Stock Code: 200771 Stock ID: Hangqilun B Announcement No. 2019-34
Hangzhou Steam Turbine Co., Ltd.
Announcement on the Capital Increase of Hangzhou Steam Turbine Heavy
Industry Co., Ltd.
The members of the Board and the Company acknowledge being responsible for the truthfulness,
accuracy, and completeness of the announcement. Not any false record, misleading statement or
significant omission carried in this announcement.
I. Overview of capital increase
1.Basic Information
The Company founded a wholly-owned subsidiary--Hangzhou Steam Turbine Heavy
Industry Co., Ltd. (hereinafter referred to as Steam Turbine Heavy Industry) with a contribution of
RMB 360 million on October 25, 2013. In December 2016, CDB Development Fund Co., Ltd.
capital increased capital of RMB 208 million (including RMB 198.966865 million input in the
registered capital) to Steam Turbine Heavy Industry. Upon the end of the capital increase, the
registered capital of Steam Turbine Heavy Industry rose to RMB 558.966865 million.
To gratify the fund demand of Steam Turbine Heavy Industry for business development and
boost project construction at Steam Turbine Heavy Industry, the Company is planned to increase
capital of RMB 462.731965 million to Steam Turbine Heavy Industry (including RMB
441.033135 million input in the registered capital and RMB 21.69883 million input in the capital
reserve). Upon the end of the capital increase, the registered capital of Steam Turbine Heavy
Industry will rise to RMB 1 billion.
2. Board of Directors' deliberation
On April 16, 2019, the Company held the 32nd meeting of the 7th Board of Directors by
means of telecommunication voting. With 10 votes in favor, 0 votes against and 0 abstentions, the
“Proposal on Capital Increase for Steam Turbine Heavy Industry” was considered and passed.
According to relevant provisions, submission of the preceding proposal to the General
Shareholders' Meeting for deliberation is not needed.
3.The transaction neither constitutes a major asset restructuring according to Measures for the
Administration of Major Asset Restructuring of Listed Companies. without the approval of
relevant departments.
4. The transaction does not constitute a related transaction of the Company.
II. Basic information of the object of increase capital
(I) Basic condition of Steam turbine heavy Industry
1.Name :Hangzhou Steam Turbine Heavy Industry Co., Ltd.
2. Unified social credit code：91330100079344841P
3. Enterprise property：Limited liability company
4.Address: 3/ F Building 3 No.503 Xingguo Road Qianjiang Economic Development Zone
Hangzhou City
5. Establishment Date: October 25, 2013
6. Registered capital: RMB 558.966865 million
7.Legal representative : Li Jiansheng
8. Main business: Manufacturing: Industrial turbomachinery equipment; service: technology
development and after-sales service of steam turbines, gas turbines, compressors, rotating
machinery and auxiliary equipment; wholesale: steel, building materials. (Items subjecting to
approval according to law may be operated after gaining the approval by relevant departments).
9. Equity structure：Hangzhou Steam Turbine Co.,Ltd, shareholding ratio of 64.4%; CDB
Development Fund Co., Ltd. shareholding ratio of 35.6%.
10. Relation with the Company: Steam Turbine Heavy Industry is a holding subsidiary covered in
the Company's consolidated statements.
11. Recent financial information
In RMB
Periods Gross assets Gross Liabilities Net profit Operation revenue Net profit
2017 593,199,894.85 9,329,647.16 583,870,247.69 0 1,944,162.19
2018 601,979,851.73 15,510,213.42 586,469,638.31 124,421,761.96 2,599,390.62
12. Defaulter: Steam Turbine Heavy Industry has a good credit standing and is not rated a
defaulter.
(II) Amount of contribution and shareholding ratio of each shareholder of Steam Turbine
Heavy Industry before and after the capital increase
1. Before capital increase
Name of shareholder Contribution Amount( Ten thousands yuan） Capital-contribution Ratio
Hangzhou Steam Turbine Co., Ltd. 36,000 64.40%
CDB Development Fund Co., Ltd. 19,896.6865 35.60%
Total 55,896.6865 100%
2. After capital increase
Name of shareholder Contribution Amount( Ten thousands yuan） Capital-contribution Ratio
Hangzhou Steam Turbine Co., Ltd. 80,103.3135 80.10%
CDB Development Fund Co., Ltd. 19,896.6865 19.90%
Total 100,000 100%
(III) Way of capital increase
1. Amount of capital increase
The Company is planned to increase capital of RMB 462.731965 million to Steam Turbine
Heavy Industry by cash (including RMB 441.033135 million input in the registered capital and
RMB 21.69883 million input in the capital reserve).
2. Determination of price of capital increase
The Company determines the price of the increased registered capital of Steam Turbine
Heavy Industry subject to its net assets per share audited on December 31, 2018.
According to the 2018 audit report issued by Pan-China Certified Public Accountants to
Steam Turbine Heavy Industry (Tian Jian Shen [2019] No.152), Steam Turbine Heavy Industry
had net assets of RMB 586.469638 million by the end of 2018. including:
Net assets of Steam Turbine Heavy Industry per share=net assets of Steam Turbine Heavy
Industry by the end of 2018/total capital stock of Steam Turbine Heavy Industry by the end of
2018=RMB 586.469638 million /RMB 558.966865 million =RMB 1.0492
=RMB 10,492
3.Source of funds: Own-funds
4. Way of contribution: Cash contribution
5. Upon the end of the capital increase, Steam Turbine Heavy Industry remains a subsidiary
covered in the Company's consolidated statements.
6. Upon the end of the capital increase, the Company will not guarantee for or give any financial
help to others.
III. Purpose of the transaction, existing risks and impact on the Company
1. The Company makes the capital increase with the purpose of meeting the demand of its
holding subsidiary Steam Turbine Heavy Industry for funding construction, which conforms to the
Company's strategy and total benefit.
2. Matters of the capital increase agree with relevant provisions in the Company's Articles of
Association and Company's Foreign Strategic Investment and Cooperation Management System.
The funds for the foreign investment are the Company's own funds which will not have any
significant impact on its cash flow.
3. The capital increase does not constitute any major asset restructuring or any related
transaction. The capital increase will cause no alteration to the Company' range of consolidated
statements, have no bad impact on the Company's financial situation and business results and do
no harm to benefits of the Company or shareholders herein.
IV. Other
The Company will keep following the progress of the capital increase and perform the duty
of information disclosure in accordance with relevant provisions. Please note the General
investors investment risk.
This announcement is hereby made.
The Board of Directors of Hangzhou Steam Turbine Co., Ltd.
April 17, 2019
