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个股公告正文

万 科B:2012年年度报告(英文版)

日期:2013-02-28附件下载

                                         2012 Annual Report
Important Notice:

The Board of Directors, the Supervisory Committee and the Directors, members of the Supervisory Committee and
senior management of the Company warrant that in respect of the information contained in this report, there are
no misrepresentations or misleading statements, or material omission, and individually and collectively accept full
responsibility for the authenticity, accuracy and completeness of the information contained in this report.

Chairman Wang Shi, Director Yu Liang, Director Sun Jianyi, Director Xiao Li, Independent Director Zhang
Liping, Independent Director Hua Sheng, Independent Director Elizabeth Law attended the board meeting in
person. Deputy Chairman Qiao Shibo and Director Jiang Wei were not able to attend the board meeting in person
due to their business engagements and had authorised Director Yu Liang to represent them and vote on behalf of
them at the board meeting. Director Wang Yin was not able to attend the board meeting in person due to business
engagements and had authorised Director Xiao Li to represent him and vote on his behalf at the board meeting.
Independent Director Qi Daqing was not able to attend the board meeting in person due to business engagements
and had authorised Independent Director Elizabeth Law to represent him and vote on his behalf at the board
meeting.

The Company’s proposal on dividend distribution for the year 2012: Based on the number of shares on the record
date for dividend distribution, a cash dividend of RMB1.8 (including tax) will be distributed for every 10 existing
shares held.

Chairman Wang Shi, Director and President Yu Liang, and Executive Vice President and Supervisor of Finance
Wang Wenjin declare that the financial report contained in the annual report is warranted to be true and complete.

     To Shareholders ……………………………………………………….……………………….……………            2
     Basic Corporate Information …………………………………………………………………..…………            3
     Accounting and Financial Highlights…………………………………………………………..…………           3
     Directors’ Report…………………………………………………………………………………………….. 4
     Significant Events ……………………………………………………………………………………………           43
     Change in Share Capital and Shareholders……………………………………………………………… 50
     Directors, Members of Supervisory Committee, Senior Management and Employees….…………. 54
     Corporate Governance Structure………………………………………………………………………….. 59
     Report of Supervisory Committee ………………………………………………………………………… 62
     Internal Control …………………………………………………………………………………………….. 64
     Financial Report ……………………………………………………………………………………………. 64




                                                      Page 1
I. To Shareholders
2012 was a relatively peaceful year, for a seemingly capricious property development industry in China. It is not
certain whether it was a superficial serenity above an undercurrent or in fact the beginning of an era of stability.
The truth could only be told when the present becomes history. For us who follows the path of history, we could
only wait for the answer to be unveiled.

Has the era of rapid growth in China’s housing prices come to an end? There are no short of accidents in history,
and over-confidence in judgment may lead to assertive conclusion. Nevertheless, it would be safe for us to say
that the era has come to a halt. We believe it is “safe” to draw this conclusion from three aspects; first, it is a
general public expectation, second, it is sensible based on rational analysis, and it is highly probable.

Although the judgement is not conclusive, it is sufficient for corporate interpretation in decision-making.
Corporate decisions are always choices made out of incomplete information in the face of uncertainty.

If we believe that the rapid growth in housing prices has ended, it, in fact, does not matter whether the market
continues to fluctuate or remain stable in future, since corporations can now pursue a long-term strategy that is
applicable to both volatile and steady market conditions.

The main points of the strategy are not complicated. They can be summarized as follows: First, to address the
genuine demand of end-users, rather than investment expectation; second, to rely on professionalism to make a
profit, instead of boldness in investment or “access” to acquire resources; third, quick turnaround and prudent
investment approach; and fourth, not to compromise Vanke’s bottom lines in operation, including product quality,
financial security and legal compliance and integrity, while seeking sustainable development that complements the
nature and social harmony.

Putting it in layman’s terms, focus of Vanke’s operation strategies can be expressed in three phrases: Vanke’s long-
term strategy is to achieve housing standardisation, including furbished units, prefabrication and green building;
no hoarding of land nor stalling in home sales, and not to acquire supreme land lot; and to build affordable and
liveable quality homes.

In 2012, over 80% of units delivered by Vanke were furbished units, and 90% of the Company’s products sold
were small and medium sized units below 144 sq m. Since property investors normally prefer large-sized and
undecorated units, the statistics indicate that the Company’s customers were home-buyers/end-users. Evidenced
by the complete industry cycle since 2008, demand from end-users remained rock solid, regardless of changes in
policy environment and market situation.

The volume of the Company’s land bank is determined by the area necessary for development in the next two to
three years. It is considered to be the lowest attainable level for maintaining stable operation and growth in an
open land market. It is also among the lowest benchmark of leading property developers in the world.
Nevertheless, it has not impeded the growth of Vanke, nor does it affect acceleration in the Company’s return on
equity in recent years.

No land hoarding and stalling home sales mean quick turnaround. Not acquiring supreme land lot is the realization
of the Company’s extremely prudent investment approach. A property developer capable of quick turnaround is
closer in nature to a manufacturing enterprise. The maintenance of rapid turnaround is instrumental to continued
improvement of the Company’s professionalism. A combination of quick turnaround and prudent investment
approach could then ensure safety and flexibility in the Company’s operations amid possible fluctuations in the
market.

Vanke’s strategy of offering furbished units has basically been accomplished. The Company’s strategic focus in
the coming few years will shift to prefabrication. Abilities in managing large-scale production, quality assurance,
construction efficiency, in addition to economies of scale and environmental protection brought along by
prefabrication is gradually becoming the Company’s professional niches. In comparison, furbished units can be
easily duplicated, while prefabrication can hardly be imitated. Vanke has been exploring the technique of
prefabrication for more than a decade, and the first-mover advantage brought forward by prefabrication will be
more significant than that from furbished units.

All endeavours and competitive edges of an enterprise are eventually reflected in the value created for its investors.
2013 marks the final year of the three decades of Vanke’s development, and 30 years is by no means a short period


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of time. We are thankful for the shareholders’ continued support to and confidence in Vanke’s management team.
You can be rest assured that, we will remain young and energetic at heart, although we are becoming a mature
enterprise. We will continue to pursue our dreams with passion, in order to fulfil, with honour, our duty entrusted
by the shareholders.


II. Basic Corporate Information

1.  Company name (Chinese): 万科企业股份有限公司
    Company name (English): China Vanke Co., Ltd. (“Vanke”)
2. Legal representative: Wang Shi
3. Secretary of the Board: Tan Huajie
    E-mail address: IR@vanke.com
    Securities Affairs Representative: Liang Jie
    E-mail address: IR@vanke.com
4. Contact address: Vanke Center, No. 33 Huanmei Road, Dameisha, Yantian District, Shenzhen, the People’s
    Republic of China
5. Telephone number: 0755-25606666
    Fax number: 0755-25531696
6. Registered address: Vanke Center, No. 33 Huanmei Road, Dameisha, Yantian District, Shenzhen, the People’s
    Republic of China
    Postal code: 518083
    Office address: Vanke Center, No. 33 Huanmei Road, Dameisha, Yantian District, Shenzhen, the People’s
    Republic of China
    Postal code: 518083
7. Website: www.vanke.com
    E-mail address: IR@vanke.com
8. Media for disclosure of information: “China Securities Journal”, “Securities Times”, “Shanghai Securities
    News” , “Securities Daily” and an English publication in Hong Kong
    Website for publication of annual reports: www.cninfo.com.cn
9. Place for annual report collection: The Office of the Company’s Board of Directors
10. Stock exchange on which the Company’s shares are listed: Shenzhen Stock Exchange
11. Company’s share abbreviation and stock codes on the stock exchange: Vanke A, 000002
                                                                             Vanke B, 200002
12. First registration date of the Company: 30 May 1984; location: Shenzhen
             Date of change in registration: 13 April 2010; location: Shenzhen
13. Corporate legal person business registration no.: 440301102900139
14. Taxation registration code: Local taxation registration code: 440300192181490
                                    State taxation registration code: 440300192181490
15. Organisation code: 19218149-0
16. The name and address of the certified public accountants appointed by the Company:
     KPMG Huazhen (Special General Partnership) Certified Public Accountants:
     8/F, Office Tower E2, Oriental Plaza, 1 East Chang An Avenue, Beijing
     Accountant-in-charge:Li Wanwei, Wen Huaxin

III. Accounting and Financial Highlights
1. Three-year financial information summary (Unit: RMB’000)




                                                      Page 3
                                                      2012           2011              Change          2010

     Revenue                                           96,859,914    67,709,396               43.1%   47,763,550
     Share of profits less losses of associates
                                                                                              38.2%
     and jointly controlled entities                       889,787      643,988                          291,703
     Profit before income tax                                                                 31.8%
                                                       25,697,537    19,490,060                       14,542,867
     Income tax expense                                                                       27.2%
                                                     (10,034,949)    (7,890,454)                      (5,703,257)
     Profit for the year                                                                      35.0%
                                                       15,662,588    11,599,606                        8,839,611
     Profit attributed to minority                                                            57.6%
                                                      (3,111,406 )   (1,974,731)                      (1,556,483)
     Profit attributed to Equity shareholders
                                                                                              30.4%
     of the Company                                    12,551,182     9,624,875                        7,283,127
     Basic earnings per share                                                                 29.5%
                                                              1.14          0.88                              0.66
     Diluted earnings per share                                                               29.5%
                                                              1.14          0.88                              0.66
     Dividend per share                                                                       38.5%
                                                              0.18          0.13                              0.10



2. Impact of IFRS Adjustments on Net Profit (Unit: RMB’000)
                                        Items                           Net profit for 2012
      As determined pursuant to PRC accounting standards
                                                                                   12,551,182
      As restated in conformity with IFRS
                                                                                   12,551,182




IV. Directors’ Report
1. Management Discussion and Analysis

Changes in market environment, and the Company’s perspective

The area of residential property sold in the 14 cities (Shenzhen, Guangzhou, Dongguan, Foshan, Shanghai,
Suzhou, Wuxi, Hangzhou, Nanjing, Beijing, Tianjin, Shenyang, Chengdu, and Wuhan) where the Company paid
high regard to, continued to shrink in 2010 and 2011, representing year-on-year decline of 29.6% and 19.2%
respectively. Since March 2012, there was an improvement in the residential market sentiment in these cities. As
the comparative figure was relatively small, rebound in property sales was notable. In 2012, the sales area of the
abovementioned cities increased 34.3% year-on-year. Nevertheless, it still represented a drop of 23.6% as
compared to that of 2009.

With the recovery of residential property sales in major cities, China’s accumulative sales volume in November
2012 ended the downward trend since the beginning of the year. The sales area of commodity housing for the full
year was 985,000,000 sq m, representing an increase of 2.0% when compared with that of last year. However, the
slowdown in the growth rate of China’s commodity housing sales since 2010 remained significant. The trend in
different regions also varied to a great extent. The outlook for residential property sales in the cities below
prefecture level in the mid-western region was still gloomy.

With respect to new housing supply, the aggregate approved pre-sales area of the abovementioned 14 cities in
2012 decreased by 6.8% as compared to that of the previous year. As supply dropped and sales increased, the ratio
of sales area of commodity housing to approved pre-sales area of new housing in these cities in 2012 increased to
1.01, reflecting a substantial surge when compared with 0.70 in 2011. The market was close to an equilibrium.
This, to a certain extent, had eased the pressure of rising inventory since the beginning of 2011. As at the end of
the year under review, the housing inventory available for sale (commodity housing that had been granted sales
permit but had not been sold) in these 14 cities had an aggregate area of approximately 116 million sq m, which
remained basically the same as that of the corresponding period of last year. The time taken to clear housing
inventory (based on the calculation of the moving average sales area in the last 3 months) was shortened from the


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longest period of 21.7 months as at the end of February 2012 to 10.2 months.

The decline in new supply, to a certain extent, reflected the impact of previous market adjustment on enterprises’
investment in property development. During the year under review, the completed residential development
investment in China showed an 11.4% year-on-year increase, indicating the lowest growth rate in the past 10 years.
The floor area of residential properties commenced construction across China decreased by 11.2% year-on-year,
which was rarely seen in the past few years.

The Company had predicted that enterprises with greater capital strength would be able to seize more
opportunities as land supply increased in the second half of 2012. During the year under review, the change in
land market conformed to the Company’s view. In the 16 major cities where statistics are accessible by the public
(Shenzhen, Guangzhou, Dongguan, Foshan, Shanghai, Hangzhou, Nanjing, Suzhou, Ningbo, Beijing, Tianjin,
Shenyang, Dalian, Chengdu, Wuhan, and Chongqing), the area of land supplied in the first half of the year
dropped by 1.4% year-on-year, but increased by 25.4% year-on-year in the second half of the year. About 68.9%
of the area of land supplied for the full year concentrated in the second half of the year. As property developers’
liquidity improved and their investment desire inflated, there were fewer aborted land auctions. During the second
half of the year, part of the land market in certain cities became relatively active, with more land lots changed
hands at a premium. Nevertheless, there was no noticeable increase in the land price in the second half of the year.
The activities in the land market in general had been fairly rational.

In order to facilitate a reasonable expansion of monetary credit financing, the People’s Bank of China had lowered
0.5 percentage point of the deposit reserve ratio twice in the first half of 2012, and lowered deposit and lending
interest rates in June and July respectively. According to the report of the central bank, China’s new mortgage
loans for 2012 amounted to RMB1,346.5 billon, up by RMB89.7 billion from that of last year. However, the
increase in mortgage loans represented 17.4% of the total increments of various types of loans during the year and
a slight 0.1 percentage point decrease year-on-year. Although the financing environment in the property market
had improved from 2011, fundamental improvement had yet to be seen. Broadening financing channels and
enhancing capital stability continued to be paramount for corporations.

2012 operating results and analysis
During the year under review, the Company continued its focus on the mainstream market. Satisfactory sales
results were achieved with proactive sales promotion by adjusting the momentum of new project launches in
accordance with changes in market sentiment.

In 2012, the Company realized a sales area of 12,956,000 sq m and a sales amount of RMB141.23 billion,
representing year-on-year increases of 20.5% and 16.2% respectively. The sales amount, again, marked a new
industry record.

By geographical segment, the Company realised a sales area of 4,128,000 sq m and a sales amount of RMB46.82
billion in Pearl River Delta focused Guangshen Region; a sales area of 2,557,000 sq m and a sales amount of
RMB32.97 billion in Yangtze River Delta focused Shanghai Region; a sales area of 3,460,000 sq m and a sales
amount of RMB36.99 billion in Bohai-rim focused Beijing Region; a sales area of 2,811,000 sq m and a sales
amount of RMB24.45 billion in Chengdu Region, which comprises core cities of Central and Western Region.

Residential properties sold by the Company continued to be dominated by small to medium sized ordinary
commodity housing units. Residential units with an area under 144 sq m accounted for 90% of all the residential
units sold.

During the year under review, the Company realised a booked area of 8,993,000 sq m and booked revenue of
RMB95.42 billion, representing increases of 60.0% and 43.2% year-on-year respectively. In 2012, the Company’s
revenue reaching RMB96.86 billion, representing an increase of 43.1% year-on-year. The Company’s net profit in
2012 surged by 30.4% year-on-year to RMB12.55 billion.

The average booked price of the Company’s property business was RMB10,610 per sq m, representing a 10.5%
drop from that of 2011. The booked gross profit margin of the property business stood at 27.41%, down by 3.03
percentage points year-on-year. The booked net profit margin was 13.92%, down by 1.99 percentage points year-
on-year. Although the profit margins decreased year-on-year, the Company’s return on equity increased. During
the year under review, the Company’s fully diluted return on equity was 19.66%, up by 1.49 percentage points as
compared to 2011, and was the highest in the last 10 years.


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This was due to: increase in the Company’s operating efficiency, which, to a certain extent, mitigated the impact
of lower selling price and trimmed profit margins during the market trough in 2011; and the Company’s full
implementation of its strategy in fubrbished units (furbishing operations offer lower profit margin but higher rate
of return when compared with undecorated units).

As at the end of 2012, the Company had a total area of 13,549,000 sq m sold but not yet booked stated in the
consolidated statements, with a corresponding contract amount of RMB143.65 billion, representing increases of
24.8% and 17.6% respectively when compared with those at the end of 2011. The amount provided a solid
foundation for the future performance of the Company.

The Company maintained a safe and sound financial structure. Despite the increase in receipts in advance from
RMB111.1 billion at the end of 2011 to RMB131.0 billion, the Company’s gearing ratio rose by 1.21 percentage
point, from 77.12% of 2011 to 78.33%. However, as receipts in advance would be recognized as revenue upon
recognition of projects, they did not constitute any real debt repayment pressure. Excluding receipts in advance,
the Company’s other liabilities as a percentage of total assets was 43.77%. As at the end of the year under review,
the Company’s net gearing ratio continued to remain at a relatively low level of 23.50% when compared with the
industry average.

The Company continued to adhere to its “cash is king” strategy to ensure a sound cash position. As at the end of
the year under review, the cash and cash equivalents held by the Company amounted to RMB52.29 billion, which
was significantly higher than the sum of short-term borrowings and long-term borrowings due within one year of
RMB35.56 billion. During the year under review, despite a substantial increase in investment, the Company
basically maintained a balance between cash inflow and outflow from operating activities. The relatively solid
cash position will enable the Company to be more flexible in responding to market changes.

The Company paid high regard to maintaining a low inventory level. As at the end of the year under review, the
Company’s inventories included RMB15.99 billion of completed properties (properties ready for sale), accounting
for 6.31%;RMB160.68 billion of properties under development (including properties sold but not yet booked),
accounting for 63.35%; RMB76.73 billion of properties held for development (corresponding to the Company’s
projects under planning), accounting for 30.26%. The inventory structure remained healthy.

The Company’s floor area commenced construction and completed in 2012 reached 14,330,000 sq m and
9,790,000 sq m respectively, which were 7.9% and 10.0% higher than those planned at the beginning of the year
respectively.

The Company actively seized the opportunity arising from increased land supply in the second half of 2012.
Adhering to its stringent investment criteria, the Company obtained a portfolio of land lots that could meet its
future development needs. During the year under review, the Company acquired 78 development projects, with a
site area attributable to Vanke’s equity holding of approximately 6,240,000 sq m (corresponding planned GFA of
approximately 15,890,000 sq m), at an average land premium per floor area of approximately RMB2,790 per sq m.
Besides, the Company was also involved in one city redevelopment project; according to the current planning, the
site area attributable to Vanke’s equity holding of the related project was approximately 60,000 sq m
(corresponding planned GFA of approximately 330,000 sq m) and the average composite redevelopment cost and
land premium per floor area was approximately RMB3,800 per sq m. During the year under review, the Company
also extended its reach to such cities as Nanchong, Pingdu, Xuzhou, Yingkou, Jinan etc, while intensifying
penetration of its existing markets

As at the end of the year under review, the aggregate GFA of the Company’s projects under planning attributable
to Vanke’s equity holding amounted to 39,470,000 sq m, which was more than the 32,770,000 sq m at the
beginning of the year and could basically meet its development needs within the next two to three years. In
addition, as at the end of the year under review, the Company was involved in a city redevelopment project.
According to the current planning, the GFA attributable to Vanke’s equity holding was approximately 3,030,000
sq m, which increased slightly from that at the start of the year.

Review on the Company’s management in 2012
During the year under review, the Company remained market, customer and shareholder oriented. It continued to
improve efficiency, fine-tune operation management and push ahead with the strategy of housing standardisation.
While maintaining stable growth in sales and development, the Company solidified and sharpened its expertise,


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with an enriched product and service portfolio.

In 2012, the number of residential units delivered by the Company exceeded 100,000 units. Upholding its
philosophy of “quality comes first”, the Company focused its management task on ensuring work safety and
product quality. The Company arranged a large number of project systems management staff and key technicians
to study in Japan. Their acquired project management experience from developed countries would gradually be
applied in the Company’s projects. To ensure product quality, the Company tried to stand in the shoes of its
customers, and continued to adjust and improve precision measurement system, and intensified the promotion of
the joint inspection system prior to the delivery of residential units.

During the year under review, the Company applied “management of companies by category” and “specific
guidance” to its front-line companies. Moreover, the Company also distributed some of its investment decision-
making authorities to regional offices, thus enforcing the regional offices to assume more responsibilities in
operation. Empowering the regional offices in investment decision-making allows the Company to have swift and
effective response to market changes in capturing the market opportunities. The Company’s adjustment in
management structure entailed the revamping of strategic management control system and fine-tuning of strategic
operation management system, in accordance with business proposal.

Real estate development is a capital-intensive industry. During the year under review, the Company expanded the
source and lowered the cost of funding by fully leveraging the various instruments in the capital markets and
exploring new collaboration approaches in addition to traditional financing methods. As a result, the Company
ensured the satisfaction of its development needs.

As the function of residential property returns to its origin as dwelling, ancillary services have become a key
customer consideration in home purchase. In 2012, the Company adhered to its philosophy of “Building quality
housing for ordinary people” and “Building affordable and liveable homes”. On the aspect of improving product
functionality, the Company continued to explore and improve ancillary services, and introduced a series of
innovative services including The V Canteen, Wanwu Storage, Fortune Depot. By improving every aspect of a
community’s ancillary services, from catering, storage and comprehensive convenience services, the quality of
living of customers is being enhanced.

During the year under review, the Company successfully acquired 75% equity interests in Winsor Properties
Holdings Limited, a Hong Kong listed company, which has now been renamed Vanke Property (Overseas)
Limited. As a component of the international market, the capital market in Hong Kong is relatively mature, with a
diversified range of financial products. The acquisition is conducive to the exploration and development of the
Company’s international business.

The Company's corporate image gained further recognition. In 2012, the Company was named “The Most
Respectable Enterprise in China” by Economic Observer and Management Case Center of Peking University for
the 10th consecutive time; and it was on the “All-Star List of 2012 Most Praised PRC Enterprises” of the “Most
Praised PRC Enterprises” announced by Fortune China for the fifth consecutive time; and the Company remained
in the number one position under the real estate developer category. The Company was awarded 2012 Overall
Best Corporate Citizenship in China, in the Ninth China Corporate Citizenship Forum jointly organized by 21st
Century Business Review and 21st Century Business Herald; and was awarded the Annual Corporate Social
Responsibility Showcase in the selection of Chinese Corporations’ Social Responsibility organized by Southern
Weekend.

The Company was again awarded the No. 1 title out of Top 100 Property Development Enterprises in the PRC in
2012, and the No. 1 title out of Top 10 in terms of comprehensive competitiveness, scale of operation and social
responsibility, in the assessment conducted by Enterprise Research Institute of the Development Research Center
under the State Council, Institute of Real Estate Studies of Tsinghua University and China Index Academy. The
Company was selected as “The Leading Corporate Brand in China’s Real Estate Industry in 2012”, and the
Company’s property management companies were selected as China Top Brands of Property Management
Companies in 2012. Furthermore, the Company was ranked No. 1 out of Top 500 Property Development
Enterprises in the PRC in 2012 and received the “Outstanding Contribution” award from China Real Estate
Research Association, China Real Estate Association, and China Real Estate Appraisal Center.

At the end of the year under review, the president of the Company, Mr Yu Liang, was elected among the Top 10
Economic Persons of the Year in “CCTV Economic Persons of the Year” in 2012. With the theme of “Mission of


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Industry” in 2012, the selection aimed to honour the outstanding participants in the economy and those who have
made enormous contribution to the development of the economy. The election of Mr Yu was an evidence of broad
public recognition of the business philosophy and strategies pursued by the Company over the years have won
wide recognition from the public.

The Company maintained close contact with its investors. During the year under review, the number of investor
visits and telephone conferences organized by the Company exceeded 600. Also, the Company had participated in
over 70 large-scale investors meetings held by local and overseas organizations. In addition, via results
announcement meetings, online presentations and company visits, the Company had proactively strengthened its
communication with investors. In 2012, the Company was named the Best Investor Relations Listed Company
jointly selected by hexun.com, Stock Exchange Executive Council (“SEEC”) of the PRC, and was elected as one
of the Top 100 Most Valuable Main Board Listed Companies in China by Securities Times. The Company was
also named as the Top 100 Chinese Listed Companies for Market Value Management Performance in 2012 jointly
organized by China Research Center for Market Value Management of Listed Companies, the China Center for
Financial Research, Tsinghua University and Sina.com. The Company’s secretary to the Board again received the
title of Gold Prized Secretary to the Board and was named Institutional Investors’ Most Popular Secretary to the
Board by New Fortune; he was also named the Secretary to the Board with the Most Innovative Power by
“Directors & Boards”, and Gold Prize Award to Listed Company’s Secretary to the Board by hexun.com

Development prospects in 2013
The Company will maintain a growth strategy in tandem with city development. It will focus on the mainstream
market, and a product and service philosophy of “Quality Housing, Quality Service, and Quality Neighbourhood”.
With emphasis on “producing the right products” and “acquiring the appropriate sites”, the Company will
strengthen product competitiveness, increase operating efficiency, and pay attention to cooperation relationship, so
as to achieve stable growth.

