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China Silver Group to Enter Downstream Retail Business Determined to Establish One-of-a-kind E-Commerce Platform for Silver Accessories in China

HONG KONG, 18 November 2013 – Leading Chinese silver producer China Silver Group Limited (“China Silver Group” or “The Group”; Stock Code: 815.HK) is pleased to announce that the Group plans to enter into the downstream retail and e-commerce business by establishing the most representative silver jewelry adornment e-commerce platform in China, together with the launch of a series of retail brands. The e-commerce platform and brands are expected to be launched by the end of December this year so as to tap the huge market potential. Leveraging the solid foundation of its existing silver production business, the Group seeks to develop its downstream retail business to diversify its business. 
The physical properties of silver, which is full of symbolic meaning in Chinese tradition, make the metal highly suitable for processing into jewelry adornment as well as for a wide range of other applications. As such, there is strong mass market demand in China for silver that is good value-for-money, thereby bringing about an excellent opportunity for the Group to develop an e-commerce platform for silver. At the same time, with the rapid pace of urbanization in China, along with the ever-increasing levels of Chinese consumer’s disposable incomes, the size of the urban middle class population in China now exceeds the entire population of the United States. The growing consumption power in China, along with the recent downward trend in the price of silver, has driven up demand for silver jewellery adornments. The absence of influential silver jewellery brands in the China market presents a valuable opportunity for the Group to expand its silver business. As the only professional silver producer in China listed in Hong Kong, the Group will take this opportunity to establish a professional and integrated brand as a credible producer of silver jewellery leveraging its advantage in the upstream silver production business and its leading position in the industry. 
In order to ensure success in the downstream business, the Group has been proactive in strengthening its management team, and has successfully invited two industry veterans, Mr. Kuang Yiping, Karl and Mr. Zhang Jinpeng, to join the Group. Mr. Kuang and Mr. Zhang have been appointed president and vice president of the Group’s jewelry adornment business, respectively. Mr. Kuang is well-known for his expertise and experience in brand management, marketing and promotion in the jewelry industry, and has previously served as brand and marketing consultant at several famous jewelry companies such as Batar, Sinojewel and Xingguangda Jewelry. Mr. Kuang was an advocate and practitioner of the “5S System of Brand Construction” and “Elite System of Production Line”, and has attained rich operational experience and established successful examples in the fields of business models, branding, production line planning and the building of core products. Mr. Zhang completed his undergraduate studies and master’s degree in jewelry design and jewelry brand management in Australia, and has gained more than 11 years of experience in research and design, sales and marketing, brand operation and e-commerce operation in the jewelry industry. Mr. Zhang was the vice president of, the top jewelry e-commerce brand in China. He also worked at well-known international and local jewelry companies, namely Emperor Watch and Jewelry in Hong Kong, as well as Hiersun and TianPo Jewelry. The management team’s extensive experience in China’s jewelry and e-commerce sector will strengthen the Group’s capability in developing a retail business to tap the enormous opportunities in China’s silver jewelry retail and e-commerce market. 
The e-commerce market in China has been growing rapidly in recent years. According to the China e-Business Research Center, online sales reached RMB1.3 trillion for the first three quarters of 2013, representing a year-on-year increase of 34.7%, exceeding full year sales in 2012. The China e-Business Research Center also forecasts that online sales in China, a country with 350 million online shoppers, will reach RMB1.7 trillion by the end of 2013, and that the growth momentum provides a solid foundation for the establishment of an e-business platform. Silver jewelry is more suitable for online sale as it is relatively lower in price and smaller in size and weight as compared to other jewelry or fashion items popular among online shoppers. Furthermore, silver jewelry does not need to be fitted. 
Mr. Chen Wantian, Chairman and Chief Executive Officer of China Silver Group, said, “We believe that entering into the downstream retail business will not only help us diversify our income channels, but will also enhance the Group’s profitability. At the same time, it will further consolidate and enhance the Group’s market leadership in China’s silver industry. Looking forward, the Group will continue to tap the opportunities presented by the growth momentum in the industry and the market, and is determined to become the leading integrated silver producer in the world.”
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