Annual Report 2024

China Merchants China Direct Investments Limited Annual Report 2024 25 INVESTMENT MANAGER’S DISCUSSION AND ANALYSIS (CONTINUED) REVIEW OF INVESTMENTS (CONTINUED) In June 2024, Kantar Group, a global brand data and analysis company, announced the list of “2024 Top 50 Kantar BrandZ Chinese Global Brand Builders.” Arashi Vision’s Insta360 was featured on the list again, ranking 27th, while the smart device industry represented by Arashi Vision saw the most significant growth in brand building power, reaching 61%. In October 2024, the US “Time” magazine announced a list of the best inventions of 2024. Arashi Vision’s Insta360 X4 8K panoramic sports camera was featured and recognised as the extraordinary choice among sports cameras. This is the second time that Arashi Vision has been selected in four years. Xunfei Healthcare Technology Co., Ltd. (“Xunfei Healthcare”) was established in the High-tech Development Zone, Hefei, Anhui in 2016 and is an AI-empowered healthcare solution provider, offering products and solutions that support a range of healthcare services, ranging from health risk warnings, early screening, auxiliary diagnosis and treatment as well as treatment effect evaluation to post-discharge management and chronic disease management. Xunfei Healthcare has independently developed AI technologies that underpin its products and solutions. The Fund invested RMB60 million (equivalent to US$8.60 million) in February 2020 and RMB50 million (equivalent to US$7.80 million) in November 2021, for an aggregate investment of RMB110 million (equivalent to US$16.40 million) in Xunfei Healthcare. In December 2024, the Fund subscribed for the H shares of Xunfei Healthcare through the global offering of Xunfei Healthcare at an offer price of HK$82.80, in the amount of HK$28 million (equivalent to US$3.61 million), and the number of H shares allocated to the Fund was 338,150. After the completion of the global offering and listing of Xunfei Healthcare, together with the existing investment, the Fund has cumulatively invested an equivalent amount of RMB136 million (equivalent to US$20.01 million) in Xunfei Healthcare, and holds 4,238,150 H shares, accounting for 3.506% of the issued share capital of Xunfei Healthcare. In addition, of the 4,238,150 H shares of Xunfei Healthcare held by the Fund, 3,900,000 shares are subject to a lock-up period of 12 months, and 338,150 shares are subject to a lock-up period of 6 months. As of the end of 2024, the carrying value of the Fund’s interest in Xunfei Healthcare was US$42.61 million, representing an increase of 4.74% over US$40.68 million at the end of last year. The Fund’s unrealised gain attributable to its investment in Xunfei Healthcare for 2024 was negative US$1.08 million, while the relevant amount for 2023 was US$34.69 million. iFLYTEK, the controlling shareholder of Xunfei Healthcare, announced on 10 January 2024 that it proposed to apply to spin off Xunfei Healthcare with a listing in Hong Kong. Following the completion of the spin-off and listing, Xunfei Healthcare would obtain financing through the Hong Kong capital market, which would help it to maintain its leading role in the field of medical AI and to increase its international presence, thus enhancing Xunfei Healthcare’s overall competitiveness as a listing entity. On 31 January 2024, iFLYTEK announced that Xunfei Healthcare had submitted an application for an IPO of H shares to the Hong Kong Stock Exchange. On 30 December 2024, Xunfei Healthcare was successfully listed on the Hong Kong Stock Exchange. According to the listing documents, Xunfei Healthcare recorded a loss and total comprehensive expense of RMB84 million, RMB189 million, RMB145 million and RMB130 million for 2021, 2022, 2023 and the six months ended 30 June 2024, respectively. On 26 March 2025, Xunfei Healthcare announced that its audited net loss for 2024 was RMB133 million, compared to a net loss of RMB145 million for last year.