The Ministry of Environmental Protection recently conducted environmental verification on Jiangnan Red Arrow. On September 17, the Ministry of Environmental Protection issued a notice stating that the company affiliated to the company is basically in compliance with the relevant requirements for listing environmental protection verification. With the reorganization of Jiangnan Red Arrow, the industry pointed out that the super-hard material concept listed company will add another share.

Since 2012, Jiangnan Red Arrow has officially planned major asset injection and private placement. As of August 30 this year, Jiangnan Red Arrow announced that the company's major asset restructuring was completed.

According to the announcement, the current asset injection has been completed, and the assets of this transaction are 100% equity of Zhongnan Diamond. Zhongnan Diamonds is listed on the backdoor.

Zhongnan Diamond is one of the leading synthetic diamonds in China, with significant scale, industry chain, technology and brand advantages. The main products are synthetic diamond and cubic boron nitride, which are mainly used in building materials processing, machining and drilling and mining industries.

China Merchants Securities released a research report saying that the current super-hard materials industry is in an oligopolistic competition pattern. The top three production capacity accounts for more than 80% of the whole industry, while Zhongnan Diamonds is the industry leader, with a market share of about 45%, and its scale far exceeds that of its peers. The company will benefit first from the stage of low-level growth and the resurgence of growth.

At present, the main domestic super hard materials listed companies include the Yellow River Cyclone, Yu Diamond, Sifangda, Boshen Tools and Antai Technology.

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Letter on Hunan Environmental Protection Verification of Jiangnan Hongjian Co., Ltd.

China Securities Regulatory Commission:

According to Hunan Jiangnan Red Arrow Co., Ltd. “Application for Environmental Protection Verification of Hunan Jiangnan Red Arrow Co., Ltd.” (Jiangnan Hongjian [2013] No. 3), our organization organized a liquidation check on the company.

The scope of this verification is the four production enterprises of the company. For details, please refer to the attachment. Through the initial review of the Environmental Protection Department of Henan Province, Guangdong Province and Jiangxi Province, as well as the verification and social publicity organized by our Ministry, Hunan Jiangnan Red Arrow Co., Ltd. is basically in line with the relevant requirements for listing environmental protection verification.

According to the verification situation, the company should further strengthen environmental management, ensure that pollutants are discharged to the standards, and safely dispose of hazardous wastes; strengthen environmental risk prevention and ensure environmental safety; new, reform and expansion projects shall go through environmental protection examination and approval procedures in a timely manner; Complete, true and accurate disclosure of corporate environmental information.

Attachment: Company Profile of Hunan Jiangnan Red Arrow Co., Ltd.

September 17, 2013 Attachment

Hunan Jiangnan Red Arrow Co., Ltd. The scope of the enterprise within the scope of verification. The serial number of the main business of the province and city where the company name is located
1
Zhongnan Diamond Co., Ltd. Henan Nanyang Synthetic Diamond Wastewater: COD
Exhaust gas: acid mist large particle diamond product production line construction project (recruitment project, under construction)
High-toughness industrial diamond product production line construction project (recruitment project, under construction)
High-grade polycrystalline cubic boron nitride composite sheet (PCBN) and polycrystalline diamond composite sheet (PCD) series tool material industrialization project for precision processing (recruitment project, under construction)
Superhard material R&D center construction project (recruitment project, proposed)
2
Zhengzhou Zhongnan Jiete Superhard Material Co., Ltd. Henan Zhengzhou cubic boron nitride wastewater: BOD5, SS
Exhaust gas: HCl, ammonia, dust
3
Shenzhen Zhongnan Diamond Co., Ltd. Guangdong Shenzhen powder core block (synthetic diamond raw material)
Waste water: COD, BOD5, SS
Exhaust gas: dust, nickel and its compounds
4
Jiangxi Shentian Carbon Co., Ltd. Jiangxi Yichun high-purity graphite, diamond materials and other products wastewater: COD, BOD5, SS
Exhaust gas: dust, chlorine, TSP, benzopyrene production line of 6,000 tons of special graphite (isostatic pressure) production line (recruitment project, proposed)

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