In 2013, it is estimated that the number of residential units of to be delivered by the Company will exceed 110,000
units. In order to ensure construction safety and quality of the units upon delivery, the Company will strictly
adhere to the safety management regulations, and will strengthen civilized construction management and improve
the safety of the working environment for construction workers. With respect to quality management, the
Company will constantly improve the appraisal system, taking into account customers’ perspective, and adhering
to the principle of simplicity and effectiveness.

On the front of procurement management, the Company will strictly adhere to the three-level material
management system, insisting on unscheduled quality inspection. To realise its accountability to customers, the
Company will continue to improve the quality and standardize the material used for furbishing, with an emphasis
on healthy, quality and environmental friendly elements.

The Company will maintain a rapid development strategy. Basing on the Company’s existing projects, the floor
area commencing construction and area to be completed in 2013 are expected to reach 16,530,000 sq m and
1,290,000 sq m respectively.

Given a relatively strong cash position, the Company will consolidate its end-user oriented product positioning
and continue to stay alert of potential project development opportunities, with a prudent approach. In respect of
the decision-making for project development, the Company’s consideration lies in whether the land premium is
reasonable relative to property prices in the surrounding areas and the project risk exposure is controllable. The
Company will not determine a project’s profitability in accordance with overoptimistic expectation.

The extension of cities’ functionality and the advancement of the property industry and escalation in customers’
qualitative demand in recent years, have led to more demanding requirement for the Company’s products and
services. The Company will maintain a growth strategy in tandem with city development, and constantly improve
its product line, to satisfy customer needs. It will prudently explore types of real estate that can be integrated with
residential property development. In January 2013, the Company has established its Commercial Property
Management Division in Beijing. In future, the Company will consolidate its commercial resources around its
residential development, in order to create synergetic benefits from integrated commercial and residential
developments, and to offer a living environment that provides “Quality Housing, Quality Service, Quality
Neighbourhood” for customers. The Company will seek to identify the kind of commercial property that can fit in
its operations.



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In 2012, the Company established an overseas business development team, to conduct study tours across the
world. At the beginning of 2013, the Company tapped into the Hong Kong and US markets through collaboration
with local experienced and renowned property developers. At present, the Company is still in the trial and learning
phase in the development of international business. For some time in future, this business will be kept within a
reasonable size. Through its attempts in international business, the Company will obtain the chance of and
experience in learning and understanding the operation of overseas mature markets. During this process, the
Company will gradually develop the ability to independently carry out overseas business. Cooperating with other
international top-notch companies in the same industry plays a positive role in sharpening the Company’s
expertise in the aspects of product design, understanding customers’ needs and refined management.

Although the Company has a reservoir of talents, its ability to continue to attract and retain talents is a crucial
factor for the Company to remain competitive in future. As such, against a backdrop of intensified struggle for
human resources, the Company will continue to strengthen its grooming of a pool of talents for successive
development. It will fine-tune its training mechanism for the building of an efficient elite workforce, in order to
improve its organization effectiveness. The Company will initiate a strong leadership programme. Through both
internal training and external sourcing, the Company will be able to have the management talents, either through
recruitment or promotion, leading the Company to survive the competition. In order to meet the needs for
exploring new commercial and overseas businesses, the Company will also bring in professional talents with the
relevant experience, providing manpower support for new business development.

Progress of standardisation in residential development

Since the establishment of Vanke Architectural Research Centre in 1999, the Company has been engaging in
housing standardisation for 13 years. The Company’s persistence in research and development, as well as product
application has established its expert niches in this field. The Company’s strategy for standardisation in
residential development consists of three aspects: furbished housing, prefabrication, and green building. There
have been some favourable results in the development of the abovementioned aspects, thanks to the Company’s
intensified effort in pushing forward their application in recent years. The Company believes that the extensive
promotion and application of standardisation system in residential development will enable the Company to break
through the bottleneck in expansion of operational scale, and it will become an important source of the Company’s
core competitiveness in future.

1. Furbished housing
China’s residential property industry is still in the transition from traditional undecorated housing to furbished
housing. Vanke was a pioneer in the industry to carry out furbished housing strategy. In 2012, the number of
furbished units delivered by the Company exceeded 80,000 units, a quantity unprecedented in the industry.

Contrary to the handover of undecorated housing, the delivery of furbished units can basically eliminate
secondary pollution and reduce most of the waste generated during decoration, and help customers to save
enormous amount of time and energy. The delivery of furbished units will also greatly reduce disturbance to
neighbours from furbishing works taking place at different times. As to the developers, promotion of delivery of
furbished units not only conforms to the development trend of the industry, but also helps increase return on net
assets.

The delivery of furbished units involves more complex and stringent requirements for construction management.
The Company has established a set of relatively comprehensive procedures for unit furbishing and handover
management. To keep improving the quality of furbished units being delivered, the Company published a set of
grading standards for a healthy housing system in 2012. The Company formulated a more rigorous technology and
management guidelines, strengthened the management of interior environment furbishing and further increased
the frequency of material and furniture random inspection.

In 2013, the number of furbished units to be delivered by the Company will exceed 100,000 units. The Company
will continue to fine-tune the delivery process of furbished units and work standards, improve the techniques and
process of furbishing, and promote “Guidelines on inspection and acceptance of furbished housing upon delivery”,
and promote joint inspection prior to handover to ensure delivery quality.

2. Prefabrication
Compared to traditional construction method, prefabrication has distinctive advantages in certain aspects. It is
conducive to quality control in large-scale housing development; home building via prefabrication is faster than


                                                      Page 9
raditional construction process, which can help shorten turnaround time. Moreover, prefabrication is more
environmentally friendly than traditional construction method.

With the significant increase in labour costs in the building industry, the economic benefits of prefabrication are
becoming more obvious. The time for large-scale application is arriving. The Company’s floor area of
prefabricated projects commenced construction reached 2,720,000 sq m in 2012.

In recent years, the Company has extensively applied steel formwork system and aluminium formwork system.
Compared with timber formwork, steel and aluminium formwork systems can significantly lower wood
consumption during the construction process, thereby protecting the environment. At the same time, the use of
these systems reduce dependence on manpower, save the process of surface plastering and polishing, prevent
possible appearance of cracks in walls or air cavity between the wall structure and plaster, and will, thus, ensure
higher quality consistency. In 2012, the Company’s floor area commenced construction using aluminium and steel
formwork systems amounted to 6.95 million sq m, representing a 93% increase from that of 2011.

In addition, the Company began to apply and conduct a series of research on mechanical technique, including
mechanical shotcrete application and mechanical putty sander in recent years. Compared with traditional
construction process, application of mechanical technique does not only allow the Company to effectively
increase the passing rates in quality inspection by averting the common quality problems, but also enable the
Company to complete an amount of works significantly larger than that achieved by traditional method, given the
same amount of manpower.

In cities where conditions permit, the Company will gradually initiate pilot projects for comprehensive
prefabrication. With prefabrication technology application and systematic construction becoming more and more
mature, the Company will be entering an era of total prefabrication.

3. Green building
Against the backdrop of low carbon economy, provision of green property is in line with the future development
trend of the industry. Vanke was a pioneer in the industry to promote green building. In 2012, the Company
completed a total of 20 three-star green projects, with a total gross floor area of 1,666,000 sq m; of which
1,220,000 sq m were residential projects, accounting for 44% of the total three-star green residential area in China.

In 2012, a foundation stone laying ceremony for the Beijing Green Buildings Demonstration Zone was held in
Fangshan District, Beijing. Initiated by Vanke, the Beijing Green Buildings Demonstration Zone project
comprises of green parks, a research and development centre and an industry incubation park. Upon completion, it
will become a leading platform for promoting green ideology in the world. Actively driven by Vanke, the project
has amassed a number of international and domestic first-class research institutions and companies, with the
establishment of the Green Technology Alliance for Vanke Beijing Green Building Park by Vanke and 14 research
institutions and enterprises, including United Kingdom’s Building Research Establishment (BRE). Latest green
concepts had been adopted during the planning process, with the introduction of international advanced green
building technology. This will undoubtedly further increase Vanke’s influence in the field of green building.
Meanwhile, Vanke’s collaboration with the world’s top-notch green building research institutions and enterprises
will facilitate exchange in ideas and experience in highly efficient and sustainable construction and development.
This will further consolidate the Company’s expert niches in green building.

During the year under review, the Company and the World Wide Fund for Nature (“WWF”), the world’s largest
independent environmental non-governmental organisation, entered into a Memorandum of Understanding, with
the intention to collaborate on environmental protection and green and sustainable development in the next five
years. Vanke was the first Chinese enterprise to enter into an agreement with WWF. Collaboration with WWF will
enable the Company to garner more support for specialised technology in the areas of carbon emission reduction,
ecological protection and forest protection, which are instrumental to the Company’s promotion of green
strategies and strengthening of long-term competitive edge.

In 2012, a number of experimental facilities at the Company’s architectural research centre were gradually put into
operation. Vanke Architecture Experimental Tower at the Company’s Dongguan Architectural Research Centre
has inaugurated. It is the first domestic and the world’s highest high-rise building equipment system performance
testing and experimental tower. The experimental tower, using precise technical research method, introduces
research on the comfort level and green technology of residential properties. It will provide a scientific and
disciplined reference for the State’s establishment of the industry standards. The laboratories and simulation room


                                                      Page 10
in the Dongguan Architectural Research Centre have passed relevant quality assessment tests and are now ready
for operation. These achievements strengthen the Company’s influence and authority as a specialised residential
developer, and equip the Company with internationally advanced research skills and resources on certain subjects.
With the continued strengthening of its research ability in architecture, the Company will further solidify its first-
mover advantage in standardisation in residential development.

2. Operation of the Company
(1) The scope and operations of the Company’s core businesses
A. By sector
The Company specialises in property development with commodity housing as its major products. In 2012, the
Company’s sales area and sales amount were 12,956,000 sq m and RMB141.23 billion respectively, representing
increases of 20.5% and 16.2% respectively when compared with those of 2011.

In 2012, the total sales of commodity housing in the PRC amounted to RMB6,445.6 billion. Based on the
aforesaid amount, the Company accounted for 2.19% of the domestic market, representing a year-on-year growth
of 0.13 percentage point.

During the year under review, the booked area, booked revenue and booked cost of the Company’s property
projects were 8,993,000 sq m, RMB95.42 billion and RMB64.62 billion respectively, representing increases of
60.0%, 43.19%, and 51.53% respectively when compared with those of the previous year. The operating profit
margin of the property business for the year was 27.41%, down by 3.03 percentage points from that of the
previous year.

                                                                                                Unit: RMB’000
                                     Revenue                       Cost of sales                     Operating profit margin
          Sector
                             Amount            Change        Amount           Change               Value                Change
                                                                                                                       Down by 3.06
 1.     Core businesses    96,223,797          43.24%                         51.58%              27.27%
                                                            65,325,752                                              percentage points
 Include: Sale of                                                                                                      Down by 3.03
                           95,416,611          43.19%                         51.53%              27.41%
      property                                              64,600,952                                              percentage points
          Property
                                                                                                                       Down by 6.46
          manageme           807,186           49.37%                         55.75%              10.11%
                                                             701,389                                                percentage points
          nt
                                                                                                                          Up by 8.38
 2. Other businesses         636,117           19.79%                         -15.35%             79.80%
                                                             128,476                                                percentage points
                                                                                                                       Down by 3.04
 Total                     96,859,914          43.05%                         51.34%              27.61%
                                                            65,454,228                                              percentage points

Note: Core business tax and surcharges had been deducted from the operating profit margin



B. By investment region
                            Revenue                         Net profit                             Booked
                           from core            Percenta    (RMB’000      Percentage               area                Percentage
                           businesses              ge           )                                  (sq m)
                          (RMB’000)
Guangshen                       27,149,856        28.46%     4,462,982             33.60%               2,398,703              26.67%
    i
RShanghai
                                  20,422,697      21.40%     2,296,641             17.29%               1,426,061              15.86%
R i                                                                                                                            34.69%
Beijing Region                    31,419,977      32.93%     4,182,329             31.49%               3,119,394
Chengdu Region                    16,424,081      17.21%     2,339,903             17.62%               2,048,799              22.78%

Total                             95,416,611    100.00%     13,281,855        100.00%                   8,992,957           100.00%

(2) Operating results of the major wholly-owned subsidiaries of the Company
                                                                                              Unit: RMB’000
                                                                                                                     Major projects
      Name of           Equity                                                          Total assets at the end
                                     Revenue in 2012         Net profit in 2012                                       developed in
      company          interest                                                                of 2012                    2012
                                                                                                                    Blue Mountain,
Beijing   Vanke                                                                                                     Beijing,        ,
                          100%                  2,723,785                1,140,147                   15,298,258
Company Limited                                                                                                     Hongshi Jiayuan,
                                                                                                                    Beijing,     and



                                                             Page 11
                                                                                                            Beijing    Vanke
                                                                                                            Lan (万科蓝)
   Shenzhen Vanke
                                                                                                            Philippe Castle,
   Evergrande              100%             1,754,460                411,691                    1,965,527
                                                                                                            Shenzhen
   Property Co., Ltd.
   Dalian Glamorous                                                                                         A      Glamorous
   City Real Estate                                                                                         City, Dalian, and
                           100%             1,700,799                402,479                    2,293,411
   Development Co.,                                                                                         Spring       Dew
   Ltd.                                                                                                     Mansion,, Dalian
   Dongguan
                                                                                                            Hongxinuoya,
   Songhuju Property       100%             1,388,488                405,456                    1,415,856
                                                                                                            Dongguan
   Co., Ltd.
   Hangzhou
   Liangzhu      New                                                                                        Hangzhou
   Town                    100%             1,218,182                431,833                    4,214,189   Liangzhu     New
   Development                                                                                              Town
   Company Limited
   Xiamen       Vanke
                                                                                                            Huxindao,
   Huxindao       Real     100%             1,151,896                423,620                    2,049,021
                                                                                                            Xiamen
   Estate Co., Ltd.
   Tianjin Zhongtian
   Wenfang                                                                                                  Holiday     Dew
                           100%             1,121,191                327,879                    2,179,050
   Investment     Co.,                                                                                      Garden, Tianjin
   Ltd.
   Qingdao   Vanke                                                                                          Blue Mountain,
                           100%             1,118,728                480,753                    3,795,284
   Company Limited                                                                                          Qingdao
   Anshan    Vanke
                                                                                                            Whistler, Anshan
   Real      Estate
                           100%              988,190                 132,432                    1,622,129   and Dream Town,
   Development Co.,
                                                                                                            Anshan
   Ltd.
   Guangzhou
                                                                                                            Jinyu  Huating,
   Wanxin Property         100%              924,965                 187,666                    1,263,583
                                                                                                            Guangzhou
   Company Limited

   (3) Implementation of the business plan
   The Company focused on mainstream customers – end-users, and actively promoted sales to achieve satisfactory
   performance. In 2012, the Company’s sales area and sales amount reached 12,956,000 sq m and RMB141.23
   billion respectively, representing increases of 20.5% and 16.2% respectively.

   At the beginning of the year, the Company’s planned floor area commencing construction and area to be
   completed were 13,280,000 sq m and 8,900,000 sq m respectively. In 2012, the actual floor area commenced
   construction amounted to 14,330,000 sq m, representing an increase of 7.9% from that planned at the beginning of
   the year. The actual completed area achieved by the Company for the full year amounted to 9,790,000 sq m,
   representing an increase of 10.0% from that planned at the beginning of the year.

   Development of the Company’s major projects in 2012

                                                                                                                    Unit: sq m
      Project Name            Location     Equity       Site area    Planned       Area of           Area of         Accumulated
                                          interest                    GFA        construction      construction         area of
                                                                                    work           work done in      construction
                                                                                 commenced            2012             work not
                                                                                   in 2012                          done as at the
                                                                                                                      end of 2012
Guangshen region
Vanke Centre, Shenzhen        Yantian       100%            61,730      80,201              -                   -                -
Vega Villa (天琴湾)           Yantian
Shenzhen                                    100%          253,990       25,040              -               7,474           14,611
Yihaicheng(壹海城),           Yantian
Shenzhen                                     50%          137,250      354,695        188,297                   -                -
Antuoshan Project,            Nanshan
                                            100%            48,804     219,967              -                   -                -
Shenzhen
Respecte Chateau (金色领          Baoan
域), Shenzhen                               100%            65,364     165,648         11,764           125,575            125,575
Ravine Village, Shenzhen          Baoan      60%          158,639       47,270              -                   -                -


                                                           Page 12
Philippe Castle(翡丽郡),       Baoan
                                           100%    77,265    262,793    194,131        -         -
Shenzhen
Golden Paradise, Shenzhen   Pingshan New
                                           100%   104,801    323,624    158,440        -    82,186
                               District
The Village, Shenzhen         Longgang     100%   421,916    595,982          -        -   465,798
Tianyu, (天誉), Shenzhen     Longgang      100%    62,575    352,464          -        -         -
Qianlin Shanju, Shenzhen     Longgang      100%   198,597    380,547          -        -   324,277
Home (万科红), Shenzhen      Longgang      100%    31,337    155,951          -        -    91,182
Home III, Shenzhen           Longgang      50%     43,727   176,535      63,557        -         -
Shuijing (水径) Project,     Longgang
Buji, Shenzhen                             60%    164,989    456,405     20,117        -         -
Park Avenue (公园里),        Longgang
Shenzhen                                   65%     45,794    238,203     95,197        -   143,006
Langqi Project, Shenzhen     Longgang      100%    41,487     22,380          -        -         -
Dajia Island, Shenzhen        Huizhou      100%   364,450     93,340          -        -         -
Lunas Del Mar (双月湾),       Huidong
Huizhou                                    67%    704,223   1,068,191   136,353        -         -
Jinyu Huating, Huizhou       Huicheng      100%   151,298    313,678    157,961   24,290   139,790
Watercity(双城水岸),        Tangxia Town
Dongguan                                   51%    596,786    414,759          -   33,296    84,125
Golden City, Dongguan       Tangxia Town   40%     32,002     96,006          -        -         -
Wonderland(四季花城),       Tangxia Town
Dongguan                                   70%     51,263     92,273          -        -         -
Spring Dew Mansion,         Tangxia Town
                                           51%    128,144    256,129    176,221        -         -
Dongguan
Jinyu Songhu (金域松湖),     Songshan
                                           51%    136,151    381,000    176,505   85,605    85,605
Dongguan                       Lake
Hongxinuoya, Dongguan        Songshan
                                           100%   349,951    267,450          -   83,068   217,861
                               Lake
Songshan Lake Centre (松     Songshan
湖中心), Dongguan              Lake        34%     95,506     73,872     73,872        -         -
Songshan Lake Centre II,     Songshan
                                           25%     30,084     30,084     18,865        -         -
Dongguan                       Lake
Zitai, Dongguan             Humen Town     100%    60,570    151,426          -   82,798    82,798
Gold Milestone(金色里程),   Humen Town
Dongguan                                   100%    17,374     69,495          -        -         -
Chang’ an Vanke Centre,     Chang’an
Dongguan                      Town         100%    75,653    249,654    103,958   15,390    15,390
Vanke Building, Dongguan     Nanchang      100%     4,771     42,937          -        -         -
King Metropolis, Dongguan    Nanchang      51%    189,934    493,827    119,871   75,653   231,005
Feilishan (翡丽山),          Nanchang
Dongguan                                   50%    249,534    374,302          -   50,717    50,717
Xiangshu Lishe(香树丽舍),    Nanchang
Dongguan                                   51%     43,851    109,626          -        -         -
Jinyu International,        Houjie Town
Dongguan                                   100%    88,788    257,486     48,845        -         -
                              Houjie
Houjie Plaza, Dongguan                     67%     32,002    113,856          -        -         -
                               Town
Changping Dream Town,        Changping
Dongguan                       Town        100%   635,971    442,460    106,424   18,928   287,622
Vanke Luhu, (万科麓湖)       Dalingshan
Dongguan                       Town        100%   146,674    117,341          -   36,170    81,479
The Paradiso, Guangzhou       Baiyun       50%    144,657    433,584          -   34,323   311,288
Land Lot AB2911022,            Baiyun
Baiyun New Town,                           100%    24,052     92,130          -        -         -
Guangzhou
Jinyu Huating, Guanzghou       Haizhu      100%     9,117     85,682          -        -    41,444
Jiangyan Road Project,         Haizhu
                                           68%     16,831     52,765          -        -         -
Guangzhou
Le Bonheur, Guangzhou          Liwan       100%    38,111    135,689          -   32,952   107,092
Vanke Fuqian Garden,          Nansha
Guanzhou                                   95%    134,760    269,520          -   68,701    68,701
Racho Santa Fe, Guangzhou      Huadu       49%    210,252    126,172          -   14,577    76,085
Donghui Garden,               Luogang
Guangzhou                                  55%    177,588    443,970    105,054        -         -
Donghui                       Luogang      33%    109,748    274,370    274,370        -         -


                                                  Page 13
Garden(Expanding),
Guangzhou
Project SDK-D-3, East          Luogang
Side, Zhonghai, Luogang,                    100%   115,671    289,178          -         -         -
Guangzhou
Jinse Yuefu, Guangzhou        Huangpu       100%    24,056     63,591     63,591         -         -
Lot AT030548, Gaotang,          Tianhe
Software Park, Tianhe,                      100%    30,995     82,962          -         -         -
Guangzhou
Xiinguang City Garden,          Panyu
Guangzhou                                   100%   364,651    570,743    124,511         -   126,234
Dream Town, Qingyuan          Qingyuan      100%   726,374   1,430,375   263,836   200,864   200,864
Vanke Huafu, Qingyuan         Qingyuan      100%    79,164    312,820    109,101    22,361    22,361
The Paradiso, Foshan           Nanhai       55%    221,035    574,690    155,619   179,889   278,995
Jinse Xigu Huayuan (金色       Nanhai
                                            49%     66,533     81,080     53,215    26,210    26,210
溪谷花园), Foshan
King Metropolis, Foshan        Nanhai       100%    75,916    184,607          -    35,396   184,607
A14 Project, Foshan            Nanhai       50%     47,254    354,404          -         -         -
Binfen Siji (缤纷四季),        Shunde
Foshan                                      100%   156,840    429,527     90,959   127,684   179,284
Crystal City, Foshan           Shunde       49%    284,036    710,092    190,499    38,723   111,671
Lunjiao Qinyuan, Foshan        Shunde       100%    80,571    241,712     68,005   111,407   117,704
Tianaowan Project, Foshan      Shunde       50%     30,382     75,954          -         -         -
F06 Project, Foshan            Shunde       50%    113,224    452,880          -         -         -
Vanke Plaza, Foshan           Chancheng     88%    114,429    555,819    146,788         -         -
Dream Town, Foshan            Chancheng     100%   337,544    776,350     81,502    55,902   270,793
Jinyu International, Foshan   Chancheng     51%     89,000    373,820     83,703         -         -
Zhubin Garden (珠宾花园),     Xiangzhou
                                            100%   109,917    146,497      2,705    65,787    90,703
Zhuhai
Jinyu Gangwan (金域港         Xiangzhou
                                            50%     78,000    196,358          -         -         -
湾), Zhuhai
Glamorous City, Zhuhai         Doumen       100%   137,061    274,122    172,851         -         -
City Garden, Zhuhai             Jinwan      51%     63,233    189,621          -         -         -
Jinyue Huating (金悦华庭),     Tanzhou
Zhongshan                        Town       100%    32,103    127,789          -         -         -
City Views, Zhongshan          Southern
                              District of   100%   338,516    523,177          -    59,032   523,177
                              Zhongshan
Spring Dew Mansion,             Eastern
Zhongshan                     District of   100%    76,387    175,133          -    72,136   100,092
                              Zhongshan
Golden Home (金色家园),       Dongfeng
Zhongshan                        Town       100%   255,623    789,453          -    54,971    54,971
Le Bonheur, Zhongshan           Huoju       65%    251,900    488,889          -         -         -
Heart of Lake, Xiamen            Huli       100%    95,098    199,710          -    34,207    34,207
Joying Gold, Xiamen           Xiang’an     100%    54,441    109,000          -    43,049   106,092
King Metropolis, Xiamen         Jimei
                                            100%   102,427    446,842    131,262    51,345    51,345
Vanke Plaza, Xiamen             Jimei       100%   137,934    710,000    200,000         -         -
Haicang Dream Town,            Haicang
                                            40%    189,752    517,690    200,495         -         -
Xiamen
Jinyu Rongjun (金域榕郡),       Jinan
Fuzhou                                      100%   166,736    381,589          -    68,800   161,183
King Metropolis, Fuzhou       Cangshan      100%    16,168     37,614          -         -    34,399
Yongtai Dream Town,            Yongtai
Fuzhou                                      51%    392,000    556,032     28,848         -         -
Vanke Plaza, Fuzhou            Taijiang     100%    93,359    439,213     50,469         -         -
Jinyu Garden (金域花园),       Taijiang
Fuzhou                                      60%     25,397    130,795    130,795         -         -
Dream Town, Putian             Licheng      80%    250,708    528,566    178,355         -         -
King Metropolis, Changsha       Yuhua       60%    238,066    512,778          -    39,036   167,287
The Paradiso, Changsha         Furong       100%   120,208    352,083          -         -   102,956
City Garden, Changsha           Yuelu       100%    39,339    138,032          -   106,014   112,859


