bonds whether directly or indirectly to any person in
Singapore other than (i) to an institutional investor (as defined in Section 4A of the Securities and Futures
Act 2001 of Singapore as modified or amended from time to time (the “SFA”)) pursuant to Section 274
of the SFA or (ii) to an accredited investor (as defined in Section 4A of the SFA) pursuant to and in
accordance with the conditions specified in Section 275 of the SFA.BRITISH VIRGIN ISLANDS
Each of the Managers has represented warranted and agreed that no invitation has been made or will be
made directly or indirectly to any person in the BVI or to the public in the BVI to purchase the Bonds
and the Bonds are not being offered or sold and may not be offered or sold directly or indirectly in the
BVI except as otherwise permitted by BVI law. This Offering Circular does not constitute and there will
not be an offering of the Bonds to any person in the BVI.JAPAN
The Bonds have not been and will not be registered under the Financial Instruments and Exchange Act of
Japan (Act No. 25 of 1948 as amended the “Financial Instruments and Exchange Act”). Accordingly
each of the Managers has represented and agreed that it has not directly or indirectly offered or sold and
will not directly or indirectly offer or sell any Bonds in Japan or to or for the benefit of any resident
of Japan (which term as used herein means any person resident in Japan including any corporation or
other entity organised under the laws of Japan) or to others for re-offering or re-sale directly or indirectly
in Japan or to or for the benefit of any resident of Japan except pursuant to an exemption from the
registration requirements of and otherwise in compliance with the Financial Instruments and Exchange
Act and other relevant laws and regulations of Japan.– 195 –GENERAL INFORMATION
1. Clearing Systems: The Bonds have been accepted for clearance through Euroclear and Clearstream.
The Legal Entity Identifier of the Issuer is 836800YIDYE5HS47RZ68. The Common Code of the
Bonds is 310836303 and the International Securities Identification Number of the Bonds is
XS3108363030.
2. Authorisations: The Issuer and the Guarantor have obtained all necessary consents approvals and
authorisations in connection with the issue of and performance of its obligations under the Bonds and
the Guarantee. The issue of the Bonds was authorised by resolutions passed in a meeting of the Issuer
held on 25 June 2025 and the guarantee of the Bonds and the right of conversion into H Shares were
authorised by the resolutions of the Board passed on 25 June 2025. The Issuer and the Guarantor will
execute and deliver each of the Trust Deed the Deed of Guarantee (in the case of the Guarantor) and
the Agency Agreement and perform their obligations thereunder and (in the case of the Issuer) to
issue sell and deliver the Bonds as contemplated under the Subscription Agreement.
3. No Material Adverse Change: There has been no material adverse change or any development or
event likely to involve a prospective change in the condition (financial or otherwise) trading
position prospects results of operations business or general affairs of the Issuer or the Guarantor
since 31 December 2024.
4. Litigation: The Guarantor may from time to time be involved in contractual disputes or legal
proceedings arising out of the ordinary course of business or otherwise. As at the date of this
Offering Circular there were no pending actions suits or proceedings against or affecting the
Guarantor or any other member of the Group or any of their respective properties which if
determined adversely to the Guarantor or any other member of the Group would individually or in
the aggregate adversely affect the ability of the Guarantor or to perform its obligations under the
Subscription Agreement the Trust Deed the Deed of Guarantee the Agency Agreement or the
Bonds or which are otherwise material in the context of the issue offering and distribution of the
Bonds and to the best of the Guarantor’s knowledge (after due and careful enquiry) no such actions
suits or proceedings are threatened or contemplated.
5. Listing of Bonds: Application will be made to the Hong Kong Stock Exchange for the listing of and
permission to deal in the Bonds on the Hong Kong Stock Exchange by way of debt issues to
Professional Investors only and such permission is expected to become effective on 11 July 2025.
6. Listing of Shares: Application has been made to the Hong Kong Stock Exchange for the listing of
and permission to deal in the Shares to be issued upon conversion of the Bonds and such permission
is expected to become effective when such Shares are issued.
7. Available Documents: As long as any of the Bonds are outstanding copies of the Trust Deed the
Deed of Guarantee and the Agency Agreement will be available (i) for inspection by the Bondholders
at all reasonable times during normal business hours (being between 9:00 a.m. and 3:00 p.m. from
Monday to Friday (other than public holidays)) following prior written request and proof of holding
and identity to the satisfaction of the Trustee at the principal place of business in Hong Kong of the
Trustee being at the Issue Date at 3/F CCB Tower 3 Connaught Road Central Central Hong Kong
or (ii) electronically to the requesting Bondholder from the Principal Agent following prior written
request and proof of holding and identity to the satisfaction of the Principal Agent and in the case
of the documents referred to below copies may be obtained during normal business hours at the
specified office of the Guarantor at TK Chuangzhi Tiandi Building Keji South 1st Road Nanshan
District Shenzhen Guangdong Province the PRC:
* Articles of Association;
* copies of the 2023 Financial Statements and the 2024 Financial Statements;
* the Deed of Guarantee;
– 196 –* the Agency Agreement; and
* the Trust Deed.
8. Independent Auditor: The financial information of the Guarantor as of and for the years ended 31
December 2022 and 2023 have been audited by PricewaterhouseCoopers Certified Public
Accountants Hong Kong in accordance with HKSIR 200 issued by HKICPA and the consolidated
financial statements as of and for the year ended 31 December 2024 has been audited by
PricewaterhouseCoopers in accordance with International Standards on ISAs issued by the IAASB.– 197 –ISSUER GUARANTOR
SF Holding Investment 2023 Limited S.F. Holding Co. Ltd.Ritter House Wickhams Cay II PO Box 3170 (順豐控股股份有限公司)
Road Town Tortola VG1110 TK Chuangzhi Tiandi Building
British Virgin Islands Keji South 1st Road
Nanshan District Shenzhen
Guangdong Province the PRC
PRINCIPAL PAYING AGENT
PRINCIPAL CONVERSION AGENT
PRINCIPAL TRANSFER AGENT
TRUSTEE AND REGISTRAR
China Construction Bank (Asia) China Construction Bank (Asia)
Corporation Limited Corporation Limited
(中國建設銀行(亞洲)股份有限公司)(中國建設銀行(亞洲)股份有限公司)
28/F CCB Tower 28/F CCB Tower
3 Connaught Road Central 3 Connaught Road Central
Central Central
Hong Kong Hong Kong
LEGAL ADVISERS TO THE ISSUER AND THE GUARANTOR
To the Issuer and the
To the Issuer as to Guarantor as to English law To the Guarantor as to
BVI law and Hong Kong law PRC law
Ogier Herbert Smith Freehills CM Law Firm
11th Floor Central Tower Kramer Room 2805 Plaza 66 Tower 2
28 Queen’s Road Central 23rd Floor Gloucester Tower 1366 West Nanjing Rd
Central 15 Queen’s Road Central Shanghai PRC
Hong Kong Hong Kong
LEGAL ADVISORS TO THE MANAGERS
As to Hong Kong and English law As to PRC law
Linklaters King & Wood Mallesons
11/F Alexandra House 18/F East Tower World Financial Center
Chater Road No. 1 Dongsanhuan Zhonglu Chaoyang District
Hong Kong SAR Beijing PRC
LEGAL ADVISOR TO THE TRUSTEE
Linklaters
11/F Alexandra House
Chater Road
Hong Kong SAR
INDEPENDENT AUDITOR
PricewaterhouseCoopers
Certified Public Accountants and
Registered Public Interest Entity Auditor
22/F Prince’s Building Central
Hong Kong
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