China Tobacco International HK : Proposed General Mandates to Issue and Repurchase Shares, Proposed Final Dividend, Proposed Re-Election of Directors and Notice of Annual General Meeting

THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to any aspect of this circular or as to the action you should take, you should consult your stockbroker or other registered dealer in securities, bank manager, solicitor, professional accountant or other professional adviser.

If you have sold or transferred all your shares in China Tobacco International (HK) Company Limited, you should at once hand this circular together with the enclosed form of proxy to the purchaser or transferee or to the bank, stockbroker or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this circular, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this circular.

中煙國際 (香港)有限公 司

CHINA TOBACCO INTERNATIONAL (HK) COMPANY LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 6055)

PROPOSED GENERAL MANDATES TO ISSUE AND

REPURCHASE SHARES

PROPOSED FINAL DIVIDEND

PROPOSED RE-ELECTION OF DIRECTORS

AND

NOTICE OF ANNUAL GENERAL MEETING

A notice convening the annual general meeting of China Tobacco International (HK) Company Limited to be held at 3:00 pm on Friday, 21 May 2021 at 17/F, Tower A, China Life Tower, One Harbour Gate, 18 Hung Luen Road, Hung Hom, Kowloon, Hong Kong is set out on pages 16 to 19 of this circular.

Whether you are able to attend the AGM or not, you are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return the completed form of proxy to the Company's share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong, as soon as possible, and in any event so that it is received not less than 48 hours before the time appointed for the holding of the AGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM or any adjourned meeting should you so wish.

PRECAUTIONARY MEASURES FOR THE AGM

In order to prevent the spread of COVID-19 pandemic and to safeguard the health and safety of Shareholders, the Company will implement the following precautionary measures at the AGM:

• compulsory body temperature checks and health declarations
• compulsory wearing of surgical face masks
• no provision of refreshments and corporate gifts

Any person who does not comply with the precautionary measures will be denied entry into the AGM venue. All attendees are requested to wear surgical face masks at all times at the AGM venue. Shareholders are reminded to exercise their voting rights at the AGM by appointing the chairman of the AGM as proxy to attend and vote on the relevant resolutions at the AGM instead of attending the AGM or any adjourned meeting in person.

20 April 2021

			CONTENTS
				Page
PRECAUTIONARY MEASURES FOR THE AGM . . . . . . . . . . . . . . . . . . . . . . . .	1
DEFINITION . .	. . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	2
LETTER FROM THE BOARD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
Introduction	. . .	. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
1.	Proposed general mandate to issue shares . . . . . . . . . . . . . . . . . . . . . . . . .	5
2.	Proposed general mandate to repurchase shares . . . . . . . . . . . . . . . . . . . . .	5
3.	Proposed final dividend . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
4.	Proposed re-election of directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	6
5.	Annual general meeting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	7
6.	Voting by poll . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
7.	Responsibility statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
8.	Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	8
APPENDIX I	-	EXPLANATORY STATEMENT FOR THE SHARE
			REPURCHASE MANDATE . . . . . . . . . . . . . . . . . . . . . . .	9
APPENDIX II	-	DETAILS OF DIRECTORS PROPOSED TO BE
			RE-ELECTEDAT THE AGM . . . . . . . . . . . . . . . . . . . .	12
NOTICE OF ANNUAL GENERAL MEETING . . . . . . . . . . . . . . . . . . . . . . . . . . .	16

- i -

PRECAUTIONARY MEASURES FOR THE AGM

In view of the ongoing COVID-19 pandemic and recent requirements for prevention and control of its spread, the Company will implement the following precautionary measures at the AGM to protect attending Shareholders, staff and other stakeholders from the risk of infection:

1. Compulsory body temperature checks will be conducted on every attending Shareholder, proxy and other attendees at the entrance of the AGM venue. Any person found to be suffering from a fever or otherwise unwell will be denied entry into the AGM venue or be required to leave the AGM venue.
2. All attending Shareholders, proxies and other attendees are required to complete and submit at the entrance of the AGM venue a declaration form confirming their names and contact details, and be asked whether (a) they have travelled to, or to their best of knowledge had close contact with any person who has recently travelled to, areas outside of Hong Kong at any time in the preceding 14 days of the AGM; and (b) they are subject to any compulsory quarantine prescribed by the Hong Kong Government. Any person who responds affirmatively to any one of the above questions will be denied entry into the AGM venue or be required to leave the AGM venue.
3. All attendees are requested to wear surgical face masks at the AGM venue at all times, and to maintain a safe distance with other attendees.
4. No refreshments and corporate gifts will be provided.

To the extent permitted under applicable laws, the Company reserves the right to deny entry into the AGM venue or require any person to leave the AGM venue in order to ensure the safety of the attendees at the AGM.

In the interest of all stakeholders' health and safety and in response to the recent guidelines on prevention and control of COVID-19 pandemic, Shareholders are reminded that

physical attendance in person at the AGM is not necessary for the purpose of exercising voting rights. As an alternative, by completing form of proxy in accordance with the instructions printed thereon, Shareholders may appoint the chairman of the AGM as proxy to attend and vote on the relevant resolutions at the AGM instead of attending the AGM or any adjourned meeting in person.