                                                   Page 14
Golden Paradise, Changsha        Yuelu      78%       43,737      129,065            -           -           -
Jinyu Bingjiang, Changsha        Yuelu      58%       58,287      200,892            -           -           -
Heron Hill, Changsha             Yuelu      100%     100,351      291,401            -           -           -
Dream Town, Changsha             Kaifu      70%      204,010      472,187            -     79,979     135,431
Zitai, Changsha                 Tianxin     70%      108,162      266,296      94,530            -           -
Project Gaozheng,               Yuhua
Changsha                                    60%       40,360      169,469            -           -           -
Sanya Forest Holiday Park        Sanya      65%      942,745      470,814      34,927      54,584      54,584
Gaozhiyuan Project, Sanya        Sanya      65%      387,807      349,026            -           -     69,185
Vanke Lakeside Holiday          Sanya
                                            80%      260,293      301,650      76,436            -           -
Park, Sanya
                       Subtotal                    15,336,161   29,463,166   4,962,804   2,316,893   6,444,831
Shanghai Region
Qinglinjing,Shanghai          Pudong New
                                            100%      99,209      148,814            -    148,814     148,814
                                District
Wujiefang, Shanghai           Pudong New
                                            100%     121,463      126,887            -           -           -
                                District
Haishang Chuanqi (海上传      Pudong New
                                District    60%      140,981      260,883      83,780            -           -
奇), Shanghai
Golden City, Shanghai         Pudong New
                                            60%      264,646      549,046      55,114            -    296,741
                                District
Tongshan Street Project,      Pudong New
                                            75%       58,550      182,230            -           -           -
Shanghai                        District
Bingjiang Project, Shanghai   Pudong New
                                            100%      38,753      103,132            -           -           -
                                District
53# Qibao, Shanghai            Minhang      100%      49,294      126,869            -           -           -
New City Garden, Shanghai      Minhang      51%      287,741      334,669      39,981      25,336     164,148
Southern portion of Land       Minhang
Lot No. 03, Shanghai
                                            50%       32,170      110,462     110,462            -           -
Hongqiao Business District
Core District Phase I
Firenze, Shanghai              Minhang      49%      304,830      199,071      84,680       5,646     120,037
Project No. 11, Shanghai       Minhang
                                            61%      112,864      177,885            -           -           -
Hongqiao
Jinse Huating, Shanghai        Songjiang    33%       67,932      108,137      21,504      50,154      50,154
Sheshan Longyuan,              Songjiang
                                            45%      130,970      102,060            -           -           -
Shanghai
14# Songjiang Business         Songjiang
                                            60%       57,734      145,234            -           -           -
 District, Shanghai
Castle Tudor, Shanghai          Baoshan     100%     231,753      241,169            -     66,307     241,169
Respecte Chateau (金色领        Jiading
                                            50%       90,013      180,026      52,841            -           -
域), Shanghai
Shangyuan, Shanghai              Qinpu      49%      116,524      142,858            -    101,573     101,573
Shanghai Nanzhan Business        Xuhui
                                            51%      108,010      493,447            -           -           -
District Land
The Paradiso, Nantong          Gangzha      55%       99,910      218,650     101,151      51,024      51,024
Land Lot at Rengang Road,     Chongchuan
                                            100%      43,217       99,000            -           -           -
Nantong
Golden Paradise, Jiaxing      Xinzhou New
                                            100%      85,286      137,495            -           -           -
                                 District
Golden Dream, Jiaxing         Xinzhou New
                                            100%      80,987      144,699      69,761            -           -
                                 District
Anpin Street, Nanjing            Baixia     100%      27,325       20,340            -           -           -
The Paradiso, Nanjing          Jiangning    100%     272,298      545,280      42,750      21,593     174,107
Respecte Chateau (金色领         Qixia
                                            100%      91,751      201,828     109,707            -           -
域), Nanjing
Golden Hill, Nanjing            Pukou       100%      62,291       98,692      54,611            -           -
Land Lot 4, Eastern of         YuhuaTai
                                            100%      76,336      182,380            -           -           -
Nanjing Nan Zhan
Glamorous City, Zhenjiang      Runzhou      100%     795,100      942,820      17,975      76,575     401,983



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Blue Mountain Garden,           Runzhou
                                              60%     285,683     416,285     10,601    40,262    40,262
Zhenjiang
Nimble Bay, Suzhou              Industrial
                                              70%     384,042     835,281     67,703    78,382   642,195
                                 District
Golden Paradise, Suzhou         Industrial
                                              92%      47,177     117,936          -         -    63,593
                                 District
Bai Tang Park, Suzhou           Industrial
                                              100%    104,486     179,075          -         -         -
                                 District
Vanke New Metropolis (万       New District
科新都会), Suzhou                             55%      89,098      83,220     27,920    17,188    17,188
Golden Milestone, Suzhou        Jinchang      49%      99,093     247,732     51,126         -         -
Dream Town, Suzhou              Wuzhong       55%     144,535     361,338     65,682         -         -
Pingjiang New City Project,       Gusu
Suzhou                                        100%     80,948     189,677          -         -         -
Golf Project, Kunshan           Bacheng
                                              100%    433,916     240,701          -         -         -
                                 Town
Huaqiao Project, Kunshan        Kushan        60%     179,000     447,600          -         -         -
Glamorous City, Wuxi              Binhu       60%     960,000    1,346,963    88,666   157,341   974,550
The Paradiso, Wuxi                Binhu       100%    154,468     386,170     27,093    57,564   159,669
Xincheng Road, Wuxi               Binhu       100%    154,119     385,299     52,436         -         -
Golden Paradise,Wuxi           New District   100%    224,376     620,713     44,146    55,224   166,444
Dream Town, Yangzhou            Hanjiang
                                              65%     297,139     313,970    139,330         -         -
                                District
Project F, Western District,    Hanjiang
New Town, Yangzhou                            65%      59,835     130,067          -         -         -
                                District
Dream Town, Xuzhou                Jiuli       100%    396,349     713,428          -         -         -
Land Lot GHI, Huaixi            Quanshan
Project, Xuzhou                               85%      90,639     305,617          -         -         -
Liangzhu New Town,               Yuhang
                                              100%   3,108,146   2,368,153   244,752   157,097   878,668
Hangzhou
Project Gouzhuang,               Yuhang
Hangzhou                                      50%     115,683     293,835          -         -         -
West Spring Butterfly             Xihu
Garden, Hangzhou                              51%     155,838     354,038          -   143,392   354,038
No 58, Jiangcun Project,          Xihu
Hangzhou                                      51%      75,998     151,996          -         -         -
No 59, Jiangcun Project,          Xihu
Hangzhou                                      100%     30,403      60,806          -         -         -
Gongwang (公望),                 Fuyang
Hangzhou                                      100%    517,900     208,981          -         -    67,275
Junwang A+D, Hangzhou            Fuyang       20%     129,874     164,845          -         -         -
Junwang B+C, Hangzhou            Fuyang       20%     138,233     152,231          -         -         -
Caozhuang, Hangzhou             Jianggan      100%     37,178      86,938          -    34,294    34,294
Golden Caozhuang,               Jianggan
Hangzhou                                      50%      68,564     150,841          -         -         -
Project Pufu, Hangzhou          Jianggan      100%     46,069     110,566          -         -         -
Project Puyan, Hangzhou         Binjiang      60%      66,521     166,303          -         -         -
Yunluwan (云鹭湾),               Jiangbei
Ningbo                                        100%    314,200     394,764     67,447    75,367    75,367
Golden City, Ningbo              Yinzhou      100%     95,242     171,425          -    78,601    78,601
Jinyu International, Ningbo      Yinzhou      55%      41,080      73,940     73,940         -         -
Dream Town, Ningbo               Zhenhai      49%     226,777     491,525    122,857         -         -
Project Rongjia, Ningbo         Jiangdong     100%     66,833     133,666          -         -         -
Longwan Project, Wenzhou        Longwan       60%     125,219     178,298     89,309         -         -
Golden Mingjun, Hefei            Shushan      50%     107,326     401,670          -   105,585   268,107
King Metropolis, Hefei           Shushan      50%     115,628     412,101          -    97,248    97,248
Dream Town, Hefei                 Binhu       55%     107,220     375,272    189,104         -         -
Blue Mountain Garden,             Binhu
Hefei                                         55%     165,584     463,635    108,345         -         -
Forest Park Project, Hefei       Luyang       100%    516,459    1,394,439         -         -         -
Dream Town, Wuhu                Hanjiang      100%    274,404     493,926    105,079         -         -
Qingshan Lake, Nanchang         Qingshan
                                              50%      97,061     133,693          -    40,618    78,428
                                  Lake


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Dew Garden (润园),               Qingyunpu
Nanchang                                        50%       97,109      144,011            -      5,151      60,666
The Paradiso, Nanchang                 Xihu     50%       21,818       75,338            -           -           -
Dream Town, Nanchang                  Gaoxin    33%      299,845      417,362            -           -           -
Qingshan Lake North                  Qingshan
Avenue Project, Nanchang                        50%       16,888       50,381      50,381            -           -
                                       Lake
                          Subtotal                     15,311,941   23,720,114   2,470,234   1,690,336   5,806,343
Beijing Region
Ruyuan C3, Beijing                   Haidian    50%       33,745       74,239      74,239            -           -
Ruyuan C1, Beijing                    Haidian   50%      104,899      178,275            -           -           -
No. 5 Park Front Boutique            Chaoyang
Apartment, Beijing                              60%       37,917       97,044            -           -     95,718
Blue Mountain, Beijing               Chaoyang   100%      55,885      128,190            -     65,371     112,054
The Metropolis (大都会),             Chaoyang
Beijing                                         100%       5,329       42,556            -      8,467       8,467
Changyang Bandao, Beijing            Fangshan   50%      437,179      853,165     174,412     202,244     266,625
Yunwan Jiayuan, Beijing              Fangshan   50%       61,567      157,992            -           -           -
Xingfuhui (幸福汇),                  Fangshan
Beijing                                         68%       71,912      137,808      27,536      34,790      34,790
New Milestone, Beijing               Fangshan   20%       77,834      146,002      12,380            -           -
Golden Paradise, Beijing          Fangshan      40%       65,967      145,195      86,755            -           -
Jinyu Vanke City, Beijing         Changping     49%      178,908      485,234            -     90,077     395,026
King Metropolis, Beijing          Changping     50%      206,007      577,188      87,597     209,210     209,210
Holiday Views, Beijing                Fengtai   50%      224,289      413,304            -     24,966     413,304
Hongshi Jiayuan (红狮家               Fengtai
园), Beijing                                    100%      59,800      184,502            -           -    146,009
Vanke Lan (万科蓝),                   Fengtai
Beijing                                         100%      14,449       36,084      36,084            -           -
Xihuafu, Beijing                      Fengtai   50%      233,209      629,170     253,156            -           -
Spring Dew Mansion,                   Daxing
Beijing                                         50%       67,650      173,215      54,194            -           -
Jinyu Dongjun, Beijing                Daxing    50%       57,826      144,525            -           -           -
Dream Town, Beijing                   Daxing    50%      103,116      155,206            -           -           -
Huanqingcheng, Langfang              Langfang   50%      130,045      169,587            -           -           -
Stratford, Tangshan                   Lunan     100%     153,527       96,661            -     33,867      63,230
Stratford South(红郡南),              Lunan
Tangshan                                        100%      47,007       47,621            -           -           -
King Metropolis.Tangshan              Lubei     60%       78,977      166,159      34,936            -           -
The Paradiso, Tangshan                Lubei     40%       26,329       63,825      63,825            -           -
Holiday Views (假日风景)             Haigang
                                                80%      270,549      642,357            -           -           -
Qinghuangdao
Beidaihe Yang Ge Zhuang              Beidaihe
                                                50%      238,561      279,248            -           -           -
Land, Qinhuangdao
Waterfront, Tianjin                   Dongli    100%    2,708,886    1,763,059    130,029     133,857     854,505
Glamorous City, Tianjin               Dongli    100%     176,773      258,579       4,945      72,760     228,057
New Milestone, Tianjin                Dongli    51%      136,524      206,863            -     51,793     154,397
Jinse Yazhu (金色雅筑),               Dongli
                                                49%       90,792      173,987            -     97,070     153,134
Tianjin
King Metropolis, Tianjin              Dongli    51%      221,217      357,220      35,683            -           -
Holiday Dew Garden,                   Xiqing
Tianjin                                         100%     229,201      343,101            -     91,291     212,572
Jin’ao International, Tianjin        Xiqing    100%      58,577      160,080            -     55,445      88,846
Binhai Modern, Tianjin           Development
                                   District     100%       6,538       43,473       3,161            -           -
Park Residence, Tianjin          Development
                                   District     60%       32,270       48,709      22,471      25,424      25,424
Harbor (海港城), Tianjin         Binhai New
                                   District     51%      149,483      372,910      40,728      97,415      97,415
Jinlu (锦庐), Tianjin            Binhai New
                                   District     95%       90,604      126,600            -     47,355      47,355
East Coast, Tianjin              Binhai New
                                   District     51%      255,311      382,929      23,157            -           -



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Jinyu International, Tianjin   Binhai New
                                 District    51%    108,389    190,144     48,638         -         -
Shilinyuan (仕林苑),             Jinnan
Tianjin                                      40%     63,582    114,474      9,901         -         -
Dream Town, Shenyang             Heping      49%    361,320    868,373     98,534   148,975   710,133
Rotterdam (鹿特丹),              Heping
Shenyang                                     100%   120,333    360,999     38,727         -         -
Glamorous City, Shenyang         Yuhong      100%   156,817    297,026          -    49,487   297,026
Xianghushengjing (香湖胜         Yuhong
景) North, Shenyang                          49%    190,200    342,360          -    31,380    31,380
Xianghushengjing (香湖胜         Yuhong
景) South, Shenyang                          51%    135,464    304,520      8,816     8,816     8,816
Park Avenue, Shenyang            Yuhong      75%    169,774    407,374          -         -         -
The Paradiso, Shenyang         Hunnan New
                                 District    100%   226,356    615,688     64,749    46,534   307,553
Park Residence, Shenyang         Shenhe      55%     83,229    290,681     77,064   107,097   107,097
Chunheli(春河里),                Shenhe
Shenyang                                     79%     81,378    431,232     97,093    58,093    58,093
Whistler (惠斯勒小镇),          Dongling
Shenyang                                     70%    285,599    286,141     20,473         -         -
Vanke Blue Mountain ,            Dadong
Shenyang                                     60%     78,367    235,102     14,186   132,774   132,774
Spring Dew Mansion (Long          Tiexi
Mansion), Shenyang                           70%     66,547    178,598     78,636         -         -
Spring Dew Mansion (Run           Tiexi
Mansion) , Shenyang                          100%    60,292    150,315     55,266         -         -
Tomorrow Square,               Hunnan New
Shenyang                         District    65%    199,319    597,957     50,341         -         -
The Paradiso, Fushun           Development
                                 District    100%   226,529    739,519          -    44,439    44,439
Jinyu Internationl, Fushun      Shuncheng    100%    72,560    316,582          -         -         -
Harbor (营口海港城),            Bayujuan
                                             100%   138,990    319,677     67,464         -         -
Yingkou
Whistler (惠斯勒), Anshan        Tiedong     100%   422,171    713,400          -   102,994   188,903
Dream Town, Anshan               Gaoxin      100%   167,664    375,002          -    51,948   207,527
Jinyu International, Anshan       Tiexi      51%    225,715    677,000     66,756         -         -
Ravine Village, Dalian          Ganjingzi    100%   363,716    380,922          -    29,466   347,907
Glamorous City, Dalian          Ganjingzi    100%   218,498    443,186          -   173,186   369,624
Spring Dew Mansion,,            Ganjingzi
Dalian                                       100%   118,506    223,512    163,628         -         -
Xishan Project, Dalian          Ganjingzi    55%     90,404     90,988     41,364         -         -
Habor, Dalian                  Puwan New
                                 District    55%    747,224   1,253,300    83,942         -         -
Cherry Blossom Garden,          High-Tech
Dalian                          Industrial   61%    192,248    356,034    121,845         -         -
                                  Zone
Dream Town, Dalian               Jinzhou     100%   268,583    681,200          -         -         -
Blue Mountain, Changchun          Erdao      100%   228,670    501,678     55,535   135,390   135,390
Whistler (惠斯勒),               Jingyue
Changchun                                    50%    399,715    484,714     57,739    79,826    79,826
Dream Town, Changchun            Jingyue     51%    350,965   1,041,375    58,770         -         -
Park Residence, Changchun       Chaoyang     100%   267,981    503,349     51,651   111,589   111,589
Sculpture Park (雕塑公园)       Nanguan
Project, Changchun                           100%   121,109    343,058          -         -         -
Dream Town, Jilin                Gaoxin      65%    728,139   2,142,910   340,517   278,418   278,418
Songhua Lake Project, Jilin     Fengman      100%   531,598    681,890          -         -         -
Wonderland, Qingdao               Jimo       55%    153,284    240,507          -    92,055   240,507
Glamorous City, Qingdao        Chengyang     80%    200,289    341,463          -    52,937   341,463
City Garden, Qingdao           Chengyang     80%    130,873    228,966          -   180,062   180,062
Xingyang Road Project,         Chengyang
Qingdao                                      51%    258,675    433,177          -         -         -
Chunyang Road Project,         Chengyang
Qingdao                                      51%     86,493    177,966          -         -         -
Aureate City, Qingdao            Sifang      100%    61,873    174,157          -    29,017   174,157
Dream Town, Qingdao              Sifang      55%    154,607    399,565    121,455   118,443   118,443



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Fuzhou Road Vanke Center,            Sifang
Qingdao                                         100%      38,775      124,751            -           -           -
Shandong Road Vanke                  Sifang
Center, Qingdao                                 70%       18,646       70,856            -           -           -
Blue Mountain, Qingdao               Shibei     100%      68,153      204,189      39,001      77,907      77,907
Vanke Ecological Town,               Licang
Qingdao                                         100%     141,346      260,784      80,902            -           -
Qingdao Town                         Jiaonan    34%      933,293      989,125     107,533            -           -
Dongjun(东郡), Qingdao                Jimo      55%      112,344      279,451     162,977            -           -
Pingdu Dream Town,                   Pingdu
Qingdao                                         51%       59,308      198,807      75,873            -           -
Pingdu New City, Qingdao             Pingdu     51%       75,701      136,900            -           -           -
Haiyuntai, Yantai                     Zhifu     100%     311,614      444,065            -     75,527      75,527
Holiday Views, Yantai                Fushan     70%      190,281      361,220      62,404      79,737      79,737
Holiday Dew Garden,                  Fushan
Yantai                                          70%       65,733      152,466     152,466            -           -
Jinyu International, Jinan           Gaoxin     63%       38,164      118,741     102,634            -           -
Jinyu Internationl, Taiyuan         Wanbolin    100%      49,407      169,679            -           -           -
Blue Mountain, Taiyuan              Wanbolin    51%      198,392      687,671      93,097            -           -
Zitai, Taiyuan                       Yingze     51%       95,687      331,236     109,940            -           -
Spring Dew Mansion,                   Yuci
                                                51%      218,143      482,246            -           -           -
Jinzhong
                         Subtotal                      19,127,691   35,410,130   4,045,205   3,637,499   8,310,436
Chengdu region
Glamorous City,                     Chenghua    60%      308,501      761,258      68,120            -    612,385
Vanke Diamond Plaza,                Chenghua
                                                85%       15,404       92,422            -           -           -
Chengdu
Vanke Huamao Plaza,                 Chenghua
                                                51%       29,720      207,600            -           -           -
Chengdu
Jinyu Xiling (金域西岭),             Jinniu
                                                60%       79,331      361,100            -     43,256     268,480
Chengdu
Respecte Chateau (金色领            Qingyang
                                                100%      49,628      244,459            -     71,851      71,851
域), Chengdu
Jinrun Huafu, Chengdu               Jingjiang   100%      52,895      267,928            -     72,749     120,099
Golden Hairong, Chengdu              Wuhou      49%       54,970      234,125     100,648      90,051     141,161
Haiyue Huicheng, Chengdu            Shuangliu   90%      104,307      521,698     252,913      62,398      62,398
Wulong Mountain Garden,              Xindu
                                                100%     345,168      356,503     117,565     120,748     120,748
Chengdu
Project Mu 72, Dayuan                Gaoxin
                                                100%      48,345      145,034            -           -           -
Chengdu
Project Mu 131, Gaoxin,              Gaoxin
                                                100%      87,822      263,464            -           -           -
Chengdu
Mu 107, Longquan Damian,        Longquanyi
                                                100%      72,102      288,410            -           -           -
Chengdu
Mu 71, Longquan Shiling,        Longquanyi
                                                100%      47,245      141,642            -           -           -
Chengdu
Jinrun Huafu, Nanchong              Nanchong    60%      182,012      518,004     104,882            -           -
Golf City Garden, Wuhan             Dongxihu    49%      237,660      393,858            -    107,873     393,858
King Metropolis, Wuhan              Wuchang     100%      59,790      191,300      39,634      63,148     100,885
Hanyang International,              Hanyang
                                                70%      166,817      568,974     273,400            -           -
Wuhan
Dream Town, Wuhan                   Jianghan    100%      65,901      299,337            -     36,110     154,297
Stratford, Wuhan                 East Lake
                                High-Tech
                                                100%     230,894      349,607      15,696     106,599     192,807
                               Development
                                   Zone
The Paradiso, Chengdu          Economic and
                               Technological
                                                100%     213,440      533,600      41,074     142,296     142,296
                               Development
                                   Zone
Vanke Golden City, Wuhan         Hongshan       100%     274,100      896,484     225,532      53,583      53,583
Changzheng Village                  Hongshan    100%     282,235      871,721            -           -           -


                                                          Page 19
Huashan Ecological Town,             Hongshan
                                                 50%      199,705       299,557             -              -               -
Wuhan
Youcheng Ecological                   Yubei
                                                 51%      229,581       344,372        32,087         37,902        305,188
Garden, Chongqing
Wonder Town, Chongqing          Northern New
                                                 100%      41,448       145,067             -         91,361        145,067
                                  District
Palace of Pleasure,             Northern New
                                                 100%     137,996       376,737        97,563         32,704         63,565
Chongqing                         District
Jincheng (锦程),                  Yuzhong
Chongqing                                        100%     105,406       533,486             -        138,161        138,161
Dream Town, Chongqing           Northern New
                                  District       55%      278,167       647,378        77,416              -               -
Yuewan, Chongqing                 Jiangbei       45%      435,499       649,158        41,324              -               -
Fengmingshan Project,            Shapingbei
Chongqing                                        80%      175,000       700,000             -              -               -
Xijiao Hospital Project,             Jiulongpo
Chongqing                                        50%       26,515       145,688             -              -               -
Jinyu Qujiang (金域曲江),       Qujiang New
Xi’an                            District       55%      152,667       385,408        46,446        157,379        157,379
Dream Town, Xi’an               Chang’an       85%      176,056       614,377       141,915        100,016        100,016
Landlot No. 3, Dream                 Chang’an
Town, Xi’an                                     60%      113,231       352,803        66,162              -               -
Dream Town 8#, Xi’an                Chang’an   100%     172,700       504,800             -              -               -
King Metropolis, Xi’an              Weiyang     51%      106,667       373,034       162,466              -               -
Daminggong Project, Xi’an.          Weiyang     70%       69,052       221,603        66,540              -               -
Joying Gold, Xi’an                  Chengxi     80%      193,594       664,643       123,930              -               -
King Metropolis, Guiyang              Xiaohe     51%      351,800       581,217        64,777        224,999        255,392
Nimble Bay, Guiyang                   Yunyan     100%      90,456       201,012        64,433          7,801           7,801
Metropolis(大都会),                   Xiaohe
Guiyang                                          51%      181,235       761,187        43,898              -               -
Vanke Joy City(悦城),                Yunyan
Guiyang                                          51%       85,341       262,728        71,625              -               -
Dream Town, Guiyang                   Yunyan     70%      348,117       910,910             -              -               -
Golden Paradise, Kunming             Panlong     100%     104,724       274,641             -        274,641        274,641
Dew Garden (润园),                   Panlong
                                                 100%     192,104       247,394        68,028          3,385           3,385
Baisha, Kunming
Yunshangcheng, Kunming                Wuhua      23%       34,293       177,468       177,468              -               -
Respecte Chateau (金色领              Gaoxin
域), Kunming                                     67%      105,484       423,175       226,709        110,854        110,854
King Metropolis, Urumqi          New District    82%       45,934       144,366        27,860              -               -
Nanshan Villa, Urumqi                 Urumqi     100%      32,760        14,900        14,900              -               -
Jinyu International, Urumqi          Shayibake   100%      24,149        59,764             -              -               -
Golden Paradise, Urumqi              Shayibake   100%       20,047        50,032            -              -               -
                          Subtotal                       7,238,015    19,575,433    2,855,011      2,149,865       3,996,297
                           Total                        57,013,808   108,168,843   14,333,254      9,794,593      24,557,907

    3. Major Suppliers and Customers
    (1) The aggregate purchase amount from the Company’s five largest suppliers as a percentage of its total
    purchase during the year

    In 2012, the Company continued to expand the scope of sourcing, deepen the relationship with its partners and
    increase the proportion of centralised procurement and strategic collaborations, in order to achieve economic
    benefits of bulk purchase. During the year under review, the aggregate purchase amount from the Company’s five
    largest material and equipment suppliers was RMB2.64 billion, representing a year-on-year increase of 12.8% and
    accounting for 3.61% of the total purchase for the year, which is 0.42 percentage point higher than that of 2011’s.

