Jiangyin Hengrun Heavy Industry Co., Ltd.

　　Initial Public Offering Stock Issuance Announcement

　　Sponsor (Lead Underwriter): Zhongde Securities Co., Ltd.

　　Special Notice

　　Jiangyin Hengrun Heavy Industry Co., Ltd. (hereinafter referred to as the “Issuer,” “Hengrun Shares,” or the “Company”) is conducting its initial public offering of shares in accordance with the "Administrative Measures for Securities Issuance and Underwriting" (CSRC Order No. 121, hereinafter referred to as the “Measures”), the "Guidelines for Underwriting of Initial Public Offerings of Shares" (CSF [2016] No. 7, hereinafter referred to as the “Guidelines”), and the "Implementation Rules for Online Issuance of Initial Public Offerings in the Shanghai Market" (SSE [2016] No. 1, hereinafter referred to as the “Online Issuance Implementation Rules”), among other relevant regulations.

　　This issuance involves significant changes in the issuance process, subscription, and payment procedures. Investors are urged to pay close attention.

　　1. This offering will be conducted via direct pricing, with all shares being issued to the general public investors through online channels, without any offline bookbuilding or allocation process.

　　2. Issue Price: RMB 26.97 per share. Based on this issue price, investors may place subscription orders through the trading system of the Shanghai Stock Exchange (hereinafter referred to as “SSE”) on Day T (April 24, 2017), using the online application method based on market capitalization. No subscription funds need to be paid at the time of subscription.

　　3. Online investors shall independently express their subscription intentions and may not fully entrust securities companies to place new-share subscriptions on their behalf.

　　4. After being selected in the lottery for new shares subscribed by online investors, investors shall fulfill their payment obligations according to the “Announcement on the Results of the Lottery for the Online Pricing Issuance of the Initial Public Offering of Shares by Jiangyin Hengrun Heavy Industry Co., Ltd.” (hereinafter referred to as the “Online Lottery Results Announcement”). They must ensure that their funding accounts have sufficient funds for the subscription of new shares by the end of the day on April 26, 2017 (T+2 day). Any shortfall will be deemed as a waiver of subscription, and investors shall bear all consequences and related legal liabilities arising therefrom. The remittance of investor funds shall comply with the relevant regulations of the securities company where the investor is located. Shares waived by online lottery-winning investors will be underwritten by the sponsor (lead underwriter).

　　5. If the number of shares subscribed by online investors falls below 70% of the total number of shares to be publicly offered, the sponsor (lead underwriter) will suspend the new share offering and issue a public announcement explaining the reasons for the suspension and outlining the subsequent arrangements.

　　6. If an online investor fails to fully pay for shares after being allocated them three times within any consecutive 12-month period, they will be barred from participating in new share subscriptions for six months.

　　The issuer and the sponsor (lead underwriter) solemnly remind all investors to pay attention to investment risks, invest rationally, and carefully read this announcement as well as the "Special Announcement on Investment Risks for the Initial Public Offering of Shares by Jiangyin Hengrun Heavy Industry Co., Ltd." published on the same day (hereinafter referred to as the "Investment Risk Special Announcement").

　　Valuation and Investment Risk Disclosure

　　Investing in new shares carries significant market risks. Investors need to fully understand the risks associated with investing in new shares, carefully study the risks disclosed in the issuer’s prospectus, and thoroughly consider the following risk factors before prudently participating in this new share offering.

　　1. According to the “Guidelines for Industry Classification of Listed Companies” (revised in 2012) issued by the China Securities Regulatory Commission (hereinafter referred to as “CSRC”), the company operates in the metal products industry (C33). As of April 19, 2017, the recent one-month static average price-to-earnings ratio for this industry, as published by CSI Index Co., Ltd., was 77.58 times. The offering price of RMB 26.97 per share corresponds to a diluted price-to-earnings ratio of 22.99 times based on the audited net profit for 2016, taking into account the lower of the figures before and after deducting non-recurring gains and losses. This P/E ratio is lower than the recent one-month static average P/E ratio for the industry published by CSI Index Co., Ltd.

　　2. The planned funding requirement for the fundraising projects in this offering by the issuer is RMB 48,391.00 million. Based on the public offering price of RMB 26.97 per share and the issuance of 20 million new shares, the total estimated proceeds from this offering amount to RMB 53,940.00 million. After deducting the issuance expenses that the issuer is required to bear—RMB 5,549.00 million—the net proceeds are expected to be RMB 48,391.00 million, which does not exceed the amount of funds planned to be raised for the issuer’s fundraising projects as disclosed in the prospectus.

