Baoshan Iron & Steel Co., Ltd.

3Q16 Result Briefing

October 2016

Disclaimer

The following presentation distributed herewith includes forward-looking statements.

All statements, other than statements of historical facts, that address activities, events or

developments that Baoshan Iron & Steel Co.,Ltd.(Baosteel) expects or anticipates will or

may occur in the future are forward-looking statements.

Baosteel’s actual results or developments may differ materially from those indicated

by these forward-looking statements as a result of various factors and uncertainties,

including but not limited to price fluctuations, actual demand, exchange rate

fluctuations, competition and other risks and factors beyond our control.

1 3Q Results

2 Industry Dynamics

Content

Company data Unit 3Q2015 3Q2016 YoY

Sales VolumeMillion

tons 540 542 ↑0.4%

Operating Incomebillion RMB 415.1 555.0 ↑33.7%

Operating Marginbillion RMB 29.0 53.9 ↑85.9%

Gross Margin % 7.0 9.7 ↑2.7ppts

Pre-tax Profitbillion RMB -14.5 30.9

Turn

profitable

EPSRMB/share -0.05 0.13

Turn

profitable

BVPSRMB/share 6.92 7.16 ↑3.5%

Cash Conversion CycleRMB/share 24.6 13.8 ↓43.9%

3Q results increased steadily

Operation Overview

million tons 3Q2016 YoY QoQ

Crude Steel Output 693 ↑ 25.5% ↑ 2.8%

552

674 693

0

300

600

3Q2015 2Q2016 3Q2016

540

623

542

65 98 91

-

300

600

3Q2015 2Q2016 3Q2016

million tons 3Q2016 YoY QoQ

Sales of Finished Products 542 ↑ 0.4% ↓13.0%

including：export 91 ↑ 40.0% ↓7.1%

Output & Sales

billion RMB 3Q2016 YoY QoQ

Operating Income 554 ↑ 33.8% ↑ 29.7%

Operating Cost 500 ↑ 29.9% ↑ 38.1%

414 427

554

385 362

500

0

200

400

600

3Q2015 2Q2016 3Q2016

Operating Income

Operating Income & Cost

Billion RMB 3Q2016 YoYGross

MarginYoY

Steel Making 255 ↑7.5% 15.9% ↑9.8ppts

Distribution 474 ↑36.4% 2.5% ↓0.7ppts

E-commerce 140 ↑183.3% 0.1% ↑0.17 ppts

237

347

49

255

474

140

0

200

400

600

Steel Making Distribution E-commerce

3Q2015 3Q2016

Billion RMB 3Q2016 YoYGross

MarginYoY

IT 8.5 ↓24.8% 29.6% ↑5.1 ppts

Chemicals 18 ↓7.2% 6.7% ↑2.1 ppts

Finance 1.3 ↓17.7% 53.1% ↑5.6 ppts

11.2

20

1.6

8.5

18

1.3 0

10

20

30

40

50

IT Chemicals Finance

3Q2015 3Q2016

Segment Report

The company cut cost of 1.1bn RMB in 3Q, a total of 5 bn up-to-date, overfulfilled the annual target.

Cost cutting continued

2016 Target 2016 Result

4 bn

5 bn

1.8 bn

2 bn

1.1 bn

Q4

Unit: RMB

Global debut of two high-end oriented silicon steel

Varieties Market Exploration

First high-end coated iron unit put into operation in China

Super 13Cr special buckle oil well tube entered the Middle East market

No 2 BF ramping up smoothly

Shift from construction to operation speeds up

Key indicators of some units better than benchmarks

Zhanjiang Project

1550 pickling line

hot load test

March 15

March 30

2030 hot dip galvanizing line

hot load test

3# converter system

hot load test

May 5

Heavy plate unit

hot load test

May 28

2# blast furnace of Zhanjiang

project ignition

July 15

Products development and certification go as planned

Company Data UnitJan.-Sep.

2015Jan.-Sep.