    (2) The aggregate revenue from the Company’s five largest customers as a percentage of its total revenue
    during the year

    The Company’s product is commodity housing. The majority of the Company’s customers are individual
    homebuyers making up a vast and diversified customer base. Only certain projects constructed for the government
    and sales to group purchase generated a relatively high sales amount. Revenue from the five largest customers in


                                                           Page 20
2012 amounted to approximately RMB1.79 illion, accounting for 1.84 of the Company’s total revenue of 2012.


4. Financial status of the Company
During the year under review, the Company’s operations remained stable and its financial position was sound.
                                                                                          Unit:RMB’000

          Item                31-Dec-2012            31-Dec-2011          Change (+/-)       Reasons for changes
                                                          296,534,296                     Expansion of the operational
Total Assets                       379,094,856                                 27.84%
                                                                                          scale
                                                          208,661,350                     Increase in newly added
Inventories                        253,622,152                                 21.55%     projects and projects under
                                                                                          development
                                                              1,126,105                   Increase     in    investment
Investment properties                1,714,136                                 52.22%
                                                                                          properties under development
Short-term borrowings               35,557,359             23,570,276          50.86%     Change in debt structure
                                                          168,893,596                     Increase    in    construction
Accounts payable                   215,529,570                                 27.61%
                                                                                          works
Equity attributable to                                     52,967,795
equity shareholders of the          63,825,554                                 20.50%     Increase in net profit
Company
          Items                  2012                   2011              Change (+/-)        Reasons for changes
Revenue                             96,859,914             67,709,396          43.05%     Increase in booked sales
Cost of sales                      (65,454,228)           (43,249,418)         51.34%     Increase in booked sales
Profit before taxation              25,697,537             19,490,060          31.85%     Increase in operating profit
                                                                                          Increase in profit before
Income tax                         (10,034,949)            (7,890,454)         27.18%
                                                                                          taxation
Profit attributable to
                                                                                          Increase   in   profit   before
equity shareholders of the          12,551,182                9,624,875        30.40%
                                                                                          taxation
Company
     Other guidance              2012                   2011              Change (+/-)        Reasons for changes
Gearing ratio                           78.33%                  77.12%          1.21%     Increase in pre-sales
                                                                                          Increase in receipts in
Current ratio                                1.40
                                                                   1.41          (0.01)   advance
                                                                                          Increase in receipts in
Quick ratio                                  0.42
                                                                   0.37           0.04    advance
                                                                                          Increase in collaborative
Equity ratio                            21.67%                  22.88%          -1.21%
                                                                                          projects
Accounts receivable                                                                       Increase in the turnaround on
                                               6                     8
turnover (Day)                                                                      (2)   accounts receivable
Inventory turnover (Day)                    1,271                                         Increase in inventory turnover
                                                                 1,442           (171)


5. Investment of the Company
(1) Use of proceeds from the capital market
Public issue of A Shares in 2007

Having obtained the approval from the relevant authorities, the Company issued a prospectus regarding the public
issue of A shares on 22 August 2007. The Company issued 317,158,261 shares (par value: RMB1 per share) at an
issue price of RMB31.53 per share, raising proceeds of RMB9,999,999,969.33. After deducting issuing expenses
of RMB63,398,268.11, the net proceeds amounted to RMB9,936,601,701.22 and were received on 30 August
2007. Shenzhen Nanfang-Minhe CPA Firm Co., Ltd (深圳南方民和会计师事务所) had prepared and filed a
capital verification report (Shen Nan Yan Zi (2007) No. 155).

The aforesaid proceeds were used to invest in 11 projects. Details on the investment amount, investment gain,
development progress of the projects as of 31 December 2012 are as follows:

                                                                                                          Unit: RMB’000




                                                    Page 21
Total amount
of proceeds,               9,936,602                           Funds used for investment during the year               14,695
net
Amount of
proceeds with                                           0
                                                                                                                       9,831,507
changed usage
                                                                       Accumulated funds used
Percentage of
proceeds with                                          0%
changed usage
Investment       Is      Amount of funds Funds used Accumulated              Progress of Accumulated          Does it Change
projects         there planned for use      for           funds used         application realized income      achieve in
                 any                        investment                       of funds                         estimated feasibility
                 change                     during the                                                        income
                 in                         year
                 project
Everest Town
(former Science
City H3             No              600,000             0            600,000     100%                144,580 Yes            No
Project),
Guangzhou
The Paradiso
(former
Jinshazhou          No              800,000             0            800,000 100%                    601,316 Yes            No
Project),
Guangzhou
The Dream
Town (former
Nanzhuang           No              900,000             0            900,000 100%                    493,822 Yes            No
Project),
Foshan
Zhuhai Hotel
Project,
                    No              650,000             0            650,000 100%                    675,961 Yes            No
Xiangzhou
District, Zhuhai
West Spring
Butterfly
Garden (former
                    No              700,000             0            700,000 100%                  1,701,141 Yes            No
Jiangcun
Project),
Hangzhou
Liangzhu
Project, Yuhang
                    No            1,700,000             0          1,700,000 100%                    766,879 Yes            No
District,
Hangzhou
Golden Town
Project,
Yinzhou             No            1,636,602             0          1,636,600 100%                    890,073 Yes            No
District,
Ningbo
Wujiefang,
Pudong,             No            1,200,000             0          1,200,000 100%                           0 Yes           No
Shanghai
Jinse Yazhu
(former
Zhonglin            No              700,000             0            700,000 100%                    263,164 Yes            No
Project),
Shanghai
Anpin Street
Project, Baixia
                    No              650,000       14,695             544,904 83.8%                          0 Yes           No
District,
Nanjing
Stratford
(former
Huangjiayu          No              400,000             0            400,000 100%                     51,220      No        No
Project),
Nanjing
      Total         No            9,936,602       14,695           9,831,504 98.9%                 5,588,154
Remarks on       (1). The preconstruction of Shanghai Wujiefang was affected by the government’s redirection of roads due to its
delay and        location within the Expo area. Construction commenced in the second half of 2010 and sales of the project


                                                            Page 22
           failure to       started in May 2012, but were not yet booked as at the end of the year under review. Nanjing Anpin Street
           achieve          Project was not able to commence construction according to schedule, as the government was making adjustment
           estimated        to its planning to preserve the city’s heritage. The relevant planning has now been approved. The overall
           income (by       development plan of the project was adjusted according to progress.
           project)         (2) Stratford Project in Nanjing was almost sold out and delivered in 2010. Accumulative net margin amounted
                            to 8.51%. The project had achieved brand effect but the income generated from the project did not reach the
                            estimated level stated in the prospectus, while the income of other projects financed by the raised proceeds
                            exceeded or is expected to exceed the estimated level. It is expected that the overall return from the projects
                            financed by the raised proceeds will be higher than the estimated level stated in the prospectus.
           Remarks on
           reasons and
           procedures for   No changes
           changes (by
           project)
           Application of   As of 31 December 2012, the Company had applied RMB9,831,500,000 of the proceeds in accordance with the
           the balance of   prospectus. The amount represented 98.9% of the net proceeds of RMB9,936,600,000. The balance of the
           the proceeds     proceeds of RMB105,100,000 will be applied in accordance with the progress of project development.


          (1) Use of capital not from the capital market

          A. Equity investment
          During the year under review, the Company’s investment amount increased by RMB8,858 million, which were
          used as follows:

          1) During the year under review, the Company promoted and established 24 new subsidiaries, each with registered
          capital of over RMB30 million, and actual investment had been made. The details are as follows:
                                                                                            Actual
                                                                       Registered       investment by
No.     Name of the newly established company           Currency                                                  Scope of business
                                                                        capital             Vanke
                                                                                           (RMB)
      Ningbo Wanzhu Real Estate Co., Ltd.                                                                  Property development and
1                                                         RMB        430,800,000.00     236,940,000.00
      宁波万筑房地产开发有限公司                                                                           operation
      Dalian Wanding Property Co., Ltd.                                                                    Property development and
2                                                         RMB        300,000,000.00     300,000,000.00
      大连万鼎置业有限公司                                                                                 operation
      Qingdao Advertising Cultural Industrial Park
      Development Co., Ltd.                                                                                Property development and
3                                                         USD        111,110,000.00     357,351,253.29     operation
      青岛广告文化产业园开发有限公司
      Hangzhou Wanpu Property Co., Ltd.                                                                    Property development and
4                                                         USD        100,000,000.00     345,702,500.00
      杭州万普置业有限公司                                                                                 operation
      Qingdao Vanke Commercial Property Co., Ltd.                                                          Property development and
5                                                         RMB        100,000,000.00     100,000,000.00
      青岛万科商业地产有限公司                                                                             operation
      Chengdu Vanke Xinnong Investment Co., Ltd.
6                                                         RMB        100,000,000.00      90,000,000.00     Project investment
      成都万科鑫农投资有限公司
      Zhejiang Shudou Investment Management Co.,
7     Ltd.                                                RMB        100,000,000.00     100,000,000.00     Investment management
      浙江墅都投资管理有限公司
      Hefei Vanke Ruixiang Property Co., Ltd.                                                              Property development and
8                                                         RMB        100,000,000.00     100,000,000.00
      合肥万科瑞翔地产有限公司                                                                             operation
      Jilin Songhua Lake International Resort
      Development Co., Ltd.                                                                                Property development and
9                                                         RMB        100,000,000.00     100,000,000.00     operation
      吉林省松花湖国际度假区开发有限公司
      Tianjin Wancheng Property Co., Ltd.                                                                  Property development and
10                                                        RMB        100,000,000.00      80,000,000.00
      天津万城置业有限公司                                                                                 operation
      Jinan Vanke Real Estate Co., Ltd.                                                                    Property development and
11                                                        RMB        100,000,000.00     100,000,000.00
      济南万科房地产开发有限公司                                                                           operation
      Guangzhou Wanxuan Real Estate Co., Ltd.                                                              Property development and
12                                                        RMB        100,000,000.00     100,000,000.00
      广州市万轩房地产有限公司                                                                             operation
      Xuzhou Vanke Real Estate Co., Ltd.                                                                   Property development and
13                                                        RMB        100,000,000.00     100,000,000.00
      徐州万科房地产发展有限公司                                                                           operation
      Hangzhou Wanhong Property Co., Ltd.                                                                  Property development and
14                                                        RMB        100,000,000.00     100,000,000.00
      杭州万泓置业有限公司                                                                                 operation
      Zhengzhou Vanke Real Estate Co., Ltd.                                                                Property development and
15                                                        RMB        100,000,000.00     100,000,000.00
      郑州万科房地产有限公司                                                                               operation
      Shenzhen Yingda Investment Fund
16    Management Co., Ltd.                                RMB        100,000,000.00     100,000,000.00     Investment management
      深圳市盈达投资基金管理有限公司


                                                                       Page 23
     Hangzhou Vanke Jinnan Property Co., Ltd.                                                 Property development and
17                                                RMB      80,000,000.00    80,000,000.00
     杭州万科锦南置业有限公司                                                                 operation
     Beijing Xingfuhui Investment Co., Ltd.
18                                                RMB      75,000,000.00    45,000,000.00     Project investment
     北京幸福汇投资有限公司
     Chongqing Wanyong Property Co., Ltd.                                                     Property development and
19                                                USD      72,319,976.00   125,710,000.00
     重庆万永置业有限公司                                                                      management
     Hefei Vanke Xincheng Property Co., Ltd.                                                  Property development and
20                                                RMB      60,000,000.00    33,000,000.00
     合肥万科新城地产有限公司                                                                 operation
     Tianjin Wanwei Property Co., Ltd.                                                        Property development,
21                                                RMB      50,000,000.00    25,500,000.00     commercial investment, real
     天津万为置业投资有限公司
                                                                                              estate agent
     Tianjin Vanke Investment Co., Ltd.
22                                                RMB      30,000,000.00    30,000,000.00     Project investment
     天津万科投资有限公司
     Guangzhou Wanxi Real Estate Co., Ltd.                                                    Property development and
23                                                RMB      30,000,000.00    30,000,000.00
     广州市万溪房地产有限公司                                                                 operation
     Wuhan Wanhexing Investment Management
24   Co., Ltd.                                    RMB      30,000,000.00    30,000,000.00     Investment management
     武汉万合兴投资管理有限公司
                                     Total                                 2,809,203,753.29


         In addition, the Company had established another 59 new companies, with a total amount of investment of
         RMB359 million.

         2) The major companies that the Company acquired during the year under review are as follows:

         a) On 16 July 2012, the Company acquired 75% equity interests in Vanke Property (Overseas) Limited (formerly
         known as Winsor Properties Holdings Limited) for a cash consideration of RMB1,095 million.

         B. On 20 August 2012, the Company acquired 100% equity interests of Excel Right Investments Limited for a
         consideration of US$50,000,000. Excel Right Investments Limited holds 45% equity interests in Dalian Vanke
         Glamorous City Property Development Company Limited.

         C. On 3 August 2012, the Company acquired 50% equity interests in Beijing Wanxin Investment Development
         Company Limited (“Beijing Wanxin”) for a consideration of RMB300 million. After the acquisition, the Company
         owns 100% equity interests in Beijing Wanxin, through which the Company holds 50% equity interests in
         Hangzhou Dafan Investment Management Co., Ltd..

         D. On 23 April 2012, the Company acquired 100% equity interests in Wise Grow Group Limited for a total
         consideration of US$35 million. Wise Grow Group Limited holds 45% equity interests in Dalian Vanke City
         Property Co., Ltd..

         E. On 5 January 2012, the Company acquired 65% equity interests in Airwell Aircon (China) Co., Ltd. for a total
         consideration of RMB215 million.

         F. On 15 June 2012, the Company acquired 90% equity interests in Changchun Vanke Jingcheng Real Estate
         Development Co., Ltd. for a total consideration of RMB207 million.

         G. On 25 October 2012, the Company acquired 63% equity interests in Jinan Tiantai Property Co., Ltd. for a total
         consideration of RMB202 million.

         H. On 22 November 2012, the Company acquired 85% equity interests in Xuzhou Dingxu Property Co., Ltd. for a
         total consideration of RMB175 million.

         I. On 23 April 2012, the Company acquired 83.67% equity interests in Bonus Plus Holdings Limited for a total
         consideration of US$24 million. Bonus Plus Holdings Limited holds 49% equity interests in Suzhou Huihua
         Investment Property Company Limited.

         J. On 23 April 2012, the Company acquired 100% equity interests in Tian Cheng (Holdings) Investments Limited
         for a total consideration of US$21 million. Tian Cheng (Holdings) Investments Limited holds 45% equity interests
         in Wuhan Vanke Tiancheng Real Estate Company Limited.

                                                             Page 24
During the year under review, the Company acquired another 18 companies for a total consideration of RMB462
million.

3) During the year under review, the Company increased the capital of 14 subsidiaries by RMB2,422 million. Of
the total amount, RMB482 million was for Shanghai Wanshi Property Co., Ltd. (上海万狮置业有限公司),
RMB460 million for Suzhou Qingyun Property Co., Ltd. (苏州青云置业有限公司), RMB441 million for Beijing
Minmetals Vanke Property Co., Ltd. (北京五矿万科置业有限公司), RMB280 million for Dongguan Vanke Real
Estate Co., Ltd.(东莞市万科房地产有限公司), RMB303 million for Hefei Vanke Haozhi Property Co., Ltd. (合
肥万科皓智地产有限公司, RMB200 million for Putian Vanke Property Co., Ltd.(莆田市万科置业有限公司),
RMB150 million for Guangdong Shangcheng Construction Co., Ltd. (广东上城建设有限公司) and RMB106
million for other subsidiaries

B. Project investments
During the year under review, the Company acquired 78 new projects, with a site area attributable to Vanke’s
equity holding of approximately 6,240,000 sq m (corresponding planned GFA of approximately 15,890,000 sq m).
In addition, during the year under review, the Company was involved in one city redevelopment project.
According to the current planning, the site area attributable to Vanke’s equity holding was approximately 60,000
sq m (corresponding planned GFA was approximately 330,000 sq m). The relevant land transfer procedures were
being handled.


                                                                                         GFA
                                                          Perce
                                                                                         attributab
                                                          ntage
                                                                              Planned    le      to
                                                          of      Site area
No    City           Project                Location                          GFA        Vanke’s     Progress
                                                          share   (sq m)
                                                                              (sq m)     equity
                                                          holdi
                                                                                         holding
                                                          ng
                                                                                         (sq m)
                     Phase 3, Golden        Dongfeng                                                  Preconstruct
1     Zhongshan                                           100%    18,686      65,400     65,400
                     Home                   Town                                                      ion
                                                                                                      Under
2     Guangzhou      Jinse Yuefu            Huangpu       100%    24,056      63,591     63,591
                                                                                                      construction
                                                                                                      Pre-
3     Changsha       Heron Hill             Yuelu         100%    100,351     291,401    291,401
                                                                                                      construction
                     Land Lot AT030548
                                                                                                      Pre-
4     Guangzhou      Gaotang New Area of    Tianhe        100%    30,995      82,962     82,962
                                                                                                      construction
                     Tianhe Software Park
                     Project SDK-D-3,
                                                                                                      Pre-
5     Guangzhou      East Side, Zhonghai,   Luogang       100%    115,671     289,178    289,178
                                                                                                      construction
                     Luogang
                     Project 01, Jiangyan                                                             Pre-
6     Guangzhou                             Haizhu        68%     16,831      52,765     35,880
                     Road                                                                             construction
                                                                                                      Pre-
7     Qingyuan       Project Backyard       Qingyuan      100%    37,048      74,096     74,096
                                                                                                      construction
                                                                                                      Pre-
8     Foshan         Project F06            Shunde        50%     113,224     452,880    226,440
                                                                                                      construction
                                                                                                      Pre-
9     Foshan         Project A14            Nanhai        50%     47,254      354,404    177,202
                                                                                                      construction
                                                                                                      Pre-
10    Dongguan       Xiangshu Lishe         Nanchang      51%     43,851      109,626    55,909
                                                                                                      construction
                                                                                                      Pre-
11    Dongguan       Golden Milestone       Humen         100%    17,374      69,495     69,495
                                                                                                      construction
                                            Tangxia                                                   Pre-
12    Dongguan       Golden City                          40%     32,002      96,006     38,402
                                            Town                                                      construction
                                            Tangxia                                                   Pre-
13    Dongguan       Wonderland                           70%     51,263      92,273     64,591
                                            Town                                                      construction


                                                      Page 25
                                        Houjie                                                Pre-
14   Dongguan   Houjie Plaza                           67%    32,002    113,856    76,284
                                        Town                                                  construction
                                                                                              Under
15   Shenzhen   Phase III of Home       Longgang       50%    43,727    176,535    88,267
                                                                                              construction
                                                                                              Under
16   Xiamen     Vanke Plaza             Jimei          100%   137,934   710,000    710,000
                                                                                              construction
                The Dream Town                                                                Pre-
17   Putian                             Licheng        80%    102,694   203,224    162,579
                (II)                                                                        construction
                Blue Mountain                                                                 Under
18   Hefei                              Binhu          55%    165,584   463,635    254,999
                Garden,                                                                       construction
                                                                        1,394,43   1,394,43   Under
19   Hefei      Forest Park Project     Luyang         100%   516,459
                                                                        9          9          construction
                                                                                              Pre-
20   Hangzhou   Project Gouzhuang       Yuhang         50%    115,683   293,835    146,918
                                                                                              construction
                                                                                              Pre-
21   Hangzhou   Project Pufu            Jianggan       100%   46,069    110,566    110,566
                                                                                              construction
                                                                                              Pre-
22   Hangzhou   Project Puyan           Binjiang       60%    66,521    166,303    99,782
                                                                                              construction
                Land lot No 58,                                                               Pre-
23   Hangzhou                           Xihu           51%    75,998    151,996    77,518
                Jiangcun Project                                                              construction
                Land lot No 59,                                                               Pre-
24   Hangzhou                           Xihu           100%   30,403    60,806     60,806
                Jiangcun Project                                                              construction
                Qingshan Lake North     Qingshan                                              Under
25   Nanchang                                          50%    16,888    50,381     25,191
                Avenue Project          Lake                                                  construction
                                                                                              Under
26   Ningbo     Jiyu International      Yinzhou        55%    41,080    73,940     40,667
                                                                                              construction
                                                                                              Pre-
27   Ningbo     Project Rongjia         Jiangdong      100%   66,833    133,666    133,666
                                                                                              construction
                Project F, Western      Hanjiang                                              Pre-
28   Yangzhou                                          65%    59,835    130,067    84,544
                District, New Town      District                                              construction
                Pingjiang New City                                                            Pre-
29   Suzhou                             Gusu           100%   80,948    189,677    189,677
                Project                                                                       construction
                                        Industrial                                            Pre-
30   Suzhou     Project Baitang Park                   100%   104,486   179,075    179,075
                                        District                                              construction
                Project Huaqiao,                                                              Pre-
31   Suzhou                             Kunshan        60%    179,000   447,600    268,560
                Kunshan                                                                       construction
                4 Land Lots at                                                                Pre-
32   Nanjing                            Yuhuatai       100%   76,336    182,380    182,380
                Southern Station East                                                         construction
                Land Lot in the CBD                                                           Pre-
33   Shanghai                           Xuhui          51%    108,010   493,447    251,658
                of Southern Station                                                           construction
                Project No. 11,                                                               Pre-
34   Shanghai                           Minhang        61%    112,864   177,885    108,510
                Hongqiao,                                                                     construction
                Land Lot at Rengang     Chongchua                                             Pre-
35   Nantong                                           100%   43,217    99,000     99,000
                Road                    n                                                     construction
                No. 14, Songjiang                                                             Pre-
36   Shanghai                           Songjiang      60%    57,734    145,234    87,140
                CBD                                                                           construction
                                                                                              Pre-
37   Xuzhou     Dream Town              Jiuli          100%   396,349   713,428    713,428
                                                                                              construction
                Land Lot GHI,                                                                 Pre-
38   Xuzhou                             Quanshan       85%    90,639    305,617    259,774
                Huaixi Project                                                                construction
                                                                                              Under
39   Shenyang   Spring Dew Mansion      Tiexi          100%   19,321    48,302     48,302
                                                                                              construction
                                                                                              Pre-
40   Tangshan   Stratford South         Lunan          100%   47,007    47,621     47,621
                                                                                              construction




