Annual Report 2023

China Merchants China Direct Investments Limited Annual Report 2023 27 INVESTMENT MANAGER’S DISCUSSION AND ANALYSIS (CONTINUED) REVIEW OF INVESTMENTS (CONTINUED) In May 2023, UnionPay International, a subsidiary of China UnionPay, announced a new collaboration with the National Payment Corporation of Vietnam (NAPAS) by signing a memorandum of understanding. The two parties agreed to jointly promote the integration of UnionPay payment information into Vietnam’s national QR code (VietQR). With this collaboration, the acceptance coverage of UnionPay mobile payment products in Vietnam will increase to 70%. On 20 December 2023, China UnionPay and Huawei successfully held a “Signing ceremony for in-depth cooperation in Hongmeng.” China UnionPay had previously launched its Mobile QuickPass APP based on Hongmeng’s HarmonyOS NEXT for native application development. Building on this foundation, China UnionPay will comprehensively adapt its UnionPay payment network ecosystem applications to the Hongmeng native platform. Both parties will be in collaboration to create a new payment infrastructure based on the Hongmeng ecosystem, connecting millions of users and thousands of merchants, while jointly embracing a new era of the Internet of Everything. CASREV FUND III-RMB L.P. (“CASREV Fund III”) was established in Shenzhen, Guangdong in February 2020, with an investment horizon of 8 to 10 years and with a total fund subscription amount of RMB6 billion (presently, the paid-in capital amounts to RMB4.5 billion). The major investment targets of CASREV Fund III include enterprises related to smart manufacturing, smart products and services, big data and cloud computing, AI, Internet of Things (IoT), blockchain, biological engineering, chips and sensors, operating system, kernel modules, communication networks, materials and other emerging technologies. The general partner and investment manager of CASREV Fund III is CAS Investment Management Co., Ltd., which is responsible for defining and executing the investment strategy for CASREV Fund III, as well as for managing their operations. The Fund holds a beneficial interest in CASREV Fund III via CASRF Fund L.P. The Fund has committed to subscribe to an aggregate amount of RMB50 million by installment, representing 1.11% of the paid-in capital of CASREV Fund III. Since September 2020, the Fund had made successive capital contributions to CASREV Fund III for an aggregate amount of RMB50 million (equivalent to US$7.50 million), representing 100% of the subscription amount committed by the Fund. In addition, through the end of December 2023, the Fund received cash distributions from CASREV Fund III in a cumulative amount of RMB9.88 million. As of the end of 2023, the carrying value of the Fund’s interest in CASREV Fund III was US$10.98 million, representing an increase of 23.51% over US$8.89 million at the end of last year. Through the end of December 2023, the investment committee of CASREV Fund III has approved a total of sixty-four investment projects, for a total approved investment amount of RMB3.874 billion, of which RMB3.874 billion has been paid. At present, among the companies invested in by CASREV Fund III, five have been listed. One additional company has submitted an IPO application to the SSE STAR Market, which was accepted and is presently undergoing the stage of inquiry and feedback.