Annual Report and Financial Statements 31 January 2026 # Baillie Gifford China Growth Trust plc Managed by **Baillie Gifford™** --- # Investor Disclosure Document The UK Alternative Investment Fund Managers Regulations require certain information to be made available to investors prior to their investment in the Company. The Company's Investor Disclosure Document is available for viewing at bailliegiffordchinagrowthtrust.com. ## Notes None of the views expressed in this document should be construed as advice to buy or sell a particular investment. Investment trusts are UK public listed companies and as such comply with the requirements of the Financial Conduct Authority ('FCA'). They are not authorised or regulated by the FCA. Baillie Gifford China Growth Trust plc currently conducts its affairs, and intends to continue to conduct its affairs, so that the Company's ordinary shares can qualify to be considered as a mainstream investment product and can be recommended by Independent Financial Advisers to ordinary retail investors in accordance with the rules of the FCA in relation to non-mainstream investment products. ### **This document is important and requires your immediate attention.** If you reside in the United Kingdom and you are in any doubt as to the action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorised under the Financial Services and Markets Act 2000 immediately. If you reside outwith the United Kingdom, you should consult an appropriately authorised financial adviser. If you have sold or otherwise transferred all of your holding in Baillie Gifford China Growth Trust plc, please forward this document, together with accompanying documents, but not your personalised form of proxy, as soon as possible to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale or transfer was or is being effected for delivery to the purchaser or transferee. **Baillie Gifford™** --- Baillie Gifford China Growth Trust plc # Contents ## Introduction Financial highlights 2 Key performance indicators 3 Baillie Gifford – philosophy and process 4 ## Strategic report Chair's statement 7 Managers' report 12 Review of investments 22 One year summary 26 Five year summary 28 Ten year record 30 Business review 32 Managers' report on environmental, social and governance engagement 45 Baillie Gifford – proxy voting 51 Baillie Gifford – statement on stewardship 52 Baillie Gifford – valuing private companies 54 List of investments 55 Distribution of total assets 58 ## Governance report Directors and management 60 Directors' report 63 Corporate governance report 68 Audit Committee report 75 Directors' remuneration report 78 Statement of Directors' responsibilities 82 ## Financial report Independent Auditor's report 85 Income statement 94 Balance sheet 95 Statement of changes in equity 96 Cash flow statement 97 Notes to the Financial Statements 98 ## Shareholder information Notice of Annual General Meeting 114 Further shareholder information 120 Communicating with shareholders 122 Insights 123 Third party data provider disclaimer 124 Sustainable Finance Disclosure Regulation 125 Glossary of terms and alternative performance measures 126 Company information 129 01 --- Introduction The principal investment objective of the Company is to produce long-term capital growth by investing predominantly in shares of, or depositary receipts representing the shares of, Chinese companies. # Financial highlights Year to 31 January 2026 Share price* NAV*† Comparative index*# +38.8% +34.0% +22.2% NAV, share price and benchmark total return* (figures rebased to 100 at 31 January 2025) ![img-0.jpeg](img-0.jpeg) Discount to net asset value* (figures plotted on a weekly basis) ![img-1.jpeg](img-1.jpeg) * Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 124. All figures are stated on a total return basis. Total return and discount are alternative performance measures – see Glossary of terms and alternative performance measures on pages 126 to 128. † Net asset value per share ('NAV'). # The benchmark is the MSCI China All Shares Index (in sterling terms). Past performance is not a guide to future performance. 02 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Key performance indicators The Board uses key performance indicators ('KPIs') to measure the progress and performance of the Company over time when discharging its duties as set out on page 70. These KPIs are established industry measures. The one, five and ten year records of the KPIs can be found on pages 26 to 31. Further discussion is included in the Chair's statement on pages 7 to 11. In addition to the above, the Board considers peer group comparative performance. Across these measures, the Board looks for relative outperformance over the long term, while remaining mindful that the nature of the Investment Policy and the growth characteristics of the portfolio investments may entail periods of underperformance over the short and medium term. Baillie Gifford & Co Limited were appointed as Managers and Company Secretaries on 16 September 2020. Before 16 September 2020, the Trust was able to invest across the Asia Pacific region rather than solely in China, and had a different comparative index. ## Net asset value total return relative to the benchmark\* The total return is the return to shareholders after reinvesting the net dividend on the date that the share price goes ex-dividend. ## Share price total return relative to the benchmark\* The total return is the return to shareholders after reinvesting the net dividend on the date that the share price goes ex-dividend. ![img-2.jpeg](img-2.jpeg) ## Share price (discount)/premium\* As stock markets and share prices vary, an investment trust's share price is rarely the same as its NAV. When the share price is lower than the NAV it is said to be trading at a discount. If the share price is higher than the NAV, this situation is called a premium. ![img-3.jpeg](img-3.jpeg) ## Ongoing charges ratio\* The ongoing charges ratio is the total recurring expenses (excluding the Company's cost of dealing in investments and borrowing costs) incurred by the Company as a percentage of the daily average NAV. Without the management fee waiver (see page 30) the ongoing charges ratio for 2021 would have been 1.0% and in 2022 0.8%. The Board has an ongoing charges target of 1.0% or less. The Board is satisfied that the ongoing charges ratio is competitive. ![img-4.jpeg](img-4.jpeg) The Board believes that KPI performance in the financial year to 31 January 2026 was positive. The NAV total return outperformance relative to benchmark was a key positive. Share price performance relative to the benchmark was positive. The ongoing charges ratio was stable at around 1%. The Board assesses the KPIs over longer periods, including since the mandate change in September 2020 and since the commencement of the performance related CTO period on 29 November 2024. \* Alternative performance measure – see Glossary of terms and alternative performance measures on pages 126 to 128. Past performance is not a guide to future performance. 03 --- Introduction # Baillie Gifford – philosophy and process ## Our philosophy and competitive edges Our goal is to use our global perspectives and local knowledge to identify the next generation of exciting growth companies and build a portfolio of 40–80 of the best ideas. We seek to identify mispricing relative to fundamentals and accept that it can take time for this to be reflected properly in company valuations. We believe that long-term returns are derived from investing in disruptive and secular trends which play out over years not months or quarters. We are looking for businesses that enjoy sustainable competitive advantages and have the potential to grow their earnings significantly ahead of the market average over the long term. As growth investors, we are focused on identifying the innovative companies with competitive advantages that position themselves to benefit from, and contribute to, China’s economic, societal and cultural development over the long-term. We believe fundamental research focused on the five-year prospects for companies makes for a differentiated approach to managing Chinese equities, in an asset class where impatience and short-termism abound. We think our approach delivers an active edge in three key areas: time horizons, perspectives and insights. ## Time horizon Companies grow over time. The true value of a business is rarely determined by what will happen in the next few quarters, but by what will happen in the many years ahead. It is over years that deep changes in industries and behaviours occur, and that competitive advantage and management excellence are recognised. Being able to think and act independently of the structures and short-term incentives of traditional finance is an important advantage. A long-term focus also embeds the consideration of ESG factors at its heart. We believe this is vital in a country like China, given the role of the state, lower levels of disclosure, and the need for engagement with companies. It allows us to mitigate the risks of getting Chinese companies wrong, but importantly, it helps us discover where the best opportunities lie. Fighting the instinct to involve ourselves in conventional market short termism requires important behavioural and cultural traits. Our partnership structure allows us to think differently and independently, and that provides our opportunity. 04 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Perspective We believe that balancing on-the-ground insights with a global perspective gives us an important edge. An open and collaborative culture allows us to understand Chinese companies not just in their own market, but in a global context too. Having investment managers and analysts on-the-ground in Shanghai enables us to deepen our long-standing relationships with existing holdings, identify the next generation of exceptional companies at an earlier stage, better understand societal and cultural developments, and forge partnerships with academics and industry specialists in the region. When added to the global perspectives derived across Baillie Gifford, we can gain far deeper insights into companies and sectors of interest. The benefit from our global perspectives is multi-fold: Baillie Gifford’s long history of researching growth companies globally, well-established trust with global companies as long-term, patient investors, as well as our strong academic connections, not only deepens our understanding of the industry trends and the competitive environment that Chinese companies operate in, but also provides checks and balances when assessing Chinese companies in a global context, including an assessment of the geopolitical environment and ESG standards. ## Relationships and insight Given our investment time horizons, we prioritise meeting with academics, industry specialists and owners of businesses who think about their strategy, not financial analysts who think about the next quarter’s earnings. With three decades of experience investing in China, we have built relationships as a patient and supportive shareholder and developed strong access to some of the largest and most influential companies. Relationships take time to build but they have been critical in helping us understand China’s ongoing development and the future direction of Chinese businesses. These relationships, often built on trust and reputation over many years, provide access to a range of interesting companies, ensure management teams are aware of our approach and philosophy, and in doing so, help position us and our thinking in a different light to much of the market. This has provided an advantage in our understanding of companies early in their growth