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DAIDO GROUP LIMITED

大同集團有限公司
(incorporated in Bermuda with limited liability)
(Stock code: 544)

ANNOUNCEMENT

The impairment loss on available-for-sale investments of HK$11,600,000 made in the
Interim Results Announcement is related to the investment of the Group in Richbo
Enterprises Limited which has an investment in an investment property and a hotel resort
complex in Macau. Such impairment loss was measured as the difference between the
carrying amount of the available-for-sale investments and the present value of the
estimated future cash flows of investment property, hotel operation and spa operation
discounted at 14%, 16% and 18% respectively.

Reference is made to the announcement (the “Interim Results Announcement”) of
unaudited interim results for the six months ended 30 June 2007 released by the Company
dated 19 September 2007. Unless otherwise stated herein, capitalised terms used in this
announcement shall have the same meaning as those defined in the Interim Results
Announcement.

The Board would like to provide further information regarding the impairment loss on
available-for-sale investments of HK$11,600,000 made in the Interim Results Announcement
as follows:

The Group has, through an acquisition of subsidiaries, acquired certain assets including the
available-for-sale investments in 2006. These investments represent the Group's effective
interest of 30% of the issued ordinary shares of a private entity incorporated in the British
Virgin Islands. The private entity is Richbo Enterprises Limited, a company principally
engaged in investment holding. Richbo Enterprises Limited holds 44.45% (31.12.2006: 50%)
interest in Hoover International Limited, which in turn holds 90% (31.12.2006: 80%) interest
in a group that operates an investment property and a hotel resort complex in the Macau
Special Administrative Region of the People's Republic of China (“Macau”). As at 31st
December, 2006, the Group, through its subsidiary and Richbo Enterprises Limited, held 12%
effective interest in an investment property and held 12% effective interest in a hotel resort
complex operation. In February 2007, as a result of a partial disposal of equity interest of an
investee that holds the investment property, the effective interest of the Group in the

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investment property has been reduced from 12% to 6%. The investment was measured at
cost less impairment at each balance sheet date because the range of reasonable fair value
estimates is so varied that the directors of the Company are of the opinion that their fair
values cannot be measured reliably.

The Group has recognised the impairment loss on available-for-sale investments amounting to
HK$11,600,000 in the condensed consolidated income statement of the Group for the six
months ended 30 June 2007. The amount of the impairment loss was measured as the
difference between the carrying amount of the available-for-sale investments and the present
value of the estimated future cash flows of investment property, hotel operation and spa
operation discounted at 14%, 16% and 18% respectively. Due to the keen competition for
hotel operation and spa operation in Macau, and the effect of partial disposal of equity interest
of an investee holding the investment property, the Group has revised its cash flow forecasts
and the carrying amount of available-for-sale investments has therefore been reduced to its
recoverable amount through the recognition of the impairment loss.

The above information will be contained in the interim report to be published and released to
the shareholders by the Company on or about 28 September 2007.

By Order of the Board
Daido Group Limited
Choy Kai Sing
Company Secretary

Hong Kong, 20 September 2007

As at the date of this announcement, the Board comprises executive Directors, namely, Mr.
Fung Wa Ko and Mr. Tang Tsz Man, Philip and independent non-executive Directors, namely,
Mr. Leung Chi Hung, Mr. Leung, Tsz Fung David Ferreira and Mr. Tse Yuen Ming.