　　3. If the funds raised by the issuer in this offering are misused or if its business fails to grow in tandem within a short period, it could adversely affect the issuer’s profitability and pose a significant risk of a substantial decline in the issuer’s return on net assets. This could lead to a downward revision of the issuer’s valuation, a drop in its stock price, and consequently, the risk of investment losses for investors.

　　Important Notice

　　1. The application for Hengrun Shares’ initial public offering of no more than 20 million shares of Renminbi common stock (A-shares) (hereinafter referred to as “this Offering”) has been approved by the China Securities Regulatory Commission under Document No. [2017]527. The stock’s abbreviated name is “Hengrun Shares,” and its stock code is 603985.

　　2. This offering will be conducted via an online public offering at a fixed price directly to retail investors based on market capitalization (hereinafter referred to as the “online offering”), and is planned to be listed on the Shanghai Stock Exchange. The subscription for this online offering is abbreviated as “Hengrun Subscription,” with a subscription code of “732985.”

　　3. The total number of shares to be publicly issued this time is 20 million shares. Of these, 20 million shares will be offered online, accounting for 100% of the total issuance volume. All shares issued this time are new shares; no transfer of existing shares is planned.

　　4. The issuer and the sponsor (lead underwriter), taking into account comprehensively the issuer’s fundamentals, the industry in which it operates, market conditions, valuation levels of comparable companies, fundraising needs, and underwriting risks, have jointly agreed upon an issue price of RMB 26.97 per share. The corresponding price-to-earnings ratio is as follows:

　　(1) 17.24 times (calculated by dividing the net profit attributable to the parent company for 2016—determined as the lower of the net profit before and after deducting non-recurring gains and losses, audited by an accounting firm in accordance with Chinese Accounting Standards—by the total share capital prior to this offering);

　　(2) 22.99 times (calculated by dividing the net profit attributable to the parent company for 2016—determined as the lower of the figures before and after deducting non-recurring gains and losses, audited by an accounting firm in accordance with Chinese Accounting Standards—by the total share capital following this offering).

　　5. If this offering is successful, the issuer will raise a total of RMB 53,940.00 million, with net proceeds amounting to RMB 48,391.00 million, which does not exceed the amount of funds expected to be used for the projects funded by this offering. The issuer’s plan for the use of the raised funds and other relevant details were disclosed in the “Prospectus for the Initial Public Offering of Jiangyin Hengrun Heavy Industry Co., Ltd.” on April 20, 2017 (T-2 day).

　　6. Important matters regarding online issuance:

　　(1) The online subscription period is from 9:30 a.m. to 11:30 a.m. and from 1:00 p.m. to 3:00 p.m. on April 24, 2017 (T-day). Online investors shall independently express their subscription intentions and may not fully delegate the task of subscribing for new shares to securities companies.

　　(2) Investors who have opened a securities account with the Shanghai Branch of China Securities Depository & Clearing Corporation prior to April 24, 2017 (T-day), and who, as of April 20, 2017 (T-2 day)—the 20 trading days preceding T-day (including T-2 day)—have maintained an average daily market value of no less than RMB 10,000 (inclusive) in non-restricted A-shares traded on the Shanghai market may subscribe for the shares issued online through the SSE trading system. The market value of non-restricted A-shares traded on the Shenzhen market will not be included in this calculation.

　　(3) Investors’ online subscription quotas are determined based on the market value of their non-restricted A-share stocks held in the Shanghai market (hereinafter referred to as “market value”). Securities accounts that are unqualified, dormant, or canceled will not be counted toward the market value calculation. The average daily market value held by an investor over the 20 trading days preceding April 20, 2017 (T-2 day), including T-2 day itself, will be used for this calculation. For securities accounts opened less than 20 trading days prior to the calculation date, the average daily market value will be calculated based on a 20-trading-day period. Only investors holding a market value of RMB 10,000 or more (including RMB 10,000) are eligible to participate in the subscription of new shares. For every RMB 10,000 of market value held, an investor can subscribe for one subscription unit. Any portion of the market value below RMB 10,000 will not be counted toward the subscription quota. Each subscription unit consists of 1,000 shares, and the number of shares subscribed must be a multiple of 1,000 shares. However, the maximum number of shares that an investor may subscribe cannot exceed one-thousandth of the total number of shares issued online, i.e., no more than 20,000 shares, and at the same time, it cannot exceed the upper limit of the subscription quota calculated based on the investor’s market value.

　　(4) Investors do not need to pay the subscription funds when making a subscription.