                                                   Page 26
                                         Xianghe                                             Pre-
41   Langfang     Huanqingcheng                         50%    130,045   169,587   84,794
                                         County                                              construction
                                                                                             Under
42   Tangshan     King Metropolis        Lubei          40%    26,329    63,825    25,530
                                                                                             construction
                  Land lot
     Qinghuangd                                                                              Pre-
43                Yanggezhuang,          Beidaihe       50%    238,561   279,248   139,624
     ao                                                                                      construction
                  Beidaihe
                                                                                             Pre-
44   Beijing      Jinyu Dongjun          Daxing         50%    57,826    144,525   72,263
                                                                                             construction
                  Vanke Cheng (万科                                                          Pre-
45   Beijing                             Daxing         50%    103,116   155,206   77,603
                  橙)                                                                        construction
                                                                                             Pre-
46   Dalian       Dream Town             Jinzhou        100%   268,583   681,200   681,200
                                                                                             construction
                  Vanke Centre,                                                              Pre-
47   Qingdao                             Sifang         100%   38,775    124,751   124,751
                  Fuzhou Road                                                                construction

48   Qingdao      Dongjun                Jimo           55%    112,344   279,451   153,698   Sold

49   Qingdao      Dream Town             Pingdu         51%    59,308    198,807   101,391   Sold

                                                                                             Under
50   Qingdao      New Town Project       Pingdu         51%    75,701    136,900   69,819
                                                                                             construction
                  Project Xingyang                                                           Pre-
51   Qingdao                             Chengyang      51%    258,675   433,177   220,920
                  Road                                                                       construction
                  Vanke Centre,                                                              Pre-
52   Qingdao                             Sifang         70%    18,646    70,856    49,599
                  Shandong Road                                                              construction
                  Project Chunyang                                                           Pre-
53   Qingdao                             Chengyang      51%    86,493    177,966   90,763
                  Road                                                                       construction
                                                                                             Under
54   Jinan        Jinyu International    Gaoxing        63%    38,164    118,741   74,807
                                                                                             construction
                                                                                             Pre-
55   Fushun       Jinyu International    Shuncheng      100%   72,560    316,582   316,582
                                                                                             construction
                                                                                             Pre-
56   Shenyang     Project Park Avenue    Yuhong         75%    169,774   407,374   305,531
                                                                                             construction
                                                                                             Pre-
57   Yingkou      Harbor                 Boyuguan       100%   138,990   319,677   319,677
                                                                                             construction
                                         Fushan                                              Under
58   Yantai       Holiday Dew Garden                    70%    65,733    152,466   106,726
                                         District                                            construction
                  Project Sculpture                                                          Pre-
59   Changchun                           Nanguan        100%   121,109   343,058   343,058
                  Park                                                                       construction
                                                                                             Pre-
60   Jilin        Project Songhua Lake   Fengman        100%   531,598   681,890   681,890
                                                                                             construction
                                         Binhai
                                                                                             Under
61   Tianjin      Jinyu International    New            51%    108,389   190,144   96,973
                                                                                             construction
                                         District
                                                                                             Under
62   Tianjin      King Metropolis        Dongli         51%    221,217   357,220   182,182
                                                                                             construction
                                                                                             Under
63   Nanchong     Jinrun Huafu           Nanchong       60%    182,012   518,004   310,803
                                                                                             construction
                                                                                             Pre-
64   Chengdu      Vanke Huamao Plaza     Chenghua       51%    29,720    207,600   105,876
                                                                                             construction
                  Project Mu 72,                                                             Pre-
65   Chengdu                             Gaoxin         100%   48,345    145,034   145,034
                  Dayuan                                                                     construction
                  Project Mu 131,                                                            Pre-
66   Chengdu                             Gaoxin         100%   87,822    263,464   263,464
                  Gaoxin                                                                     construction




                                                    Page 27
                      Mu 107, Longquan            Longquany                                                        Pre-
67    Chengdu                                                     100%     72,102      288,410       288,410
                      Damian                      i                                                                construction
                      Mu 71, Longquan             Longquany                                                        Pre-
68    Chengdu                                                     100%     47,245      141,642       141,642
                      Shiling                     i                                                                construction

69    Kunming         Yunshang Cheng              Wuhua           23%      34,293      177,468       40,818        Sold

70    Kunming         Respecte Chateau            Gaoxin          67%      105,484     423,175       283,527       Sold

                                                                                                                   Under
71    Xi’an          Joying Gold                 Chengxi         80%      193,594     664,643       531,714
                                                                                                                   construction
                                                                                                                   Pre-
72    Xi’an          Dream Town 8#               Chang’an       100%     172,700     504,800       504,800
                                                                                                                   construction
                      Project                                                                                      Pre-
73    Chongqing                                   Shapingba       80%      175,000     700,000       560,000
                      Fengmingshan                                                                                 construction
                      Project Xijiao                                                                               Pre-
74    Chongqing                                   Jiulongpo       50%      26,515      145,688       72,844
                      Hospital                                                                                     construction

75    Guiyang         Vanke Yuecheng              Yunyan          51%      85,341      262,728       133,991       Sold

                                                                                                                   Pre-
76    Guiyang         Dream Town                  Yunyan          70%      348,117     910,910       637,637
                                                                                                                   construction
                                                                                                                   Pre-
77    Urumqi          Jinyu International         Sayibak         100%     24,149      59,764        59,764
                                                                                                                   construction
                                                                                                                   Pre-
78    Urumqi          Golden Paradise             Sayibak         100%     20,047      50,032        50,032
                                                                                                                   construction
                                                                                        20,622,6     15,885,6
                                   Total                                    8,07,646
                                                                                           03           34

The total land premium and composite redevelopment cost of the above-mentioned projects attributable to
Vanke’s equity holding was approximately RMB43.9 billion.

From the end of the year under review to the date of publication of this report, the Company had acquired 14 new
projects, with a site area attributable to Vanke’s equity holding of approximately 1,170,000 sq m (corresponding
planned GFA of approximately 2,860,000 sq m). Details are as follows:

                                                                                                        GFA
                                                                                                   attributable
                                                  % of             Site area    Planned GFA         to Vanke’s
No.     City         Project           Location                                                                      Progress
                                                  shareholding      (sq m)         (sq m)              equity
                                                                                                      holding
                                                                                                      (sq m)
                  Project                                                                                               Pre-
 1    Dongguan                        Guancheng            100%        53,887          215,548           215,548
                  Qifenglu                                                                                          construction
                                                                                                                       Under
 2    Shenzhen    Project Bayifu      Longgang             100%        28,894          115,000           115,000
                                                                                                                    construction
                  Land lot 3-5-7
                                                                                                                        Pre-
 3    Nanjing     South Station       Yuhuatai             100%        45,022          133,266           133,266
                                                                                                                    construction
                  East Road
                                                                                                                        Pre-
 4     Yantai     Liangjiacun         Zhifu                 51%       332,514          615,200           313,752
                                                                                                                    construction
                  Jiefang South                                                                                         Pre-
 5     Tianjin                        Hexi                  80%        62,205          124,410            99,528
                  Road                                                                                              construction
                                                                                                                        Pre-
 6     Tianjin    Zhangjiawo          Xiqing                51%       409,701          502,988           256,524
                                                                                                                    construction
                  Changyang
                                                                                                                       Under
 7     Beijing    West Station,       Fangshan              51%        27,528           55,056            28,709
                                                                                                                    construction
                  Shanglinwan
                  Minhou                                                                                                Pre-
 8     Fuzhou                         Minhou               100%       213,602          701,001           701,001
                  College Town                                                                                      construction
                  Gaoxin ash                                                                                            Pre-
 9    Nanchong                        Gaoxin                50%       163,213          355,678           177,839
                  yard                                                                                              construction


                                                            Page 28
                      Land lot of
                      Zhenghao                                                                                                   Pre-
  10       Jinan                          Lixia                   100%        191,418          476,783           476,783
                      chemical fibre                                                                                         construction
                      factory
                      Residential
                      land of                                                                                                    Pre-
  11      Beijing                         Tongzhou                  50%        39,000           91,260             45,630
                      Tongzhou                                                                                               construction
                      Taihu 017
                      Residential
                      land of                                                                                                    Pre-
  12      Beijing                         Tongzhou                  50%        47,000          117,500             58,750
                      Tongzhou                                                                                               construction
                      Taihu 014
                                          Fenghuang                                                                              Pre-
  13      Tangshan    凤凰新城                                      48%        88,848         266,441           127,892
                                          New Town                                                                           construction
                      Hetanlu
                      Yingkexinchun                                                                                              Pre-
  14     Urumqi                        Xinshi                       82%        37,626          131,466           107,802
                      fertilizer                                                                                             construction
                      factory
                                 Total                                     1,740,485         3,901,597         2,857,394

 C. Other investments

 1) Investment of securities
 Nil

 2) Equity interests held in other listed companies
                                                                                                                        Unit: RMB
                                                                                                               Changes in equity
                                                                           Booked value      Gains/(losses)
                                      Initial                                                                   attributable to
  Stock          Stock                                 Percentage of      as at the end of    during the
                                   investment                                                                   equity holders
  code        abbreviation                             shareholdings      the year under      year under
                                     amount                                                                     during the year
                                                                              review            review
                                                                                                                 under review
600751         SST Tianjin     143,600.00          0.04%            143,600.00          -                     -
               Marine
               Shipping
               Co., Ltd.
Total          -               143,600.00          -                143,600.00          -                  -
 Note: Equity interests held in SST Tianjin Marine Shipping Co., Ltd are legal person shares held by the Company over the years. Up
 till now, it has not undergone share reform.

 10.3 Shareholding in non-listed financial corporations and companies planning for listing
 Nil

 10.4. Investment in derivatives

Remarks on risk analysis and management of derivative            In order to limit the risk associated with the fluctuations of interest
positions during the year under review (including but not        rate, the Company entered into an interest rate swap (“IRS”)
                                                                 agreement to hedge floating rate foreign currency loan. The Company
limited to market risk, liquidity risk, credit risk, operational risk
and legal risk, etc.)                                            would charge the counterparty an interest according to a floating rate,
                                                                 in order to pay the floating-rate interest to the original lender, while
                                                                 paying a fixed rate to the counterparty. In terms of the term and
                                                                 amount of the foreign currency loan, IRS limits the risk of fluctuations
                                                                 of interest rate through fixed forward rate.
Change in market price or fair value of the derivatives invested The effect of the change in the IRS value on the Company’s profit and
during the year under review, as well as the method, related     loss during the year under review amounted to RMB (8,719,200). The
assumptions and parameters used to analyse the fair value of     value of the IRS was determined based on the fair value assessed on
derivatives should be disclosed                                  31 December 2012.
Remarks on whether there has been a material change in the       Nil
accounting policy and accounting measurement principles for
the Company’s derivatives during the year under review as
compared with those of the previous financial year
Special advice on derivative investment and risk control by      The Company’s independent directors are of the view that financial
independent directors, sponsors or financial advisors            instruments such as IRS prevent the possible loss associated with
                                                                 foreign currency loan in the event of significant fluctuations in interest
                                                                 rate. The relevant arrangement of the Company had been prudent and
                                                                 reasonable.


                                                                    Page 29
Derivative positions as at the end of the year under review
                                                                                                                  Unit: RMB’000
                             Contract amount
                                                 Contract amount                            Contract amount as a percentage of the
                            as at the beginning                      Profit/loss during the
   Type of contracts                            as at the end of the                         Company’s net assets as at the end of
                             of the year under                        year under review
                                                year under review                                   the year under review
                                   review
Interest rate swap
                                 3,079,879.9        2,553,798.7             (8,719.2)                       3.11%
(IRS) agreement
Total                            3,079,879.9        2,553,798.7             (8,719.2)                       3.11%

6. Project development plan for the current year

At the end of 2012, the Company had 320 development projects; the total GFA of projects under development
attributable to Vanke’s equity holding amounted to approximately 22,660,000 sq m, and the total GFA of projects
under planning attributable to Vanke’s equity holding amounted to approximately 39,470,000 sq m. In addition,
the Company was also involved in 7 city redevelopment projects. At present, demolition is in progress and the
relevant formalities are being processed. According to the current planning, the site area attributable to Vanke’s
equity holding of the relevant project was approximately 730,000 sq m (corresponding GFA attributable to
Vanke’s equity holding was approximately 3,030,000 sq m).

In view of the Company’s existing projects, the floor area commencing construction for the current year is
expected to amount to 16,530,000 sq m, representing an increase of 15.3% from the actual floor area commenced
construction achieved in 2012. Since construction of part of the projects acquired in the current year will
commence during the year, it is expected that the actual construction area in 2013 will be larger than the above-
mentioned plan. The area to be completed in 2013 is expected to amount to 12,900,000 sq m, up by 31.7% from
the actual completed area in 2012.

The Group’s planned projects in 2013 are as follows:

                                                                                                                    Unit: sq m

                                                                                         Planned
                                                                                         area of        Planned
                                                                                         newly          complet
                                                 Equity                     Planned                                 Land bank at the
Project                            Location                 Site area                    commenced      ed
                                                 interest                   GFA                                     end of the year
                                                                                         constructio    area in
                                                                                         n              2013
                                                                                         in 2013
Guangshen region
Vanke Centre, Shenzhen             Yantian       100%              61,730       80,201              -          -                       -
Vega Villa, Shenzhen               Yantian       100%             253,990       25,040        10,429           -                  10,429
Yihaicheng, Shenzhen               Yantian       50%              137,250      354,695        65,000    120,000                  166,398
Antuoshan Project, Shenzhen        Nanshan       100%              48,804      219,967              -          -                 219,967
Respecte Chateau, Shenzhen         Baoan         100%              65,364      165,648              -    40,073                        -
Ravine Village, Shenzhen           Baoan         60%              158,639       47,270              -          -                  47,270
Philippe Castle, Shenzhen          Baoan         100%              77,265      262,793              -    62,822                   39,900
                                   Pingshan
Golden Paradise, Shenzhen          New           100%             104,801      323,624              -   128,870                        -
                                   District
The Village, Shenzhen              Longgang      100%             421,916      595,982              -    71,238                        -
Tianyu, Shenzhen                   Longgang      100%              62,575      352,464              -    95,094                  257,370
Qianlin Shanju, Shenzhen           Longgang      100%             198,597      380,547              -    56,270                        -
Home, Shenzhen                     Longgang      100%              31,337      155,951              -    64,769                        -
Phase III Home, Shenzhen           Longgang      50%               43,727      176,535       112,978           -                 112,978
Shuijing (水径) Project, Buji,
                                   Longgang      60%              164,989      456,405        62,124     20,117                  436,288
Shenzhen
Park Avenue, Shenzhen              Longgang      65%               45,794      238,203              -          -                       -
Langqi Project, Shenzhen           Longgang      100%              41,487       22,380        22,380           -                  22,380



                                                             Page 30
Dajia Island, Shenzhen        Huizhou      100%     364,450     93,340          -         -    93,340
Lunas Del Mar, Huizhou        Huidong      67%      704,223   1,068,191   207,236   157,292   825,508
Jinyu Huating, Huizhou        Huicheng     100%     151,298    313,678          -    85,453         -
                              Tangxia,To
Watercity, Dongguan                        51%      596,786    414,759     55,000    15,640   220,442
                                  wn
                              Tangxia,To
Golden City, Dongguan                      40%       32,002     96,006     96,006         -    96,006
                                  wn
                              Tangxia,To
Wonderland, Dongguan                       70%       51,263     92,273     92,273         -    92,273
                                  wn
Spring Dew Mansion,           Tangxia,To
                                           51%      128,144    256,129          -    18,777         -
Dongguan                          wn
Jinyu Songhu, Dongguan        Songshan     51%      136,151    381,000          -   129,044         -
                              Songshan
Hongxinuoya, Dongguan                      100%     349,951    267,450          -    49,589         -
                                  Lake
Songshan Lake Centre,
                              Songshan     34%       95,506     73,872          -    23,509         -
Dongguan
Songshan Lake Centre II,
                              Songshan     25%       30,084     30,084     11,219         -    11,219
Dongguan
Vanke Building, Dongguan      Nanchang     100%       4,771     42,937          -         -         -
King Metropolis, Dongguan     Nanchang     51%      189,934    493,827          -    41,473         -
Feilishan (翡丽山),
                              Nanchang     50%      249,534    374,302     24,196         -   218,833
Dongguan
Xiangshu Lishe, Dongguan      Nanchang     51%       43,851    109,626    109,626         -   109,626
                              Humen
Zitai (紫台), Dongguan                     100%      60,570    151,426          -    68,628         -
                                  Town
Golden Milestone (色          Humen
                                           100%      17,374     69,495     69,495         -    69,495
程), Dongguan                     Town
Chang’an Vanke Centre,       Chang’an
                                           100%      75,653    249,654    101,196    29,195   101,196
Dongguan                          Town
Jinyu International,          Houjie
                                           100%      88,788    257,486          -    67,015         -
Dongguan                          Town
                              Houjie
Houjie Plaza, Dongguan                     67%       32,002    113,856    113,856         -   113,856
                                  Town
Changping Dream Town, ,
                              Changping    100%     635,971    442,460          -    70,170         -
Dongguan
Luhu (麓湖) Dongguan          Dalingshan   100%     146,674    117,341          -    35,862         -
The Paradiso, Guangzhou       Baiyun       50%      144,657    433,584          -   122,296         -
Land Lot AB2911022,
                              Baiyun       100%      24,052     92,130          -         -    92,130
Baiyun New Town
Jinyu Huating, Guangzhou      Haizhu       100%       9,117     85,682          -         -         -
Jiangyan Road
                              Haizhu       68%       16,831     52,765     35,911         -    52,765
Project,Guangzhou
Le Bonheur, Guangzhou         Liwan        100%      38,111    135,689          -    28,597         -
Vanke Fuqian Garden,
                              Nansha       95%      134,760    269,520          -   200,819         -
Guangzhou
Racho Santa Fe, Guangzhou     Huadu        49%      210,252    126,172          -    21,912         -
Donghui Garden, Guangzhou     Luogang      55%      177,588    443,970    116,543    93,558   213,120
Donghui Garden
                              Luogang      33%      109,748    274,370          -         -         -
(expanding), Guangzhou
Project SDK-D-3, East Side,
Zhonghai, Luogang,            Luogang      100%     115,671    289,178    109,487         -   289,178
Guangzhou
Jinse Yuefu, Guangzhou        Huangpu      100%      24,056     63,591          -    63,591         -
Lot AT030548, Gaotang,
Software Park, Tianhe,        Tianhe       100%      30,995     82,962     82,962         -    82,962
Guangzhou
Xinguang City Garden,
                              Panyu        100%     364,651    570,743          -    55,124   272,910
Guangzhou
Dream Town, Qingyuan          Qingyuan     100%     726,374   1,430,375    32,590   133,440   799,609
Vanke Huafu (万科华府),
                              Qingyuan     100%      79,164    312,820     77,719    50,675    77,719
Qingyuan
The Paradiso, Foshan          Nanhai       55%      221,035    574,690     66,283    74,676    66,283



                                                  Page 31
Jinse Xigu Huayuan (金色溪
                               Nanhai         49%         66,533      81,080               -    45,985                       -
谷花园), Foshan
King Metropolis, Foshan        Nanhai         100%        75,916     184,607               -          -                      -
A14 Project, Foshan            Nanhai         50%         47,254     354,404        96,200            -                354,404
Binfen Siji (缤纷四季),
                               Shunde         100%       156,840     429,527               -    79,040                       -
Foshan
Crystal City, Foshan           Shunde         49%        284,036     710,092       143,035      71,062                 313,355
Qinyuan (沁园), Foshan         Shunde         100%        80,571     241,712               -    33,814                       -
Tianaowan Project, Foshan      Shunde         50%         30,382      75,954               -    56,552                  20,904
F06 Project, Foshan            Shunde         50%        113,224     452,880       125,280            -                452,880
Vanke Plaza, Foshan            Chancheng      88%        114,429     555,819       379,611            -                409,032
The Dream Town, Foshan         Chancheng      100%       337,544     776,350       190,000      24,397                 396,281
Jinyu International, Foshan    Chancheng      51%         89,000     373,820       162,258      52,710                 290,117
Zhubin Garden (珠宾花园),
                               Xiangzhou      100%       109,917     146,497               -    20,793                       -
Zhuhai
Jinyu Gangwan (金域港湾),
                               Xiangzhou      50%         78,000     196,358        56,032            -                196,358
Zhuhai
Glamorous City, Zhuhai         Doumen         100%       137,061     274,122               -          -                101,271
City Garden, Zhuhai            Jinwan         51%         63,233     189,621               -    51,329                       -
Jinyue Huating (金悦华庭),     Tanzhou
                                              100%        32,103     127,789               -    94,035                       -
Zhongshan                          Town
City Views, Zhongshan          Southern       100%       338,516     523,177               -          -                      -
Spring Dew Mansion,
                               Eastern        100%        76,387     175,133               -    75,041                       -
Zhongshan
Golden Home (金色家园),        Dongfeng
                                              100%       255,623     789,453       181,471     107,682                 647,840
Zhongshan                          Town
Le Bonheur, Zhongshan          Huoju          65%        251,900     488,889        98,302            -                488,889
Heart of Lake, Xiamen          Huli           100%        95,098     199,710        22,055      36,075                 129,428
Joying Gold, Xiamen            Xiang’an      100%        54,441     109,000               -          -                      -
King Metropolis, Xiamen        Jimei          100%       102,427     446,842               -    84,581                  73,646
Vanke Plaza, Xiamen            Jimei          100%       137,934     710,000       149,655            -                510,000
Haicang Dream Town,
                               Haicang        40%        189,752     517,690       150,702            -                317,195
Xiamen
Jinyu Rongjun (金域榕郡),      Jinan          100%       166,736     381,589        59,198      54,620                  59,198
Fuzhou
King Metropolis, Fuzhou        Cangshan       100%        16,168      37,614               -          -                      -
Yongtai Dream Town,
                               Yongtai        51%        392,000     556,032       111,000            -                527,184
Fuzhou
Vanke Plaza, Fuzhou            Taijiang       100%        93,359     439,213       124,381     249,976                 124,381
Jinyu Garden (金域花园),
                               Taijiang       60%         25,397     130,795               -          -                      -
Fuzhou
Dream Town, Putian             Licheng        80%        250,708     528,566       203,224     110,342                 203,224
King Metropolis, Changsha      Yuhua          60%        238,066     512,778               -    94,078                       -
Project Gaozheng, Changsha     Yuhua          60%         40,360     169,469       169,469            -                169,469
The Paradiso, Changsha         Furong         100%       120,208     352,083       105,460            -                249,127
City Garden, Changsha          Yuelu          100%        39,339     138,032               -    30,910                       -
Golden Paradise, Changsha      Yuelu          78%         43,737     129,065       129,065            -                129,065
Jinyu Binjiang, Changsha       Yuelu          58%         58,287     200,892       200,892            -                200,892
Heron Hill, Changsha           Yuelu          100%       100,351     291,401        43,332            -                291,401
Dream Town, Changsha           Kaifu          70%        204,010     472,187        30,600     102,221                  30,600
Zitai, Changsha                Tianxin        70%        108,162     266,296        12,533            -                171,766
Sanya Forest Holiday Park      Sanya          65%        942,745     470,814        21,340      84,277                 320,510
Gaozhiyuan Project, Sanya      Sanya          65%        387,807     349,026        26,086            -                279,841
Vanke Lakeside Holiday
                               Sanya          80%        260,293     301,650               -          -                225,214
Park, Sanya
                                                                   29,463,16                   3,855,10
                  Guangshen region subtotal          15,336,161                4,665,690                  12,894,922
                                                                   6                           8