- 1 -

DEFINITION

In this circular, unless the context otherwise requires, the following expressions shall have the following meanings:

Term	Definition
"AGM"	the annual general meeting of the Company to be held at
	3:00 pm on Friday, 21 May 2021 at 17/F, Tower A, China
	Life Tower, One Harbour Gate, 18 Hung Luen Road,
	Hung Hom, Kowloon, Hong Kong or any adjournment
	thereof
"Articles of Association"	The articles of association of the Company
"Board"	the board of Directors
"close associate(s)"	has the meaning ascribed thereto under the Listing Rules
"Company"	China Tobacco International (HK) Company Limited (中
	煙國際(香港)有限公司), a company incorporated in Hong
	Kong with limited liability and whose Shares are listed
	on the Stock Exchange
"CTI"	China Tobacco International Inc.* (中國煙草國際有限公
	司), a company incorporated with limited liability in the
	PRC on 6 November 1984 and a wholly-owned
	subsidiary of CNTC
"CTIG"	China Tobacco International Group Limited (中煙國際集
	團有限公司), formerly known as Tian Li International
	Company Limited, a company incorporated in Hong
	Kong with limited liability and the controlling
	shareholder of the Company. On 2 September, 2020, CTI,
	the sole shareholder of CTIG and a wholly-owned
	subsidiary of CNTC, transferred the entire issued share
	capital of CTIG held by it to CNTC. Immediately after
	this transfer, CTIG became a direct wholly-owned
	subsidiary of CNTC
"Director(s)"	the director(s) of the Company
"Final Dividend"	the proposed final dividend of HK$0.04 per Share and
	payable in Hong Kong dollars
"HK$"	Hong Kong dollars, the lawful currency of Hong Kong

- 2 -

	DEFINITION
"Hong Kong"	the Hong Kong Special Administrative Region of the
	People's Republic of China
"Latest Practicable Date"	16 April 2021, being the latest practicable date prior to
	the printing of this circular for ascertaining certain
	information for inclusion in this circular
"Listing Rules"	the Rules Governing the Listing of Securities on the
	Stock Exchange
"PRC"	the People's Republic of China
"SFO"	the Securities and Futures Ordinance (Cap 571 of the
	Laws of Hong Kong) as amended, supplemented or
	otherwise modified from time to time
"Share(s)"	the ordinary share(s) of the Company
"Share Issue Mandate"	the general mandate to Directors to exercise the power of
	the Company to allot, issue and deal with Shares not
	exceeding 20% of the total number of the issued Shares
	as at the date of passing of the resolution approving such
	mandate
"Share Repurchase Mandate"	the general mandate to Directors to exercise the power of
	the Company to repurchase Shares not exceeding 10% of
	the total number of the issued Shares as at the date of
	passing of the resolution approving such mandate
"Shareholder(s)"	holder(s) of the Share(s)
"Stock Exchange"	The Stock Exchange of Hong Kong Limited
"Takeovers Code"	the Code on Takeovers and Mergers as approved by the
	Securities and Futures Commission

In this circular, the English translation of an entity's or a company's name in Chinese which is marked with "*" is for identification purpose only. If there is any inconsistency between the Chinese names of entities or companies established in the PRC and their English translations, the Chinese names shall prevail.

- 3 -

LETTER FROM THE BOARD

中 煙國際 (香 港)有限公司

CHINA TOBACCO INTERNATIONAL (HK) COMPANY LIMITED

	(Incorporated in Hong Kong with limited liability)
	(Stock Code: 6055)
Non-Executive Director:	Headquarters, Registered Office and
SHAO Yan (Chairman)	Principal Place of Business:
	Room 1002, 10/F, Tower A,
Executive Directors:	China Life Center,
YANG Xuemei	One Harbour Gate,
LI Yan	18 Hung Luen Road,
LIANG Deqing	Hung Hom, Kowloon,
WANG Chengrui	Hong Kong

Independent Non-Executive Directors:

CHOW Siu Lui

WANG Xinhua

CHAU Kwok Keung

QIAN Yi

20 April 2021

To the Shareholders

Dear Sir or Madam

PROPOSED GENERAL MANDATES TO ISSUE AND

REPURCHASE SHARES

PROPOSED FINAL DIVIDEND

PROPOSED RE-ELECTION OF DIRECTORS

AND

NOTICE OF ANNUAL GENERAL MEETING

INTRODUCTION

The purpose of this circular is to provide you with information regarding resolutions to be proposed at the AGM regarding (i) the granting to the Directors of general and unconditional mandates for the issue and repurchase of the Shares; (ii) payment of Final Dividend; and (iii) the re-election of retiring Directors.

- 4 -

LETTER FROM THE BOARD

1. PROPOSED GENERAL MANDATE TO ISSUE SHARES

At the AGM, an ordinary resolution will be proposed for the Shareholders to consider and, if thought fit, grant a general mandate to Directors to allot, issue and deal with Shares up to 20% of the total number of issued Shares at the date of passing this ordinary resolution. In addition, an ordinary resolution will also be proposed for the Shareholders to consider and, if thought fit, approve the extension of the Share Issue Mandate by adding to the total number of Shares which may be allotted or agreed conditionally or unconditionally to be allotted by the Directors pursuant to the Share Issue Mandate the number of Shares purchased under the Share Repurchase Mandate (referred to in section 2 below), if granted.

