09:24     SINOTRONICS<01195> - Announcement (2)                               

    To avoid causing confusion to the public, the Company made the            
    Announcement to name it as a loan agreement to be in conformity           
    with the accounting treatment of the transaction under the said           
    financial statements and the Annual Report 2004 where it was named        
    as a loan receivable, notwithstanding the view taken by the               
    Company's legal adviser in the PRC. The Board was also of the             
    opinion that the Announcement has disclosed the essential elements        
    of the transaction as required under Rule 13.16 of the Rules              
    Governing the Listing of Securities on the Stock Exchange of Hong         
    Kong Limited (``the Listing Rules''), irrespective of whether the         
    transaction was treated as a loan or an investment.                       
                                                                              
    The Board wishes to further advise that in order to minimise the          
    confusion and concerns of the shareholders, the Third Party               
    confirmed on 17 December 2004 that it will refund the investment          
    capital of RMB30,000,000 and the 8% return to Fujian Fuqiang in           
    March 2005. Consequently, the Company will no longer be                   
    participating in the designing, production and packaging of               
    certain circuit boards in the project of the Third Party upon the         
    receipt of investment capital. In spite of the refund, the Board          
    is of the opinion that the co-operation between the Company and           
    the Third Party was not affected.                                         
                                                                              
    GENERAL                                                                   
                                                                              
    As at the date of this announcement, the Board comprises Mr. Lin          
    Wan Qaing, Mr. Chen Yan Shun, Mr. Liu Zhao Cai, Mr. Xiang Song and        
    Mr. Tong Yiu On as executive directors, and Mr. Pan Chang Chi, Mr.        
    Cai Xun Shan and Mr. Cheung Chuen as independent non-executive            
    directors.                                                                
                                                                              
    By Order of the Board                                                     
    Tong Yiu On                                                               
    Company Secretary                                                         
                                                                              
    Hong Kong, 19 January 2005                                                
                                                                              
    (* For Chinese name, please refer to the press announcement today.)