                                                     Page 32
Shanghai Region
                                Pudong
Qinglinjing,Shanghai            New             100%      99,209   148,814         -         -         -
                                District
                                Pudong
Wujiefang, Shanghai             New             100%     121,463   126,887         -    79,113         -
                                District
                                Pudong
Haishang Chuanqi (海上传
                                New             60%      140,981   260,883    89,625    83,780   177,103
奇), Shanghai                   District
                                Pudong
Golden City, Shanghai           New             60%      264,646   549,046   160,533         -   197,191
                                District
                                Pudong
Tongshan Street Project,
                                New             75%       58,550   182,230         -         -   129,919
Shanghai
                                District
                                Pudong
Bingjiang Project, Shanghai     New             100%      38,753   103,132   103,132         -   103,132
                                District
53#, Qibao, Shanghai            Minhang         100%      49,294   126,869   126,869         -   126,869
New City Garden, Shanghai       Minhang         51%      287,741   334,669         -    54,120    93,701
Firenze, Shanghai               Minhang         49%      304,830   199,071         -    42,464         -
Southern portion of Land Lot
No. 03, Phase 1 of Core Area,
                                Minhang         50%       32,170   110,462         -         -         -
Shanghai Hongqiao Business
District
Project No. 11, Shanghai
                                Minhang         61%      112,864   177,885   108,183         -   177,885
Hongqiao
Jinse Huatin, Shanghai          Songjiang       33%       67,932   108,137         -    57,983         -
Sheshan Longyuan(佘山珑
                                Songjiang       45%      130,970   102,060    34,076    26,780    75,279
原), Shanghai
14# Songjiang Business
                                Songjiang       60%       57,734   145,234   145,234         -   145,234
District, Shanghai
Castle Tudor, Shanghai          Baoshan         100%     231,753   241,169         -         -         -
Respecte Chateau (色领          Jiading         50%       90,013   180,026    82,561    73,946    82,561
域), Shanghai
Shangyuan(尚源), Shanghai       Qingpu          49%      116,524   142,858         -    35,255         -
Shanghai Nanzhan Business
                                Xuhui           51%      108,010   493,447    58,612         -   493,447
District Land
The Paradiso, Nantong           Gangzha         55%       99,910   218,650         -    67,147         -
Land Lot at Rengang Road,
                                Chongchuan      100%      43,217    99,000    99,000         -    99,000
Nantong
                                Xinzhou
Golden Paradise, Jiaxing        New             100%      85,286   137,495         -   133,174         -
                                District
                                Xinzhou
Golden Dream, Jiaxing           New             100%      80,987   144,699    51,961         -    74,938
                                District
Anpin Street Project, Nanjing   Baixia          100%      27,325    20,340         -         -    20,340
The Paradiso, Nanjing           Jiangning       100%     272,298   545,280   137,105   118,237   181,610
Respecte Chateau (金色领
                                Qixia           100%      91,751   201,828         -    65,768         -
域), Nanjing
                                Pukou
Golden Hill, Nanjing                            100%      62,291    98,692    44,082         -    44,082
                                 District
Land Lot 4, Eastern of
                                Yuhuatai        100%      76,336   182,380   129,366         -   182,380
Nanjing Nan Zhan
Glamorous City, Zhenjiang       Runzhou         100%     795,100   942,820    52,380    75,730   408,031
Blue Mountain, Zhenjiang        Runzhou         60%      285,683   416,285    21,240    35,634   323,380
                                Industrial
Nimble Bay, Suzhou                              70%      384,042   835,281    36,397    80,867    36,397
                                District
                                Industrial
Golden Paradise, Suzhou                         92%       47,177   117,936         -    54,343         -
                                District
                                Industrial
Bai Tang Park, Suzhou                           100%     104,486   179,075    60,000         -   179,075
                                     District



                                                       Page 33
Vanke New Metropolis (万科    New
                                               55%       89,098      83,220     27,156    38,876     27,156
新都会), Suzhou               District
Golden Milestone Project,
                              Jinchang         49%       99,093     247,732     60,646    87,139    109,467
Suzhou
                              Wuzhong
Dream Town, Suzhou                             55%      144,535     361,338     85,248    29,625    295,656
                                 District
Pingjiang New City Project,
                              Gusu             100%      80,948     189,677     90,000         -    189,677
Suzhou
                              Bacheng
Golf Project, Kunshan                          100%     433,916     240,701      5,000              232,086
                                  Town
Huaqiao Project, Kunshan      Kunshan          60%      179,000     447,600    150,000         -    447,600
Glamorous City, Wuxi          Binhu            60%      960,000    1,346,963   100,953    66,463    215,662
The Paradiso, Wuxi            Binhu            100%     154,468     386,170     53,177         -    198,920
Xincheng Road, Wuxi           Binhu            100%     154,119     385,299     60,537    36,709    210,535
                              New
Golden Paradise,Wuxi                           100%     224,376     620,713     77,168   113,977    298,168
                                    District
                              Hanjiang
Dream Town, Yangzhou                           65%      297,139     313,970     60,280    98,797    101,773
                              District
Project F, Western District   Hanjiang
                                               65%       59,835     130,067    130,067         -    130,067
New Town, Yangzhou            District
Dream Town, Xuzhou            Jiuli            100%     396,349     713,428    263,000         -    713,428
Land Lot GHI, Huaixi
                              Quanshan         85%       90,639     305,617    305,617         -    305,617
Project, Xuzhou
Liangzhu New Town,
                              Yuhang           100%    3,108,146   2,368,153   143,694   105,436   1,174,233
Hangzhou
Project Gouzhuang,
                              Yuhang           50%      115,683     293,835    133,226         -    293,835
Hangzhou
West Spring Butterfly         Xihu             51%      155,838     354,038          -         -           -
Garden, Hangzhou
No 58, Jiangcun Project,      Xihu             51%       75,998     151,996    151,996         -    151,996
Hangzhou
No 59, Jiangcun Project,      Xihu             100%      30,403      60,806          -         -     60,806
Hangzhou
Gongwang (公望), Hangzhou     Fuyang           100%     517,900     208,981          -              121,026
Junwang A+D, Hangzhou         Fuyang           20%      129,874     164,845     24,220         -    164,845
Junwang B+C, Hangzhou         Fuyang           20%      138,233     152,231          -         -    152,231
Caozhuang, Hangzhou           Jianggan         100%      37,178      86,938          -         -     52,644
Jinse Caozhuang (金色草庄).   Jianggan         50%       68,564     150,841    150,841         -    150,841
Hangzhou
Project Pufu, Hangzhou        Jianggan         100%      46,069     110,566    110,566         -    110,566
Project Puyan, Hangzhou       Binjiang         60%       66,521     166,303    166,303         -    166,303
Yunluwan (云鹭湾), Ningbo     Jiangbei         100%     314,200     394,764     58,600         -    213,424
Golden City, Ningbo           Yinzhou          100%      95,242     171,425          -    92,824           -
Jinyu International, Ningbo   Yinzhou          55%       41,080      73,940          -         -           -
Dream Town, Ningbo            Zhenhai          49%      226,777     491,525     94,079   138,266    230,402
Project Rongjia, Ningbo       Jiangdong        100%      66,833     133,666    133,666         -    133,666
Longwan Project, Wenzhou      Longwan          60%      125,219     178,298          -    89,612           -
Golden Mingjun, Hefei         Shushan          50%      107,326     401,670          -   123,563           -
King Metropolis, Hefei        Shushan          50%      115,628     412,101     84,740   106,601    208,991
Blue Mountain Garden, Hefei   Binhu            55%      165,584     463,635     59,433         -    355,290
Dream Town, Hefei             Binhu            55%      107,220     375,272     32,749    79,231    182,972
Forest Park Project, Hefei    Luyang           100%     516,459    1,394,439   210,000         -   1,394,439
Dream Town, Wuhu              Jiujiang         100%     274,404     493,926    106,752   145,368    237,518
                              Qingshan
Qingshan Lake, Nanchang                        50%       97,061     133,693          -    55,265           -
                              Lake
Qingshan Lake North Avenue    Qingshan
Project, Nanchang             Lake             50%       16,888      50,381          -         -           -
Dew Garden (润园),            Qingyunpu        50%       97,109     144,011          -    83,345           -
Nanchang
The Paradiso, Nanchang        Xihu             50%       21,818      75,338          -    75,338           -
Dream Town, Nanchang          Gaoxin           33%      299,845     417,362    263,060              348,880



                                                      Page 34
                                                                                            69,495
                                                                  23,720,11                2,720,27
      Shanghai region subtotal                       15,311,941                4,933,130               12,732,274
                                                                          4                       1
Beijing region
Ruyuan C3, Beijing               Haidian      50%       33,745        74,239                  43,213
Ruyuan C1, Beijing               Haidian      50%      104,899       178,275     20,000                  178,275
No. 5 Park Front Boutique        Chaoyang     60%       37,917        97,044
Apartment, Beijing
Blue Mountain, Beijing           Chaoyang     100%      55,885       128,190                  16,136
The Metropolis (大都会),
                                 Chaoyang     100%       5,329        42,556                  29,999
Beijing
Changyang Bandao, Beijing        Fangshan     50%      437,179       853,165     59,610     153,683      256,093
Yunwan Jiayuan, Beijing          Fangshan     50%       61,567       157,992                  72,100
Xingfuhui (幸福汇), Beijing      Fangshan     68%       71,912       137,808                  21,288      75,482
New Milestone, Beijing           Fangshan     20%       77,834       146,002     26,500       59,787      86,359
Golden Paradise, Beijing         Fangshan     40%       65,967       145,195     30,667                   58,439
Jinyu Vanke City, Beijing        Changping    49%      178,908       485,234                  22,116      10,800
King Metropolis, Beijing         Changping    50%      206,007       577,188     42,000       38,401     280,381
Holiday Views, Beijing           Fengtai      50%      224,289       413,304
Hongshi Jiayuan (红狮家园),      Fengtai      100%      59,800       184,502                  38,493
Beijing
Vanke Lan (万科蓝), Beijing      Fengtai      100%      14,449        36,084
Xihuafu, Beijing                 Fengtai      50%      233,209       629,170     48,000                  376,014
Spring Dew Mansion,
                                 Daxing       50%       67,650       173,215     51,423       51,423     119,021
Beijing
Jinyu Dongjun, Beijing           Daxing       50%       57,826       144,525     39,924                  144,525
Vanke Cheng, Beijing (万科
                                 Daxing       50%      103,116       155,206     50,000                  155,206
橙)
Huanqingcheng, Langfang          Langfang     50%      130,045      169,587                              169,587
Stratford, Tangshan              Lunan        100%     153,527        96,661
Stratford South(红郡南),
                                 Lunan        100%      47,007        47,621     47,621                   47,621
Tangshan
King Metropolis, Tangshan        Lubei        60%       78,977       166,159                  98,351
The Paradiso, Tangshan           Lubei        40%       26,329        63,825
Holiday Views (假日风景)
                                 Haigang      80%      270,549       642,357                106,509      400,559
Qinghuangdao
Land lot Beidaihe
                                 Beidaihe     50%      238,561       279,248     55,000                  279,248
Yanggezhuang, Qinhuangdao
Waterfront, Tianjin              Dongli       100%    2,708,886    1,763,059     28,571       47,000     765,467
A Glamorous City, Tianjin        Dongli       100%     176,773       258,579                  30,522
New Milestone, Tianjin           Dongli       51%      136,524       206,863                  80,389
Jinse Yazhu (金色雅筑),
                                 Dongli       49%       90,792       173,987                  20,853
Tianjin
King Metropolis, Tianjin         Dongli       51%      221,217       357,220    130,151                  321,537
Holiday Dew Garden, Tianjin      Xiqing       100%     229,201       343,101     13,885     134,044       13,885
Jin’ao International, Tianjin   Xiqing       100%      58,577       160,080                  71,234
                                 Developmen
Binhai Modern, Tianjin                        100%       6,538        43,473
                                 t District
                                 Developmen
Park Residence, Tianjin                       60%       32,270        48,709
                                 t District
                                 Binhai New
Harbor (海港城), Tianjin                      51%      149,483       372,910     60,936       53,876     116,221
                                 District
                                 Binhai New
Jinlu (锦庐), Tianjin                         95%       90,604       126,600     43,284                   64,284
                                 District
                                 Binhai New
East Coast, Tianjin                           51%      255,311       382,929                             359,772
                                 District
                                 Binhai New
Jinyu International, Tianjin                  51%      108,389       190,144     12,936                  141,506
                                 District
Shilinyuan (仕林苑), Tianjin     Jinnan       40%       63,582       114,474                  26,788


                                                     Page 35
Dream Town, Shenyang           Heping          49%      361,320    868,373               59,706
Rotterdam , Shenyang           Heping          100%     120,333    360,999     26,686    81,203    219,259
A Glamorous City, Shenyang     Yuhong          100%     156,817    297,026
Xianghushengjing (香湖胜
                               Yuhong          49%      190,200    342,360     31,010    82,603    202,345
景) North, Shenyang
Xianghushengjing (香湖胜
                               Yuhong          51%      135,464    304,520                         295,704
  景) South, Shenyang
Park Avenue, Shenyang          Yuhong          75%      169,774    407,374     82,963              407,374
                               Hunnan
The Paradiso, Shenyang         New             100%     226,356    615,688     63,966   103,829    136,454
                               District
                               Hunnan
Shenyang Tomorrow City         New             65%      199,319    597,957     59,645    65,358    331,798
                               District
Park Residence, Shenyang       Shenhe          55%       83,229    290,681               14,691     91,829
Chunheli, Shenyang             Shenhe          79%       81,378    431,232     21,560    20,545    251,516
Whistler (惠斯勒小镇),         Dongling        70%      285,599    286,141               42,579    197,765
Shenyang
Vanke Blue Mountain ,          Dadong          60%       78,367    235,102              102,328
Shenyang
Spring Dew Mansion (Long       Tiexi           70%       66,547    178,598               85,420
Mansion), Shenyang
Spring Dew Mansion (Run
                               Tiexi           100%      60,292    150,315              109,286     95,049
Mansion) , Shenyang
                               Developmen
The Paradiso, Fushun                           100%     226,529    739,519              105,982    589,098
                               t District
Vanke Jinyu International,     Shuncheng       100%      72,560    316,582    109,774              316,582
Fushan
Yinkou Habor(营口海港城),
                               Bayuquan        100%     138,990    319,677     22,145              252,213
Shenyang
Whistler Town, Anshan          Tiedong         100%     422,171    713,400     60,226    72,257    449,906
Dream Town, Anshan             Gaoxin          100%     167,664    375,002              109,287     58,189
Jinyu Internationl, Anshan     Tiexi           51%      225,715    677,000                         610,244
Ravine Village, Dalian         Ganjingzi       100%     363,716    380,922               33,015
A Glamorous City, Dalian       Ganjingzi       100%     218,498    443,186               73,561
Spring Dew Mansion,, Dalian    Ganjingzi       100%     118,506    223,512     59,884               59,884
Xishan Project, Dalian         Ganjingzi       55%       90,404     90,988     49,624               49,624
                               Puwan New
Habor, Dalian                                  55%      747,224   1,253,300    40,000   101,717    975,325
                                    District
                               High-Tech
Cherry Blossom Garden,
                                    Industri   61%      192,248    356,034     40,000    30,655    234,189
Dalian
                                    al Zone
Vanke City, Dalian             Jinzhou         100%     268,583    681,200    140,000              681,200
Blue Mountain, Changchun       Erdao           100%     228,670    501,678     80,000   126,408    135,851
Whistler (惠斯勒),
                               Jingyue         50%      399,715    484,714     98,233    28,449    294,017
Changchun
Dream Town, Changchun          Jingyue         51%      350,965   1,041,375    95,613   120,513    860,598
Park Residence, Changchun      Chaoyang        100%     267,981    503,349     29,000    96,129    230,959
Scupture Park Project,
                               Nanguan         100%     121,109    343,058    147,715              343,058
Changchun
Dream Town, Jinlin             Gaoxin          65%      728,139   2,142,910   124,700   185,498   1,470,130
Songhua Lake Project, Jinlin   Fengman         100%     531,598    681,890                         681,890
Wonderland, Qingdao            Jimo            55%      153,284    240,507
A Glamorous City, Qingdao      Chengyang       80%      200,289    341,463
City Garden, Qingdao           Chengyang       80%      130,873    228,966               48,904
Xingyang Road Project,
                               Chengyang       51%      258,675    433,177    317,348              433,177
Qingdao
Chunyang Road Project,         Chengyang       51%       86,493    177,966    177,966              177,966
Qingdao
Aureate City, Qingdao          Sifang          100%      61,873    174,157



                                                      Page 36
Fuzhou Road Vanke Centre,
                                Sifang          100%      38,775      124,751      124,751                         124,751
 Qingdao
Shandong Road Vanke
                                Sifang          70%       18,646       70,856       70,856                          70,856
    Centre, Qingdao
Dream Town, Qingdao             Sifang          55%      154,607      399,565       92,166        115,555           92,166
                                Shibei
Blue Mountain, Qingdao                          100%      68,153      204,189       17,778         69,503           17,778
                                     District
Qingdao Vanke Ecological
                                Licang          100%     141,346      260,784                     151,248
Town
Qingdao Town                    Jiaonan         34%      933,293      989,125       65,115         76,971          804,621
Qingdao Dongjun                 Jimo            55%      112,344      279,451      116,474                         116,474
Pingdu Dream Town,
                                Pingdu          51%       59,308      198,807       87,364                         122,933
Qingdao
Pingdu New City Project,
                                Pingdu          51%       75,701      136,900      136,900                         136,900
Qingdao
Haiyuntai, Yantai               Zhifu           100%     311,614      444,065                      47,545          246,055
Holiday Views, Yantai           Fushan          70%      190,281      361,220                      77,434          141,644
Holiday Dew Garden, Yantai      Fushan          70%       65,733      152,466
Jiyu International(金域国际),
                                Gaoxin          63%       38,164      118,741       16,107                          16,107
   Jinan
Jinyu Internationl, Taiyuan     Wanbolin        100%      49,407      169,679                     169,679
Blue Mountain, Taiyuan          Wanbolin        51%      198,392      687,671      253,091                         594,575
Zitai, Taiyuan                  Yingze          51%       95,687      331,236       74,471        136,224           85,072
 Spring Dew Mansion, JinzhongYuci               51%      218,143      482,246      109,355        104,626        109,355      104,626
     Beijing region subtotal                           19,127,691   35,410,130    3,802,994   4,064,913          18,501,027
Chengdu region
A Glamorous City,               Chenghua        60%      308,501        761,258               -         81,226            -
Vanke Diamond Plaza,
Chengdu                         Chenghua        85%       15,404         92,422               -              -            -
Vanke Huamao Plaza,
Chengdu                         Chenghua        51%       29,720        207,600        29,720                -     207,600
Jinyu Xiling (金域西岭),
Chengdu                         Jinniu          60%       79,331        361,100               -         61,576            -
Golden Domain, Chengdu          Qingyang        100%      49,628        244,459               -       121,243             -
Jinrun Huafu, Chengdu           Jingjiang       100%      52,895        267,928               -       120,076             -
Golden Hairong, Chengdu         Wuhou           49%       54,970        234,125               -              -            -
Haiyue Huicheng, Chengdu        Shuangliu       90%      104,307        521,698               -       130,800             -
Wulong Mountain Garden,
Chengdu                         Xindu           100%     345,168        356,503        35,820           93,723      35,820
Project Mu 72, Dayuan
Chengdu                         Gaoxin          100%      48,345        145,034        85,714                -     145,034
Project Mu 131, Gaoxin,
Chengdu                         Gaoxin          100%      87,822        263,464        38,371                -     263,464
Mu 107, Longquan Damian,
Chengdu                         Longquanyi      100%      72,102        288,410        86,337                -     288,410
Mu 71, Longquan Shiling,
Chengdu                         Longquanyi      100%      47,245        141,642        85,906                -     141,642
Jinrun Huafu, Nanchong          Nanchong        60%      182,012        518,004        50,000                -     413,122
Golf City Garden, Wuhan         Dongxihu        49%      237,660        393,858               -              -            -
King Metropolis, Wuhan          Wuchang         100%      59,790        191,300               -         38,627            -
Hanyang International,
Wuhan                           Hanyang         70%      166,817        568,974       158,119           78,826     295,574
Dream Town, Wuhan               Jianghan        100%      65,901        299,337               -        115,391            -
                                East Lake
                                High-Tech
                                Develop-
Stratford, Wuhan                mentZone        100%     230,894        349,607               -       155,079             -
                                Economic
                                and
                                Technologic
                                al
The Paradiso, Wuhan             Developmen      100%     213,440        533,600       220,530           86,598     246,384


                                                       Page 37
                              t Zone

Golden City, Wuhan            Hongshan     100%        274,100       896,484             -     243,450      200,540
Changzheng Village Project,
Wuhan                         Hongshan     100%        282,235       871,721      160,000             -     871,721
Huashan Ecological Town,
Wuhan                         Hongshan     50%         199,705       299,557       50,000             -     299,557
Youcheng Ecological Garden
(友诚生态名苑), Chongqing     Yubei        51%         229,581       344,372             -      34,363             -
                              Northern
Wonder Town (缇香郡),         New
Chongqing                     District     100%         41,448       145,067             -            -            -
                              Northern
Palance of Pleasure (悦府),   New
Chongqing                     District     100%        137,996       376,737             -     111,409             -
                              Northern
                              New
Dream Town, Chongqing         District     55%         278,167       647,378      158,653             -     354,743
Jincheng (锦程), Chongqing    Yuzhong      100%        105,406       533,486             -     192,767             -
Yuewan, Chongqing             Jiangbei     45%         435,499       649,158      165,174       73,609      566,459
Fengmingshan Project,
Chongqing                     Shapingbei   80%         175,000       700,000      316,454             -     700,000
Xijiao Hospital Project,
Chongqing                     Jiulongpo    50%          26,515       145,688       69,481             -     145,688
                              Qujiang
Jinyu Qujiang (金域曲江),     New
Xi’an                        District     55%         152,667       385,408             -      89,915             -
Dream Town, Xi’an            Chang’an    85%         176,056       614,377      101,304      144,489      101,304
Landlot No. 3, Dream Town,
Xi’an                        Chang’an    60%         113,231       352,803       93,560             -     198,620
Dream Town 8#, Xi’an         Chang’an    100%        172,700       504,800      100,000             -     504,800
King Metropolis, Xi’an       Weiyang      51%         106,667       373,034      198,421             -     210,568
Daminggong Project, Xi’an.   Weiyang      70%          69,052       221,603       38,060             -     155,063
Joying Gold, Xi’an           Chengxi      80%         193,594       664,643      140,713             -     540,713
King Metropolis, Guiyang      Xiaohe       51%         351,800       581,217       32,000             -     261,048
Metropolis(大都会),
Guiyang                       Xiaohe       51%         181,235       761,187       68,920             -     717,289
Nimble Bay, Guiyang           Yunyan       100%         90,456       201,012       28,544             -     128,778
Vanke Joy City(悦城),
Guiyang                       Yunyan       51%          85,341       262,728       64,129             -     191,103
Dream Town, Guiyang           Yunyan       70%         348,117       910,910      244,064             -     910,910
Golden Paradise, Kunming      Panlong      100%        104,724       274,641             -            -            -
Dew Garden (润园), Baisha,
Kunming                       Panlong      100%        192,104       247,394      125,424      118,585      125,424
Yunshangcheng, Kunming        Wuhua        23%          34,293       177,468             -            -            -
Respecte Chateau (金色领
域), Kunming                  Gaoxin       67%         105,484       423,175       74,693       36,552      196,465
                              New
King Metropolis, Urumqi       District     82%          45,934       144,366             -     131,604             -
                              Urumqi
Nanshan Villa, Urumqi         County       100%         32,760        14,900             -            -      14,900
Jinyu International, Urumqi   Shayibake    100%         24,149        59,764       59,764             -      59,764
Golden Paradise, Urumqi       Shayibake    100%         20,047        50,032        50,032            -       50,032
Chengdu region subtotal                              7,238,015    19,575,433     3,129,907    2,259,908    9,542,539
     Total                                                       108,168,843   16,531,721    12,900,200   53,670,762
                                                    57,013,808


Special Remarks on Risk Factors:

The schedule for the commencement and completion of the above-mentioned projects may be adjusted due to the
following factors:
a) There may be changes in the macro economic condition and the property market or changes in the sale of an
individual project;
b) Approval requirements may be tightened by new rules and regulations such that the progress of application for
permits will be slowed down, thereby affecting the schedule of project development;


                                                    Page 38
c) Progress in demolition and resettlement of related projects may affect the development schedule;
d) Significant changes in weather conditions may affect the progress of project development, which in turn affect
the schedule for completion;
e) Impact of other unpredictable significant events on the construction progress of projects.

