Shanghai Electric : ANNOUNCEMENT ON ELIGIBILITY FOR TRADING FOR RESTRICTED SHARES UNDER THE NON-PUBLIC ISSUANCE

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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 ON ELIGIBILITY FOR TRADING FOR

RESTRICTED SHARES UNDER THE NON-PUBLIC ISSUANCE

References are made to the announcements of Shanghai Electric Group Company Limited (the "Company") dated 6 December 2015 and 14 March 2016 and the circular of the Company dated 31 December 2015 in relation to, among others, the restructuring and the proposed issuance and placing of A shares (the "Transactions" or the "Non-publicIssuance"), the announcement of the Company dated 27 April 2016 in relation to the approval for the Transactions from the China Securities Regulatory Commission (the "CSRC"), the announcements of the Company dated 21 June 2016, 21 July 2016 and 19 August 2016 in relation to the implementation progress of the Transactions, the announcement of the Company dated 26 August 2016 in relation to the completion of transfer of the assets under the restructuring, the announcement of the Company dated 31 August 2016 in relation to the issuance results of the restructuring and change in share capital, and the announcement of the Company dated 26 August 2019 in relation to, among others, the undertaking by Shanghai Electric (Group) Corporation (the "SEC") to extend the lock-up period of the 606,843,370 A shares (the "Restricted Shares") subscribed by it in the Transactions for 6 months to 29 February 2020. Terms defined in the abovementioned announcements shall have the same meaning when used herein unless the context herein requires otherwise.

I. Background of Restricted Shares which will Become Eligible for Trading

The type of the Restricted Shares which will become eligible for trading are tradable A shares subject to trading moratorium issued under the Non-public Issuance.

(I) Approval Date

On 26 April 2016, the Company received the Approval for the Application for the Issuance of Shares to Shanghai Electric (Group) Corporation for Acquiring Assets and Raising Supporting Funds by Shanghai Electric Group Company Limited (Zheng Jian Xu Ke [2016] No.905) from CSRC, which approved the issuance of 606,843,370 Shares to SEC by the Company for the acquisition of the relevant assets.

(II) Share Registration Date

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The share registration and deposit procedures in relation to the new shares issued under the Non-public Issuance were completed with the Shanghai Branch of China Securities Depository and Clearing Corporation Limited on 29 August 2016.

(III) Lock-up Period Arrangement

The target subscriber of the Non-public Issuance was SEC. The lock-up period for the shares subscribed by SEC under the Non-public Issuance shall be within 36 months from the date of completion of the Non-public Issuance. If the closing prices of the Company's shares are below the issue price for the Non-public Issuance (the "Issue Price") for 20 consecutive trading days within the six-month period from the date of completion of the Non-public Issuance, or the closing price is lower than the Issue Price at the end of the above-mentionedsix-month period after the date of completion of the Non-public Issuance, the lock-up period for shares of the Company subscribed and held by SEC under the Non-public Issuance would be extended automatically for at least six months.

As the trading of shares of the Company was suspended in the period from 31 August 2016 to 28 February 2017 (the end of the six months after the completion of the Transactions) and the closing price of the Company's shares on the last trading day before the suspension of trading, i.e. 31 August 2016, was lower than the Issue Price, the conditions on performance of the abovementioned undertakings were triggered. Therefore, SEC undertook to extend the lock-up period of 606,843,370 Restricted Shares obtained in the Transactions for 6 months to 29 February 2020.

1. Changes in the Issued Share Capital of the Company since the Issuance of the Restricted Shares

On 29 August 2016, upon the completion of the registration of Non-public Issuance, the total issued share capital of the Company increased from 12,824,313,060 to 13,431,156,430.

From the issuance of the Restricted Shares to 31 December 2019, the total issued share capital of the Company increased from 13,431,156,430 shares to 15,152,462,418, including a total of 1,294,006,771 A shares issued by the Company in 2017 for assets acquisition and raising of supporting funds by issuance of shares, a total of 133,578,000 A Shares issued to the participants by way of implementing restricted A share incentive scheme by the Company in 2019, and a total of 293,721,217 A shares added by conversion of the Company's issued A share convertible corporate bonds.

1. Undertakings Related to the Restricted Shares which will Become Eligible for Trading

SEC undertook that the shares subscribed by SEC in the Transactions shall not be transferred within 36 months commencing from the date of completion of the Non-public Issuance subject to the relevant requirements of the CSRC and the Shanghai Stock Exchange thereafter. If the closing prices of the shares of the Company are below the Issue Price for 20 consecutive trading days within six months after the completion of the Transactions, or the closing price of the shares of the Company as at the end of the abovementioned six-month period after the completion of the Transactions is below the Issue Price, the lock-up period for the shares of the Company subscribed and held under the Non-public Issuance by SEC will be automatically extended for at least six months. Meanwhile, SEC undertook that the above undertaking shall

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also apply to the additional shares of the Company allotted to SEC due to bonus issues, transfers of capital surplus to share capital of the Company and etc.

As at the date of this announcement, SEC had strictly complied with the above undertakings and there was no non-compliance with the undertakings which affected the eligibility for trading of the Restricted Shares.

IV. Fund Occupancy by the Controlling Shareholder or its Related Party

There is no fund occupancy by the controlling shareholder of the Company or its related party (as defined in applicable PRC laws and regulations).

V. Details of the Restricted Shares which will Become Eligible for Trading

The number of the Restricted Shares which will become eligible for trading is 606,843,370; The first trading date of the Restricted Shares is 2 March 2020;

Details of the Restricted Shares are as follows:

No.	Name of shareholder	Number of	Shareholding	Number of	Balance of
		shares held	percentage	shares freely	shares subject to
		which are	(%) of the	tradable	trading
		subject to	total issued	(shares)	moratorium
		trading	share capital		(shares)
		moratorium	of the
		(shares)	Company
1	SEC	1,692,805,758	11.17%	606,843,370	1,085,962,388
	Total	1,692,805,758	11.17%	606,843,370	1,085,962,388

VI. Change in the Structure of Share Capital

		Before trading of	Change in	After trading of
	Unit: share	the Restricted	the Restricted
	number
		Shares	Shares
	1. State-owned shares	1,692,805,758	-606,843,370	1,085,962,388
Shares	2. Shares held by state-owned	69,348,127	0	69,348,127
entities
subject to
trading
3. Other shares held by	133,578,000	0	133,578,000
moratoriu
domestic legal persons
m
	Total number of shares	1,895,731,885	-606,843,370	1,288,888,515
	subject to trading moratorium
	A Shares	10,283,818,533	+606,843,370	10,890,661,903

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Shares not	H Shares	2,972,912,000	0	2,972,912,000
subject to
trading	Total number of shares not	13,256,730,533	+606,843,370	13,863,573,903
moratoriu
subject to trading moratorium
m
Total number of shares	15,152,462,418	0	15,152,462,418

By order of the Board

Shanghai Electric Group Company Limited

ZHENG Jianhua

Chairman of the Board

Shanghai, the PRC, 24 February 2020

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 Dr. CHU Junhao, Dr. XI Juntong and Dr. XU Jianxin.

* For identification purpose only

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