stages, and insight into the future challenges and opportunities for companies we hold. 05 --- # Strategic report The Strategic report, which includes pages 6 to 58 and incorporates the Chair's statement, has been prepared in accordance with the Companies Act 2006. --- Baillie Gifford China Growth Trust plc # Chair's statement ![img-5.jpeg](img-5.jpeg) **Nicholas Pink** Chair Appointed to the Board in 2023 and as Chair in 2024 ## Introduction The Board believe that Baillie Gifford China Growth Trust ('the Company') has a unique investment strategy. There is no other open or closed end equity fund offering a China growth style, investment in unlisted companies, prudent gearing, a competitive cost and a commitment to discount management via a buyback and a 100% performance related Conditional Tender Offer ('CTO'). The financial year to 31 January 2026 was a period where all the components of the Company strategy contributed to deliver very strong performance for shareholders. The strong performance over the past year therefore builds on the recovery in the Company's performance, which started in 2024. Whilst Baillie Gifford's long-term investment time horizon is five to ten years, it remains encouraging that the Manager has continued to outperform when conditions for growth investing have been more favourable. In the past year the Board has remained focussed on enhancing shareholder value including scrutiny of the Company's strategy and investment performance, monitoring the prevailing discount at which the shares trade, and undertaking share buybacks (2.9% in financial year to 31 January 2026), renewal of the loan facility and the marketing of the Company. ## Key Performance Indicators ('KPIs') The Company has four KPIs: - Net Asset Value per share total return ('NAV TR') relative to the benchmark - Share price total return relative to the benchmark - the discount of the share price to Net Asset Value ('the discount') - the Ongoing Charges Ratio ('OCR') For a definition of terms, see Glossary of terms and alternative performance measures on pages 126 to 128. See disclaimer on page 124. Past performance is not a guide to future performance. 07 --- Strategic report The Company reported positive progress on all its KPIs. The NAV TR was 34.0%, outperforming the benchmark by 11.8%. The share price total return was 38.8%, also exceeding the benchmark by 16.6%. Encouragingly, the discount of share price to Net Asset Value decreased to 7.4% as at 31 January 2026 (10.4% as at 31 January 2025). The OCR fell to 1.06% in the year to 31 January 2026 (from 1.12% in the financial year to 31 January 2025) due to the higher average Net Asset Value ('NAV') owing to investment gains. In November 2024, the Company announced a CTO based on performance in the four-year period to 30 November 2028. Further details can be found on page 76 of the Annual Report. Since the CTO measurement period commenced (29 November 2024 to 31 January 2026), the NAV TR outperformed the benchmark by 12.4%. The very strong performance over the past two years is therefore sharply reducing the underperformance since the Company's mandate change. Between 16 September 2020 and 31 January 2026, the Company NAV TR and share price total return has underperformed the benchmark by 6.3% and 9.3%, respectively. #### Total Return Performance * | | Year to 31 January 2026 | Since announcement of Conditional Tender Offer † to 31 January 2026 | Since Mandate change # 31 January 2026 | | --- | --- | --- | --- | | NAV TR (%) | 34.0 | 38.9 | -8.2 | | Share price TR (%) | 38.8 | 47.7 | -11.2 | | Benchmark TR ‡ (%) | 22.2 | 26.5 | -1.9 | Whilst Investment Manager Baillie Gifford's investment time horizon is five to ten years, it is very encouraging that the Manager has outperformed the benchmark consistently since August 2024, when conditions for growth investing in China have been favourable. ## Investment Performance China's equity performance in 2025 echoes Lenin's famous saying that 'there are decades when nothing happens; and there are weeks where decades happen'. It arguably marked a turning point in investor attitudes to Chinese equities. The past year saw investors wake-up to the attraction of China's innovation in critical technologies such as EVs, e-commerce, advanced manufacturing and AI, all available at below historic average valuations. This, combined with a re-evaluation of the risk and reward of passive global equity portfolios dominated by US investments, triggered diversification outside the US, including to China, where regulatory risk also receded. These factors provided a tailwind to both the Chinese equity market and growth investing. The Company's performance rebounded significantly in absolute and relative terms. Analysis of the performance drivers shows management of the portfolio consistent with the growth style, evidence of improved stock selection and a contribution from improved valuation and sell discipline. Specifically, outperformance was driven by strong contributions from several of the Manager's highest conviction holdings. Key contributors were ByteDance, Zijin Mining Group, Pop Mart and Zhongji Innolight. Detractors were Meituan, DPC Dash and Sunny Optical Technology. Further detail on investment performance can be found in the Managers' report on page 12. ## Earnings and Dividend In the year to 31 January 2026, the revenue earnings per ordinary share increased by 17.8% from 2.53p to 2.98p. The Company's dividend policy is that any dividend paid will be by way of a final dividend and be not less than the minimum required for the Company to maintain its investment trust status. The Board is proposing a final dividend of 2.50p, an increase of 14%, which, subject to shareholder approval, will be paid on 22 July 2026 to shareholders on the register at the close of business on 19 June 2026, with the shares trading ex-dividend on 18 June 2026. * Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 124. All figures are stated on a total return basis. Total return and discount are alternative performance measures – see Glossary of terms and alternative performance measures on pages 126 to 128. † The Company announced the introduction of a performance related tender offer (the 'Conditional Tender Offer') from 29 November 2024. # Baillie Gifford & Co Limited were appointed as Managers and Company Secretaries on 16 September 2020. ‡ The benchmark is the MSCI China All Shares Index (in sterling terms). 08 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc The increased income partly reflects the continuing improvement in dividend pay-out ratios for portfolio companies because of improved capital discipline. Whilst a positive, Baillie Gifford's focus is on managing the portfolio for total return and most future total returns are expected to be from capital gains. ## Company Strategy In the financial year ending 31 January 2026 the Board reviewed and reaffirmed the relevance of the Company's strategy to shareholders. The annual Strategy Day covered the investment objective, strategy limits, gearing, unlisted investments, discount management, the investment manager's approach to Environmental, Social and Governance research and investment performance. ### Unlisted Investments The Board believe owning unlisted investments benefits shareholders, especially given the Company's closed-end status and Baillie Gifford's expertise in successfully sourcing and investing in private Chinese investments via its close relationships with founders and global investment knowledge. However, trading unlisted investments is more complex due to lower liquidity and the potential need for permission from the investee company to sell to others, depending on individual arrangements. The Company has a limit on unlisted investments of 20% of gross asset value of the Company, measured at the time of investment. When above this figure, the existing investments can continue to be held, but new positions or follow-on investments cannot be made. The Investment Manager, under scrutiny from the Board, closely monitors the proportion of the portfolio invested in unlisted investments and the diversification of the investment portfolio. The Company's primary private investment is ByteDance, which was 10.4% of total assets on 31 January 2026. In September 2025 the manager made a private investment in RedNote, a Chinese lifestyle content and commerce platform. In total, unlisted investments represented 12.2% of total assets as at 31 January 2026 (9.1% as at 31 January 2025). The valuation of private investments is undertaken by Baillie Gifford and supplemented by independent input from S&P Global. This valuation is overseen by the Board at the interim and annual results. The valuation of unlisted investments is an estimate based on the price of recent investments in secondary market trading and peer multiples and revenues. In addition, the Board takes comfort that there is additional information available via ByteDance's annual buybacks. ByteDance made significant progress in 2025, becoming the world's third largest private company measured by most recent funding round*. Since acquisition to 31 January 2026, ByteDance has increased in value 158% in sterling terms and is the largest single contributor to Company outperformance. Whilst the ByteDance IPO is not imminent, it is an indication of the value offered by private investment in China. ### Gearing A prudent level of gearing remains advantageous given that the long-term returns forecast in China equities by Baillie Gifford exceed the cost of debt. The Company is in discussions with lenders regarding renewal of the US$25m loan facility, which is due to mature on 11 April 2026, and the Board does not currently anticipate any issues with its renewal. The Board sets a gearing limit to maintain prudent liquidity and adhere to its loan covenants. The Board is mindful of high volatility in Chinese equities, the portfolio's higher Beta compared to the benchmark and the Company ownership of unlisted investments. Within the Board's limits, Baillie Gifford manages and reports quarterly to the Board on the proposed use of gearing. Net gearing was 3.1% as at 31 January 2026 (3.3% as at 31 January 2025). ### Discount and Premium Management The Board recognises the need to address any sustained and significant imbalance of buyers and sellers which might otherwise lead to shares trading at an anomalous discount or premium to NAV. The Board constantly monitors the level of discount and regularly consults its advisers and shareholders to determine appropriate measures. The Board is committed to using its share purchase and issuance authorities where appropriate to mitigate such imbalances. Details of the Discount/premium policy are on page 33. * Source: Financial Times 5 February, Crunchbase 09 --- Strategic report In the 12 months to 31 January 2026 the Company bought back 1.7m shares representing 2.9% of share capital excluding shares held in Treasury as at 31 January 2025. The buyback was conducted at an average discount of 10.4% and enhanced the NAV per share by 0.3%. The combination of investment performance, the commencement of the share buyback in January 2024 and the introduction of the CTO in November 2024 has significantly reduced the discount level and its volatility since 2023. The average discount of share price to NAV has reduced from 11.3% in the year to 31 January 2025 to 9.6% in the year to 31 January 2026 and the discount was significantly less volatile over the year. ## China Risks Risks related to investing in China are difficult to diversify given the single country mandate and could adversely affect companies held within the portfolio. These comprise the economic outlook and geopolitical risks, including the potential impact of