Dear customers, colleagues, shareholders and friends from all walks of life.

Hello, everyone!

2022 in this epidemic and cold winter quietly away from you and me, taking away all the tiredness and confusion, people are looking forward to the new year can have new weather, new hope, re-establish a new goal to meet new challenges. Yes, the past year was a year of great difficulty and hardship. We struggled to move forward under many uncertain environmental conditions and advanced our work under many unfavorable internal and external factors. We are grateful to all the partners who worked with us, all the leaders who supported and cared about us, and especially grateful to our customers, who worked hand in hand to achieve good results in all the work.

Fruitful and promising future。It is certain that: after the baptism of the industry, Kuncai still maintains the position of the world's largest supplier of pearlescent pigment. Zhengtai project has been completed and put into production, and all the indexes are improving day by day, which is going to be the biggest growth point of the company, thus forming a complete industrial chain and building a core competitiveness and moat for pearlescent pigment. The world's first set of process and technology for preparing titanium dioxide chloride and iron oxide by extraction method has injected core competitiveness for the company's strategic development. Even though the global technology is ever-changing and ever-expanding, titanium dioxide, iron oxide and pearlescent pigments are still showing vigorous vitality. Economic changes will cause short-term quantitative changes, but cannot shake the long-term rigid demand of the market. So on the basis of summarizing that Kuncai Technology has achieved three definable performance in 2022, we look forward to a new pattern of work in 2023.

In the crisis to find opportunities, in the change of the situation to seek a new situation。2023 is the 14th Five-Year Plan to carry on the next key year, comprehensively do a good job, high quality to complete the work of 2023 goals appear to be more important, has just closed the party's twentieth congress report for us to depict the new blueprint for the construction of socialist modernization, the recent convening of the central 2023 economic work conference clearly pointed out the importance of the status and development of private enterprises. In general, the political situation is conducive to the industry's leading enterprises and main board listed companies to do better and stronger, in the company's three has been determined on the basis of more courageous and bold, to promote high standards of work. We can foresee the overall international situation before 2025 still presents an economic environment is not optimistic. First, the Russian-Ukrainian conflict will be heading towards what is still uncertain, the uncertainty of the war on the future stability of the internal and external environment as well as the economic situation is huge. Second, the changes in the international political situation personally affect the pace of Chinese enterprises to go out, Chinese enterprises in the process of globalization by the external obstacles, into a relatively difficult period of development. Third, the current slowdown in the domestic economy, more than 40 years of reform and opening up what we often call the "Troika" in the "export trade" and "consumption" growth is slightly declining. Many industries are facing difficulties in transformation and development after a stage of rapid development, and investment-driven infrastructure construction, urbanization and real estate have all entered a state of oversaturation. The revitalization of the countryside and the construction of water resources have potential for development, but only if there is a sound economic basis for solving society's excess production capacity and employment problems.

Collaborative Innovation for the Future。Looking at the situation at home and abroad and combining with the industry environment and market competition situation in which Kuncai is located, I put forward the following points hope to share with you: 1, innovation-driven, transformation and upgrading, leading the development of proactive, warmth, synergy and win-win situation. Kuncai technology will lead the titanium dioxide industry and iron oxide industry in innovation, out of the new technology routes, access to new products, in terms of product performance, functionality, cost to give more possibilities for the transformation and upgrading of the company to create a solid foundation at the same time, but also lead the progress of the industry and the development of enterprises. We should be more proactive to realize our own potential, comprehensively deepen cooperation, embrace the warmth, the use of product diversification, customer overlap and brand influence to form a synergistic effect and win-win situation. 2, integration platform, resource sharing, model building, tapping the potential, and overcome the difficulties together. Survival is the basis of all development, but there will still be some enterprises due to the lack of full awareness of the competitive market situation and market self-purification of the environment, will gradually disappear in the public eye. Being too self-righteous, not forming a real survival ecology, not possessing core competitiveness, still using the past methods and means to operate the present business, using relatively simple and rough means to deal with the relationship with customers, and not sorting out the relationship between the company (the organization) and the human being are all important factors to be eliminated by the market. We should have a differentiated understanding of the carrier, value and significance of your services between the two, and more from a long-term perspective, deep consideration of the services you provide to this unit as well as the value and significance of the personal existence of the people you serve. Therefore, we must integrate the platform and resources, the use of the core competitiveness of Kuncai as a background, reflecting the value and significance of your existence, build a new model to achieve the comprehensive use of modern logistics, interconnection, information, platform. Do on-line and off-line interaction, change the traditional settlement method, warehousing, and constantly tap the potential of dealers and customer space to solve the capital backlog, poor flow, high cost of goods sold and other issues, and overcome the difficulties. To this end, Kuncai Technology has been preparing for five years, the establishment of the interconnection, intelligent warehousing, settlement and sharing platform, from now on its significance and value will be further reflected. 3, build core competitiveness, closed-loop industrial chain, the formation of a circular economy. Digging deep moat, high firewall, stronger domestic market, bigger international market, forming domestic and international double cycle. Kuncai technology will be from the mining of mineral resources, processing, production to meet the main raw material supply of Zhengtai new materials, while the production of Kuncai pearlescent to provide the main raw materials to solve the problem of purchasing costs, Zhengtai and Kuncai for the purple cow to provide titanium dioxide, pearlescent pigments in order to produce high solids content of masterbatches, the ring is interlocked to form a complete industrial chain. Relying on the complete upstream and downstream industrial chain resources in Jiangyin Development Zone, we have formed a closed-loop industrial chain system and a circular economic system, formed a moat of competitive advantages by giving full play to the technological advantages of the first set of processes, and built up a high firewall by giving full play to the advantages of the scale, of course, there are also many international and domestic intellectual property rights, and a large number of strategic partners are our moats and firewalls, which build a good foundation for us to build a unified domestic market and international double-cycle. The international double cycle has built a good foundation for us to build a unified domestic market and an international double cycle.

Colleagues, dealers, the new year has given us a new mission, new tasks, new goals, I would like to take this opportunity on behalf of Kuncai Technology to serve you wholeheartedly, looking for a deeper level of cooperation space, digging a greater value and significance of cooperation, the formation of a higher platform for mutually beneficial cooperation, sincerely hope that in the new year you will be able to achieve better development.

Here to wish you all a happy new year, in this new year is approaching, I wish you good health, family happiness, but also together with Kun Cai prosperity, peace and good luck, and bless our great motherland: national prosperity, prosperity!

          Kuncai Technology Chairman: Xie Bingkun

                    January 2023