　　(5) During the subscription period, investors shall place their orders by filling out order forms at the determined offering price, using the method of placing buy orders for stocks. Once submitted, such orders cannot be withdrawn. Investors participating in the online public offering of shares may use only one securities account. If the same investor uses multiple securities accounts to subscribe for the same new stock, or if the same investor uses the same securities account to subscribe for the same new stock more than once, only the investor’s first subscription shall be considered valid; all subsequent subscriptions shall be deemed invalid. If an investor holds multiple securities accounts, the market values of these accounts shall be combined for calculation purposes. The principle for determining whether multiple securities accounts are held by the same investor is that both the “account holder name” and the “valid identification document number” recorded in the securities account registration data must be identical. The securities account registration data shall be based on the status as of the end of day T-2. For margin trading and short selling clients, the market value of their credit securities accounts shall be combined into the investor’s total market value. Similarly, the market value of securities accounts designated for securities lending guarantees held by securities companies shall be combined into the securities company’s total market value. The occurrence of judicial freezes or pledges on A-share stocks that are not subject to sale restrictions, as well as any trading restrictions imposed on directors, supervisors, and senior management personnel of listed companies, shall not affect the calculation of the market value held within the securities accounts.

　　(6) For dedicated accounts for targeted asset management by securities companies and enterprise annuity accounts, if the “account holder name” and the “valid identification document number” are identical in the securities account registration information, the market value shall be calculated separately for each securities account and such accounts shall participate in the subscription.

　　7. The online subscription for this offering will close at 3:00 p.m. on April 24, 2017 (T-day, the subscription day). After 3:00 p.m. on T-day, the Shanghai Stock Exchange will confirm the total number of valid subscriptions and assign a unique serial number to each valid subscription unit. All valid subscriptions will be assigned serial numbers continuously in chronological order without interruption, up to the last valid subscription. New shares will then be allocated according to the following principles:

　　(1) If the amount of valid subscriptions is less than or equal to the online issuance volume for this offering, no lottery drawing is required. All assigned subscription numbers will be considered winning numbers, and investors will subscribe to the new shares according to their valid subscription amounts.

　　(2) If the total number of valid applications exceeds the amount to be issued online this time, the winning lottery numbers will be determined by a random drawing. Each winning number will entitle its holder to subscribe to one unit of the new shares. On T+1 day, the issuer and the sponsor (lead underwriter) will announce the winning rate in designated media. If the total number of valid applications exceeds the amount to be issued online this time, on T+1 day, under the supervision of a notary public, the sponsor (lead underwriter) will conduct the random drawing to confirm the winning results. The winning results will then be announced in designated media on T+2 day.

　　8. After winning the lottery for new shares through the subscription process, investors shall fulfill their payment obligations in accordance with the “Announcement on the Results of the Lottery for the Online Pricing Issuance of Shares in the Initial Public Offering of Jiangyin Hengrun Heavy Industry Co., Ltd.” published on April 26, 2017 (T+2 day). When making payments online, investors should abide by the relevant regulations of their securities firms. By the end of T+2 day, investors who have won the lottery must ensure that their fund accounts have sufficient funds for the subscription of new shares; any shortfall will be deemed as a waiver of the subscription, and investors shall bear all consequences and related legal liabilities arising therefrom. Shares waived by investors will be underwritten by the sponsor (lead underwriter). Special reminder: If an online investor accumulates three instances of failing to fully pay after winning the lottery within any consecutive 12-month period, such investor will be barred from participating in new share subscriptions for six months.

　　9. For details on circumstances under which this offering may be suspended, see “V. Suspension of Offering.”

　　10. The shares issued online this time are not subject to any circulation restrictions or lock-up arrangements.

　　11. This announcement provides only a brief overview of the stock issuance and does not constitute investment advice. Investors are urged to carefully read the summary of the prospectus for this offering, which was published on April 20, 2017 (T-2 day) in the China Securities Journal, the Shanghai Securities Journal, the Securities Times, and the Securities Daily. The full text of the prospectus and related materials for this offering can be found on the website of the Shanghai Stock Exchange (www.sse.com.cn). The issuer and the sponsor (lead underwriter) hereby draw investors’ particular attention to the “Important Matters Notice” and “Risk Factors” sections of the prospectus, encouraging them to fully understand all risk factors associated with the issuer, independently assess the issuer’s operating conditions and investment value, and make investment decisions prudently. The issuer’s operating conditions may change due to influences from political, economic, industry, and management factors; any resulting investment risks shall be borne solely by the investors themselves.

　　12. The listing of the shares issued this time will be announced separately. Other details regarding this issuance will be promptly disclosed in the China Securities Journal, the Shanghai Securities Journal, the Securities Times, and the Securities Daily. Investors are kindly advised to pay close attention.

　　Issuer: Jiangyin Hengrun Heavy Industry Co., Ltd.

　　Sponsor (Lead Underwriter): Zhongde Securities Co., Ltd.

　　April 21, 2017