2016YoY

Sales VolumeMillion

tons 1610 1727 ↑7.3%

Operating Incomebillion RMB 1224.5 1336.1 ↑9.1%

Operating Marginbillion RMB 122.0 163.5 ↑34.0%

Gross Margin % 10.0 12.2 ↑2.2ppts

Pre-tax Profit billion RMB 29.5 81.1 ↑174.6%

EPSRMB/share 0.14 0.34 ↑142.9%

BVPSRMB/share 6.85 7.16 ↑4.5%

Cash Conversion CycleRMB/share 24.6 13.8 ↓43.9%

Operation Overview of Jan.-Sep. 2016

*Overall cost cut contribution

*Effective market exploration and varieties optimization

*Substantial reduction in foreign exchange losses YoY

Annual net profit expected to increase by 600%-800%

0.42

0.60

0.35 0.35

0.06

0.43

0.55

0.1

0.3

0.5

0.7

2011 2012 2013 2014 2015 2016E

EPS

↑ 600%

↑ 800%

Unit: Yuan

Estimated net profit：7.09-9.12 billion Yuan

2

1 3Q Results

Industry Dynamics

Content

9.5%

7.7% 7.7%7.4%

6.9%6.7%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

2011 2012 2013 2014 2015 2016

GDP

5.4%

2.6% 2.6%

2.0%

1.4%1.7%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

2011 2012 2013 2014 2015 2016

GDP CPI

• GDP was up steadily to 6.7% in Q3.

• GDP growth targets at 6.7% in 2016,

supply side reform is still the top priority.

• CPI growth was up to 1.7% in Q3.

• CPI growth targets at 1.9% in 2016. Prudent

monetary policy is expected to continue.

3Q2016 3Q2016

Economy outlook

Data source：Wind

Crude steel output and Apparent consumption

Unit: million tons Jan-Sep 2016 YoY

Crude steel output 604 ↑ 0.4%

Net export 80 ↑ 2.58%

Apparent consumption 524 ↑ 0.1%

• Crude steel output was 603mn tons in 3Q，up

0.4% YoY. Export increased slightly. Apparent

consumption increased by 0.1% YoY.

• Industry FAI growth rate increased significantly.

816 823 804

604 765 739

698

524

0

200

400

600

800

1,000

2013 2014 2015 2016

Crude steel output Apparent consumption

Unit: million tons

411.8

505.5 506 478.9425.7

309.7

14.60%

-2.04% -2.06%-5.90%

-11%

-0.40%

-15%

-10%

-5%

0%

5%

10%

15%

20%

0

200

400

600

2011 2012 2013 2014 2015 2016

Investment Growth rate Unit: billion Yuan

Jan-Sep 2016Jan-Sep 2016

Steel industry outlook

Steel industry FAI

Data source：National Bureau of Statistics, Steelhome, Wind

• Steel social inventory declined gradually. Steel mill inventory reached two-year lows.

Unit：ten thousand tons

941

529412

1206

0

500

1000

1500

2000

2500

2014年9月 2015年3月 2015年9月 2016年3月 2016年9月2014 2015 20160

500

1000

1500

2000

2500

2014年1月 2014年7月 2015年1月 2015年7月 2016年1月 2016年7月

Total inventory Long products Flat products

2014 2015 2016

Data source：Wind

Steel inventory

Social inventory Key steel mill inventory

Unit：ten thousand tons

CSPI Prices

• The whole steel market was active in 3Q. Steel price rebounded QoQ.

75.56

3700

3200

2510

50

55

60

65

70

75

80

85

90

95

100

2014年9月 2015年3月 2015年9月 2016年3月 2016年9月2014 2015 2016

1500

2000

2500

3000

3500

4000

4500

2014年9月 2015年3月 2015年9月 2016年3月 2016年9月

价格:热轧板卷:3.0mm:上海 价格:冷轧板卷:1.0mm:上海

价格:螺纹钢:HRB400 20mm:上海

2014 2015 2016

Data source：Wind

Steel market

Unit: RMB/ton

FAI

20.6%19.6%

15.7%

• Total FAI was 42.7 trillion RMB in the first three quarters, up 8.2% YoY. Growth was up steadily.

36.543.6

50.255.2

42.7

20.6% 19.6%

15.7%

10.0%8.2%

8%

10%

12%

14%

16%

18%

20%

22%

0

20

40

60

2012 2013 2014 2015 2016

Investment Growth rate

Infrastructure FAI

7.79.4

11.2

13.1

8.3

13.7%

21.2%20.3%

17.3%19.4%

10%

12%

14%

16%

18%

20%

22%

24%

0.0

5.0

10.0

15.0

2012 2013 2014 2015 2016

Investment Growth rate

• Infrastructure FAI was 8.3 trillion RMB, up 19.4% YoY. Growth was steady and relatively rapid.