sanctions. The Board evaluates the risks with Baillie Gifford and, where appropriate, with input from external advisers and experts. A summary of Principal Risks is on page 35. ## Marketing The Board co-funds marketing with Baillie Gifford. This includes the website (bailliegiffordchinagrowthtrust.com) and digital content from Baillie Gifford. During the year the Board wrote to all shareholders who hold their shares via the large investment platforms to invite them to sign-up for updates from the Company. If you've not already signed up but would like to do so, please scan the QR code located on the back cover of this Annual Report. In addition, the Board continued to fund a programme of marketing targeting regional wealth managers via its broker. ## The Board There were no changes to the Board during the year, and the Board remains fully compliant with both the Parker review and the FTSE Women Leaders Review. The Board has disclosed its ethnic diversity within the Corporate Governance Statement in the Company's Annual Report on page 71. The Board conducted an internal review of Board performance and concluded it was operating effectively. ## Annual General Meeting (the 'AGM') The AGM will be held at 1 Moorgate Pl, City of London, London, EC2R 6EA on Wednesday 27 May 2026, at 2pm. A presentation from Baillie Gifford will be included and all shareholders are invited to attend. The Board encourages all shareholders to exercise their votes on the AGM resolutions by completing and submitting the form of proxy elections in advance of the meeting and submitting any questions by emailing enquiries@bailliegifford.com or by calling 0800 917 2113. ## Outlook Whilst the re-rating over the past two years has eliminated China equity market's historical valuation discount, the Board remains positive about the Company's prospects. Firstly, China's ongoing structural transformation continues to offer compelling opportunities for the Company's strategy of owning a concentrated portfolio of China's most innovative growth stocks. The Company has exposure to China's growing dominance in critical technologies such as energy transition, e-commerce, advanced manufacturing and AI. Secondly, whilst China stock valuations have increased to just above the long-term average in the past two years, and the portfolio's valuation, as measured by the price earnings ratio, is higher than the benchmark, the Company's holdings are forecasted to deliver nearly double the benchmark's earnings growth over the next three years. It is a comfort that the portfolio's concentration in higher valuation names is significantly lower than at past market peaks. Thirdly, there is potential upside from earnings growth in innovation-led growth companies, stabilisation of the property market and a recovery in consumption, further government stimulus, a continued truce in US-China relations and greater allocation to China equities by both foreign and domestic investors. 10 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc However, there are also risks to investing in the Company, which can lead to volatility and drawdowns. These include a deterioration in US-China relations, continuing geopolitical tension, portfolio concentration in AI related businesses and deflation in China. The discount the portfolio trades to global equities is arguably a comfort, as investors re-assess the risk-reward of passive global equity portfolios dominated by US technology companies. Additionally, the Company’s effective discount control through the share buyback and CTO provide some protection against discount widening to shareholders until November 2028. The Board therefore continue to believe that a holding in the Company remains an attractive part of an investor’s long-term global equity allocation. Nicholas Pink Chair 31 March 2026 11 --- Strategic report # Managers' report Over the past 12 months, the Company delivered its second consecutive year of strong performance for shareholders. In a year when China's macro backdrop continued to evolve, the market increasingly rewarded genuine corporate progress and innovation, and the Company captured that strength particularly well. For the 12 months to 31 January 2026, the Company returned 34.0% on a NAV total return basis and 38.8% on a share price total return basis, comfortably ahead of the 22.2% benchmark return. ## Looking back on 2025: the Chinese economy In 2025, China delivered a steady but distinctly two-speed expansion. Real GDP grew by 5.0%, broadly in line with the official target, though momentum eased as the year progressed. The year is best understood less as a simple slowdown and more as a transition away from a property-led growth model toward one driven by productivity, innovation and new forms of consumption. While uneven, this shift matters for investors as it reshapes the picture of where long-term growth opportunities will emerge. Exports and industrial activity once again provided resilience. Goods trade increased 3.8% in value terms, with exports rising 6.1%, supported by continued diversification toward Belt and Road Initiative (BRI) partner countries, which accounted for just over half of total trade. BRI countries are those that have signed a BRI cooperation document (often Memorandums of Understanding) with China. China's official messaging commonly frames this as 'over 150 countries and over 30 international organisations' having signed BRI cooperation documents. Hi-tech exports rose 13.2%, reflecting China's growing presence in higher-value manufacturing. This was echoed in production. Industrial value added grew 5.9%, led by equipment manufacturing and hi-tech industries. Output growth in areas such as 3D-printing devices (+52.5%), industrial robots (+28.0%) and new energy vehicles (+25.1%) highlighted how quickly 'innovation at scale' is translating into real productive capacity. China's response to demographic and cost pressures has increasingly been automation and digitisation, and the country is now the world's largest industrial-robot market, accounting for more than half of global installations. Another notable development was the extension of China's external footprint beyond traditional 'hard goods' into higher-value technology, brands and intellectual property. CATL (a holding in the portfolio) remained emblematic of this shift, supplying batteries for around one-third of new electric vehicles globally and a similar share of grid-scale energy storage systems. In consumer culture, companies such as Pop Mart illustrated how Chinese design and intellectual property are increasingly resonating with overseas consumers. Domestic consumption improved modestly but remained uneven. Retail sales grew 3.7% for the year, with online channels continuing to outperform. Targeted policy support was visible in categories linked to trade-in programmes, including communication equipment (+20.9%) and household appliances and audio-visual equipment (+11.0%). Momentum, however, softened toward year-end, and weak pricing conditions persisted, with flat consumer prices and declining producer prices (-2.6%), reinforcing a sense of 'real growth but weak nominal momentum'. For a definition of terms see Glossary of terms and alternative performance measures on pages 126 to 128. Past performance is not a guide to future performance. 12 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Confidence remained the key constraint, closely tied to housing. The property downturn continued to weigh on activity, with real-estate development investment down 17.2%, floor space sold down 8.7%, and new starts down 20.4%. This helps explain subdued fixed-asset investment (-3.8%) and private investment (-6.4%), even as 'upgrading' activity persisted in areas such as equipment and technology, where investment rose 11.8%. Policy signals during the year helped stabilise expectations. Support for the private sector became clearer, fiscal policy adopted a more proactive stance, and official messaging increasingly emphasised consumption as a strategic priority, acknowledging the limits of investment-led growth amid overcapacities. However, we do not expect a large, credit-fuelled stimulus of the kind seen in past cycles. The more realistic path is continued targeted support, aimed first at preventing further deterioration in the property market and gradually improving household confidence, alongside selective consumption incentives. In our view, this makes the recovery more likely to be steady and uneven, rather than rapid. With households holding substantial savings, the potential for a gradual shift toward spending or longer-duration financial assets remains an important swing factor for the outlook. Household deposits exceeded roughly RMB 160tn (about US$22tn vs China's economy of US$30tn) by mid-2025 and continued to rise through the year. It means even a modest change in behaviour at the margin can become macro-relevant. Finally, 2025 was a year in which innovation became increasingly visible in day-to-day economic activity. In AI, the emergence of tools such as DeepSeek and the rapid proliferation of generative applications underscore the speed of the Chinese ecosystem's evolution, supported by intense competition and policy momentum. ## AI for China Artificial intelligence became a defining theme for China in 2025, moving decisively from experimentation to deployment. For policymakers, AI is increasingly viewed as a strategic lever to lift productivity, upgrade industry and offset structural headwinds such as the ageing demographic. For companies, the focus has shifted from demonstrating technical capability to embedding AI into products, services and workflows at scale. From our perspective as long-term investors, this transition from capability to application is what ultimately matters. China's national AI strategy places less emphasis on a single 'breakthrough moment' and more on diffusion, the broad rollout of AI across manufacturing, services and everyday economic activity. This approach plays to China's strengths: scale, speed of iteration and the ability to integrate software into physical systems. Rather than being confined to a small number of frontier labs, AI in China is increasingly appearing in factories, devices, enterprise tools, and consumer platforms. In Shenzhen, a visit to private company Bambu Lab (not a holding in the portfolio) captured this shift perfectly. China produces around 90% of the world's consumer-grade 3D printers, with much of that manufacturing concentrated in Shenzhen, giving companies such as Bambu an unusually dense ecosystem of suppliers, engineers and rapid iteration loops. Rather than talking about AI in abstract terms, the team showed us how a small on-device neural network, essentially a compact digital brain built directly into the printer's hardware, quietly monitors a print as it runs. This can detect 'spaghetti' failures (prints that detach or misprint, leaving a nest of extruded filament) in real time and can intervene before material and time are wasted. 