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ForwardForward--Looking StatementsLooking Statements

The presentation is prepared by China High Speed Transmission Equipment Co., Ltd (the “Company”) and issolely for the purpose of corporate communication and general reference only. The presentation is notintended as an offer to sell, or to solicit an offer to buy or to form any basis of investment decision for anyclass of securities of the Company in any jurisdiction. All such information should not be used or relied onwithout professional advice. The presentation is a brief summary in nature and do not purport to be acomplete description of the Company, its business, its current or historical operating results or its futurebusiness prospects.

This presentation contains forward-looking statements which are subject to market risks and uncertainties.This presentation contains forward looking statements which are subject to market risks and uncertainties.This forward-looking statements can be identified by terminology such as "will," "expects," "anticipates,""future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, CHSTE'sexpectations with respect the wind gear box and other related businesses above contain forward-lookingstatement. Such statements involve certain risks and uncertainties that could differ materially from what wehave discussed today to those in the forward looking statements Further information regarding these andhave discussed today to those in the forward-looking statements. Further information regarding these andother risks has been filed with the Hong Kong Stock Exchange. In addition, any projections about CHSTE'sfuture performance represent management's estimates as of today September 1, 2014. China High SpeedTransmission Equipment Co. Ltd does not undertake any obligation to update any forward-looking statementas a result of new information, future events or otherwise, except as required under an applicable law.

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AgendaAgenda

2014 Interim Results Review and Analysis2014 Interim Results Review and Analysis1

2 Business ReviewBusiness Review

3 Development StrategiesDevelopment Strategies

4 Q & AQ & A

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12014 Interim Results Review 2014 Interim Results Review and Analysisand Analysisand Analysisand Analysis

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Financial HighlightsFinancial Highlights

RMB MM 1H 2014 1H 2013 Change%

Sales Revenue 3,947.5 2,640.4 49.5%

Gross Profit 1,010.4 532.8 89.6%

EBITDA 940.8 387.9 142.5%EBITDA 940.8 387.9 142.5%

EBIT 602.9 81.3 641.6%

Net Profit (Loss) Attributable to Equity Holders

234.5 (289.3) N/Ato Equity Holders

Gross Profit Margin 25.6% 20.2% 5.4ppt

EBITDA Margin 23.8% 14.7% 9.1ppt

EBIT Margin 15.3% 3.1% 12.2ppt

Net Profit Margin 5.9% N/A N/A

Earning per Share-Basic (RMB) 0.143 (0.212)Earning per Share Basic (RMB) 0.143 (0.212)

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Analysis of Sales RevenueAnalysis of Sales Revenue

RMB MM

Revenue Breakdown by Business Segment

1H 2014 1H 2013

3,947.5

RMB MM (% of total revenue)

Wind Gear 70.6% 63.0%Marine gear 4.4% 5.1%High speed locomotives

·

High speed locomotives and urban light rails 1.8% 1.3%

CNC Products 2.1% 4.5%

Diesel Engine 2.0% 3.1%

2,640.35Traditional Gear Transmission Equipment

High speed heavy duty gear 0.1% 0.1%

Gear for construction 4.4% 4.9%

General purpose gear 0.8% 1.4%

Gear for Bar-rolling, Wire-rolling and Plate-rolling 4.1% 5.9%rolling and Plate-rolling

Others 9.7% 10.7%

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Gross Profit Margin AnalysisGross Profit Margin Analysis

Products 1H 2014 1H 2013

Wind Gear 30.1% 26.0%

Consolidated Gross Profit MarginMarine gear 4.1% 5.8%

High speed locomotives and urban light rails

36.5% 35.6%(%) light rails

Numeric Control Series 19.5% 21.0%

Diesel Engine 9.9% 13.1%g

High speed heavy duty gear 18.6% 21.6%

Traditional Gear Transmission Equipment20.2%

Gear for construction 17.1% 19.7%

General purpose gear 8.5% 8.3%

Gear for Bar-rolling, Wire-rolling and Plate-rolling

8.1% 9.2%

Others 18.1% 0.6%

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Others 18.1% 0.6%

Cost AnalysisCost Analysis

Cost of Goods Sold

(RMB MM)

1H 20141H 2013

Other raw materials

Subcontracting & processing

Manufacturing fee

(1)

Cast iron and forged steel

Direct labor cost

Power feeCost of Goods Sold 2,937.1 Cost of Goods Sold 2,107.6

Note：(1) Including bearing and steel plates

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RMB MM 1H 2014 FY 2013Balance Sheet SummaryBalance Sheet Summary

Non-current Assets 9,564 9,337

Current Assets 14,851 13,634

Inventories 2,463 2,390

1H 2014

Account Receivables

4,403 4,578

Bill Receivable 2,364 1,016

C h d 4 267 4 950

•The Company continuously increases the percentage in long-term loans to total loansin order to improve the financial liquidityCash and

Deposits4,267 4,950

Others 1,354 700

Total 24,415 22,971

in order to improve the financial liquidity.

