Company Profile

Bohai Financial Investment Holding Co Ltd offers lease financing services. The Company financesthe leasing of aircraft, ships and other transportation equipment.

Event

Bohai Financial Investment Holding Co., Ltd. announced it made CNY 9.65 billion in revenue in2015, up 40.97% YoY. The net profit attributable to shareholders reached CNY 1.3 billion,increasing by 42.85% compared to a year earlier. EPS was CNY 0.37.

Comment

Earnings grew significantly, in line with our expectations. （1）Bohai Financial Investment Holdingbought 80% stake in Cronos in Jan 2015 whose earning results were incorporated into theCompany last year. （2） Demand for equipment leasing service from infrastructure projects, roadand bridge projects and rail transit projects rose by 79.77% YoY. （3） Aircraft leasing businessachieved 20% expansion.

Go abroad through M&A. （1） Acquiring Cronos helps Bohai Financial Investment Holding becomethe largest container leasing service supplier with 16% market share in the world. （It obtained100% ownership of Seaco in 2013, the sixth largest container leasing company in the world.） （2）Bohai Financial Investment Holding manages over 400 aircrafts worldwide and is able to offerleasing services in 36 countries and regions after integrated Avolon’s resources.

Operation leasing business proves to be more profitable. Gross profit margin of operation leasingbusiness registered at 58%, great higher than that of finance leasing business （44%）。 The scale ofoperation leasing business is expanding at faster pace after taking in Avolon, which we believewill improve the Company’s profitability.

Capital injection to further boost growth. （1） Wanjiang Financial Holding, a subsidiary under theCompany was listed on new three board. （2） Tianjin Bohai raised CNY 3.4 billion through privateplacement.

Stretch its reach in financial industry. Bohai Financial Investment Holding hold 20% stake in BohaiLife Insurance, 3.57% stake in Lianxun Securities and 6.18% stake in Sinolending （an onlinefinancial platform） in 2015.

Earnings Forecast and Investment Recommendations: We made EPS forecast for the Company atCNY 0.45 in 2016, CNY 0.51 in 2017 and CNY 0.58 in 2018, indicating CNY 2.76 billion, CNY 3.15billion and CNY 3.61 billion net profit attributable to shareholders respectively.

Potential Risks: swing of RMB price, risk of macro economy, less‐than‐expected earnings.