Palace Banquet Holdings Limited announces its subscription results

Recorded approximately 16.68 times of over-subscription for its Hong Kong public offering

HONG KONG, CHINA - Media OutReach - 14 February 2019 - Palace Banquet Holdings Limited ("Palace Banquet", together with its subsidiaries, the "Group"; stock code: 1703),a full-service restaurant group in Hong Kong offering Cantonese dining service and banquet service, announced the subscription results for its shares (the "Shares") under the Hong Kong public offering (the "Public Offer") and international placing (the "Placing",collectively, the "Share Offer"). The Shares under the Public Offer have been over-subscribed by approximately 16.68 times. The offer price per Share has been set at HK$0.5 per Share. Dealings in the Shares on the Main Board of The Stock Exchange of Hong Kong Limited ("SEHK") is expected to commence on 15 February 2019 (Friday).

Due to the over-subscription in the Public Offer, the re-allocation procedures have been applied. A total number of 30,000,000 Shares under the Placing have been re-allocated to the Public Offer, so that the total number of Shares available under the Public Offer has been increased to 60,000,000 Shares, representing 20% of the total number of the offer Shares available under the Share Offer. Based on the final offer price of HK$0.5 per Share, the net proceeds from the Share Offer to be received by the Company (after deducting underwriting fees and estimated expenses in connection with the Share Offer) is estimated to be approximately HK$91.7 million.

Palace Banquet intends to use these net proceeds for the following purposes: 1) approximately 76.1% for expanding its restaurant network and geographic coverage by opening eight new restaurants in Hong Kong by the year ending 31 March 2021; 2) approximately 14.1% for renovation of its existing restaurants; 3) approximately 5.0% for promoting its brands and wedding banquet service; 4) approximately 4.8% for additional working capital, strategic investment and other general corporate purposes.

Shenwan Hongyuan Capital (H.K.) Limited is the Sole Sponsor. Shenwan Hongyuan Capital (H.K.) Limited and Opus Capital Limited are the Joint Global Coordinators. Shenwan Hongyuan Capital (H.K.) Limited, Opus Capital Limited and Haitong International Securities Company Limited are the Joint Bookrunners and Joint Lead Managers. Elstone Securities Limited and Great Roc Capital Securities Limited are the Co-Lead Managers.

Mr. Chan Shou Ming, Chairman and Executive Director of Palace Banquet Holdings Limited, said, "We believe that the result of the Share Offer has affirmedmarket's recognition of the Group's business and confidence in our future prospects.We are honoured that investors have shown great support to the Group. Listing on the Main Board of SEHK enables the Group to further expand its restaurant network and geographic coverage, enhance our brand competitiveness and capture greater market share in catering market in Hong Kong."

About the Group

Palace Banquet Holdings Limited is a full-service restaurant group in Hong Kong offering Cantonese dining service and banquet service, including one-stop wedding banquet service. Currently, the Group operates 20 Chinese restaurants under two brand names, namely "Palace (煌府)" and "Royal Courtyard (煌苑)". According to the Frost & Sullivan Report, the Group ranked the third amongst the Chinese full-service restaurant groups in the Hong Kong banquet market with a market share of approximately 5.0% in terms of revenue in 2017. For the years ended 31 March 2016, 2017 and 2018, its revenue was approximately HK$596.0 million, HK$635.1 million and HK$770.1 million, respectively, whilst its net profit was approximately HK$39.9 million, HK$40.3 million and HK$53.0 million in the same period.