002340SZSE

Feasibility Analysis Report on Developing Foreign Exchange Derivative Trading Business

GEM Co., Ltd.·

✨ AI Summary

This report analyzes the feasibility of Greentech Co., Ltd. developing foreign exchange derivative trading business. The purpose is to hedge against exchange rate and interest rate risks, improve capital efficiency, and reduce financial costs. The company plans to use derivative products like forward settlement and options, with a total transaction amount not exceeding USD 800 million. The company has established a management system and risk control measures to ensure the business is feasible and aligns with its interests.

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Greentech Co., Ltd.

Feasibility Analysis Report on Developing Foreign Exchange Derivative Trading Business

I. Background of the Company's Development of Foreign Exchange Derivative Trading Business

Greentech Co., Ltd. (hereinafter referred to as "the Company") and its subsidiaries are involved in some foreign currency business in their daily operations, with a significant number of foreign currency settlement transactions. To effectively hedge against the risks of the international foreign exchange market, prevent adverse impacts from significant fluctuations in exchange rates and interest rates, improve the efficiency of foreign exchange capital utilization, and reasonably reduce financial expenses and enhance financial stability, the Company is developing foreign exchange derivative trading to strengthen its foreign exchange risk management.

II. Overview of the Company's Foreign Exchange Derivative Trading Business

The foreign exchange derivative products that the Company will trade are closely related to its actual business, mainly including forward settlement and sales, foreign exchange options, swaps, or combinations of these products. These foreign exchange derivative trading products are matched with the Company's business in terms of product type, scale, direction, term, and currency.

III. Necessity and Feasibility of the Company's Development of Foreign Exchange Derivative Trading Business

The Company's daily operations involve some foreign currency business and a significant number of foreign currency settlement transactions. To enhance the Company's ability to cope with exchange rate and interest rate fluctuation risks and reduce the impact on the Company's operating profit, it is necessary for the Company to engage in foreign exchange derivative trading business with commercial banks based on its actual business situation. This will help hedge and prevent exchange rate and interest rate fluctuation risks, enhance the Company's financial stability, and be in the interest of the Company and all shareholders.

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