Annual Report 2021

China Merchants China Direct Investments Limited Annual Report 2021 25 INVESTMENT MANAGER’S DISCUSSION AND ANALYSIS (CONTINUED) REVIEW OF INVESTMENTS (CONTINUED) Anhui iFlyHealth Co., Ltd. (“iFlyHealth”, also “iFlytek Healthcare”) was established in the High-tech Development Zone, Hefei, Anhui in 2016 and is a startup AI medical enterprise. The Fund invested RMB60 million (equivalent to US$8.60 million) in February 2020 for a 3% equity interest in iFlyHealth. In November 2021, the Fund invested a further RMB50 million (equivalent to US$7.80 million) through the acquisition of existing shares for a 0.714% equity interest in iFlyHealth. The Fund has therefore invested an aggregate sum of RMB110 million (equivalent to US$16.40 million) into iFlyHealth. In December 2021, iFlyHealth completed its conversion into a joint-stock limited company. At this time, its name also changed from “Anhui iFlytek Healthcare Information Technology Co., Ltd.” to “Anhui iFlyHealth Co., Ltd.” In addition, iFlytHealth completed a capital increase through the issuance of new shares. Immediately after the completion of the capital increase, and through 31 December 2021, the Fund held a 3.514% equity interest in iFlyHealth. As of the end of 2021, the carrying value of the Fund’s interest in iFlyHealth was US$40.83 million, representing an increase of 179.85% over US$14.59 million at the end of last year. The Fund’s unrealised gain attributable to its investment in iFlyHealth for 2021 was US$17.79 million, up 248.60% year-over-year. On 3 August 2021, the Resolution in Relation to the Proposed Spin-off and Listing of a Controlled Subsidiary was considered and approved by the board of Iflytek, the holding company of iFlyHealth, pursuant to which the board accepted the proposed spin-off and listing of iFlyHealth, while intending to maintain the control over iFlyHealth upon completion of the spin-off and listing. As disclosed in the interim report for 2021 published by Iflytek, the holding company of iFlyHealth, on 24 August 2021, its operating revenue from the intelligent healthcare business segment amounted to RMB99.89 million, up 34.21% year-over-year. China UnionPay Co., Ltd. (“China UnionPay”) was established in March 2002, with its headquarters in Shanghai. It is a leading enterprise in the financial payment industry and is responsible for the construction and operation of a nationwide unified inter-bank information exchange network for bank cards, the provision of professional services related to inter-bank information exchange for bank cards, the management and operation of the “UnionPay” brand name, and the formulation of business specifications and technical standards for inter-bank transactions for bank cards. The Fund invested RMB220 million (equivalent to US$31.12 million) in June 2020 for a 0.17% equity interest in China UnionPay. In September 2021, the Fund received a cash dividend of RMB1.30 million from China UnionPay for 2020. As of the end of 2021, the carrying value of the Fund’s interest in China UnionPay was US$50.64 million, representing an increase of 7.31% over US$47.19 million at the end of last year. The Fund’s unrealised gain attributable to its investment in China UnionPay for 2021 was US$2.26 million, down 82.26% year-over-year. On 8 October 2021, China UnionPay released data on UnionPay online transactions during the National Day Golden Week holiday in 2021. The amount of UnionPay online transactions for the 2021 National Day holiday totaled RMB2.72 trillion, and the average daily number of transactions was 4,863 million, up 31.73% year-over-year. The amount and number of transactions on the Mobile QuickPass APP increased by 63% and 47%, respectively, and average daily number of users increased by nearly 40% year-over-year.