13 --- Strategic report It was a modest moment, but a powerful one: AI not as a headline feature, but as something that simply makes everyday tools work better. More broadly, it reflected how China's supply chains and engineering talent allow hardware, software and AI to be combined and improved at remarkable speed. Portfolio holding Tencent also offers a distinctive form of AI leverage through gaming. As the world's leading game development, publishing and operations platform, it is using AI not only to build games, but to provide AI-enabled tools and services that make game creation faster and cheaper. Tencent highlighted GiiNEX, its generative game AI engine, designed to support developers throughout the production pipeline. In Tencent's own examples, GiiNEX can compress tasks such as city modelling from days to minutes and accelerate testing and simulation, which are often major bottlenecks in modern game production. Alongside this, Tencent's GCloud platform packages a range of game technologies, solutions and services for development and operations, reinforcing the idea of 'gaming-as-a-service' where Tencent can monetise not just content, but the underlying toolchain that powers it. In autonomous driving, our time spent with portfolio company Horizon Robotics underscored how AI is being shaped for China's real-world driving conditions. What stood out was the company's pragmatic focus on shipping capability, not promises: Horizon emphasised advanced driver-assistance systems that can be deployed at scale by domestic automakers today, then improved quickly through feedback from large volumes of real driving data. In an environment as complex as China's roads, this step-by-step approach felt both commercially grounded and technically credible. Over time, as Chinese automakers expand overseas, we believe this software-and-compute stack has the potential to travel with them – turning domestic scale into a meaningful globalisation opportunity. A visit to private company Unitree (not a holding in the portfolio) offered a different but equally striking perspective on China's robotics ambitions. Watching a humanoid robot walk, balance and recover from external pushes was impressive, but the more revealing insight came from the discussion around cost. Unitree's emphasis is not only on capability but also on making robots affordable enough to be widely deployed, a key philosophy that mirrors China's broader approach to technology diffusion. The ambition is not to build a handful of showcase machines, but to drive down costs so that humanoid and quadruped robots can move from demonstrations into industrial, commercial, and eventually consumer use. Doubao owned by ByteDance (our largest unlisted holding in the portfolio), is also a useful illustration of how quickly AI can diffuse in China when paired with strong product design and distribution. By late December 2025, multiple reports citing ByteDance internal data suggested Doubao's daily active users had surpassed 100 million, achieved with unusually low user-acquisition and marketing spend for a product of that scale. What we found striking on the ground was how this growth has been driven: Doubao's creative tools – such as image and video generation – are designed for sharing, and ByteDance can place them directly into the everyday 'habits' people already have across its ecosystem. In other words, adoption is increasingly being pulled by usefulness and social sharing, rather than pushed by novelty – an important distinction if AI is to become part of daily life at a national scale. 14 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Time spent with MiniMax, a newer holding of the Company, reinforced the idea that constraints can shape behaviour constructively. MiniMax is building cutting-edge foundation models and turning them into real products – spanning text, image, video and audio generation – bringing powerful generative AI tools to consumers and businesses at scale. Management emphasised competing on efficiency, delivering models strong enough for the vast majority of real-world use cases at a fraction of the cost of leading US offerings. In a recent interview, the founder described an ambition to achieve roughly 90% of the capability at around one-tenth the cost, reflecting how price-sensitive many users and enterprises are. As ‘inference’ (using a trained model to answer questions or generate outputs, not training it) becomes the dominant driver of compute demand, this emphasis on deployment cost, optimisation and long context practicality increasingly looks like a durable advantage. We believe China’s long-term position in AI rests on reinforcing strengths that favour diffusion at scale. Powerful platform distribution and intense domestic competition create rapid feedback loops, helping AI move quickly from novelty to habit. China can also integrate AI into the physical economy, devices, factories and supply chains, where productivity gains can be tangible and durable. China’s talent density is another advantage. NVIDIA chief executive Jensen Huang has remarked that around half of the world’s AI researchers are Chinese, and Stanford’s 2025 AI Index estimates that China accounts for around 70% of granted AI patents. Finally, AI is an energy-intensive technology. China’s scale in renewables and leadership in the clean-energy supply chain mean electricity can be materially cheaper. In some regions, it is reportedly around half US levels, supporting lower-cost training and, increasingly, inference at scale. Grid-scale storage is a crucial enabler of that system, and CATL’s leadership in energy storage is an important piece of the puzzle. But transmission matters just as much: China has built around 8,200 miles of ultra-high-voltage lines, far outstripping the US at roughly 375 miles. Our approach to AI exposure remains pragmatic. Rather than attempting to identify a single ‘winner’ at the model layer, we focus on companies with durable distribution, data advantages and clear paths to monetising AI within existing business models. This underpins our continued conviction in holdings such as Tencent, Alibaba and ByteDance, alongside selective exposure to emerging AI specialists such as MiniMax. AI is a marathon, not a sprint. China’s advantage is unlikely to be defined by a single moment or model, but by its ability to deploy AI broadly, efficiently and at scale. Based on what we saw through 2025, that diffusion is already underway – and it has the potential to become an important driver of productivity and value creation over time. Importantly, AI is not only a US–China contest. Much of the next wave of adoption is likely to come from the rest of the world, particularly emerging markets, where cost, local deployment and language support matter as much as frontier performance. China’s growing ecosystem of open and low-cost models is increasingly being used internationally, allowing developers and businesses to build AI capabilities without relying solely on expensive closed-model APIs. In Africa, for example, Chinese models are gaining traction because they can be deployed more flexibly on local infrastructure and lower the barriers for startups and public services. More broadly, we believe AI’s benefits should not be confined to a handful of countries. It should be a general-purpose technology that can raise productivity and widen opportunities globally. 15 --- Strategic report ## Geopolitics: still a factor, but changing Geopolitics remained a meaningful headwind in 2025, and the first half of the year was volatile. The return of a Trump administration brought an early tariff shock, including a 10% additional tariff on imports from China from early February, and the year saw further tariff signalling and escalation episodes that kept markets on edge. Technology remained the most sensitive arena: US restrictions on advanced chips and AI-related exports continued to tighten and evolve, raising costs and uncertainty for parts of the ecosystem while reinforcing China's push for efficiency and domestic capability-building. Later in the year, the relationship showed signs of tactical de-escalation rather than reconciliation. High-level engagement between the US and China helped reduce the risk of immediate escalation, but the underlying strategic competition in technology and security remains unresolved. As a result, we continue to assume that geopolitical frictions will be a persistent feature of the investment backdrop rather than a one-off episode. A further uncertainty entering 2026 is the Iran-related escalation and the wider Middle East backdrop, which have increased the risk of disruption along key energy and shipping routes, such as the Strait of Hormuz. In the near term, the most direct channel is energy prices and freight/insurance costs, which can affect global inflation and risk appetite and, by extension, emerging-market valuations. Over a 5-10-year horizon, our base case is not to forecast any single outcome, but to assume that periodic flare-ups remain possible and that markets will continue to price a geopolitical risk discount. For the portfolio, most holdings are primarily exposed to domestic Chinese demand rather than to Middle East trade flows; however, higher, more volatile energy prices can still influence consumer confidence and input costs. At the same time, energy insecurity can also reinforce structural tailwinds behind electrification, efficiency, and energy storage, where China has clear competitive strengths and where companies such as CATL are positioned as enablers. Against this backdrop, some idiosyncratic risks effectively resolved. The TikTok situation culminated in a completed US transaction, with the agreed structure involving a US-based entity under non-Chinese control and ByteDance retaining only a minority economic interest. With the deal now confirmed, the previous 'ban vs no ban' binary has given way to a more stable operating framework, materially reducing the likelihood of abrupt disruption relative to earlier periods. Meanwhile, DeepSeek became a fresh geopolitical flashpoint by demonstrating how quickly China's AI capabilities are advancing, intensifying scrutiny in Washington. Sanctions and entity-list risk remain part of the landscape and are inherently difficult to predict. We therefore incorporate sanctions screening and export-control awareness into both pre-investment due diligence and ongoing monitoring, drawing on a combination of internal analysis and third-party risk tools. Overall, we continue to distinguish headline risk from underlying exposure: most portfolio companies derive the majority of revenues from China and other non-US markets, where domestic and regional demand remain the dominant long-term drivers. ## Where does that leave us as growth investors in China? For growth investors, China continues to present a large but highly selective opportunity set. The country is home to a deep pool of innovative, ambitious companies, but the discipline required to convert that opportunity into attractive shareholder returns remains high. The key question is not whether growth exists in China – it clearly does – but whether the expected return is sufficient to compensate for the risks, volatility and uncertainty that accompany investing in this market. From a valuation perspective, the starting point remains supportive, but it is important to be precise about the measure being used. On a headline basis, broad China indices such as the MSCI China were trading in the mid-teens P/E range around end-January 2026, which is around to modestly above some long-run averages depending on the time period chosen and whether one looks at trailing or forward earnings. By contrast, the relative valuation remains attractively discounted: at end-January 2026, MSCI China was trading at roughly a mid-30% P/E discount to MSCI World (c. 16x versus c. 25x). This matters for growth investors because valuation provides both downside protection and the potential for meaningful upside when fundamentals improve. Importantly, today's valuations coincide with a backdrop in which the most disruptive phase of regulatory tightening appears to be behind us, policy direction has become clearer, and several industries, particularly technology, advanced manufacturing, and consumer services, are emerging from cyclical lows. 16 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc However, the opportunity is not broad-based. We believe returns will be driven