7. Fair value measurement and holding of financial assets and financial liabilities in foreign currency
Fair value measurement:
                                                                                                                         Unit: RMB’000
                                                                                              Provision
                                                      Gain/loss
                                                                                              for                             Balance at
                                   Balance at         from changes        Accumulated                       Disposal
                                                                                              diminution                      the end of
                                   the                in fair value       changes of fair                   during the
Item                                                                                          in value                        the year
                                   beginning of       during the          value recognised                  year under
                                                                                              during the                      under
                                   the year           year under          in equity                         review
                                                                                              year under                      review
                                                      review
                                                                                              review
Financial assets
Including:
1. Financial assets measured at
fair value, and changes of                        -               -                      -              -                              -
which are recorded in profit and
loss during the period
Including: Derivative financial
                                                  -               -                      -              -                              -
assets
2. Available-for-sale financial
                                      441,261.6                   -                      -              -       (436,498.0)      4,763.6
assets
Sub-total of financial assets         441,261.6                   -                      -              -       (436,498.0)      4,763.6


Financial liabilities                 17,041.8             8,719.2                       -              -                 -    25,761.0
Investment properties                         -                   -                      -              -                 -            -
Productive biological assets                  -                   -                      -              -                 -            -
Others                                        -                   -                      -              -                 -            -
Total                                         -           (8,719.2)                      -              -   (436,498.0)                -

Financial assets and financial liabilities in foreign currency
                                                                                                                         Unit: RMB’000
                                                                                                  Provision      Disposal
                                                      Gain/loss
                                                                                                  for            during    Balance at
                                    Balance at        from changes         Accumulated
                                                                                                  diminution     the year the end of
                                    the               in fair value        changes of fair
Item                                                                                              in value       under     the year
                                    beginning         during the           value recognised
                                                                                                  during the     review    under
                                    of the year       year under           in equity
                                                                                                  year under               review
                                                      review
                                                                                                  review
Financial assets
Including:
1. Financial assets measured at
fair value, and changes of which                  -                   -                       -             -            -             -
are recorded in profit and loss
during the period
Including: Derivative financial
                                                  -                   -                       -             -            -             -
assets
2.     Loans     and    accounts
                                                  -                   -                       -             -            -             -
receivables
3. Available-for-sale financial
                                                  -                   -                       -             -            -             -
assets
4. Held-to-maturity investment                    -                   -                       -             -            -             -
Sub-total of financial assets                                         -                       -             -            -             -


Financial liabilities                  17,041.8              8,719.2                          -             -            -      25,761.0

Most of the items of the above-mentioned companies measured at fair value are legal person shares that have been


                                                               Page 39
held by the Company over the years. Their value was insignificant and they are being gradually disposed of. With
respect to certain items, the Company refers to the control procedures for major investment projects: the
Company’s management reviewed and approved, within the scope of authority as conferred by the Board, the
relevant items after they have been reviewed by the specialised departments with due diligence.

8.Specialised Committees’ Performance of Duties

The audit committee, the remuneration and nomination committee, as well as the investment and decision-making
committee, had dutifully performed their duties, in accordance with the “Code of corporate governance for listed
companies”, “Articles of Association”, and “Rules Governing the Procedures of Board Meetings” and the
responsibilities and obligations as stipulated in the implementation details of the different specialised committees.

A.      Audit committee’s performance of duties

During the year under review, the audit committee held six audit committee meetings and communication
meetings. The audit committee considered the following issues: the arrangement of audit duties, the periodical
financial reports, proposal on profit appropriation, the appointment of audit firm, execution of standardization of
internal control, guarantees, election of convenor, etc. The audit committee also communicated with the auditors
on several occasions.

The audit committee actively facilitated the audit process in 2012. Since the end of the year under review, the
audit committee held two more work-related meetings and communication meetings, supervised the auditors to
strictly follow the audit schedule, reviewed the financial statements and provided feedback. It also resolved on the
appointment of auditors, internal control self-assessment report, and dividend distribution.

The audit committee concluded the audit performed by KPMG Huazhen Certified Public Accountants in 2012 as
follows:

I.      Preparation before auditing

i. Determination of audit schedule
The audit for 2012 took seven months to complete, starting from internal control auditing, which commenced at
the beginning of August 2012. Details of the work schedule are as follows:
1) August to September 2012: Internal control audit. KPMG selected certain key subsidiaries and newly
established companies according to the Group’s internal control guidelines to conduct internal control audit.;
2) November to December 2012: Pre-audit. KPMG selected key cities to perform pre-audit according to the level
of importance and new projects acquired in 2012;
3) 13 January 2013: KPMG started to perform their annual audit in Vanke’s office. On 21 February, the first draft
of the 2012 Auditor’s Report was presented to the audit committee for review; and the Auditor’s Report was
presented on 26 February.

ii. Review of not-yet audited financial statements
Before the auditors came in, the audit committee had reviewed, with due diligence, the financial statements
prepared by the Company and provided their opinions in writing.

II.       Audit process
Starting from 13 January 2013, KPMG sent five different teams (for Guangshen Region, Shanghai Region,
Beijing Region, Chengdu Region and the Group as a whole) to perform audit for the Company’s headquarters and
its subsidiaries.
During the auditing process, the audit committee supervised in writing and requested KPMG to arrange its audit
work according to the audit work schedule, in order to ensure that the audit completed on time.
On 21 February 2013, KPMG submitted to the audit committee the 2012 Auditors’ Report and Internal Control
Audit Report. On 26 February 2013, the Board meeting approved the reports and the work performed by KPMG
for the Company’s 2012 audit completed.

III.  Audit results
KPMG has issued its unqualified opinion for the 2012 Auditors’ Report and Internal Control Audit Report.



                                                      Page 40
The audit committee is of the opinion that the audit performance of KPMG Huazhen Certified Public Accountants
on the Company’s 2012 financial statements is satisfactory.

The audit committee resolved to propose to the Board for approval of the reappointment of KPMG Huazhen
Certified Public Accountants to audit the Company’s 2013 financial statements according to the PRC and
international accounting standards, and to prepare the internal control audit report according to the requirements
of the regulatory bodies.

B.   Remuneration and nomination committee’s performance of duties

During the year under review, the remuneration and nomination committee held one meeting and a poll via voting
by correspondence. The committee had vetted and confirmed the beneficiaries who could exercise their stock
options during the first exercise period under the A-share stock option incentive plan, and held discussions on the
execution of the Company’s bonus proposal and senior management’s remuneration. Since 2013, the remuneration
and nomination committee held one more meeting and a poll via voting by correspondence, during which a slight
adjustment in the Company’s bonus proposal was discussed. The committee had maintained regular contact with
the management and held several debriefing sessions where the management reported their work.

C. Investment and decision-making committee’s performance of duties

During the year under review, the investment and decision-making committee paid close attention to the Board’s
authorization of project development and financing, and maintained regular contact with the management, thereby
having full understanding of the various business activities carried out within the scope of authority granted.


9. Profit Appropriation and Dividend Distribution Proposal

The Company’s profit appropriation and dividend distribution was based on the Company’s profit available for
appropriation. Details on the profit available for appropriation of the Group and the Company in 2012 according
to the PRC Accounting Standards for Business Enterprises are as follows:

                                                                                                        Unit: RMB
                                                        The Group                   The Company
            Profit after taxation available for             30,056,422,494.32           5,644,079,543.48
            appropriation
             Include: Net profit for 2012                   12,551,182,392.23          5,613,873,212.56
            Profit available for appropriation at the       18,934,617,430.43          1,459,583,659.26
            beginning of the year
            Allocation of dividend for 2011                (1,429,377,328.34)       (1,429,377,328.34)
Note: The significant difference between the profit of the Company and the consolidated profit of the Group is
attributable to the cost method used for recording investment in subsidiaries after the adoption of “Accounting
Standards for Business Enterprises 2006”. Moreover, the appropriations made by the subsidiaries’ legal persons to
statutory surplus reserve according to the Company Law were retained in the subsidiaries, and the subsidiaries’ profit
for the year has yet to be appropriated to the Company.

According to the relevant rules and requirements of the Company’s Articles of Association, and considering
shareholders’ interests and the Company’s development needs in the long run, the Board submitted to the
shareholders meeting the following profit appropriation proposal for the year 2012:

1. to appropriate 10 per cent of the net profit of the Company to statutory surplus reserve;
2. to appropriate 50 per cent of the net profit of the Company to discretionary surplus reserve;
3. to appropriate 40 per cent of the net profit of the Company and the unappropriated profit of the previous year
for dividend distribution fund;

The allocation of the profit available for appropriation for the year 2012 is as follows:

                                                                                                           Unit: RMB




                                                       Page 41
                                                                              As a
                                                                                                 As a percentage
                                                                              percentage of
                                                                                                 of the Group’s
                                                      The Company             the Company’s
                                                                                                 consolidated net
                                                                              net profit for
                                                                                                 profit for the year
                                                                              the year
     Net profit of 2012                             5,613,873,212.56                     100%                 44.73%
     Transfer to statutory surplus reserve            561,387,321.26                      10%                  4.47%
     Transfer to discretionary surplus reserve      2,806,936,606.29                      50%                 22.36%
     Transfer to 2012 dividend distribution
                                                    2,245,549,285.01             40%                          17.89%
     fund
     Profit available for appropriation at the
                                                       30,206,330.92               0                                 0
     beginning of the year
     Distribution of cash dividend for 2012*        1,979,199,561.24          35.26%                          15.77%
     Retained profit for appropriation for the
                                                      296,556,054.69                -                                  -
     following financial year
*Calculated based on the total number of shares of the Company at the end of 2012

2012 dividend distribution proposal: Based on the number of shares on the record date for dividend distribution,
a cash dividend of RMB1.8 (including tax) will be distributed for every 10 existing shares held.

Based on the Company’s total number of shares of 10,995,553,118 prior to the publication date of this report, the
total amount of cash dividends for distribution for 2012 will be RMB1,979,199,561.24.

The independent directors were of the view that the preparation of the Company’s proposals on the profit
appropriation and dividend distribution for the year 2012 was in compliance with the Company’s Articles of
Association and the relevant requirements, and took into account the interests of various types of shareholders.
The independent directors unanimously agreed to submit the relevant proposals to the shareholders’ meeting for
consideration.

The Company’s proposal on dividend distribution for the past three years:

                Year                           Proposal on dividend distribution
                         Based on the number of shares on the record date for dividend distribution, a
                2011     cash dividend of RMB1.3 (including tax) would be distributed for every 10
                         existing shares held.
                         Based on the number of shares on the record date for dividend distribution, a
                2010     cash dividend of RMB1.0 (including tax) would be distributed for every 10
                         existing shares held.
                         Based on the number of shares on the record date for dividend distribution, a
                2009     cash dividend of RMB0.7 (including tax) would be distributed for every 10
                         existing shares held.


The Company’s distribution of cash dividends for the past three years:
                                                                                                                   Unit: RMB
                                                                                                              The Group’s
                                                                      As a percentage As a percentage of
                                                     The Group’s                                          consolidated profit
            Cash dividend    The Company’s net                            of the        the Group’s
 Year                                              consolidated net                                           available for
             (before tax)          profit                             Company’s net   consolidated net
                                                        profit                                              appropriation for
                                                                           profit           profit
                                                                                                                the year
 2011       1,429,377,328.34 4,372,887,322.93        9,624,875,268.23          32.69%            14.85%     21,995,638,556.48
 2010       1,099,521,021.80 3,083,108,153.24        7,283,127,039.15          35.66%            15.10%     15,321,861,067.94
 2009         769,664,715.26 2,874,475,278.28        5,329,737,727.00          26.78%            14.44%     10,964,255,202.76
        Accumulated cash dividends in the past 3 years as a percentage to the Group’s
                                                                                                     44.50%
                     average consolidated net profits in the past three years

The Company insists on an annual cash dividends distribution policy. In future, the Company will, each year,
maintain a stable cash dividend payout ratio of approximately 15% of the Company’s consolidated net profit of
that year.


                                                          Page 42
10. Selected Media for Disclosure of Information

The Company has chosen China Securities Journal, Securities Times, Shanghai Securities News, Securities Daily
and an English publication in Hong Kong as media for disclosure of information.


V. Significant Events
1.      Material Litigation and Arbitration
During the year under review, the Company did not involve in any material litigation or arbitration.

2.      Major Acquisition and Disposal of Assets
During the year under review, the Company did not have any major acquisition or disposal of assets.

3.       Major Connected Transactions
In February 2012, pursuant to the authority granted at the Company’s 2011 first extraordinary general meeting in
relation to the collaboration with China Resources, the Board considered and approved that the Company applied
for a trust loan of RMB1 billion, with a 2-year term and a fixed annual interest rate of 10.6% from China
Resources SZITIC Trust Co., Ltd. to satisfy the development needs of the Company’s Dongguan Zitai Project,
Dongguan King Metropolis Project and Anshan Whistler Project. To satisfy the development needs of the
Wenzhou Longwan Garden Phase I Project, Nanjing The Paradiso Phase III Project, Hangzhou Liangzhu Heron
Hill West Phase I Project and Qinhuangdao Holiday Town Phase III Project, the Company had applied for a trust
loan of RMB2 billion, with a 2-year term and a fixed annual interest rate of 10.5% from China Resources SZITIC
Trust Co., Ltd.

In May 2012, the Company’s 2011 annual general meeting passed the resolution regarding continued cooperation
with China Resources, resolving to authorise the Board to determine, within RMB10.59 billion (i.e. not more than
20% of the Company’s audited net assets value as at the end of 2011), entering into a loan agreement with China
Resources Bank of Zhuhai Co., Ltd., using the funds under China Resources SZITIC Trust Co., Ltd. and Harvest
Capital Partners Limited, and joint investment with China Resources SZITIC Trust Co., Ltd. and Harvest Capital
Partners Limited. The authorisation is valid for a one-year period.

In December 2012, to satisfy the needs for the development of the Company’s Nanjing Paradiso Phase III,
Tangshan South Lake Phase II and “Qinyuan” – Sanjiequ Phase I of Zhenjiang Glamorous City, the Company,
upon consideration by the Board, applied for a trust loan of RMB1.1 billion, with a 1.5-year term and a fixed
annual interest rate of 6.75% from China Resources SZITIC Trust Co., Ltd.

The relevant loans will help facilitate the development of the Company’s related projects, and increase the
projects’ operating efficiency. The costs of the loans have been determined with reference to the prevailing market
price and the characteristics of the projects, which were not higher than the costs of securing a trust loan from an
independent third party at the time. The relevant decision-making process was in compliance with the relevant
regulations, and was in the interest of the listed company and its shareholders as a whole.

Between the end of the year under review and the publication date of this annual report, Shanghai Vanke
Investment Management Co., Ltd. (“Shanghai Vanke Investment”), a wholly-owned subsidiary of the Company,
transferred 39% equity interests of Shanghai Hongqiao Project No. 11 to Shenzhen Huawei Xincheng No. 1
Partnership Enterprise (limited partnership) (深圳市華威欣城一號投资合伙企业) (“Huawei Xincheng”) to
satisfy the development needs of Shanghai Hongqiao Project No. 11. The total consideration of this cooperation is
approximately RMB867 million. Both parties will jointly develop Shanghai Hongqiao Project No. 11, and will
share the risks and returns of the project. Harvest Capital Partners Limited and China Resources SZITIC Trust Co.,
Ltd. respectively hold 51 per cent and 49 per cent equity interests in Shenzhen Huawei Yongsheng Management
Co., Ltd. ( 深 圳 市 華 威 永 盛 企 業 管 理 有 限 公 司 ), which is a general partner of Huawei Xincheng. This
cooperation can help speed up the development of Shanghai Hongqiao Project No. 11, increase the operating
efficiency of the project, and is conducive to enhancing the Company’s capital utilization efficiency and returns.
The relevant decision-making process was in compliance with the relevant regulations.

The implementation of the cooperation projects with China Resources fully leveraged China Resources’ financial
strengths and platform, which will help broaden the Company’s financing channels, strengthen its ability to avert
risk, accelerate its development, enhance return on assets, and create synergies to achieve win-win situations.


                                                     Page 43
4. A-share Stock Option Incentive Scheme
(1) Relevant procedures and progress of the implementation of the A-Share Stock Option Incentive Scheme

After filing and without objection from China Securities Regulatory Commission, the A-Share Stock Option
Incentive Scheme of China Vanke Co., Ltd. (Revised Draft) (the “Scheme”) was passed at the first extraordinary
general meeting of the Company in 2011 on 8 April 2011. Implementation of the Scheme thus commenced.

The A-Share Stock Option Incentive Scheme uses stock option as an incentive instrument. Each stock option
confers the right to purchase one A-share of Vanke at the exercise price within the exercise period under the A-
Share Stock Option Incentive Scheme. The underlying shares of the stock options are new shares issued by the
Company to the beneficiaries. When the Company and the beneficiaries of the Scheme fulfil the conditions for
granting the options, the Company will grant stock options to the beneficiaries according to the Scheme. No stock
options should be exercised during the vesting period, which is one year from the grant date. Thereafter, the
granted stock options can be exercisable in three exercise periods. 40% of the options granted shall be exercisable
during the first exercise period, another 30% and the remaining 30% shall be exercisable in the second and third
exercise periods respectively. The right to exercise the stock options in each corresponding exercise period is
subject to the fulfilment of the vesting conditions by the Company and the beneficiaries of the Scheme. The stock
options will lapse if they fail to vest because the performance targets are not achieved and if they are not exercised
even after the expiry of the exercise periods.

The second meeting of the sixteenth session of the Board of the Company held on 18 April 2011 confirmed the
fulfilment of the conditions for granting the stock options under the A-share Stock Option Incentive Scheme, and
determined 25 April 2011 as the grant date of stock options. The seventh Supervisory Committee of the Company
had verified and given its opinion on the list of beneficiaries of the Scheme. On 9 May 2011, the registration of
the grant of stock options was completed. The Company granted an aggregate of 108,435,000 stock options to 810
beneficiaries. The abbreviation of the stock options granted under the Scheme is VankeJLC1, and the stock option
code is 037015.

(2) Adjustment of exercise price of stock options of and the implementation procedures for the A-Share
Stock Options Incentive Scheme

The initial exercise price of the stock options under the A-Share Stock Options Incentive Scheme was RMB8.89,
which was subject to adjustment according to the relevant requirements of the Scheme should distribution of
dividends, transfer of capital surplus reserve to share capital or other conditions occur within the validity period of
stock options.

On 27 May 2011 the Company implemented the proposal on dividend distribution for the year 2010. A cash
dividend of RMB1 (including tax) would be paid to all the shareholders on the basis of every 10 existing shares
held. Pursuant to the authority granted by the first extraordinary general meeting in 2011, the Board resolved to
adjust the exercise price of the stock options to RMB8.79.

On 5 July 2012, the Company implemented the proposal on dividend distribution for year 2011, and distributed a
cash dividend of RMB1.3 (including tax) to all shareholders for every 10 existing shares held. Pursuant to the
authority granted by the first extraordinary general meeting in 2011, the Board resolved to make corresponding
adjustment to the exercise price of the A-share stock options. The adjusted exercise price was RMB8.66.

(3) Exercise of stock options under the A-Share Stock Option Incentive Scheme during the year under
review

During the year under review, the Board, pursuant to the authority granted by the first extraordinary general
meeting in 2011, confirmed the vesting conditions of the stock options within the first exercise period had been
fulfilled. Upon the completion of the relevant procedures for approval, the Scheme entered the first exercise
period on 12 July 2012. Under the Scheme, beneficiaries can exercise their vested options of their own accord. As
such, beneficiaries could exercise 40% of the options they are holding during the exercisable period between 12
July 2012 and 24 April 2014. During the year under review, 23 beneficiaries exercised a total of 342,900 stock
options, resulting in the corresponding increase of 342,900 A shares of the Company.

Between the end of the year under review and the publication date of the annual report, another 74 beneficiaries


                                                       Page 44
exercised 9,468,850 stock options, resulting in a corresponding increase of 9,468,850 A shares of the Company.

(4) Impact of implementation of the A-Share Stock Option Incentive Scheme on the financial position and
operating results in the year under review and subsequent years

The introduction of the A-Share Stock Option Incentive Scheme will fill the gap in the Company’s long-term
incentive instruments, while establishing a check-and-balance mechanism between shareholders and professional
management team through linking up their interests. The Scheme will further improve the Company’s corporate
governance structure and strengthen the Company’s competitiveness.

Accounting treatments for the A-Share Stock Option Incentive Scheme as equity-settled share-based payment are
carried out in accordance with the “Accounting Standard for Business Enterprises No. 11 – Share-based payment”.
On each balance sheet date within the vesting period, the Company shall include, based on the best estimate of the
number of vested stock options, the services obtained from the beneficiaries during the period in the costs and
expenses as well as in the capital surplus reserves at the fair value of the stock options on the grant date. During
the exercise period of the stock options, the Company shall make no adjustment to the relevant costs, expenses or
the capital surplus reserves which have been recognised. On each balance sheet date, based on the actual number
of options exercised, the capital surplus reserves recognised shall be settled.

A-Share Stock Option Incentive Scheme adopts Binomial option pricing model to estimate the fair value of the
stock options on the grant date. According to the assessment results, the fair value of the stock options in the first
exercise period is RMB88,790,000, the fair value of the stock options in the second exercise period is
RMB94,280,000, while the fair value of the stock options in the third exercise period is RMB110,980,000.

During the year under review, according to the straight-line method, the cost of stock options of RMB88,230,000
amortised by the Company for the first, second and third exercise periods was included in the costs and expenses,
while the Company’s capital surplus reserves increased by RMB88,230,000. Please refer to the notes to the
financial statements for details on the accounting treatments.

For details, please refer to the announcements published on China Securities Journal, Securities Times, Shanghai
Securities News and www.cninfo.com.cn on 23 March 2011, 9 April 2011, 20 April 2011, 10 May 2011, 21 May
2011 and 12 July 2012.

5. Major Contracts and Their Implementation

(1) During the year under review, the Company was not subject to any material entrustment, sub-contracting or
leasing arrangements involving assets of other companies, nor were any other companies entitled to any
entrustment, sub-contracting or leasing arrangements involving assets of the Company.

