FUTURE

PROSPECTS

The Company has always been identifying suitable investment or business opportunities so as to diversify the business of the Group and broaden the Group’s income sources. Meanwhile, before securing potential investment opportunities, the Company will seize any opportunity to make short-term investment with lower risks for the sake of greater returns for shareholders.

Loan Financing Business

In recent years, as the macroeconomic environment in the PRC continued to improve, the loan financing industry in the PRC acted as an important supplement to traditional credit of enterprise. In 2017, the contract balance of the loan financing company in the PRC exceeded RMB6 trillion and the PRC has become the largest loan financing market in Asia and the second largest globally. However, in June 2018, registered number and contract balance of loan financing companies has slowed down, from 63% in December 2017 to less than 10%. In general, despite a certain slowdown, under the common guidance of the current economic environment, positive fiscal policy and steady monetary policy, the loan financing industry is expected to usher in a new round of expansion opportunities with broad market prospects.

In the future, under the guidance of the “One Belt One Road” policy of the PRC, the Group will continue to advance the loan financing business for hospitals, maintain an appropriate scale of secured assets for hospitals and expand the loan financing business for hospitals while considering the opportunities of the entire industry chain of sectors such as medical healthcare. Meanwhile, the Group will also actively explore subindustry with large market capacity and weak periodicity and secured equipment of strong versatility and high value protection rate, focus on certain industries such as transportation and energy, innovate business models, facilitate the Group to develop the loan financing business in the future.

Short-term Loan Business

In 2019, Shanghai Dongkui will strengthen capital liquidity and effectively utilize the capital so that it will have safe and adequate capital to increase lending projects (within one-year term) should any exceptional projects arise.

Property Investment Holding

Despite online retailers have posed tremendous pressure on traditional retail industry, given an increasing per capita income in the PRC and the consumption structure upgrade, the new retail industry in the PRC has been growing rapidly. It is forecasted that the new retail industry will reach RMB1.8 trillion by 2022, which foresees the potential growth of the new retail industry. The Group believes that under the prevailing trend of continuous growth of the new retail industry along with the shifting of consumption pattern of consumers in the PRC to be more focus on consumption experience, traditional retail modes, such as department stores and shopping malls, that could rely on big data to realize online-to-offline in-depth integration and accelerate transformation would definitely be able to maintain its competitive edge in the market. The Group believed that the overall recovery of physical retail and the Group’s sustainable investment to the development of Dong Dong Mall project will result in a stable growth of rental income and return growth rate of Dong Dong Mall.