Jan-Sep 2016 Jan-Sep 2016

Data source：Wind

Infrastructure

Unit: trillion RMBUnit: trillion RMB

Real estate FAI

20.6%19.6%

15.7%

• Real estate FAI was 7.5 trillion RMB in the first three quarters, up 5.8% YoY. Growth rate increased significantly.

New start and Sales growth

7.28.6

9.5 9.6

7.516.2%

19.8%

10.5%

1.0%

5.8%

0%

5%

10%

15%

20%

0

5

10

2012 2013 2014 2015 2016

Investment Growth rate Unit: trillion RMB

• In the first three quarters, new construction was up 6.8% YoY. Sales was up 26.9% YoY, down slightly compared with 1H.

-7.3%

13.5%

-10.7%-14.0%

6.80%1.8%

17.3%

-7.6%

6.5%

26.9%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

2012 2013 2014 2015 2016

New start Sales growth

Jan-Sep 2016 Jan-Sep 2016

Data source：Wind

Real estate

Output Sales

• Output and sales were up 13.3% and 13.2% YoY respectively in the first three quarters.

• Passenger car sales was up 14.8% YoY, outperforming commercial car(up 4.0% YoY).

19.2722.12

23.72 24.5

19.42

4.6%

14.8%

7.3%

3.3%

13.3%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

10

20

30

2012 2013 2014 2015 2016

19.3121.98

23.49 24.6

19.36

4.3%

14.0%

6.9%

4.7%

13.2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

0

10

20

30

2012 2013 2014 2015 2016Jan-Sep 2016 Jan-Sep 2016

Auto

Unit: million units Unit: million units

Data source：CAAM

Washing machine Refrigerator

67.4272.02 71.14 72.75

48.9

1.4%

8.2%

-3.3%

0.7%

6.0%

-5%

0%

5%

10%

0

20

40

60

80

2012 2013 2014 2015 2016

Output Growth rate

84.2793.41

87.96 89.93

62.31

-3.1%

10.6%

-1.0%-1.9%

-2.9%

-5%

0%

5%

10%

0

20

40

60

80

100

2012 2013 2014 2015 2016

Output Growth rate

Air conditioner

• In the first eight months, washing machine output grew fast, refrigerator output decreased slightly, while air conditioner output decreased YoY.

132.81143.33 144.63

156.5

109.48

4.9%

11.6%11.5%

0.0%-2.4%

-5%

0%

5%

10%

15%

0

30

60

90

120

150

180

2012 2013 2014 2015 2016

Output Growth rate

Jan-Aug2016 Jan-Aug2016 Jan-Aug2016

Data source：Wind

Home appliances

Machinery value added growth

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

General Equipment Special Equipment

Electrical Equipment Transportation Equipment

2013 2014 2015 2016

60.21

45.34 39.05 41.84

24.93 20.41

69.84

59.95

31.26

18.52

106.95 131.00

148.90

123.04

109.30

0

50

100

150

0

20

40

60

80

2012 2013 2014 2015 2016

Completion New Orders Carrying Orders(right)

Ship building

• New ship building orders increased, machinery experienced moderate growth, while main economic indicators remained downward trend.

Jan-Sep 2016

Data source：Wind

Ship building & machinery

Unit: million tons

Platts（62% Fe） Port inventory

• Iron ore price remained low. Q3 Platts(60% Fe) increased 5.3% QoQ.

59.15

10568

0

20

40

60

80

100

120

2014年10月 2015年4月 2015年10月 2016年4月 2016年10月2014 2015 20166000

7000

8000

9000

10000

11000

12000

2014年10月 2015年4月 2015年10月 2016年4月 2016年10月2014 2015 2016

Data source：Wind

Raw Material

Unit: USD/ ton Unit: ten thousand tons

Coking coal（from Australia） First-grade metallurgical coke

• Coking coal price increased sharply in Q3, creating a two-year high.

1460

1765

500

700

900

1100

1300

1500

1700

2014年10月 2015年4月 2015年10月 2016年4月 2016年10月2014 2015 2016500

700

900

1100

1300

1500

1700

1900

2014年10月 2015年4月 2015年10月 2016年4月 2016年10月2014 2015 2016

Data source：Wind

Raw Material

Unit: RMB/ton Unit: RMB/ton

Sheet price, especially CRC price will

remain at relatively high level.

Sheet demand stronger that rebar

Outlook for 4Q2016

High capacity utilization for

major players

Continuously rising cost

Strict de-capacity at year-end