•The net asset per share is approx. RMB 5.5

G i ti i 63 2%Total 24,415 22,971

Capital & Reserves 8,983 8,762

Non Current Liabilities

3,102 2,700

•Gearing ratio is approx.63.2%

• Average turnover day of account receivable and inventory are 205 days and 149 days respectively, which is slightly improved when compared to the

LoansOthers

2,799303

2,338362

Current Liabilities 12,330 11,509

which is slightly improved when compared to the end of 2013.

•Cash and Deposits is approx. RMB 4.26 billion

Account Payables

1,588 1,635

Notes Payable 911 1,260

•Good relationship with both domestic and offshore banks

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Loans 8,349 7,109

Others 1,482 1,505

Business ReviewBusiness Review 2

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Wind Gear Transmission EquipmentWind Gear Transmission Equipment

Product Mix

Product1H 2014 1H 2013 1H 2014 1H 2013

(Unit) (% of total revenue of wind power)

3 MW Gearbox 82 60 4.6% 5.1%

2MW Gearbox 909 783 31 1% 39 8%2MW Gearbox 909 783 31.1% 39.8%

1.5MW Gearbox 1,861 919 50.2% 42.5%

750KW Gearbox 21 1 0.2% 0%

Yaw Motor & Drive 9,577 5,959 10.1% 10.2%

Pitch 9,280 3,991 3.8% 2.4%

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Strong Client Portfolio for Wind Strong Client Portfolio for Wind Gear Transmission EquipmentGear Transmission EquipmentGear Transmission EquipmentGear Transmission Equipment

Domestic Customers

2004 2005 2006 2006 2008 2010Co. started: 2013

OverseasCustomers

Co. started: 2006 2007 2007 2008 2009 2011 20122005

The Group maintains a strong client portfolio, with clients including major wind turbine manufacturers in the PRC, and renowned international wind turbine manufacturers .

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Breakthrough in Marine Breakthrough in Marine Transmission EquipmentTransmission EquipmentTransmission EquipmentTransmission Equipment

• The nine series of marine products have been applied in all equipments of overall ship propulsion system. The

Actively expand the domestic and overseas markets

propulsion equipment manufactured by the Group, is also applied in fishery patrols in the domestic sea area and is well known in the overall marine supplementary business.

• In addition to the 46m-long anchors supplementing propulsion systems supplied to a Singaporean customer for use as tug boats which have contributed to the successful trial sailing and ship delivery, NGC-MARINE also received an g g p y,order from a customer in Southeast Asia for propulsion systems for five triple-purpose operation ships and an orderfor propulsion systems for a total of 31 government law-enforcement ships, and entered into a strategic partnership framework agreement with Siemens Limited China. Th G ti i t d i th thi t th A i P ifi M iti h ld t M i B S d C f C t i• The Group participated in the thirteenth Asia Pacific Maritime held at Marina Bay Sands Conference Centre in Singapore, the Group displayed and demonstrated marine platform lifting system gear box,etc, which attracted a great deal of attention of visitors.

• The Group has received invention patents granted by the State Intellectual Property Office for its products “Telescopic lateral thruster” and “A type of paralleling dual-PTO (power take-off) marine gearbox” .

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HighHigh--Speed Locomotive and Urban Speed Locomotive and Urban Light Rails Becomes the New Revenue Growth PointLight Rails Becomes the New Revenue Growth Point

Remarkable R&D Performance Product Quality in Compliance with International

Light Rails Becomes the New Revenue Growth PointLight Rails Becomes the New Revenue Growth Point

Remarkable R&D Performance, Product Quality in Compliance with International Standards, Huge Market Potential, Brilliant Market Prospects

• The Group got orders of gearboxes for Qingdao Metro Line 3, orders of gearboxes for South Island Line in p g g g , gHong Kong, Line CCL and NEL in Singapore.