by a narrower cohort of companies that can combine durable growth with improving capital discipline, clear competitive advantages and the ability to monetise innovation. In areas such as AI, advanced manufacturing, renewable energy systems and selected consumer platforms, we continue to see businesses with the potential to compound value over long time horizons. At the same time, competition within China remains intense, and growth alone is not sufficient. Execution, cost control and return on invested capital matter more than ever. Our experience over recent years has reinforced the importance of valuation discipline and risk awareness within a growth framework. Periods of strong performance can quickly give way to sharp corrections, particularly in a market where sentiment can shift abruptly. Since the enhancements we described last year, we have continued to work closely with Baillie Gifford's Investment Risk team to embed a more systematic set of tools into the portfolio process. These include clearer valuation reference points at purchase, regular monitoring of portfolio-level valuation dispersion, and alerts to identify anomalies where share prices move materially ahead of changes in underlying fundamentals. The benefits are practical rather than theoretical. During the year we used these tools to support measured profit-taking in a small number of holdings after unusually rapid share-price appreciation, and to recycle capital into opportunities where we felt the prospective return was more attractive. This discipline is not intended to dampen returns. Instead, it is designed to improve the quality and durability of those returns through the cycle, while ensuring that we remain long-term owners of exceptional companies without becoming complacent about valuation. At the firm level, Baillie Gifford remains deeply committed to China as a long-term growth opportunity. We continue to invest in local presence, research capability and risk oversight, recognising that successful investing in China requires both long-term conviction and on-the-ground understanding. Our approach remains unchanged: to identify a concentrated set of exceptional growth companies, remain patient through volatility, and evolve the portfolio as opportunities and risks change. In summary, we believe China remains a compelling market for growth investors who are willing to be selective, disciplined and long-term in their approach. With valuations still supportive, innovation accelerating across multiple sectors, and confidence showing tentative signs of improvement, we believe the balance of risks and rewards remains attractive for long term investors. ## Portfolio positioning and recent activity We continue to run the Company as a concentrated portfolio of China's most innovative growth businesses, typically holding 40–80 companies selected from an investable universe of thousands. The portfolio remains differentiated, with an active share of 62% and a one-year standard turnover of 19.1%, consistent with our long-term investment horizon. At a portfolio level, we aim to keep the Company anchored in structural growth, particularly the platform economy powered by AI, consumer brands, advanced manufacturing and the energy transition, while remaining selective in areas where we see fewer attractive growth opportunities. Portfolio activity throughout the year was purposeful rather than frequent. We used market dislocations to refine the portfolio – adding where we saw durable compounding at attractive prices and exiting where the growth outlook, risk profile or valuation asymmetry became less compelling. - New holdings included a mix of structural growers and diversifiers: MiniMax (AI), Anta Sports Products, Atour, H World (consumer/services), Didi (mobility), Wanhua Chemical, China Yangtze Power (quality infrastructure/clean power), and selected resources exposure including Tianqi Lithium, Ganfeng Lithium, and Zijin Gold International. - We also continued to evolve our approach to private companies. During the year we added a second private holding, RedNote (Little Red Book), alongside ByteDance. The Company's investment policy permits investment in unlisted securities up to 20% of gross asset value at the time of investment, and our allocation to private companies remains within this limit. RedNote is a consumer internet franchise at the intersection of social discovery and commerce: users come for trusted recommendations and content-led discovery, and merchants come for highly targeted demand generation. Our investment followed a long period of monitoring and repeated engagement with management, reflecting the additional diligence required for private investments, where we focus heavily on governance, incentives, competitive positioning and the durability of monetisation. 17 --- Strategic report - Sales/exits included Li Ning, Proya, Ke Holdings, Robam Appliances, Shanxi Fen Wine, Yonyou, and others where our conviction reduced or where risk/reward became less favourable. Beyond outright exits, we also made selective sizing decisions. For example, we materially trimmed Meituan as competitive intensity in food delivery and instant retail escalated, and we redeployed capital toward opportunities where we judged the prospective return to be more attractive. By the end of the period, the portfolio's top ten investments included Tencent, ByteDance, Alibaba, Ping An, CATL, Zijin Mining, Kweichow Moutai, China Merchants Bank, China Construction Bank, and Weichai Power. It is a combination of platform AI leaders, consumer franchises and energy-transition enablers. Overall, the pattern of activity reflects our intent to keep the portfolio focused on a concentrated set of high-conviction growth franchises, while remaining willing to adjust exposures as fundamentals, valuations and the opportunity cost of capital evolve. ## Performance The Company delivered strong absolute and relative returns. For the 12 months to 31 January 2026, the Company generated a NAV total return of 34.0% and a share price total return of 38.8%, compared with 22.2% for the benchmark. Returns were supported by a broad-based recovery across growth equities in China, with particularly strong contributions from several of our highest-conviction holdings. Platform and AI-related exposure were an important driver as market confidence improved and investors began to re-engage with China's leading private-sector champions. From a sector perspective, relative performance was driven primarily by stock selection, with +8.3% coming from selection effects versus +1.9% from allocation (total relative attribution: +10.4%). In plain terms, allocation reflects where we positioned the portfolio at the sector level, meaning the impact of being overweight or underweight sectors relative to the benchmark. Selection reflects what we owned within those sectors, meaning the impact of choosing individual stocks that performed better or worse than the benchmark's holdings in the same sector. The largest positive sector contributions came from: - Consumer discretionary (+2.1%) – the biggest driver of relative returns. Industrials (+2.1%) – again dominated by selection (+2.2%), with a broadly neutral allocation impact (-0.1%). - Financials (+1.6%) – positive despite a large underweight in the sector (6.2% vs 19.5% index). The contribution came from a combination of allocation (+0.7%) and selection (+0.8%), suggesting that our more selective exposure was helpful relative to the broader sector. - Communication services (+1.4%) – driven mainly by allocation (+1.3%), consistent with our structural overweight to platform leaders. - Materials (+1.1%) and information technology (+0.9%) – both mainly selection-led, reflecting strong stock-specific outcomes. Other notable items: - A small additional tailwind came from capital structure. The Company's modest net gearing added to returns in a rising market, while our low allocation to cash and deposits was a slight drag on relative performance. Taken together, these effects were minor but directionally consistent with the benefit of being more fully invested during a strong year for equities. - Most other sectors were close to neutral, with only consumer staples (-0.1%) slightly negative. Overall, the pattern is encouraging. The performance was not reliant on a single sector call, and the majority of outperformance came from choosing the right businesses within sectors rather than simply being in the 'right' parts of the market. Stock-specific contributors to relative performance were varied. Over the year, the largest positive contributors were: ### ByteDance (+1.70% relative contribution; average weight ~10.3%) ByteDance was the single largest contributor to relative performance and remains the Company's most significant unlisted holding. It represented 10.4% of total assets at 31 January 2026, reflecting both business progress and valuation uplifts. 18 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Over the year, the investment case was supported by continued strong execution in advertising and content monetisation, rapidly scaling AI activity, and the successful completion of the TikTok US transaction. The agreed structure – with TikTok’s US operations housed in a US-based entity under non-Chinese control and ByteDance retaining only a minority economic interest – has reduced regulatory tail risk and provided greater clarity over TikTok’s long-term operating environment in its largest market. In valuation terms, the Company’s interim report noted that ByteDance’s valuation was revised upwards by about 30% in response to double-digit revenue and cash flow growth, a higher valuation backdrop for its listed peer group, and reduced uncertainty around TikTok’s US outlook. Given the deal has now completed, the valuation remains attractive even on a standalone basis, assuming no value for the US business. This is also a good point to reiterate how we value private holdings: the process is overseen by Baillie Gifford’s valuations committee, with independent input from S&P Global, and is monitored for “trigger events”, such as material corporate or regulatory developments, that warrant updates between regular cycles. US-related uncertainty (TikTok) remained a key swing factor for sentiment, but the risk profile became less binary as deadlines were repeatedly extended and negotiations continued, allowing investors to place a less punitive value on the US option than in earlier periods. We do not assume a definitive resolution is “done” until agreements are finalised and implemented, but we also note that our conviction in ByteDance does not depend on the US business: as stated previously, we continue to view the growth opportunity and current valuation as attractive even excluding the US operations. Finally, on position size: the Company’s investment policy limits any individual holding to the lower of 20% or the benchmark weight plus 7.5%, measured at the time of investment. Within those parameters, we remain comfortable with ByteDance as a large holding given its scale, cash generation and reinvestment capacity, and we continue to monitor it closely through our private valuation framework and ongoing fundamental engagement. #### **Zijin Mining (H-shares) (+1.62% relative contribution; active weight ~+1.94%)** Zijin Mining was a significant contributor over the year. The shares benefited from a constructive backdrop for metals, particularly gold and copper, alongside continued operational delivery and progress on asset development. Our overweight position versus the index was the main driver of the relative contribution. In addition, investor sentiment was supported by corporate actions during the period, including the planned separation and listing of Zijin