Annual Report 2025

8 China Merchants China Direct Investments Limited Annual Report 2025 INVESTMENT MANAGER’S DISCUSSION AND ANALYSIS OVERALL PERFORMANCE China Merchants China Direct Investments Limited and its subsidiaries (the “ Fund ”) recorded a profit attributable to equity shareholders of US$189.94 million for the year ended 31 December 2025, compared to a profit attributable to equity shareholders of US$120.35 million for last year, representing an increase of US$69.59 million or 57.82% – with the profit increase largely attributable to a significant rise in the overall value of the financial assets at fair value through profit or loss (the “ Financial Assets ”), especially increase in value of Arashi Vision Inc. after listing. As of 31 December 2025, the net assets of the Fund were US$834.65 million (31 December 2024: US$647.38 million), with a net asset value per share of US$5.479 (31 December 2024: US$4.250). The net gain on the Financial Assets for the year was US$230.11 million, representing a substantial increase of 67.35% compared to US$137.50 million in the previous year. Looking deeper, the Fund’s listed and unlisted investments recorded net gains of US$177.53 million and US$52.58 million, respectively. For more information on the change in fair value of each of the listed and unlisted investments, please see the section titled “Review of Investments” in this Investment Manager’s Discussion and Analysis. Total investment income for the year increased by 7.48% to US$19.12 million (2024: US$17.79 million) as compared to last year, due mainly to an increase in dividend income from investments. ACQUISITIONS AND EXITS OF INVESTMENTS In 2025, the Fund continued to seek out and rigorously evaluate investment opportunities. During the year, the Fund made investments in information technology industry and medical industry. The investments completed include the following: On 31 March 2025, the Fund entered into a capital increase agreement and other relevant agreements in relation to Jade Bird Display (Shanghai) Limited (“ JBD ”), pursuant to which the Fund agreed to contribute capital of RMB30 million to JBD in order to acquire a 0.449% equity interest. The Fund paid the investment amount of RMB30 million (equivalent to US$4.18 million) on 26 May 2025 to complete the transaction. JBD is a company engaging in the research, development and manufacture of micro light-emitting diodes (MicroLED), specialising in the development of MicroLED display technology. It is currently the world’s leading company in achieving mass production and delivery of MicroLED chips and optical engines for augmented reality (AR) glasses. Its products are known for their industry- leading performance across key attributes such as high brightness, low power consumption, and compact size. Its leading technologies have been recognised by many leading domestic and overseas customers. On 28 October 2025, the Fund entered into a share purchase agreement and other relevant agreements in relation to Neuracle Technology (Shanghai) Co., Ltd. (“ Neuracle Technology ”), pursuant to which the Fund agreed to contribute capital of RMB15 million to Neuracle Technology to acquire its partial equity interests. The Fund paid the investment amount of RMB15 million (equivalent to US$2.12 million) on 7 November 2025 to complete the transaction. Neuracle Technology was founded in November 2011. It is a high-tech enterprise in Mainland China that centers around its proprietary innovative brain-computer interface (BCI) technology and specializes in the research, development, production, sales, and technical services of BCI systems. Neuracle Technology is dedicated to providing professional, comprehensive solutions for innovative neuroscience research and clinical studies in the diagnosis, treatment, and rehabilitation of neurological disorders.