As at the Latest Practicable Date, the total number of issued Shares was 691,680,000 Shares. Assuming that there is no change in the total number of issued Shares between the period from the Latest Practicable Date and the date of passing the resolution approving the Share Issue Mandate, the maximum number of Shares which may be allotted, issued and dealt with pursuant to the Share Issue Mandate at the date of passing the resolution approving the Share Issue Mandate will be 138,336,000 Shares, which represent 20% of the total number of issued Shares at the date of passing the ordinary resolution for Share Issue Mandate.

Details of the Share Issue Mandate and the extension of the Share Issue Mandate are respectively set out in Resolutions 5 and 7 in the notice of the AGM set out on pages 17 to 18 of this circular.

The Share Issue Mandate will expire upon whichever is the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association or by law to be held; and (c) the date on which the authority given under the ordinary resolution approving the Share Issue Mandate is revoked or varied by an ordinary resolution of the Shareholders.

2. PROPOSED GENERAL MANDATE TO REPURCHASE SHARES

At the AGM, an ordinary resolution will be proposed for the Shareholders to consider and, if thought fit, grant a general mandate to Directors to repurchase Shares up to 10% of the total number of issued Shares at the date of passing this ordinary resolution.

As at the Latest Practicable Date, the total number of issued Shares was 691,680,000 Shares. Assuming that there is no change in the total number of issued Shares between the period from the Latest Practicable Date and the date of passing the resolution approving the Share Repurchase Mandate, the maximum number of Shares which may be repurchased pursuant to the Share Repurchase Mandate at the date of passing the resolution approving the Share Repurchase Mandate will be 69,168,000 Shares, which represent 10% of the total number of issued Shares at the date of passing the ordinary resolution for Share Repurchase Mandate.

- 5 -

LETTER FROM THE BOARD

An explanatory statement, giving certain information regarding the Share Repurchase Mandate, is set out in Appendix I to this circular. The Share Repurchase Mandate will expire upon whichever is the earliest of: (a) the conclusion of the next annual general meeting of the Company; (b) the expiration of the period within which the next annual general meeting of the Company is required by the Articles of Association or by law to be held; and (c) the date on which the authority given under the ordinary resolution approving the Share Repurchase Mandate is revoked or varied by an ordinary resolution of the Shareholders.

3. PROPOSED FINAL DIVIDEND

The Board has recommended the declaration and payment of a final dividend of HK$0.04 per Share and payable in Hong Kong dollars for the year ended 31 December 2020, subject to the Shareholders' approval at the AGM. As at the Latest Practicable Date, the Company has 691,680,000 Shares in issue. Based on the number of issued Shares as at the Latest Practicable Date, the Final Dividend, if declared and paid, will amount to an aggregate amount of approximately HK$27,667,200.

For determining the entitlement to the proposed Final Dividend, the register of members of the Company will be closed from Thursday, 27 May 2021 to Monday, 31 May 2021, both days inclusive, during which period no transfer of Shares will be registered. In order to qualify for the proposed Final Dividend, all duly completed transfer forms accompanied by the relevant share certificates must be lodged with the Company's Hong Kong Share Registrar, Computershare Hong Kong Investor Services Limited, at Room 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong for registration not later than 4:30 p.m. on Wednesday, 26 May 2021. The Final Dividend is expected to be paid on or about Thursday, 17 June 2021 to the Shareholders whose name appear on the register of members of the Company on Monday, 31 May 2021.

4. PROPOSED RE-ELECTION OF DIRECTORS

In accordance with Article 111 of the Articles of Association, Ms. YANG Xuemei, Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung will retire by rotation at the AGM and, being eligible, offer themselves for re-election.

Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung were appointed as independent non-executive Directors in December 2018, respectively, after review and approval by the Board. Mr. CHOW Siu Lui has a wealth of experience in fund raising and initial public offering activities in Hong Kong and in accounting and financial areas. Mr. CHAU Kwok Keung has more than 17 years of experience in accounting and financial management. With their accounting and financial expertise, each of them can contribute to the Board diversity of the Company and is a highly valued and respected member of the Board. The Board believes that each of them will make a significant contribution to the Company with their extensive experience. Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung have provided the Company with confirmations of their independence with reference to the factors set out in Rule 3.13 of the Listing Rules, respectively, and the Board is of the view that each of them is independent. Accordingly, the Board is of the view that Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung have the character, integrity, independence and expertise to continue to fulfill their roles as an independent non-executive Director effectively, respectively.

- 6 -

LETTER FROM THE BOARD

Notwithstanding Mr. CHOW Siu Lui holds directorship in seven listed companies other than the Company, all such directorships are non-executive in nature and do not require Mr. CHOW Siu Lui to devote his full time and attention to the affairs of those companies. Mr. CHOW Siu Lui has maintained his professionalism in various directorships of listed companies he served, and maintained an excellent attendance rate of 100% of all the Board meetings and Board committee meetings which Mr. CHOW Siu Lui was eligible to attend during the period since his appointment in December 2018. In addition, Mr. CHOW Siu Lui has provided the Company with a written confirmation on the sufficiency of his time spent and attention to the affairs of the Company. Accordingly, the Board is of the view that he is able to devote sufficient time and attention to perform the duties as an independent non-executive Director.