Gold International (also a portfolio holding), which helped to crystallise value and increase focus on the group’s fast-growing gold business. #### **Pop Mart (+1.46% relative contribution; active weight ~+2.28%)** Pop Mart’s contribution reflected both strong underlying momentum and a continuing internationalisation story. Demand for its IP – especially its character Labubu – helped drive rapid overseas growth, reinforcing the thesis that this is not simply a domestic toy company, but an IP-led consumer platform with growing global resonance. #### **Zhongji Innolight (+1.30% relative contribution; active weight ~+0.76%)** Zhongji Innolight was also a meaningful positive contributor. The shares delivered an exceptional return over the year (+437%), and our overweight position versus the benchmark translated this into a sizeable relative contribution (+1.3%). Innolight is a leader in high-speed optical transceivers – critical components in AI training clusters and data centre networks. It has benefited from sustained growth in global AI-related capex and demand for higher-bandwidth connectivity. Following such a rapid share price move, we trimmed the position to realise some gains and reallocated capital to other opportunities with more attractive prospective returns. The three largest detractors were: #### **Meituan (-0.57% relative contribution; active weight ~+0.90%)** Meituan was the largest detractor as competition in local services intensified, weighing on near-term margin expectations and investor sentiment. While we remain positive on Meituan’s long-term position in local commerce and fulfilment, 2025 reminded us that competitive cycles in China can be sharp, and markets often discount near-term pressure quickly. We did reduce our position meaningfully in the middle of the year to take some profit from its strong performance last year. 19 --- Strategic report # **DPC Dash (-0.46% relative contribution; average weight +0.43%)** DPC Dash detracted as the market focused on the costs of expansion and the path to sustainable profitability. Despite progress in execution and brand momentum, investor concerns around operating leverage and the pace of store rollout weighed on the shares during the period. # **Sunny Optical Technology (-0.41% relative contribution; active weight ~+1.18%)** Sunny Optical Technology was affected amid a weaker demand environment for parts of consumer electronics and ongoing pricing pressure across components. While longer-term opportunities in automotive optics and higher-value modules remain attractive, the year highlighted how cyclical end markets can still dominate short-term performance. # **Outlook for 2026** As we look ahead to 2026, our outlook for China is shaped less by any single macro forecast and more by the direction of travel that became clearer through 2025. China's transition toward a growth model led by innovation, productivity and consumption remains uneven, but it is progressing. It is increasingly showing up in company-level outcomes. Policy is likely to remain supportive but pragmatic. We do not expect a sudden credit-fuelled rebound or a return to the excesses of past cycles. Instead, the focus should remain on stabilising confidence, particularly in housing, while directing resources toward strategic priorities such as advanced manufacturing, AI, clean energy, automation and healthcare innovation. Incremental progress is the more likely path, but incremental change can still be powerful in an economy of China's scale. Domestic demand remains the key swing factor. The lessons of 2025 reinforced that confidence, rather than capacity, is the binding constraint. With household balance sheets strong and savings substantial, even modest improvements in sentiment could translate into meaningful momentum. A stabilising property market, clearer policy messaging and improving labour-market dynamics would support this process. The timing is uncertain, but the asymmetry is notable: small shifts in behaviour can have outsized effects. Innovation will remain central to China's growth trajectory in 2026. What changed in 2025 is that innovation is increasingly visible in deployment. AI is moving from experimentation to application across platforms, enterprises and physical systems. As AI diffusion accelerates, factors such as scale, integration with manufacturing and access to low-cost clean energy are likely to matter as much as headline breakthroughs. Over time, we believe this can support productivity gains and new profit pools across multiple sectors. Geopolitical uncertainty will continue to influence sentiment and valuations. However, recent experience suggests these risks are persistent rather than paralysing. Trade patterns are diversifying, companies are adapting their structures, and China's domestic market remains large enough to support long-term growth for many businesses. This reinforces the importance of distinguishing between headline risk and underlying economic exposure. Valuations remain an important part of the opportunity. Despite two consecutive years of strong performance, Chinese equities continue to trade at a meaningful discount to global markets. While the US market (60% of global indices) continues to trade at elevated levels, Chinese equities offer a compelling absolute value proposition. Currently, major Chinese indices are trading at P/E levels of approximately 16x, well within their historical range of 10x to 25x. Beyond these low entry points, BG's conviction rests on the 'growth-inflection' potential within our portfolio. Using our investment risk matrix, we identify 'outlier' companies in sectors like AI, automation, and core technology that possess the fundamental characteristics to double in value over a five-year horizon. We believe the market is currently underestimating the compounding power of these domestic champions, providing a margin of safety on an absolute basis while offering significant upside from structural growth. 20 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc If policy execution continues to improve and confidence stabilises, there is scope for valuation normalisation alongside earnings growth, particularly for high-quality growth companies with durable competitive advantages. For the Company, our focus in 2026 remains unchanged. We aim to own a concentrated portfolio of exceptional Chinese growth companies, remain disciplined on valuation and risk, and look beyond near-term volatility. The past year reinforced that patience, selectivity and long-term conviction matter in China. While challenges remain, the lessons of 2025 leave us cautiously optimistic that the balance of risks and rewards continues to improve for long-term growth investors. Linda Lin Sophie Earnshaw Baillie Gifford & Co 31 March 2026 21 --- Strategic report # Review of investments **A review of the Company's ten largest investments as at 31 January 2026.** ![img-6.jpeg](img-6.jpeg) © Alamy Stock Photo ![img-7.jpeg](img-7.jpeg) © AFP/Getty Images ## Tencent Tencent is a leading social media and entertainment platform. It has a dominant position in online gaming and an ecosystem in WeChat that we believe is one of the strongest in China. Monetisation of WeChat's over one billion monthly active users represents one growth driver for the company. Further growth opportunities are provided by Tencent's strong positions in cloud infrastructure and consumer and SME lending, along with its portfolio of investee companies which span online music streaming, ecommerce, and short form video. Pony Ma, the founder and Chairman of the company, is indelibly focused on the long term and has executed exceptionally well in one of China's fastest moving industries. ## ByteDance ByteDance is a social media and short form video company and it represents the Company's first private investment. It was founded in 2012 by Yiming Zhang and the company has grown to rank amongst the world's largest companies of its kind. Its short form video app, Douyin, is a market leader in China, and TikTok, its global equivalent, is dominating the format globally. ByteDance benefits from a technological edge in machine learning which it uses to bring out new applications tailored to different media forms and different demographics. The company's ability to innovate in this space is exceptional and we believe one of the key drivers of its likely future success. We believe ByteDance has the potential to be a generation defining media company. | Valuation at 31 January 2026 ('000) | £24,628 | Valuation at 31 January 2026 ('000) | £21,349 | | --- | --- | --- | --- | | % of total investments at 31 January 2026 | 12.1 | % of total investments at 31 January 2026 | 10.5 | | Valuation at 31 January 2025 ('000) | £19,013 | Valuation at 31 January 2025 ('000) | £14,429 | | % of total investments at 31 January 2025 | 11.9 | % of total investments at 31 January 2025 | 9.1 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£924) | Net purchases/(sales) in year to 31 January 2026 ('000) | Nil | 22 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ![img-8.jpeg](img-8.jpeg) © China News Service/Getty Images ### Alibaba Alibaba is a leading online retailer. Its ecommerce business is returning to growth after a period of intensified competition and share loss. Steadily increasing online penetration in segments such as grocery and Fast Moving Consumer Goods remains a long term driver for the business, whilst the company's efforts to integrate live streaming and social media into the platform aim to revitalise the platform following stiff competition for customers' and merchants' attention from competitors. In addition, Alibaba retains a strong position in infrastructure as a service, or the cloud, where it has a similar business to Amazon Web Services. The company has taken the decision to focus on profitable growth as opposed to growth at any cost. Alibaba's partnership structure and its capable and experienced management team are well-aligned with shareholders. ![img-9.jpeg](img-9.jpeg) ### Ping An Insurance Ping An Insurance is one of China's leading financial services groups. It is China's second largest life insurer, a market with growth potential driven by China's emerging middle class and rising disposable income. It also has a leading position in property and casualty insurance where it has consistently delivered strong returns. In addition, it has consistently invested in artificial intelligence and machine learning in order to increase the efficiency and long-term viability of its core business. Again, this is a company with a long-term, growth mind-set that we believe will deliver substantial returns to shareholders. ![img-10.jpeg](img-10.jpeg) ### CATL CATL is a Chinese manufacturer of lithium-ion battery cells with dominant market share both in cathode chemistries (LFP) and form factors (prismatic) batteries which are poised to grow through electric vehicle (EV) uptake and energy storage. The company is a national champion in China, which is the world's largest EV and electricity generation market, and it is well aligned with the state's decarbonisation objectives and emphasis on Chinese self-sufficiency in the hard sciences and technology. Beyond its home market, CATL's future growth could be further fuelled by its operations in Europe where it already has a manufacturing presence and its presence in other emerging markets. We like the magnitude and duration of the growth opportunity combined with CATL's market leadership, which we believe can prove defensible thanks to the company's partnerships with a wide variety of automakers who are making the shift to electric vehicles and relying on CATL's cell-to-pack battery technology to do so. | Valuation at 31 January 2026 ('000) | £16,939 | Valuation at 31 January 2026 ('000) | £8,376 | Valuation at 31 January 2026 ('000) | £6,537 | | --- | --- | --- | --- | --- | --- | | % of total investments at 31 January 2026 | 8.3 | % of total investments at 31 January 2026 | 4.1 | % of total investments at 31 January 2026 | 3.2 | | Valuation at 31 January 2025 ('000) | £9,679 | Valuation at 31 January 2025 ('000) | £4,984 | Valuation at 31 January 2025 ('000) | £5,315 | | % of total investments at 31 January 2025 | 6.1 | % of total investments at 31 January 2025 | 3.1 | % of total investments at 31 January 2025 | 3.3 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£778) | Net purchases/(sales) in year to 31 January 2026 ('000) | £739 | Net purchases/(sales) in year to 31 January 2026 ('000) | (£122) | 23 --- Strategic report ![img-11.jpeg](img-11.jpeg) ![img-12.jpeg](img-12.jpeg) © VCG/Getty Images ![img-13.jpeg](img-13.jpeg) ### Zijin Mining Group Zijin is a Chinese mining company that has been active in overseas acquisitions in recent years and is now present in 12 countries with exposure to an exciting portfolio of growth assets. The historic focus has been on gold but is now shifting to copper, where production is forecast to double over the next few years helped in particular by the company's exposure to the world-class, low-cost Kamoa-Kakula project in the DRC. Copper demand is likely to remain elevated amid the transition to net-zero, and given the potential supply constraints involved in meeting such demand, we feel that Zijin has an important role to play as an enabler of green infrastructure. We do not think the upside to the commodity price, nor Zijin's growth potential, is being adequately factored in by the market, and we also think that the company suffers from an unfair ESG discount given the improvement that we have observed in transparency and reporting. ### Kweichow Moutai Kweichow Moutai is one of the most important and iconic Chinese brands. It manufactures premium baijiu (white alcohol) which has a heritage and respect embedded within Chinese culture. Its unique brewing conditions and process provide a core competitive advantage. When combined with supply scarcity and limited competition in the very high-end market, Moutai is able to price at a premium and maintain a loyal customer base. It is an extremely profitable business. We believe in the strength and heritage of the brand, the sustainability of revenue growth, and the longevity of its core competitive advantage. ### China Merchants Bank China Merchants Bank is a leading consumer bank in China with a lengthy track record and solid market share. It has outcompeted its state-owned rivals via a relentless focus on the consumer. As such, it has built up an enviable position in consumer lending and in wealth management, both segments with strong growth potential. In terms of lending quality, this has been strong through the cycle and we believe this is a bank that will continue to offer attractive returns to shareholders. | Valuation at 31 January 2026 ('000) | £6,514 | | --- | --- | | % of total investments at 31 January 2026 | 3.2 | | Valuation at 31 January 2025 ('000) | £2,909 | | % of total investments at 31 January 2025 | 1.8 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£259) | | Valuation at 31 January 2026 ('000) | £5,426 | | --- | --- | | % of total investments at 31 January 2026 | 2.7 | | Valuation at 31 January 2025 ('000) | £6,268 | | % of total investments at 31 January 2025 | 3.9 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£514) | | Valuation at 31 January 2026 ('000) | £4,870 | | --- | --- | | % of total investments at 31 January 2026 | 2.4 | | Valuation at 31 January 2025 ('000) | £5,057 | | % of total investments at 31 January 2025 | 3.2 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£242) | 24 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ![img-14.jpeg](img-14.jpeg) ### China Construction Bank Corporation We bought CCB because we think China's banking sector is closer to a profitability trough than the market implies. Over the past decade, shadow banking has been curtailed and legacy losses absorbed. Profitability has compressed as margins have fallen, fees have been cut, and the sector has been forced to absorb a certain degree of directed lending. However, recent steps such as recapitalisations and deposit-rate cuts suggest that the burden is starting to ease, while valuations remain very low (around 0.5x price to book). In that context, we believe banks like CCB with strong retail franchises benefit from the best risk-adjusted books; CCB stands out for its scale in wealth/custody, deep urban footprint, prime mortgage exposure, strong cost discipline and relatively sticky low-cost deposits. These factors give it a better chance to defend margins and stabilise returns. Even assuming no rerating, a c. 5% dividend yield plus modest earnings resilience offers a credible path to double-digit total returns. ![img-15.jpeg](img-15.jpeg) ### Weichai Power Weichai Power is a state-owned enterprise with 35-40% market share in diesel engines. Its products have been widely adopted for truck makers, buses, construction machinery and industrial equipment. Heavy duty truck engines represent roughly two thirds of revenues and profits. Weichai is expected to benefit from continued development in China's industrial and infrastructure sectors. In addition to the core engine business, Weichai also makes heavy duty trucks through its fully-owned subsidiary, Shaanqi, and has a presence in global warehouse logistics and automation via a majority stake in German forklift maker Kion. Future growth is likely to come from diversification into new products and markets both via expanding engine types and entering new markets. | Valuation at 31 January 2026 ('000) | £4,818 | | --- | --- | | % of total investments at 31 January 2026 | 2.4 | | Valuation at 31 January 2025 ('000) | - | | % of total investments at 31 January 2025 | - | | Net purchases/(sales) in year to 31 January 2026 ('000) | £4,902 | | Valuation at 31 January 2026 ('000) | £4,737 | | --- | --- | | % of total investments at 31 January 2026 | 2.3 | | Valuation at 31 January 2025 ('000) | £2,715 | | % of total investments at 31 January 2025 | 1.7 | | Net purchases/(sales) in year to 31 January 2026 ('000) | (£81) | 25 --- Strategic report # One year summary **The following information illustrates how Baillie Gifford China Growth Trust has performed over the year to 31 January 2026** | | 31 January 2026 | 31 January 2025 | % change | | --- | --- | --- | --- | | Total adjusted assets (before deduction of bank loans)* | £205.3m | £159.2m | | | Bank loans | £7.7m | £6.1m | | | Shareholders' funds* | £197.6m | £153.1m | | | Net asset value per ordinary share* | 344.44p | 259.07p | 33.0% | | Share price | 319.00p | 232.00p | 37.5% | | MSCI China All Shares Index (in sterling terms)† | | | 19.3% | | Revenue earnings per ordinary share | 2.98p | 2.53p | | | Dividends paid and payable in respect of the year | 2.50p | 2.20p | | | Ongoing charges†† | 1.06% | 1.12% | | | Discount†† | (7.4%) | (10.4%) | | | Active share† | 62% | 68% | | | **Year to 31 January** | **2026** | **2025** | | | **Total return†** | | | | | Net asset value per ordinary share | 34.0% | 35.4% | | | Share price | 38.8% | 29.4% | | | Benchmark‡ | 22.2% | 32.4% | | * For a definition of terms see Glossary of terms and alternative performance measures on pages 126 to 128. † Key Performance Indicator. ‡ The benchmark is the MSCI China All Shares Index (in sterling terms). † Alternative performance measure – see Glossary of terms and alternative performance measures on pages 126 to 128. Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 124. Past performance is not a guide to future performance. 26 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc | Year to 31 January | 2026 | 2026 | 2025 | 2025 | | --- | --- | --- | --- | --- | | Year's high and low | High | Low | High | Low | | Net asset value per ordinary share | 355.69p | 255.52p | 285.19p | 193.64p | | Share price | 322.00p | 223.00p | 253.00p | 176.00p | | (Discount)/ premium^{†} | (6.1%) | (14.8%) | (6.3%) | (15.7%) | | Year to 31 January | 2026 | 2025 | | --- | --- | --- | | **Net return per ordinary share** | | | | Revenue | 2.98p | 2.53p | | Capital | 83.83p | 64.39p | | **Total** | **86.81p** | **66.92p** | * For a definition of terms see Glossary of terms and alternative performance measures on pages 126 to 128. † Key Performance Indicator. ‡ The benchmark is the MSCI China All Shares Index (in sterling terms). ¶ Alternative performance measure – see Glossary of terms and alternative performance measures on pages 126 to 128. Source: LSEG/Baillie Gifford and relevant underlying index providers. See disclaimer on page 124. Past performance is not a guide to future performance. 27 --- Strategic report # Five year summary The following charts indicate how an investment in Baillie Gifford China Growth Trust has performed relative to its benchmark$^{†}$ and its underlying NAV over the five year period to 31 January 2026. ## Five year total return$^{*}$ performance (figures rebased to 100 at 31 January 2020) ![img-16.jpeg](img-16.jpeg) ● Share price total return$^{*}$ ● NAV total return$^{*}$ ● Benchmark$^{†#}$ Source: LSEG/Baillie Gifford and relevant underlying index providers$^{#}$. ## (Discount)/premium$^{*}$ to NAV (figures plotted on a monthly basis) ![img-17.jpeg](img-17.jpeg) ● (Discount)/premium$^{†}$ Source: LSEG/Baillie Gifford. $^{*}$ Alternative performance measure – see Glossary of terms and alternative performance measures on pages 126 to 128. $^{†}$ The benchmark is the MSCI China All Shares Index (in sterling terms), prior to 16 September 2020 the benchmark was MSCI AC Asia ex Pacific Index. Data is chain-linked from 16 September 2020 to form a single comparative index. $^{#}$ See disclaimer on page 124. Past performance is not a guide to future performance. 28 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ### Annual NAV and share price total returns* ![img-18.jpeg](img-18.jpeg) ● NAV total return* ● Share price total return* Source: LSEG/Baillie Gifford. ### Annual NAV and share price total returns† (relative to the benchmark‡ total returns) ![img-19.jpeg](img-19.jpeg) ● NAV total return* ● Share price total return* Source: LSEG/Baillie Gifford and relevant underlying index providers#. * Alternative performance measure – see Glossary of terms and alternative performance measures on pages 126 to 128. † The benchmark is the MSCI China All Shares Index (in sterling terms), prior to 16 September 2020 the benchmark was MSCI AC Asia ex Pacific Index. Data is chain-linked from 16 September 2020 to form a single comparative index. # See disclaimer on page 124. Past performance is not a guide to future performance. 