• The Group secured again an order of metro gear box from Brail. The previous gear box orders pertaining to Brazil’s two MTR lines were completed for delivery.The Group obtained an order of gear boxes for trains in suburbs of South Africa which is the largest order in• The Group obtained an order of gear boxes for trains in suburbs of South Africa, which is the largest order inrailway transportation business for the Group.

• The rail transportation products of the Group were awarded with IRIS Certificate. • Locomotive tractive gears manufactured by Nanjing High Speed Gear Manufacturing Co., Ltd., successfully

passed the certification of China Railway Test & Certification Centre (CRCC)

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Traditional Gear Transmission Traditional Gear Transmission Equipment Accelerating the Expansion in the Overseas MarketEquipment Accelerating the Expansion in the Overseas Market

Traditional Gear Transmission Equipment Business

Equipment Accelerating the Expansion in the Overseas MarketEquipment Accelerating the Expansion in the Overseas Market

q pstill keeps leading position in China’s market

and has entered the overseas market

•The Group focused on the development of energy-saving and environmentally-friendly products. New products were also launched to facilitate the development strategies.

•The Group enhanced efforts in providing and selling to client spare parts of relevant products•The Group enhanced efforts in providing and selling to client spare parts of relevant products.

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Computer Numerical ControlledComputer Numerical Controlled(“CNC”) And Heavy High Precision Machine Tools Product(“CNC”) And Heavy High Precision Machine Tools Product

Explore the high-end market and provide advanced machine tools

( CNC ) And Heavy, High Precision Machine Tools Product( CNC ) And Heavy, High Precision Machine Tools Product

•The Group has manufactured its own CNC system and CNC machine tool products through acquisition and research and development. The Group possessed the proprietary intellectual property rights of its self-developed CNC system p p p p p y p p y g p yand machine tools and its products include vertical machining centre and five-axis CNC milling machine such as high speed CNC engraving and milling machine.

• Machine tool companies under the Group participated in the eighth CNC Machine Tool Show (CCMT2014) .The orld’s largest scre propeller Lathe Mill NC Machine ith se en si a is as de eloped b the Gro p in ho se• The world’s largest screw propeller Lathe-Mill NC Machine with seven-six axis, as developed by the Group in-house, was assembled on site in a user Wuhan Heavy Industry Casting & Forging Co., Ltd.

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Development StrategiesDevelopment Strategies 3

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Development StrategiesDevelopment Strategies

1. Gear products2. LED sapphire products3 Coal mine machinery products3. Coal mine machinery products4. Marine products5. Mechanical and electrical products6 Machine tool products6. Machine tool products

The Group will actively improve products of the six major segments and step up efforts in developing overseas markets by adopting a prudent investment attitude and strategy while ensuring its

financial soundness so as to constantly enhance its overall corporate competitiveness.

Development StrategiesDevelopment Strategies

【【 】】Wind Gear Transmission BusinessThe Group will adhere to its practice of giving top priority to product quality and continue the manufacture of large and

【【Gear Products Gear Products 】】The Group will adhere to its practice of giving top priority to product quality and continue the manufacture of large anddiversified wind power transmission equipment. The Group aims to consolidate its position in the industry through enhancingits advanced research and development capabilities, producing quality products, expanding its business and optimising itsproduct mix. Based on the mainstream development trend of large-scale wind turbine, the Group will continue to provide1.5MW, 2MW and 3MW gearboxes to customers. In addition, the Group has successfully developed and sold 5MW and6MW wind turbine gearbox transmission equipment for offshore wind turbine development which will bring greater business6MW wind turbine gearbox transmission equipment for offshore wind turbine development, which will bring greater businessbreakthroughs for the Group in the future. In order to accelerate the expansion of overseas markets, the Group recentlyestablished wholly-owned subsidiaries in Germany, Singapore and Canada with a view to achieving closer communicationand discussion with existing and potential overseas customers.

High-speed Locomotives, Metros and Urban Light Rails BusinessThe use of high-speed locomotives, metros and urban light rails as environmentally-friendly transportation has become amajor global trend. It is believed that the industry has promising potential. The popularization of high-speed railway in Chinahas created strong development momentum for high speed locomotives metros and urban light rails and also has laid a solidhas created strong development momentum for high-speed locomotives, metros and urban light rails and also has laid a solidfoundation for the Group to fulfill its target of rapid profit growth in the railway sector in the future. Currently, the Group hassupplied metro special transmission equipment in bulk to domestic and overseas metro companies.