On the basis above, the Board is of the view that the re-election of Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung as independent non-executive Directors is in the interests of the Company and its shareholders as a whole, and would recommend Mr. CHOW Siu Lui and Mr. CHAU Kwok Keung for re-election as independent non-executive Directors at the AGM.

Details of the Directors who are proposed to be re-elected at the AGM are set out in Appendix II to this circular.

5. ANNUAL GENERAL MEETING

A notice convening the AGM is set out on pages 16 to 19 of this circular. A form of proxy for use at the AGM is enclosed, a copy of which can also be obtained via the website of the Company at www.ctihk.com.hk or the website of the Stock Exchange at www.hkexnews.hk. Whether you are able to attend the AGM or not, you are requested to complete the enclosed form of proxy in accordance with the instructions printed thereon and return the completed form of proxy to the Company's share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong as soon as possible, and in any event so that it is received not less than 48 hours before the time appointed for the holding of the AGM or any adjournment thereof (as the case may be). Completion and return of the form of proxy will not preclude you from attending and voting in person at the AGM or any adjourned meeting should you so wish.

For determining the entitlement to attend and vote at the AGM, the register of members of the Company will be closed from Monday, 17 May 2021 to Friday, 21 May 2021, both dates inclusive, during which period no transfer of Shares will be registered. In order to be eligible to attend and vote at the AGM, non-registered holders for its Shares shall ensure that all transfer documents accompanied by the relevant share certificates must be lodged with the Company's Hong Kong Share Registrar, Computershare Hong Kong Investor Services Limited, at Room 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wanchai, Hong Kong for registration not later than 4:30 p.m. on Friday, 14 May 2021.

- 7 -

LETTER FROM THE BOARD

6. VOTING BY POLL

Pursuant to Rule 13.39(4) of the Listing Rules, at any general meeting, a resolution put to the vote of Shareholders shall be taken by poll except where the chairman of the AGM, in good faith, decides to allow a resolution which relates purely to a procedural or administrative matter to be voted on by a show of hands.

The chairman of the AGM will exercise his power under Article 74 of the Articles of Association to demand for poll voting on all the resolutions as set out in the notice of the AGM.

The results of the poll on all the resolutions as set out in the notice of the AGM in both English and Chinese will be published on the website of the Company at www.ctihk.com.hk and the website of the Stock Exchange at www.hkexnews.hk in accordance with the Listing Rules.

7. RESPONSIBILITY STATEMENT

This circular includes particulars given in compliance with the Listing Rules for the purpose of giving information with regard to the Company. The Directors collectively and individually accept full responsibility for the accuracy of the information contained in this circular and confirm, having made all reasonable enquiries, that to the best of their knowledge and belief there are no other facts the omission of which would make any statement herein misleading.

8. RECOMMENDATION

The Directors consider that all the proposed resolutions set out in the notice of the AGM are in the interests of the Company and the Shareholders as a whole, and recommend all Shareholders to vote in favour of all such resolutions to be proposed at the AGM.

Yours faithfully

SHAO Yan

Chairman

- 8 -

APPENDIX I	EXPLANATORY STATEMENT FOR
	THE SHARE REPURCHASE MANDATE

This is an explanatory statement required to be given to the Shareholders under the Listing Rules in connection with the proposed Share Repurchase Mandate. This explanatory statement also constitutes the memorandum required under section 239 of the Companies Ordinance (Chapter 622 of the Laws of Hong Kong).

SHARE CAPITAL

As at the Latest Practicable Date, there were 691,680,000 Shares in issue. Subject to the passing of the ordinary resolution approving the Share Repurchase Mandate and on the basis that no further Shares are issued and no Shares are repurchased prior to the AGM, the Directors would be authorised under the Share Repurchase Mandate to repurchase a maximum of 69,168,000 Shares, which represent 10% of the total number of issued Shares at the date of passing the ordinary resolution.

REASONS FOR THE REPURCHASE OF SHARES

The Directors believe that the Share Repurchase Mandate is in the best interests of the Company and the Shareholders. Repurchases may, depending on the circumstances, result in an increase in net assets of the Company and/or earnings per Share. The Directors are seeking the grant of a general mandate to repurchase Shares to give the Company flexibility to do so if and when appropriate. The timing and the number(s), the price and other terms upon which the same are repurchased will be decided by the Directors at the relevant time having regard to the circumstances then prevailing.

FUNDING FOR THE REPURCHASE OF SHARES

Repurchases must be made out of funds which are legally available for such purpose in accordance with all applicable laws of Hong Kong and the Articles of Association. It is envisaged that the funds required for any repurchase would be derived from the distributable profits of the Company.

There could be adverse impact on the working capital or gearing position of the Company (as compared with the position disclosed in the audited financial statements contained in the annual report of the Company for the year ended 31 December 2020) in the event that the proposed Share repurchases were to be carried out in full at any time during the proposed repurchase period. However, the Directors do not propose to exercise the general mandate to such an extent as would, in the circumstances, have a material adverse effect on the working capital of the Company or its gearing level which in the opinion of the Directors are from time to time appropriate for the Company.

