Subscription Guide for Lianfa Co., Ltd. (002394): Basic Information on This Public Offering
(1) Stock Category: The shares being issued are ordinary A-shares listed domestically, with a par value of RMB 1.00 per share.
(2) Number of Shares Issued: The total number of shares issued this time is 27 million shares, including 5.4 million shares issued offline and 21.6 million shares issued online.
(3) Issue Price: The issue price this time is RMB 45.00 per share. The corresponding P/E ratio is:
1. 23.62 times (calculated based on the lower of the audited net profit for 2009 by the accounting firm before deducting non-recurring gains and losses divided by the total share capital before this issue);
2. 31.47 times (calculated based on the lower of the audited net profit for 2009 by the accounting firm after deducting non-recurring gains and losses divided by the total share capital before this issue).
(4) Main Schedule for This Issue:
| Sequence | Date | Issue Arrangement |
|----------|------------|-------------------|
| 1 | T-6 day, April 2, 2010 | Publish "Prospectus Summary", "Preliminary Inquiry and Roadshow Announcement" |
| 2 | T-5 day, April 7, 2010 | Preliminary inquiry (via offline issuance electronic platform) and roadshow (Shenzhen) |
| 3 | T-4 day, April 8, 2010 | Preliminary inquiry (via offline issuance electronic platform) and roadshow (Shanghai) |
| 4 | T-3 day, April 9, 2010 | Preliminary inquiry (via offline issuance electronic platform) and roadshow (Nanjing), end of preliminary inquiry (15:00 PM) |
| 5 | T-2 day, April 12, 2010 | Determine issue price, participating offline subscription placement objects, actual double and their valid subscription quantity; publish "Online Subscription Announcement" |
| 6 | T-1 day, April 13, 2010 | Publish "Issue Announcement", "Investment Risk Special Announcement"; Online roadshow (14:00-17:00) |
| 7 | T day, April 14, 2010 | Offline subscription payment day (9:30~15:00; effective arrival time before 15:00); Online subscription day (9:30~11:30, 13:00~15:00) |
| 8 | T+1 day, April 15, 2010 | Capital verification for offline and online subscriptions |
| 9 | T+2 day, April 16, 2010 | Publish "Offline Placement Result Announcement", "Online Winning Rate Announcement"; Number drawing; Refund of excess offline subscription payments |
| 10 | T+3 day, April 19, 2010 | Publish "Online Winning Number Announcement"; Thaw of online subscription funds; Refund of excess online subscription payments |
Regulations on Subscription Quantity and Frequency:
(1) For this online issue, the minimum subscription quantity for a single securities account is 500 shares, and any quantity exceeding 500 shares must be an integer multiple of 500 shares. The upper limit of subscription quantity shall not exceed 20,000 shares. For new share subscription mandates exceeding the subscription upper limit, the Shenzhen Stock Exchange trading system will automatically cancel the mandate as an invalid mandate without confirmation.
(2) Investors participating in the online public offering of stocks can only use one securities account. Each securities account can only subscribe once for each new stock issue. Once a new share subscription mandate is confirmed by the Shenzhen Stock Exchange trading system, it cannot be canceled. If multiple securities accounts (as of April 13, 2010, account registration data) with the same "account holder name" and "valid identification document number" participate in this online issue subscription, the first subscription confirmed by the Shenzhen Stock Exchange trading system will be regarded as the valid subscription, and other subscriptions will be invalid.
(3) Investors must comply with relevant laws and regulations and bear corresponding legal responsibilities.
Shareholder Research:
Main Shareholders of Lianfa Co., Ltd. (002394):
| Sequence | Shareholder Name | Number of Shares Held | Proportion of Total Share Capital |
|----------|-----------------------|------------------------|------------------------------------|
| 1 | Jiangsu Lianfa Group Co., Ltd. | 43,644,700 | 40.45% |
| 2 | Lian International Textile Limited | 27,475,300 | 25.46% |
| 3 | Shanghai Ganghong Investment Co., Ltd. | 9,780,000 | 9.06% |
Financial Indicators of Lianfa Co., Ltd. (002394) for the Past Three Years:
| Financial Indicator / Time | 2009 | 2008 | 2007 |
|----------------------------|---------|---------|---------|
| Total Assets (billion yuan) | 12.9186 | 10.0624 | 8.1944 |
| Net Assets (billion yuan) | 5.6444 | 3.842 | 2.9719 |
| Minority Shareholders' Equity (million yuan) | 4463.1 | 2552.38 | 2974.54 |
| Net Profit (billion yuan) | 1.8 | 0.98 | 1.19 |
| Capital Reserve (million yuan) | 15787.95 | 15787.95 | 15782.55 |
| Undistributed Profit (billion yuan) | 2.57 | 1.08 | 0.24 |
| Basic Earnings Per Share (yuan) | 1.9 | 1.13 | 1.54 |
| Diluted Earnings Per Share (yuan) | 1.9 | 1.13 | 1.54 |
| Cash Flow Per Share (yuan) | 2.845 | 1.12 | 1.74 |
| Return on Net Assets (%) | 31.91 | 24.52 | 38.7 |
Note:
1. T day is the offline subscription day;
2. If there are any uncontrollable factors causing the inquiry object or placement object to be unable to normally use the offline issuance electronic platform for preliminary inquiry or offline subscription, please contact the sponsor (lead underwriter) in time;
3. The above dates are working days. In case of major emergencies affecting the issuance, the sponsor (lead underwriter) and issuer will promptly announce and adjust the issuance schedule.
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