Traditional Gearbox Transmission Equipment BusinessUnder the situation of oversupply and intense market competition in connection with traditional products, the Group, throughchanging its sales strategies, provides integrating products to its customers while carrying out the spare parts supply business,in order to help its customers improve their production efficiency on the basis of existing equipment. On the other hand, ordersfor spare parts are expected to offset the effect of future decrease in some customers’ orders for the integrating products on its

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for spare parts are expected to offset the effect of future decrease in some customers orders for the integrating products on itsbusiness. The Group has also enhanced and improved its quality control system, reinforced technical innovation anddeveloped its business steadily to ensure its leading position in the PRC market.

Development StrategiesDevelopment Strategies

【【 LED hi d tLED hi d t 】】【【 LED sapphire products LED sapphire products 】】

The Group continues to pay attention to sapphire substrate production. Sapphire substrate production is an upstream production process of the screen and light-emitting diode (LED)production is an upstream production process of the screen and light-emitting diode (LED) industry chain. The process incorporates key technologies and is also an aspect with the highest added value of the whole industry chain. The Group occupies a leading position among peers in the domestic industry in terms of technology level and production capacity in connection with sapphire substrate production Currently the business is progressingin connection with sapphire substrate production. Currently, the business is progressing satisfactorily. The Group's LED products are exported to the United States and Taiwan, winning full recognition from the market for its product quality. Therefore, the Group is extremely optimistic about the future prospects for the development of the sapphire substrate businesssubstrate business.

1. Crystal growth plant 2. Crystal growth plant

Development StrategiesDevelopment Strategies【【 LED Sapphire Substrate…Con’t LED Sapphire Substrate…Con’t 】】

5.Crystal store4.Crystal store3.Crystal store 6.Crystal brick

10.Special products (200um square wafer)

8.Cutting and polishing products

9.Cutting and Polishing products

7.Crystal ingot

Development StrategiesDevelopment Strategies【【Coal Mine Machinery ProductsCoal Mine Machinery Products】】【【Coal Mine Machinery ProductsCoal Mine Machinery Products】】

In addition to transmission products, the Group has also achieved significant progress in new business development areas and has obtained mining product

f t tifi ti k f i l d l d l i hisafety certification marks for various newly developed coal mine machinery products. The Groups is currently active in designing and producing coal machinery products for renowned domestic potential customers with a view to enhancing the visibility of its products in the market. Through feedback from customers, we are

fid t i th G ’ d t F th ti ti ti lconfident in the Group’s new products. Further negotiations on cooperation are also in steady progress.

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Development StrategiesDevelopment Strategies【【Marine ProductsMarine Products】】

Marine gear transmission equipment is one of the products the Group has focused on its development in recent years. Being one of the top ship propulsion system manufacturers in the PRC the Group has been committed to optimizing and upgrading its own product mix and has

【【Marine ProductsMarine Products】】

PRC, the Group has been committed to optimizing and upgrading its own product mix and has possessed the capability of providing comprehensive one-stop product services. The Group is the only technology-driven manufacturer of marine supplementary products in the PRC capable of providing global shipment and global warranty services. We believe the Company will grasp market opportunities in a faster and better manner amidst a significant improvement in the global economic environment.

【【Mechanical and Electrical ProductsMechanical and Electrical Products】】The Company is also actively expanding its mechanical & electrical Integration business by introducing electrical transmission equipment such as electrical controlsystem and frequency converter into market while developing the wind farm business and it is expected that this business will experience significant growth in 2015.

High precision and heavy machine tool is one of the Group’s key products for development in

【【Machine Tool ProductsMachine Tool Products】】High precision and heavy machine tool is one of the Group’s key products for development in the future. Such products are developing in the technology-intensive direction of high speed, high precision, high reliability, multi-axis linkage, composite and flexibility. By upgrading the technology of products, the Group has enhanced the competitiveness of products developed in domestic and overseas marketsdomestic and overseas markets.

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Q & AQ & A 4

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Thank you！

Investor Relations contacts ：

Website︰www.chste.comEmail︰ir@chste.comTel︰(86) 25 5247 2000Tel (86) 25 5247 2000Fax︰(86) 25 5241 2731

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