- 9 -

APPENDIX I	EXPLANATORY STATEMENT FOR
	THE SHARE REPURCHASE MANDATE

DIRECTORS' UNDERTAKING

The Directors have undertaken to the Stock Exchange that, so far as the same may be applicable, they will exercise the Share Repurchase Mandate in accordance with the Listing Rules and the applicable laws of the Hong Kong.

DISCLOSURE OF INTERESTS

None of the Directors nor, to the best of their knowledge having made all reasonable enquiries, any of their close associates, has any present intention to sell any Shares to the Company in the event that the Share Repurchase Mandate is approved by the Shareholders.

No core connected person (as defined in the Listing Rules) has notified the Company that he has a present intention to sell the Shares to the Company, nor has he undertaken not to do so in the event that the Share Repurchase Mandate is approved by the Shareholders.

SHARE PRICES

The highest and lowest prices at which the Shares had been traded on the Stock Exchange during the year ended 31 December 2020 and up to the Latest Practicable Date were as follows:

	Highest	Lowest
	HK$	HK$
January 2020	19.74	14.88
February 2020	19.08	14.10
March 2020	18.42	13.98
April 2020	16.40	14.64
May 2020	16.10	14.30
June 2020	17.70	14.62
July 2020	19.90	15.30
August 2020	16.86	15.12
September 2020	17.18	14.10
October 2020	15.88	14.50
November 2020	16.60	14.52
December 2020	16.46	14.56
January 2021	18.52	14.46
February 2021	21.55	15.14
March 2021	21.50	15.82
April 2021 (up to and including the Latest
Practicable Date)	20.70	17.82

- 10 -

APPENDIX I	EXPLANATORY STATEMENT FOR
	THE SHARE REPURCHASE MANDATE

TAKEOVERS CODE

Pursuant to Rule 32 of the Takeovers Code, if as a result of a Share repurchase, a Shareholder's proportionate interest in the voting right of the Company increases, such increase will be treated as an acquisition for the purposes of the Takeovers Code and, if such increase results in a change of control, may in certain circumstances give rise to an obligation to make a mandatory offer for the Shares under Rule 26 of the Takeovers Code.

As at the Latest Practicable Date, the immediate controlling shareholder of the Company, CTIG, was recorded in the registers required to be kept by the Company under section 336 of the SFO as having an interest in 500,010,000 Shares, representing approximately 72.29% of the number of issued shares of the Company as at that date. In the event that the Share Repurchase Mandate is exercised in full and assuming that there is no change in the number of Shares held by CTIG, the shareholding of CTIG in the Company will be increased to approximately 80.32% of the reduced number of issued shares of the Company immediately after the exercise in full of the Share Repurchase Mandate. Save as disclosed above, the Directors are not aware of any consequences in relation to CTIG which would arise under the Takeovers Code as a result of such share repurchase by the Company. In addition, in exercising the Share Repurchase Mandate (whether in full or otherwise), the Directors will ensure that the Company shall comply with the requirements of the Listing Rules, including the minimum percentage of Shares being held in public hands.

SHARES REPURCHASE MADE BY THE COMPANY

The Company has not purchased any of its Shares (whether on the Stock Exchange or otherwise) during the year ended 31 December 2020 and up to the Latest Practicable Date.

- 11 -

APPENDIX II	DETAILS OF DIRECTORS PROPOSED TO BE
	RE-ELECTED AT THE AGM

The particulars of the Directors proposed to be re-elected at the AGM are as follows:

Ms. YANG Xuemei (楊雪梅), aged 51, joined us in October 2018 as the Vice General Manager of the Company until 17 March 2020 and has been an executive Director of the Company since December 2018. Ms. Yang has been the General Manager of the Company since 17 March 2020.

From July 1992 to June 1995, Ms. Yang worked at Kunming Machine Tool Company Limited* (昆明機床股份有限公司). She then worked at Yuxi Cigarette Factory* (玉溪捲煙廠 ) from June 1995 to February 1999 and at Yunnan Hongta Import & Export Company Limited* (雲南紅塔進出口有限公司) from February 1999 to January 2003. From January 2003 to January 2007, Ms. Yang successively served as a section chief of overseas investment management division, an assistant of manager and deputy manager at Hongta International Company Limited* (紅塔國際公司). From January 2007 to September 2018, Ms. Yang successively served as the vice general manager, general manager and chairman of Yunnan Tobacco International Company Limited* (雲南煙草國際有限公司).

Ms. Yang became a senior economist awarded by CNTC in August 2014. Ms. Yang obtained a bachelor's degree in engineering from North University of China (formerly known as Taiyuan Institute of Mechanical) in July 1992, and a master's degree in economics from Yunnan University in April 2007. Ms. Yang also obtained an MBA degree from University of Chicago Booth School of Business in March 2010.

Ms. Yang does not have any relationship with any other Directors, senior management, substantial shareholders or controlling shareholders of the Company. As at the Latest Practicable Date, Ms. Yang did not hold any interest in the Shares within the meaning of Part XV of the SFO.

Ms. Yang has entered into a service contract with the Company for a term of three years. Her directorship is subject to retirement by rotation and re-election at annual general meetings of the Company in accordance with the Articles of Association. Ms. Yang is not entitled to receive director's remuneration from the Company.

