Honghua Group Limited — Capital/Financing Update 2017

Mar 16, 2017

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HONGHUA GROUP LIMITED

宏華集團有限公司

(a company incorporated in the Cayman Islands with limited liability)

(Stock Code: 196)

Issuance of Short-term Financing Debentures

This announcement is made by Honghua Group Limited (the “ Company ”) pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and Inside Information Provisions under Part XIVA of the Securities and Futures Ordinance (Cap. 571, Laws of Hong Kong).

References are made to the announcements of the Company regarding the Admission for Registration for Issuance of Short-term Financing Debentures and the Announcement regarding the Cancellation of Issuance of the First Tranche of the Short Term Debenture dated 17 February 2016 and 22 March 2016 respectively (collectively the “Former Announcements” ). Unless the context otherwise defined, terms used in this announcement shall have the same meaning as those used in the Former Announcements.

The Board of the Company is pleased to announce that on 15 March 2017, Sichuan Honghua issued the first tranche of Short-term Financing Debentures in the PRC with

an aggregate principal amount of RMB 200 million, a term of 180 days, on nominal value of RMB100 per unit and with interest rate of 6.8% per annum. Heng Feng Bank Corp. Limited acted as the principal underwriter of the issuance of the Short-term Financing Debentures.

The net proceeds from the issuance of the first tranche of Short-term Financing Debentures are intended to be used to supplement working capital of the Company.

Pursuant to the relevant laws and regulations of the PRC, documents regarding the issuance of Short-term Financing Debentures are also published on both of the websites of Shanghai Clearing House (www.shclearing.com) and China Foreign Exchange Trade System (www.chinamoney.com.cn).

Any significant improvement will be made in further announcement by the Company as and when appropriate in due course.

Shareholders of the Company and potential investors are advised to exercise caution when dealing in the shares of the Company.

On behalf of the Board Honghua Group Limited Zhang Mi Chairman

PRC, 16 March 2017

As at the date of this announcement, the executive directors of the Company are Mr. Zhang Mi (Chairman), Mr. Ren Jie and Mr. Liu Zhi, the non-executive director of the Company is Mr. Siegfried Meissner （ Mr. Popin Su as his alternate ） and the independent non-executive directors of the Company are Mr. Liu Xiaofeng, Mr. Qi Daqing, Mr. Chen Guoming, Mr. Shi Xingquan and Mr. Guo Yanjun.