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19 January 2015

Dear friends,

Thanks for your questions posted over the past week. I am happy to answer your questions online. I will repost the questions in blue italics followed by my comments in black.

Kenny the fish

Dear Jayster, you wrote:

Does the plunging oil price affect your plastic business?

Hi Jayster,

The lower oil price will reduce the raw materials cost for our plastic business and thus help improve the profit margin.

Happy New Year!

Kenny the fish

Dear Kelvin Ho, you wrote:

Why did you sell your india associate at a loss?

Hi Kelvin,

Our joint venture in India had a lot of potential. However, our partners begun having different ambition and vision for the joint venture which was different from ours. Hence the decision to sell the associate.

We will have a joint venture again in India in the future when we can find a partner whom has similar vision with Qian Hu.

Happy New Year!

Kenny the fish

Dear Tony Lim, you wrote:

If Kim Kang don't repay the second instalment of S$1.24 million on March 2015, will you proceed to sell the Batu Pahat land parcel or grant further extension?

Hi Tony,

If Kim Kang doesn't pay the second installment, Qian Hu will proceed to sell the land.

Happy New Year!

Kenny the fish

Dear Serene Chan, you wrote:

Your chairman's statement mentioned potential customers from major retailers from the United States and Europe expressing their interest in your innovative products, Have this translated into actual sales order?

Hi Serene,

It will take some time for major European and US retailers to accept an Asian brand even if the product is innovative. Qian Hu is confident that in the next few years, our innovative accessories products will be in their stores as we continue our marketing efforts.

Happy New Year!

Kenny the fish

Dear Ah Huat, you wrote:

Next year you will be 50 years old. Have you found your successor? If not, do you think you will find one by the time you reach 55 years old in 2020? Time to relax and let the younger generation take over.

Hi Ah Huat,

Thank you for your kind advice for me to relax and smell the roses.

Qian Hu started the succession program when I was 40 years old. Our intention was not to look for a successor but to gather and groom a succession team to ensure the continuity from the current management.

After 10 years, we have built a strong succession team. As for the successor, the succession team has to choose their own leader. Nothing has been cast on stone yet but by Year 2020, Qian Hu will have a new CEO.

I will retain my position as the Executive Chairman to ensure a smooth transition. By Year 2025, I will relinquish my position and let the succession team take over. I will make myself available on a consultative role, free of charge.

While I will no longer be part of the management team by Year 2025, the spirit of Qian Hu will always flow in my blood.

Happy New Year!

Kenny the fish

Thanks again to all the investors who have posted their questions here. I hope I have answered them to your satisfaction. The next chance for us to correspond again will be the time when we announce our Half Year 2015 results. In the meantime, do feel free to visit our corporate website: http://www.qianhu.com/ and our IR website: http://qianhu.listedcompany.com/ for more information.

Take care and I look forward to our next online Q&A.

Kenny the fish