Save as disclosed herein, there is no information that should be disclosed pursuant to any of the requirements of Rule 13.51(2) of the Listing Rules and there are no other matters relating to Ms. Yang that need to be brought to the attention of the Shareholders.

- 12 -

APPENDIX II	DETAILS OF DIRECTORS PROPOSED TO BE
	RE-ELECTED AT THE AGM
Mr. CHOW Siu Lui	(鄒小磊), aged 60, has been appointed as our independent

non-executive Director since December 2018.

Mr. Chow has a wealth of experience in fund raising and initial public offering activities in Hong Kong and in accounting and financial areas. He is currently a partner of VMS Investment Group (HK) Limited and is responsible for its private equities activities.

Mr. Chow joined KPMG Hong Kong in July 1983 and was admitted as a partner in July 1995. In 2010, Mr. Chow participated in the review of the Code on Corporate Governance Practices issued by the Stock Exchange as a member of the listing committee. He retired from KPMG Hong Kong in December 2011. He worked at VMS Investment Group (HK) Ltd. as a director manager of the private equity department since April 2012 and is a partner currently. He has been serving as an independent non-executive director of Fullshare Holdings Limited, a company listed on the Stock Exchange (Stock Code: 0607), since December 2013, an independent non-executive director of Genertec Universal Medical Group Company Limited, a company listed on the Stock Exchange (Stock Code: 2666), since June 2015, an independent non-executive director of Shanghai Dazhong Public Utilities (Group) Co. Ltd., a company listed on the Stock Exchange (Stock Code: 1635), since April 2016, an independent non-executive director of Futong Technology Development Holdings Limited, a company listed on the Stock Exchange (Stock Code: 0465), since December 2016 and an independent non-executive director of China Everbright Greentech Limited, a company listed on the Stock Exchange (Stock Code: 1257), since May 2017, an independent non-executive director of Global Cord Blood Corporation (a company listed on the New York Stock Exchange, with stock code: NYSE: CO) since November 2019, and a non-executive director of Renrui Human Resources Technology Holdings Limited, a company listed on the Stock Exchange (Stock Code: 6919), since December 2019. He also served as an independent non-executive director of Sinco Pharmaceuticals Holdings Limited, a company listed on the Stock Exchange (Stock Code: 6833), from September 2015 to November 2018.

Mr. Chow obtained his qualification as a fellow of the Association of Chartered Certified Accountants (英國特許公認會計師公會) in July 1991, the Hong Kong Institute of Certified Public Accountants (香港會計師公會) (the "HKICPA", formerly known as the Hong Kong Society of Accountants) in December 1993, the Hong Kong Institute of Chartered Secretaries (香港特許秘書公會) (the "HKICS") in 2009, and the Institute of Chartered Secretaries and Administrators (英國特許秘書及行政人員公會) in 2009. Mr. Chow was appointed as the chairman of the mainland development strategies advisory panel and a member of the registration and practicing committee of the HKICPA for the year 2016 in February 2016. Mr. Chow was appointed as a council member and chairman of audit committee of the HKICS in December 2015. He obtained a professional diploma in accountancy from Hong Kong Polytechnic University (formerly known as Hong Kong Polytechnic) in November 1983.

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APPENDIX II	DETAILS OF DIRECTORS PROPOSED TO BE
	RE-ELECTED AT THE AGM

Mr. Chow does not have any relationship with any other Directors, senior management, substantial shareholders or controlling shareholders of the Company. As at the Latest Practicable Date, Mr. Chow did not hold any interest in the Shares within the meaning of Part XV of the SFO.

Mr. Chow has entered into a service contract with the Company for a term of three years. His directorship is subject to retirement by rotation and re-election at annual general meetings of the Company in accordance with the Articles of Association. Mr. Chow is entitled to receive a director's fee of HK$360,000 per annum. His emoluments are determined with reference to his duties and responsibilities in the Company and prevailing market conditions and reviewed by the remuneration committee of the Company.

Save as disclosed herein, there is no information that should be disclosed pursuant to any of the requirements of Rule 13.51(2) of the Listing Rules and there are no other matters relating to Mr. Chow that need to be brought to the attention of the Shareholders.

Mr. CHAU Kwok Keung (鄒國強), aged 44, has been appointed as our independent non-executive Director since December 2018.

Mr. Chau has more than 17 years of experience in accounting and financial management. Mr. Chau joined BetterLife Holding Limited as a chief financial officer in September 2020 and was appointed as an executive Director in December 2020. He is responsible for overall financial planning and management, company secretarial affairs, coordination of investors relations and administrative work.

