Annual Report 2022

22 China Merchants China Direct Investments Limited Annual Report 2022 INVESTMENT MANAGER’S DISCUSSION AND ANALYSIS (CONTINUED) REVIEW OF INVESTMENTS (CONTINUED) Ningbo Meishan Free Trade Port Area Jiangmen Venture Capital LLP (the “Jiangmen Ventures Fund” ) was established in Ningbo, Zhejiang in September 2016, with an investment horizon of 5 to 7 years and with a paid-in capital amounting to RMB262 million. Its major investment targets are chiefly early-stage business ventures related to machine intelligence, Internet of Things (IoT), natural user interface, and enterprise computing. The general partner and investment manager of the Jiangmen Ventures Fund is Jiangmen Capital Management (Beijing) Co., Ltd., which is responsible for defining and executing the investment strategy for the Jiangmen Ventures Fund, as well as for managing their operations. The Fund completed a capital contribution of RMB30 million (equivalent to US$4.74 million) in January 2018, representing 11.45% of the paid-in capital of the Jiangmen Ventures Fund as of 31 December 2022. In addition, through the end of December 2022, the Fund received cash distributions from the Jiangmen Ventures Fund in a cumulative amount of RMB8.75 million. As of the end of 2022, the carrying value of the Fund’s interest in the Jiangmen Ventures Fund was US$8.30 million, representing a decrease of 5.57% from the value at the end of last year of US$8.79 million. As of the end of 2022, the unaudited net asset value of the Jiangmen Ventures Fund was RMB509 million, representing an increase of 11.43% compared to an audited net asset value as of the end of last year. Through the end of December 2022, the Jiangmen Ventures Fund has made investments in nineteen projects for a total of RMB233 million. Currently, the Jiangmen Ventures Fund has entered into the investment exit period. Of these projects, two projects have been fully exited and three projects have been partially exited. A total of eight projects have completed new rounds of equity financing during 2022. Pony AI Inc. (“Pony AI”) was established in Silicon Valley, the United States, in December 2016 and is a research and development company in China that focuses on technology solutions for autonomous driving. In July 2018 and in April 2019, the Fund invested a total of US$8.61 million and then held a 0.889% equity interest in Pony AI. In January 2021, Pony AI completed a new round of equity financing, with a post-investment valuation of US$5.3 billion. The Fund’s equity interest in Pony AI was diluted to 0.670%, accordingly. In March 2022, Pony AI completed the first close of another new round of equity financing, with a post-investment valuation of US$8.7 billion. The equity interest of Pony AI held by the Fund was further diluted from 0.670% to 0.655%. As of the end of 2022, the carrying value of the Fund’s interest in Pony AI was US$5.10 million, representing a decrease of 85.19% from the value at the end of last year of US$34.44 million. On 20 January 2022, Pony AI has introduced its 6th generation autonomous driving system (including hardware and software), with leading-edge sensors, computing platform solutions and stylish design features for L4 automotive- grade mass production fleets. The first model equipped with this system, the Toyota S-AM (SIENNA Autono-MaaS, i.e. a hybrid electric platform based on SIENNA with 7 seats), has started road testing in China in 2022 and will be put into Robotaxi (self-driving taxi services) daily operations in the first half of 2023.