China Everbright Water

China Everbright Water (CEWL): Proposed the reduction of share premium account to set off against the accumulated losses of the company. DBSV reckons that the main reason for the reduction of share premium account or the elimination of
accumulated losses is to pave way for dividend payment in the future.

Thus, the house views such exercise as positive. Note that the above transaction will be carried out in the accounts of the holding company, i.e. not the consolidated accounts of the Group. On the Group level (or in the consolidated
accounts), share capital will not be affected and total equity remains unchanged. Thus, the exercise will not affect CEWL’s financial ratios and EPS.