Mr. Chau has served as an executive director and the chief financial officer of Comtec Solar Systems Group Limited, a company listed on the Stock Exchange (Stock Code: 712), from November 2007 to January 2020. Mr. Chau was responsible for its corporate financial and general management. He was also appointed as (i) an independent non-executive director and the chairman of the audit committee of Qingdao Port International Co., Ltd., a company dual-listed on the Stock Exchange (Stock Code: 6198) and the Shanghai Stock Exchange (Stock Code: 601298) from May 2014 to May 2019; (ii) an independent director of The9 Limited, whose shares are listed by way of American Depository Shares on NASDAQ (Stock Code: NCTY), since October 2015; (iii) an independent non-executive director and the chairman of the audit committee of China Xinhua Education Group Ltd., a company listed on the Stock Exchange (Stock Code: 2779), since October 2017; (iv) an independent non- executive director and the chairman of the audit committee of Forward Fashion (International) Holdings Company Limited, a company listed on the Stock Exchange (Stock Code: 2528), since December 2019; and (v) an independent non-executive director of Bank of Zhangjiakou Co., Ltd (張家口銀行股份有限公司) since April 2020. He also acted as a member of supervisory board of RIB Software AG (Stock Code: RIB), a software company in Germany, which was listed on the Frankfurt Stock Exchange, from May 2010 to June 2013.

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APPENDIX II	DETAILS OF DIRECTORS PROPOSED TO BE
	RE-ELECTED AT THE AGM

Mr. Chau has also served in various positions at China.com Inc. (currently known as Sino Splendid Holdings Limited), a company listed on the Stock Exchange (Stock Code: 8006) from October 2005 to October 2007, including qualified accountant, chief financial officer, company secretary and authorised representative. Prior to joining China.com Inc., he was the deputy group financial controller of China South City Holdings Limited, a company listed on the Stock Exchange (Stock Code: 1668) from August 2003 to April 2005 and the financial controller of Shanghai Hawei New Materials and Technology Company Limited from June 2002 to August 2003. Mr. Chau was employed by Arthur Andersen & Co. initially as an experienced staff accountant and then he was subsequently promoted to be a senior consultant in the Global Corporate Finance Division of Arthur Andersen & Co. in March 2002.

Mr. Chau has been a member of the Association of Chartered Certified Accountants (ACCA) since June 2002, a Chartered Financial Analyst of CFA Institute since September 2003 and a member of Hong Kong Institute of Certified Public Accountants (HKICPA) since July 2005. Mr. Chau also obtained a certificate of Qualified Independent Director from the Shanghai Stock Exchange since August 2017 and was approved by China Banking Regulatory Commission as qualified director of banking institutions in China since March 2020. Mr. Chau has been a fellow member of the Institute of Public Accountants (IPA) of Australia and Institute of Financial Accountants (IFA) since June 2020. Mr. Chau received a bachelor's degree in Business Administration from the Chinese University of Hong Kong in December 1998.

Mr. Chau does not have any relationship with any other Directors, senior management, substantial shareholders or controlling shareholders of the Company. As at the Latest Practicable Date, Mr. Chau did not hold any interest in the Shares within the meaning of Part XV of the SFO.

Mr. Chau has entered into a service contract with the Company for a term of three years. His directorship is subject to retirement by rotation and re-election at annual general meetings of the Company in accordance with the Articles of Association. Mr. Chau is entitled to receive a director's fee of HK$360,000 per annum. His emoluments are determined with reference to his duties and responsibilities in the Company and prevailing market conditions and reviewed by the remuneration committee of the Company.

Save as disclosed herein, there is no information that should be disclosed pursuant to any of the requirements of Rule 13.51(2) of the Listing Rules and there are no other matters relating to Mr. Chau that need to be brought to the attention of the Shareholders.

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NOTICE OF ANNUAL GENERAL MEETING

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this notice, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this notice.

中 煙國際 (香 港)有限公司

CHINA TOBACCO INTERNATIONAL (HK) COMPANY LIMITED

(Incorporated in Hong Kong with limited liability)

(Stock Code: 6055)

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN that the annual general meeting (the "Annual General Meeting") of China Tobacco International (HK) Company Limited (the "Company") will be held at 17/F, Tower A, China Life Tower, One Harbour Gate, 18 Hung Luen Road, Hung Hom, Kowloon, Hong Kong on Friday, 21 May 2021 at 3:00 pm for the following purposes:

1. To receive and consider the Company's audited financial statements, the report of the directors and the independent auditor's report for the year ended 31 December 2020.
2. To declare a final dividend for the year ended 31 December 2020.
3. To re-elect directors of the Company (the "Director(s)"):
4. 1. To re-elect Ms. YANG Xuemei as a Director;
   2. To re-elect Mr. CHOW Siu Lui as a Director; and
   3. To re-elect Mr. CHAU Kwok Keung as a Director.
5. To re-appoint KPMG as the auditor of the Company and authorise the Directors to fix their remuneration.

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NOTICE OF ANNUAL GENERAL MEETING

To consider and if thought fit, to pass with or without modification the following resolutions as Ordinary Resolutions:

5. "That:

