Shanghai Electric : PROPOSED CHANGE OF INDEPENDENT NON-EXECUTIVE DIRECTOR

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SHANGHAI ELECTRIC GROUP COMPANY LIMITED

上海電氣集團股份有限公司

(A joint stock limited company incorporated in the People's Republic of China with limited liability)

(Stock Code: 02727)

ANNOUNCEMENT

PROPOSED CHANGE OF INDEPENDENT NON-EXECUTIVE DIRECTOR

The board of directors (the "Board") of Shanghai Electric Group Company Limited (the "Company") hereby announces the followings:

RESIGNATION OF INDEPENDENT NON-EXECUTIVE DIRECTOR

The Company recently received the resignation from Mr. KAN Shun Ming ("Mr. KAN"), an independent non-executive director of the Company. Due to personal reasons, Mr. KAN resigned as an independent non-executive director, the chairman and a member of the audit committee, a member of the remuneration committee and a member of the nomination committee of the Company. Mr. KAN will cease to hold any position in the Company after his resignation.

Mr. KAN confirms that there is no disagreement between himself and the Board during his term of office and there is no matter relating to his resignation that needs to be brought to the attention of the shareholders of the Company (the "Shareholders").

Pursuant to the relevant provisions under the Guidelines for Introducing Independent Directors to the Board of Directors of Listed Companies and the Articles of Association of the Company, the resignation of Mr. KAN will result in the number of independent directors of the Company being less than one-third of the total number of directors. Mr. KAN will continue to perform the duties as an independent non-executive director, the chairman and a member of the audit committee, a member of the remuneration committee and a member of the nomination committee of the Company until the election of a new independent non-executive director at the general meeting of the Company.

The Board wishes to express its sincere appreciation and respect to Mr. KAN for his diligent work for the development of the Company during his term of office.

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PROPOSED APPOINTMENT OF INDEPENDENT NON-EXECUTIVE DIRECTOR

The Board agreed to nominate Mr. XU Jianxin ("Mr. XU") as the candidate for an independent non-executive director of the fifth session of the Board of the Company. The term of office of Mr. XU will be from the date on which his appointment is approved at the general meeting to the end of the term of the fifth session of the Board.

The biography of Mr. XU is as follows:

Mr. XU Jianxin, aged 63, currently serves as the senior vice president of Shanghai Purest Investment Management Co., Ltd., an independent director of Bank of Shanghai Co., Ltd. and Shanghai Shunho New Materials Technology Co., Ltd. From February 1982 to November 1997, Mr. XU served as a lecturer and associate professor of accounting at Shanghai University of Finance and Economics. From November 1997 to December 2014, he served as the deputy chief accountant, director, chief financial officer, and chief economist of Orient International (Holding) Co., Ltd. From May 2014 to May 2017, he served as an independent director of Baida Group Co., Ltd., a company listed on the Shanghai Stock Exchange (stock code: 600865). Since January 2015, he has served as the senior vice president of Shanghai Purest Investment Management Co., Ltd. Since June 2015, he has served as an independent director of Shanghai Shunho New Materials Technology Co., Ltd., a company listed on the Shanghai Stock Exchange (stock code: 002565). Since August 2015, he has served as an independent director of Bank of Shanghai Co., Ltd., a company listed on the Shanghai Stock Exchange (stock code: 601229). From September 2015 to June 2019, he served as an independent non-executive director of Shanghai Jin Jiang International Hotels (Group) Co., Ltd., a company listed on The Stock Exchange of Hong Kong Limited (stock code: 02006). Mr. XU graduated from Shanghai University of Finance and Economics with a doctorate. He is a professor-level senior accountant and a Chinese certified public accountant.

Save as disclosed above, Mr. XU has not held any directorship in any other public companies the securities of which are listed on any securities market in Hong Kong or overseas in the past three years; Mr. XU does not have any relationship with any directors, supervisors, senior management, substantial or controlling shareholders of the Company within the meaning of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the "Listing Rules"); as at the date of this announcement, Mr. XU does not have any interest in the shares of the Company or its associated companies within the meaning of Part XV of the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong); during Mr. XU's term of office being an independent non-executive director of the Company, the amount of Mr. XU's emoluments will be determined based on a number of factors, including the operating results of the Company, his responsibilities, performance and market conditions. As at the date of this announcement, the Company has not yet entered into any director service contract with Mr. XU.

Save as disclosed above, there is no other information in relation to the appointment of Mr. XU Jianxin which is required to be disclosed pursuant to the requirements set out in Rules 13.51(2)

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1. to (v) of the Listing Rules nor are there any matters which need to be brought to the attention of the Shareholders.

MISCELLANEOUS

The extraordinary general meeting of the Company ("EGM") will be convened on 14 November 2019 to approve the proposal to appoint Mr. XU Jianxin as an independent non- executive director. A circular containing, among other things, details of the appointment and notice of the EGM as well as the supplemental notice of the EGM will be dispatched to the Shareholders on or before 29 October 2019.

By order of the Board

Shanghai Electric Group Company Limited

ZHENG Jianhua

Chairman of the Board

Shanghai, the PRC, 21 October 2019

As at the date of this announcement, the executive directors of the Company are Mr. ZHENG Jianhua, Mr. HUANG Ou, Mr. ZHU Zhaokai and Mr. ZHU Bin; the non-executive directors of the Company are Ms. YAO Minfang and Ms. LI An; and the independent non-executive directors of the Company are Mr. KAN Shun Ming, Dr. CHU Junhao and Dr. XI Juntong.

* For identification purpose only

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