(2) Details on the new guarantees made by the Company during the year under review are as follows:

          Guarantor         Company for which
         (% of equity      guarantee was granted     Guarantee                                   Guarantee
No.                                                                        Details                               Remarks
       interest held by     (% of equity interest     Amount                                      Period
           Vanke )            held by Vanke )

      Vanke Properties                                            Provided a guarantee for     From 4 January
                                                     RMB193.39
1     (Hong Kong) Co.,    Tairong Co., Ltd. (100%)                a bank loan of               2012 to 4
                                                     million
      Ltd. (100%)                                                 RMB193.39 million            January 2014


                                                                  Provided a guarantee for a
                          Shanghai Jingyuan
      Shanghai Vanke                                              bank loan of RMB38           From 5 January
                          Property Development       RMB17.1
2     Real Estate Co.,                                            million in proportion to     2012 to 30
                          Company Limited (45%)      million
      Ltd. (100%)                                                 the Company’s equity        September 2013
                                                                  holding

                                                                  Provided a guarantee for a
      Shanghai Vanke      Shanghai Wanzhicheng                    bank loan of RMB30           From 16
                                                     RMB15                                                       Withdraw
3     Real Estate Co.,    Property Development                    million in proportion to     January 2012 to
                                                     million                                                         n
      Ltd. (100%)         Co., Ltd. (50%)                         the Company’s equity        31 May 2012
                                                                  holding




                                                        Page 45
                                                              Provided a guarantee for a   From 16
     Shanghai Vanke     Shanghai Wanzhicheng                  bank loan of RMB40.63
                                                  RMB20.31                                 January 2012 to    Withdraw
4    Real Estate Co.,   Property Development                  million in proportion to
                                                  million                                  12 December            n
     Ltd. (100%)        Co., Ltd. (50%)                       the Company’s equity        2014
                                                              holding

                                                              Provided a guarantee for a
                        Shanghai Jingyuan                                                  From 10
     Shanghai Vanke                                           bank loan of RMB3
                        Property Development      RMB1.35                                  February 2012
5    Real Estate Co.,                                         million in proportion to
                        Company Limited (45%)     million                                  to 30 September
     Ltd. (100%)                                              the Company’s equity        2013
                                                              holding

                                                              Provided a guarantee for a   From 21
     Shanghai Vanke     Shanghai Wanzhicheng                  bank loan of RMB2.2
                                                  RMB1.1                                   February 2012      Withdraw
6    Real Estate Co.,   Property Development                  million in proportion to
                                                  million                                  to 12 December         n
     Ltd. (100%)        Co., Ltd. (50%)                       the Company’s equity        2014
                                                              holding

                        Beijing Jindi
     Beijing Vanke      Vanke Property                        Provided a guarantee for a   From 21
7    Company Limited    Development Co., Ltd.     RMB350      loan of RMB700 million       February 2012      Withdraw
     (100%)             (50%)                     million     in proportion to the         to 21 February         n
                                                              Company’s equity holding    2014


                                                              Provided a guarantee for a   From 23
     Shanghai Vanke     Shanghai Wanzhicheng                  bank loan of RMB12.66
                                                  RMB6.33                                  February 2012      Withdraw
8    Real Estate Co.,   Property Development                  million in proportion to
                                                  million                                  to 12 December         n
     Ltd. (100%)        Co., Ltd. (50%)                       the Company’s equity        2014
                                                              holding

                        Shenzhen Vanke City                                                From 24
     Shenzhen Vanke     Views Property            RMB420      Provided a guarantee for a   February 2012
9    Real Estate Co.,   Development Co., Ltd.     million     loan of RMB420 million       to 23 August
     Ltd. (100%)        (100%)                                                             2013

                                                              Provided a guarantee for a
     Shanghai Vanke     Shanghai Jingyuan                     bank loan of RMB4            From 19 March
                                                  RMB1.8
10   Real Estate Co.,   Property Development                  million in proportion to     2012 to 30
                                                  million
     Ltd. (100%)        Company Limited (45%)                 the Company’s equity        September 2013
                                                              holding

     Changchun                                                Provided a guarantee for a
                        Changchun Vanke
     Wanrun Real                                              bank loan of RMB6.08         From 29 March
                        Xizhigu Real Estate       RMB3.04
11   Estate                                                   million in proportion to     2012 to 19 May
                        Development Co., Ltd.     million
     Development Co.,                                         the Company’s equity        2014
                        (50%)
     Ltd. (100%)                                              holding

                                                              Provided a guarantee for a
     Shenzhen Vanke     Dongguan Xinwan Real                  bank loan of RMB200          From 6 April
                                                  RMB102
12   Real Estate Co.,   Estate Development Co.,               million in proportion to     2012 to 6 April
                                                  million
     Ltd. (100%)        Ltd. (51%)                            the Company’s equity        2014
                                                              holding

                                                              Provided a guarantee for a
     Shanghai Vanke     Shanghai Jingyuan                     bank loan of RMB5            From 10 April
                                                  RMB2.25
13   Real Estate Co.,   Property Development                  million in proportion to     2012 to 30
                                                  million
     Ltd. (100%)        Company Limited (45%)                 the Company’s equity        September 2013
                                                              holding

     Changchun                                                Provided a guarantee for a
                        Changchun Vanke
     Wanrun Real                                              bank loan of RMB9.01         From 19 April
                        Xizhigu Real Estate       RMB4.51
14   Estate                                                   million in proportion to     2012 to 19 May
                        Development Co., Ltd.     million
     Development Co.,                                         the Company’s equity        2014
                        (50%)
     Ltd. (100%)                                              holding

                                                              Provided a guarantee for a
     Vanke Properties                                         bank loan of RMB632          From 20 April
                        Fengyi Co., Ltd. (100%)   RMB632
15   (Hong Kong) Co.,                                         million in proportion to     2012 to 20 April
                                                  million
     Ltd. (100%)                                              the Company’s equity        2015
                                                              holding

                                                              Provided a guarantee for a
     江西万科青山湖     江西万科青云置业有限                  bank loan of RMB30           From 27 April
                                                  RMB15mill
16   房地产开发有限                                           million in proportion to     2012 to 20 April
                        公司(50%)               ion
     公司(50%)                                              the Company’s equity        2015
                                                              holding



                                                    Page 46
                                                                 Provided a guarantee for a
     Shanghai Vanke     Shanghai Jingyuan                        bank loan of RMB8            From 9 May
                                                    RMB3.6
17   Real Estate Co.,   Property Development                     million in proportion to     2012 to 30
                                                    million
     Ltd. (100%)        Company Limited (45%)                    the Company’s equity        September 2013
                                                                 holding
                                                                 Provided a guarantee for a   From 10 May
     China Vanke Co.,   Shenzhen Vanke Property     RMB130
18                                                               bank loan of RMB130          2012 to 9 May
     Ltd. (100%)        Co., Ltd. (100%)            million      million                      2014
     Changchun                                                   Provided a guarantee for a
                        Changchun Vanke
     Wanrun Real                                                 bank loan of RMB25           From 11 May
                        Xizhigu Real Estate         RMB12.5
19   Estate                                                      million in proportion to     2012 to 19 May
                        Development Co., Ltd.       million
     Development Co.,                                            the Company’s equity        2014
                        (50%)
     Ltd. (100%)                                                 holding
     Shenyang Vanke     Shenyang Zhongtie Vanke                  Provided a guarantee for     From 24 May
                                                    RMB14.79
20   Real Estate Co.,   Langyu Property                          51% of a bank loan of        2012 to 7
                                                    million
     Ltd. (100%)        Company Limited (49%)                    RMB29 million                August 2014
     Changchun                                                   Provided a guarantee for a
                        Changchun Vanke
     Wanrun Real                                                 bank loan of RMB48           From 25 May
                        Xizhigu Real Estate         RMB24
21   Estate                                                      million in proportion to     2012 to 19 May
                        Development Co., Ltd.       million
     Development Co.,                                            the Company’s equity        2014
                        (50%)
     Ltd. (100%)                                                 holding
                                                                 Provided a guarantee for a
     Shanghai Vanke     Shanghai Jingyuan                        bank loan of RMB4.2          From 30 May
                                                    RMB1.89
22   Real Estate Co.,   Property Development                     million in proportion to     2012 to 30
                                                    million
     Ltd. (100%)        Company Limited (45%)                    the Company’s equity        September 2013
                                                                 holding
     Changchun                                                   Provided a guarantee for a
     Wanrun Real        Changchun Vanke                          bank loan of RMB31.98        From 31 May
23   Estate             Xizhigu Real Estate         RMB15.99     million in proportion to     2012 to 19 May
     Development Co.,   Development Co., Ltd.       million      the Company’s equity        2014
     Ltd. (100%)        (50%)                                    holding
                                                                 Provided a guarantee for a
     Shanghai Vanke     Shanghai Jingyuan                        bank loan of RMB7            From 7 June
                                                    RMB3.15
24   Real Estate Co.,   Property Development                     million in proportion to     2012 to 30
                                                    million
     Ltd. (100%)        Company Limited (45%)                    the Company’s equity        September 2013
                                                                 holding
                        Ningbo Zhongwan
                        Property Co., Ltd (49%                   Provided a guarantee for a
     Ningbo Vanke
                        held by Vanke, 15% of                    bank loan of RMB6.55         From 26 June
     Property                                       RMB0.98
25                                                               million in proportion to     2012 to 5
     Development Ltd.   which were held through     million      the Company’s equity        December 2014
     (100%)             Ningbo Vanke Property                    holding
                        Development Ltd)
     Vanke Properties                                            Provided a guarantee for     From 26 July
                                                    RMB3.44
26   (Hong Kong) Co.,   Tairong Co., Ltd. (100%)                 a bank loan of RMB3.44       2012 to 4
                                                    million
     Ltd. (100%)                                                 million                      January 2014
                                                                 Provided a guarantee for
     Shanghai Vanke     Shanghai Jingyuan                        a bank loan of               From 17 July
                                                    RMB1.58
27   Real Estate Co.,   Property Development                     RMB3.5million in             2012 to 30
                                                    million
     Ltd. (100%)        Company Limited (45%)                    proportion to the            September 2013
                                                                 Company’s equity holding
                                                                 Provided a guarantee for a
     Vanke Properties                                            bank loan of RMB294.78       From 23 July
                        Fengyi Co., Ltd. (100%)     RMB294.78
28   (Hong Kong) Co.,                                            million in proportion to     2012 to 20 April
                                                    million
     Ltd. (100%)                                                 the Company’s equity        2015
                                                                 holding
                        Ningbo Zhongwan
                        Property Co., Ltd (49%                   Provided a guarantee for a
     Ningbo Vanke                                                bank loan of RMB8.2          From 25 July
     Property           held by Vanke, 15% of       RMB1.23
29                                                               million in proportion to     2012 to 5
     Development Ltd.   which were held through     million      the Company’s equity        December 2014
     (100%)             Ningbo Vanke Property                    holding
                        Development Ltd)
                                                                 Provided a guarantee for a
                        Shanghai Jingyuan                                                     From 15 August
     Shanghai Vanke                                              bank loan of RMB4.3
                                                    RMB1.94                                   2012 to 30
30   Real Estate Co.,   Property Development                     million in proportion to
                                                    million                                   September
     Ltd. (100%)        Company Limited (45%)                    the Company’s equity        2013
                                                                 holding
                                                                 Provided a counter-
                                                                 guarantee in proportion to
                        Xiamen Wantefu Property                  the Company’s equity
     Xiamen Vanke       Development Company                                                   From 21 August
31   Real Estate Co.,                               RMB4.2356    holding for the letter of    2012 to 9 June
     Ltd. (100%)        Limited, being the actual   million      guarantee of RMB14           2013
                        beneficiary (30%)                        million of the Xiamen
                                                                 Special Economic Zone
                                                                 project company




                                                       Page 47
                         Ningbo Zhongwan
                         Property Co., Ltd (49%                 Provided a guarantee for a
      Ningbo Vanke
                         held by Vanke, 15% of                  bank loan of RMB5.5          From 24 August
      Property                                     RMB0.83
32                                                              million in proportion to     2012 to 5
      Development Ltd.   which were held through   million      the Company’s equity        December 2014
      (100%)             Ningbo Vanke Property                  holding
                         Development Ltd)
                         Ningbo Zhongwan
                         Property Co., Ltd (49%                 Provided a guarantee for a
      Ningbo Vanke                                              bank loan of RMB5.21         From 27
      Property           held by Vanke, 15% of     RMB0.78                                   September 2012
33                                                              million in proportion to
      Development Ltd.   which were held through   million      the Company’s equity        to 5 December
      (100%)             Ningbo Vanke Property                  holding                      2014
                         Development Ltd)
                                                                Provided a guarantee for a   From 3
      广州市万科房地     广州市万尚房地产有限                   bank loan of RMB16
                                                   RMB5.28mi                                 December 2012
34    产有限公司                                                million in proportion to
                         公司(33%)               llion                                     to 3 December
      (100%)                                                  the Company’s equity        2015
                                                                holding


During the year under review, the new amount of guarantees (including counter guarantees) made by the
Company and its majority-owned subsidiaries was RMB2,305 million, and the amount of guarantees withdrawn
was RMB4,857 million. As at the end of the year under review, the outstanding amount of guarantees made by the
Company was RMB11,133 million, accounting for 17.44% of the Company’s net assets. The outstanding amount
of guarantees made by the Company and its majority-owned subsidiaries for other majority-owned subsidiaries
was RMB10,706 million, while the outstanding amount of guarantees made by the Company and its majority-
owned subsidiaries for associated and joint venture companies was RMB427 million.

During the year under review, the Company did not provide guarantee for shareholders, beneficial controller and
its connected parties.

(2) During the year under review, the Company did not have any entrustment of financial management.

(3) For details on the projects acquired by the Company during the year under review, please refer to “Project
   investment” under the “Use of capital not from the capital market” section.

6. Specific elaboration and independent opinions of the independent directors on the use of capital by
connected parties and external guarantees provided by the Company

There had been no non-operational use of capital by the controlling shareholder or other connected parties of the
Company.

During the year under review, the Company, in strict compliance with the related rules, regulated its external
guarantee activities in order to control risks. There was no violation against the “Notice regarding the regulation
of external guarantees by listed companies”. The Company’s guarantees had been made to meet its production and
operational needs and the requirements for reasonable use of capital. The procedures for the determination of
providing guarantees had been legal and reasonable, without prejudice to the interests of the Company and its
shareholders.

7. Implementation of the undertakings given by the Company or shareholders holding 5% or more of the
equity interests in the Company

China Resources National Corporation (“CRNC”) – the parent company of China Resources Co., Limited
(“CRC”), being the Company’s original single largest shareholder and the present single largest shareholder, gave
a significant undertaking to the Company in 2001: CRNC would provide as much support to the Company as it
did in the past, as long as such support was beneficial to the Company’s development, and that it would remain
impartial in the event of any competition between the investment projects of the Company and that of CRNC and
its subsidiaries, and in the event of any disagreements or disputes arising from horizontal competition. CRNC had
fulfilled its undertaking.

8. Corporate bonds and related matters
The Shenzhen Branch of China Construction Bank Corporation (as authorised by the headquarters) provided an


                                                     Page 48
unconditional and irrevocable joint liability guarantee for the full payment of the principal and interest of the
secured corporate bonds, 08 Vanke G1, issued by the Company. During the year under review, the guarantor
continued to be profitable, with sound assets structure, and there was no significant change in its credit status.

During the year under review, the Company’s issued bonds, including “08 Vanke G1” (Bond code: 112005) and
“08 Vanke G2” (Bond code: 112006), was tracked and rated by China Chengxin Securities Rating Co., Ltd. (中诚
信证券评估有限公司) (“China Chengxin”). The rating company continued to assign AAA credit ratings to the
Company’s secured corporate bonds “08 Vanke G1” and non-secured corporate bonds “08 Vanke G2” as well as
the Company’s overall corporate credit. China Chengxin gave a stable outlook rating to the Company. During the
year under review, the Company maintained a good credit standing.

CITIC Securities Co., Ltd., the trustee of the Company’s corporate bonds, was of the opinion that the Company
has a healthy operation and good credit standing, with strong capacity to meet its financial obligation. The
principal and interest payments for this bond issue are safe.

During the year under review, the Company paid the fourth annual interest of 08 Vanke G1 and" 08 Vanke G2.

9. Was there any use of the Company’s funds by the controlling shareholder and other related parties for
non-operation purpose?
There had not been any use of the Company’s funds by the controlling shareholder and other related parties for
non-operation purpose.

10. Appointment and termination of certified public accountants
The 2011 annual general meeting resolved to re-appoint KPMG Huazhen Certified Public Accountants as the
Company’s auditors for the year 2012. The following table shows the details on the appointment of the certified
public accountants of the Company:



             Type                               2012                                                       2011
                                                                    Years of service
          Audited item                Auditor          Audit fee                                 Auditor          Audit fee
The Group’s consolidated
financial statements prepared
                                                                    12 consecutive
in accordance with the PRC
                                KPMG Huazhen                            years             KPMG Huazhen
Accounting Standards for
Business Enterprises            Certified Public RMB8,500,000.00                          Certified Public    RMB8,500,000.00
                                 Accountants                                               Accountants
The Group’s consolidated
                                                                    20 consecutive
financial statements prepared
                                                                        years
in accordance with the IFRS

 Accountant-in-charge           Li Wanwei                                  4             Li Wanwei
 Accountant-in-charge           Wen Huaxin                                 2             Wen Huaxin



The above-mentioned audit fee included the travelling expenses incurred during the auditing period.


11. There was no disciplinary action taken against the Company or its Directors, members of Supervisory
Committee and senior management during the year under review


VI. Change in Share Capital and Shareholders
1. Change in Share Capital

(1) Change in the shares of the Company (as at 31 December 2012)
                                                                                                                     Unit: Share

                                                                   Increase / decrease
         Class of Shares                31 December 2011                                           31 December 2012
                                                                         (+, -)




                                                        Page 49
                                                         Percentage of            Others                             Percentage of
                                         Quantity                                                    Quantity
                                                         shareholding             (Note)                             shareholding
  I. Restricted Shares
  1. State-owned and
  State-owned legal person
  shares
  2. Shares held by domestic
  legal persons
  3. Shares held by domestic
  natural persons                         18,426,384               0.17%                -23,711        18,402,673          0.17%
  4. Shares held by foreign
  investors
  Total number of restricted
  shares                                  18,426,384               0.17%                -23,711        18,402,673          0.17%
  II. Non-restricted Shares
  1.RMB-denominated ordinary                                                                                              87.87%
  shares (A shares)                   9,661,828,366               87.87%               366,611       9,662,194,977
  2. Domestic listed foreign                                                                                              11.96%
  shares (B shares)                   1,314,955,468               11.96%                             1,314,955,468
  Total number of
  non-restricted shares             10,976,783,834               99.83%                             10,977,150,445        99.83%
  III. Total Number of Shares       10,995,210,218              100.00%                             10,995,553,118       100.00%

Note: During the year under review, as there were changes in the Company’s senior management staff, the Shenzhen office of China
Securities Depository & Clearing Corporation Limited, according to regulations, imposed or lifted the selling restrictions on the
restricted shares held by the related senior management staff. In addition, the Company’s A-share Stock Option Incentive Scheme
entered the vesting period, during which a total of 342,900 stock options were exercised. As a result, the Company’s non-restricted
tradable shares increased by 342,900 shares accordingly.

  Change in Restricted Shares
                                                                                                                     Unit: share
     Name of            Number of           Number of            Number of        Number of          Capacity        Reasons for
   shareholder       restricted shares       restricted          restricted    restricted shares                       selling
                        held at the         shares with            shares      held at the end of                    restrictions
                     beginning of the       restrictions         increased         the year
                            year           lifted during       during the year
                                              the year
 Wang Shi                     5,112,901                    0                 0         5,112,901     Director
 Yu Liang                                                                                         Director, senior
                              3,079,684                    0                 0         3,079,684 management staff
                                                                                                    Member of      The Shenzhen
 Ding Fuyuan                  1,513,806                    0                 0         1,513,806   Supervisory     office of China
                                                                                                    Committee         Securities
 Sun Jianyi                    519,177                     0                 0           519,177     Director       Depository &
                                                                                                    Member of          Clearing
 Zhou Qingping                   15,000                    0                 0            15,000   Supervisory       Corporation
                                                                                                    Committee          Limited,
                                                                                                      Senior        according to
 Ding Changfeng               1,115,745                    0                 0         1,115,745 management staff    regulations,
                                                                                                      Senior         imposed or
 Xie Dong                     1,115,745                    0                 0         1,115,745 management staff     lifted the
                                                                                                      Senior            selling
 Zhang Jiwen                  1,161,712                    0                 0         1,161,712 management staff restrictions on
                                                                                                      Senior        the restricted
 Mo Jun                       1,161,712                    0                 0         1,161,712 management staff shares held by
                                                                                                  Director, senior    directors,
 Xiao Li                      1,085,137                    0                 0         1,085,137 management staff members of the
                                                                                                      Senior         Supervisory
 Wang Wenjin                  1,007,693                    0                 0         1,007,693 management staff Committee and
                                                                                                      Senior            senior
 Zhou Weijun                   778,549                     0                 0           778,549 management staff management
                                                                                                  Former senior          staff
 Du Jing                       551,859                     0           183,953           735,812 management staff
                                                                                                  Former senior
 Yuan Boyin                    207,664              207,664                  0                 0 management staff
       Total                18,426,384              207,664            183,953        18,402,673        -                -

 (2) Issue and listing of shares
  A. Issue of shares and derivative securities in the past three years
 Issue of corporate bonds


                                                                  Page 50
           Approved by Zhengjian Xu Ke [2008] No. 1056 documents of China Securities Regulatory Commission
           (“CSRC”), the Company issued an announcement on 2 September 2008 that it would make a public issue of
           corporate bonds with a par value not exceeding RMB5.9 billion. The corporate bonds in this issue were
           classified into secured bonds and unsecured bonds. Both of them bore a fixed interest rate with a 5-year maturity.
           The issuer of the unsecured bonds had the right to raise the coupon rate at the end of the third year of the bond
           duration, while investors had the right to resell their bonds. Pursuant to the feedback on the price, the coupon
           rate of the Company’s secured bonds was 5.50%, and that of the unsecured bonds was 7.00%. The issue was
           completed on 9 September 2008 and the actual issue size of the secured bonds was RMB3 billion, while the
           actual issue size of the unsecured bonds was RMB2.9 billion. The Company’s corporate bonds started to trade
           on the Shenzhen Stock Exchange on 18 September 2008. The stock codes of the Company’s secured bonds and
           unsecured bonds are 112005 and 112006 respectively and their abbreviations are 08 Vanke G1 and 08 Vanke G2
           respectively.

           In August 2011, the Company decided not to adjust the coupon rate of 08 Vanke G2. The coupon rate of 08
           Vanke G2 will remain at 7.00% in the last two years of the bond duration. No investors chose to resell 08 Vanke
           G2 to the Company.

           During the year under review, there was no change in the number of issued corporate bonds.

           B. During the year under review, there was no change in the Company’s total number of shares.

           C. As at the end of the year under review, the Company did not have any internal employee shares.

           2. Information on shareholders (as at 31 December 2012)
           (1) Information on shareholders

                                                                                                                              Unit: share
                                 767,659 (including 748,877 A
Total number of shareholders                                      Total number of shareholders       721,771 (including 704,832 A shareholders and
                                   shareholders and 18,782 B
    as at the end of 2012                                         as at the end of January 2013                 16,939 B shareholders)
                                         shareholders)
  Shareholdings of the top 10 shareholders
                                                 Classification   Percentage of          Total         Change in        Number of     Number of
                                                       of         shareholdings       number of          shares          restricted   pledged or
           Name of shareholder
                                                  shareholder                         shares held      during the       shares held    lock-up
                                                                                                          year                          shares
                                                  State-owned
CRC                                                                       14.72%     1,619,094,766               0                0              0
                                                  legal person
China Life Insurance Company Limited–               Others
Dividend Distribution–Individual Dividend-                               1.27%        139,383,483       9,928,566                0              0
005L-FH002 Shen
Bank of China – E Fund Shenzhen Stock              Others
                                                                          1.22%        134,010,293        -683,418                0              0
Exchange 100 Exchange-Traded Fund
Liu Yuansheng                                       Others                1.22%        133,791,208               0                0              0
ICBC - Rongtong Shenzhen Stock Exchange 100
                                                    Others                0.94%        103,099,063       9,108,760                0              0
Index Securities Investment Fund
HTHK/CMG FSGUFP-CMG FIRST STATE                     Foreign
                                                                          0.88%         96,221,388     17,866,198                 0              0
CHINA GROWTH FD                                   shareholder
Bosera Value Growth Securities Investment
                                                    Others                0.83%         91,738,052     16,738,052                 0              0
Fund
China Minsheng Banking Corp. Ltd - Yinhua
Shenzhen 100 Index Classified Securities            Others                0.83%         90,989,392     36,265,104                 0              0
Investment Fund
UBS AG                                              Others                0.78%         85,526,491     10,590,411                 0              0
MORGAN STANLEY & CO.
                                                    Others                0.75%         82,419,464     26,819,104                 0              0
INTERNATIONAL PLC
  Shareholdings of the top 10 shareholders of non-restricted shares
  Name of shareholder                              Number of non-restricted                           Class of shares
                                                   shares held
                                                                                                          Ordinary RMB-denominated shares
CRC                                                                                1,619,094,766
                                                                                                                     (A shares)




                                                                   Page 51
China Life Insurance Company Limited–
                                                                                                            Ordinary RMB-denominated shares
Dividend Distribution–Individual Dividend-                                          139,383,483
                                                                                                                       (A shares)
005L-FH002 Shen
Bank of China – E Fund Shenzhen Stock                                                                      Ordinary RMB-denominated shares
                                                                                     134,010,293
Exchange 100 Exchange-Traded Fund                                                                                      (A shares)
                                                                                                            Ordinary RMB-denominated shares
Liu Yuansheng                                                                        133,791,208
                                                                                                                       (A shares)
ICBC - Rongtong Shenzhen Stock Exchange 100                                                                 Ordinary RMB-denominated shares
                                                                                     103,099,063
Index Securities Investment Fund                                                                                       (A shares)
HTHK/CMG FSGUFP-CMG FIRST STATE                                                                             Domestically listed foreign shares
                                                                                      96,221,388
CHINA GROWTH FD                                                                                                        (B shares)
Bosera Value Growth Securities Investment                                                                   Ordinary RMB-denominated shares
                                                                                      91,738,052
Fund                                                                                                                   (A shares)
China Minsheng Banking Corp. Ltd - Yinhua
                                                                                                            Ordinary RMB-denominated shares
Shenzhen 100 Index Classified Securities                                              90,989,392
                                                                                                                       (A shares)
Investment Fund
UBS AG                                                                                                     Ordinary RMB-denominated shares
                                                                                      85,526,491
                                                                                                                       (A shares)
MORGAN STANLEY & CO.                                                                                       Ordinary RMB-denominated shares
                                                                                      82,419,464
INTERNATIONAL PLC                                                                                                      (A shares)
                                                  Iis not known as to whether there are other connections or persons deemed to be acting in concert
Remarks on the connected relationship or action
                                                  under the Measures for the Administration of the Takeover of Listed Companies among the above-
in concert of the aforementioned shareholders
                                                  mentioned shareholders.


              Note: The above-mentioned shareholders did not hold the Company shares through credit share accounts.


         (2) Number of shares held by the top 10 shareholders of restricted shares and the conditions of selling
         restrictions
                                                                                                                            Unit: Share

                                                                       Increase in the
                    Name of                        Date on which
                                   Number of                             number of
                 shareholder of                      listing and
        No.                         restricted                        shares that may              Conditions of selling restrictions
                   restricted                       trading may
                                   shares held                          be listed and
                     shares                          commence
                                                                           traded
          1     Wang Shi              5,112,901
          2     Yu Liang              3,079,684
          3     Ding Fuyuan           1,513,806                                          The Shenzhen office of China Securities
          4     Zhang Jiwen           1,161,712                                          Depository & Clearing Corporation Limited,
          5     Mo Jun                1,161,712                                          according to relevant regulations, put selling
                                                        ——                ——
          6     Ding Changfeng        1,115,745                                          restrictions on the Company’s shares held by
          7