1. subject to paragraph (c), a general mandate be and is hereby unconditionally granted to the Directors to exercise during the Relevant Period (as defined below) all the powers of the Company to allot, issue and dispose of shares in the Company and to make or grant offers, agreements, options or warrants which would or might require the exercise of such powers;
2. the mandate in paragraph (a) shall authorise the Directors during the Relevant Period to make or grant offers, agreements and options which would or might require the exercise of such powers after the end of the Relevant Period;
3. the total number of shares allotted or agreed conditionally or unconditionally to be allotted (whether pursuant to an option or otherwise) by the Directors pursuant to the mandate in paragraph (a), otherwise than pursuant to (i) a Rights Issue (as defined below), or (ii) any option scheme or similar arrangement for the time being adopted for the grant or issue to the officers and/or employees of the Company and/or any of its subsidiaries of shares or rights to acquire shares of the Company or (iii) any scrip dividend or similar arrangement pursuant to the articles of association of the Company from time to time, shall not exceed twenty per cent (20%) of the total number of issued shares of the Company at the date of this Resolution; and that this Resolution shall be limited by the applicable rules and requirements of The Stock Exchange of Hong Kong Limited as amended from time to time; and
4. for the purpose of this Resolution:
   "Relevant Period" means the period from the passing of this Resolution until whichever is the earliest of:
5. 1. the conclusion of the next annual general meeting of the Company;
   2. the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company or by law to be held; and
   3. the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting.

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NOTICE OF ANNUAL GENERAL MEETING

"Rights Issue" means an offer of shares open for a period fixed by the Directors to holders of shares of the Company or any class thereof on the register on a fixed record date in proportion to their then holdings of such shares or class thereof (subject to such exclusion or other arrangements as the Directors may deem necessary or expedient in relation to fractional entitlements or having regard to any restrictions or obligations under the laws of, or the requirements of any recognised regulatory body or any stock exchange in, any territory outside Hong Kong)."

1. "That:
2. 1. a general mandate be and is hereby unconditionally granted to the Directors to exercise during the Relevant Period (as defined below) all the powers of the Company to purchase or otherwise acquire shares of the Company in accordance with all applicable laws and the requirements of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited, provided that the total number of shares so purchased or otherwise acquired shall not exceed ten per cent (10%) of the total number of issued shares of the Company at the date of this Resolution; and
   2. for the purpose of this Resolution:
      "Relevant Period" means the period from the passing of this Resolution until whichever is the earliest of:
   3. 1. the conclusion of the next annual general meeting of the Company;
      2. the expiration of the period within which the next annual general meeting of the Company is required by the articles of association of the Company or by law to be held; and
      3. the date on which the authority set out in this Resolution is revoked or varied by an ordinary resolution of the shareholders of the Company in general meeting."
3. "That, conditional upon the passing of Resolutions 5 and 6 set out in the Notice convening this Annual General Meeting, the total number of the shares which are purchased or otherwise acquired by the Company pursuant to Resolution 6 shall be added to the total number of the shares which may be issued pursuant to Resolution 5."

By Order of the Board

SHAO Yan

Chairman

20 April 2021

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NOTICE OF ANNUAL GENERAL MEETING

Notes:

1. For determining the entitlement to attend and vote at the Annual General Meeting, the register of members of the Company will be closed from Monday, 17 May 2021 to Friday, 21 May 2021, both days inclusive, during which period no transfer of shares will be registered. In order to be entitled to attend and vote at the Annual General Meeting, all duly completed transfer forms accompanied by the relevant share certificates must be lodged with the Company's Hong Kong Share Registrar, Computershare Hong Kong Investor Services Limited, at Room 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong for registration not later than 4:30 p.m. on Friday, 14 May 2021.
2. For determining the entitlement to the proposed final dividend, the register of members of the Company will be closed from Thursday, 27 May 2021 to Monday, 31 May 2021, both days inclusive, during which period no transfer of shares of the Company will be registered. In order to qualify for the proposed final dividend, all duly completed transfer forms accompanied by the relevant share certificates must be lodged with the Company's Hong Kong Share Registrar, Computershare Hong Kong Investor Services Limited, at Room 1712-1716, 17th Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong for registration not later than 4:30 p.m. on Wednesday, 26 May 2021. The final dividend is expected to be paid on or about Thursday, 17 June 2021 to the shareholders whose name appear on the register of members of the Company on Monday, 31 May 2021.
3. Any member of the Company entitled to attend and vote at the Annual General Meeting is entitled to appoint one or, if he/she holds two or more shares, more person(s) as his/her proxy or proxies to attend and vote instead of him/her. A proxy needs not be a member of the Company. Completion and return of the form of proxy will not preclude the members of the Company from attending and voting in person at the Annual General Meeting or any adjourned meeting should they so wish.
4. The form of proxy for use at the Annual General Meeting is enclosed with the circular of the Company to its shareholders dated 20 April 2021. The form of proxy can also be downloaded from the website of the Company at www.ctihk.com.hk and the website of The Stock Exchange of Hong Kong Limited at www.hkexnews.hk. To be valid, the form of proxy must be completed, signed and deposited at the Company's share registrar, Computershare Hong Kong Investor Services Limited at 17M Floor, Hopewell Centre, 183 Queen's Road East, Wan Chai, Hong Kong not less than 48 hours before the time appointed for the holding of the Annual General Meeting or any adjournment thereof (as the case may be).

As at the date of this notice, the board of directors of the Company comprises Mr. Shao Yan, as Chairman and non-executive director of the Company, Ms. Yang Xuemei, Ms. Li Yan, Mr. Liang Deqing and Mr. Wang Chengrui as executive directors of the Company, and Mr. Chow Siu Lui, Mr. Wang Xinhua, Mr. Chau Kwok Keung and Mr. Qian Yi as independent non-executive directors of the Company.

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