29 --- Strategic report # Ten year record ## Capital | At 31 January | Total assets $'000 | Borrowings $'000 | Shareholders' funds * $'000 | NAV * p | Share price p | (Discount)/ premium * % | | --- | --- | --- | --- | --- | --- | --- | | 2016 | 170,388 | – | 170,388 | 259.3 | 231.0 | (10.9) | | 2017 | 217,035 | – | 217,035 | 333.9 | 286.0 | (14.3) | | 2018 | 244,455 | – | 244,455 | 386.6 | 344.0 | (11.0) | | 2019 | 219,929 | – | 219,929 | 352.5 | 303.0 | (14.1) | | 2020 | 222,208 | – | 222,208 | 363.5 | 333.0 | (8.4) | | 2021 | 271,424 | – | 271,424 | 492.7 | 548.0 | 11.2 | | 2022 | 224,931 | 5,590 | 219,341 | 353.7 | 339.3 | (4.1) | | 2023 | 210,032 | 6,092 | 203,940 | 328.9 | 308.0 | (6.3) | | 2024 | 125,301 | 5,890 | 119,411 | 193.1 | 181.0 | (6.2) | | 2025 | 159,193 | 6,094 | 153,099 | 259.1 | 232.0 | (10.4) | | **2026** | **205,340** | **7,745** | **197,595** | **344.4** | **319.0** | **(7.4)** | ## Revenue | Year to 31 January | Gross revenue $'000 | Available for ordinary shareholders $'000 | Revenue earnings per ordinary share p | Ordinary dividends paid and proposed per share p | Ongoing charges ratio^{†} % | Gearing ratios | | | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | Gearing * % | Gross gearing * % | | 2016 | 4,782 | 2,836 | 4.3 | 4.7 | 1.1 | – | – | | 2017 | 5,004 | 2,880 | 4.4 | 4.8 | 1.0 | – | – | | 2018 | 5,740 | 4,141 | 6.5 | 5.5 | 1.0 | – | – | | 2019 | 6,577 | 4,954 | 7.9 | 7.0 | 1.0 | – | – | | 2020 | 6,073 | 4,412 | 7.2 | 7.2 | 1.1 | – | – | | 2021 | 3,600 | 2,329 | 4.5 | 7.2 | 0.7 | – | – | | 2022 | 1,599 | 592 | 1.0 | 7.2 | 0.7 | 1 | 3 | | 2023 | 2,047 | 1,325 | 2.1 | 1.7 | 0.9 | 3 | 3 | | 2024 | 2,599 | 1,498 | 2.4 | 2.0 | 1.0 | 4 | 5 | | 2025 | 2,718 | 1,529 | 2.5 | 2.2 | 1.1 | 3 | 4 | | **2026** | **3,039** | **1,734** | **3.0** | **2.5** | **1.1** | **3** | **4** | Baillie Gifford & Co Limited were appointed as Managers and Company Secretaries on 16 September 2020. Before 16 September 2020, the Trust was able to invest across the Asia Pacific region rather than solely in China, and had a different comparative index. * For a definition of terms see Glossary of terms and alternative performance measures on pages 126 to 128. † Total operating costs (excluding performance fees) divided by average net asset value. Baillie Gifford was appointed on 16 September 2020 and agreed to waive its management fee for six months from the date of appointment. Without the management fee waiver the ongoing charges for the year to 31 January 2021 would have been 1.0% and the year to 31 January 2022 would have been 0.8%. Past performance is not a guide to future performance. 30 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # **Cumulative performance (taking 2016 as 100)** | At 31 January | Net asset value per share | Net asset value total return * | Share price | Share price total return * | Benchmark † | Benchmark total return *† | | --- | --- | --- | --- | --- | --- | --- | | 2016 | 100 | 100 | 100 | 100 | 100 | 100 | | 2017 | 129 | 131 | 124 | 126 | 132 | 135 | | 2018 | 149 | 153 | 149 | 154 | 151 | 160 | | 2019 | 136 | 142 | 131 | 138 | 139 | 151 | | 2020 | 140 | 149 | 144 | 155 | 147 | 164 | | 2021 | 190 | 206 | 237 | 260 | 175 | 199 | | 2022 | 136 | 151 | 147 | 164 | 137 | 158 | | 2023 | 127 | 142 | 133 | 151 | 131 | 155 | | 2024 | 74 | 84 | 78 | 89 | 89 | 107 | | 2025 | 100 | 114 | 100 | 116 | 114 | 142 | | **2026** | **133** | **152** | **138** | **161** | **136** | **174** | # **Compound annual returns (%)** | 3 year | 2% | 2% | 1% | 2% | 1% | 4% | | --- | --- | --- | --- | --- | --- | --- | | 5 year | (7%) | (6%) | (10%) | (9%) | (5%) | (3%) | | 10 year | 3% | 4% | 3% | 5% | 3% | 6% | Baillie Gifford & Co Limited were appointed as Managers and Company Secretaries on 16 September 2020. Before 16 September 2020, the Trust was able to invest across the Asia Pacific region rather than solely in China, and had a different comparative index. Source: LSEG and underlying index providers. See disclaimer on page 124. * For a definition of terms see Glossary of terms and alternative performance measures on pages 126 to 128. † The benchmark is the MSCI China All Shares Index (in sterling terms), prior to 16 September 2020 the benchmark was MSCI AC Asia ex Pacific Index. Data is chain-linked from 16 September 2020 to form a single comparative index. Past performance is not a guide to future performance. 31 --- Strategic report # Business review ## Business model ### Business and status Baillie Gifford China Growth Trust plc (the 'Company') is a public company limited by shares and is incorporated in England. The Company is an investment company within the meaning of section 833 of the Companies Act 2006 and carries on business as an investment trust. Investment trusts are UK public listed companies and their shares are traded on the London Stock Exchange. They invest in a portfolio of assets in order to spread risk. The Company has a fixed share capital, although, subject to shareholder approval sought annually, it may purchase its own shares or issue shares. The price of the Company's shares is determined, like other listed shares, by supply and demand. The Company has been approved as an investment trust by HM Revenue & Customs subject to the Company continuing to meet the eligibility conditions. The Directors are of the opinion that the Company has continued to conduct its affairs so as to enable it to comply with the ongoing requirements of section 1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011. The Company is an Alternative Investment Fund ('AIF') for the purposes of the UK Alternative Investment Fund Managers Regulations. ### Investment objective To produce long-term capital growth by investing predominantly in shares of, or depository receipts representing the shares of, Chinese companies. ### Investment policy The Company invests predominantly in shares of, or depository receipts representing the shares of, Chinese companies. Chinese companies are companies that have their headquarters in China or that the Investment Manager deems to have a significant part of their operations in China. They may be listed, quoted, or traded on any market, or unlisted. The Company will be actively managed and may invest in companies of any size and in any sector. In furtherance of the Investment policy the portfolio will normally consist principally of quoted equity securities although unlisted companies, fixed interest holdings or other non equity investments may be held. The portfolio will comprise between 40 and 80 listed and unlisted securities. No individual investment will represent a greater weight in the portfolio than, (i) 20%, or (ii) its weight in the MSCI China All Shares Index (in sterling terms) plus 7.5%, whichever is lower as measured at the time of investment. The maximum amount which may be invested in unlisted securities shall not exceed 20% of the gross asset value of the Company, measured at the time of investment. The Company will at all times be invested in several sectors. While there are no specific limits placed on exposure to any one sector, the Company will at all times invest and manage the portfolio in a manner consistent with spreading investment risk. The Company intends to employ gearing in the normal course of events. The Company may in aggregate borrow amounts equalling up to 25% of gross asset value, although the Board expects that borrowings will typically not exceed 20% of gross asset value, in both cases calculated at the time of drawdown. With prior approval of the Board, the Company may use derivatives for the purposes of efficient portfolio management in order to reduce, transfer or eliminate investment risk in the Company's portfolio. Derivative instruments in which the Company may 32 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc invest may include foreign exchange forwards, exchange-listed and over-the-counter options, futures, options on futures, swaps and similar instruments. The Company does not intend to enter into derivative or hedging transactions to mitigate against general currency or interest rate risk. While it is intended that the Company will be fully invested in normal market conditions, the Company may hold cash on deposit or invest on a temporary basis in a range of cash equivalent instruments. There is no restriction on the amount of cash or cash equivalent instruments that the Company may hold. The Company may invest no more than 10%, in aggregate, of gross asset value at the time of acquisition in other listed closed-ended investment funds, but this restriction will not apply to investments in such funds which themselves have stated investment policies to invest no more than 15% of their gross asset value in other closed-ended investment funds. In this case, the limit is 15%. No material change will be made to the Company's Investment Policy without the prior approval by ordinary resolution of the shareholders. ### **Culture** As an externally managed investment company with no employees, Baillie Gifford China Growth Trust's culture is expressed through its Board and its third party service providers, in particular its Managers, in their interactions with shareholders and other stakeholders. The Board's assessment of its own interactions is described in its Section 172 Statement on page 41, and the Baillie Gifford statement on stewardship, which describes the Managers' culture of constructive engagement, is set out on page 52. ### **Dividend policy** The Company's priority is to produce capital growth over the long term. The Company's dividend policy is that any dividend paid will be by way of a final dividend and be not less than the minimum required for the Company to maintain its investment trust status. ### **Discount/premium policy** The Board recognises the need to address any sustained and significant imbalance of buyers and sellers which might otherwise lead to shares trading at an anomalous discount or premium to net asset value per share. While it has not adopted any formal discount or premium targets which would dictate the point at which the Company would seek to purchase shares or issue further shares, the Board is committed to utilising its share purchase and share issuance authorities where appropriate in such a way as to mitigate the effects of any such imbalance. In considering whether buy-back or issuance might be appropriate in any particular set of circumstances, the Board will take into account, inter alia: the prevailing market conditions; whether the discount is substantial relative to the Company's peers; the degree of net asset value accretion that will result from the buy-back or issuance; the cash resources readily available to the Company; the immediate pipeline of investment opportunities open to the Company; and the level of the Company's existing borrowings. ### **Performance** At each Board meeting, the Directors consider a number of performance measures to assess the Company's success in achieving its objectives. 33 --- Strategic report ## Borrowings The Company employs gearing, as set out in the Investment Policy. The Company has in place a two year revolving credit facility for US$25 million with Royal Bank of Scotland (International) Limited which expires on 11 April 2026. The Company is in discussions with lenders regarding renewal of the loan facility, and the Board does not currently anticipate any issues with its renewal. ## Viability statement Having regard to provision 31 of the UK Corporate Governance Code, the Directors have assessed the prospects of the Company over a five year period. The Directors continue to believe this period to be appropriate as it reflects the Company's longer term investment strategy and to be a period during which, in the absence of any material adverse change to the regulatory environment in the UK and/or China and to the tax treatment afforded to UK investment trusts, they do not expect there to be any significant change to the current principal and emerging risks facing the Company nor to the effectiveness of the controls employed to mitigate those risks. Notwithstanding the conditional tender offer announced by the Board on 13 November 2024 in relation to the performance for the four year period to 30 November 2028, the Directors do not reasonably envisage any change in strategy or any events which would prevent the Company from operating over a period of five years. In considering the viability of the Company, the Directors have conducted a robust assessment of each of the principal and emerging risks and uncertainties (including climate change) detailed on pages 35 to 41, in particular the impact of market risk where a significant fall in Chinese equity markets would adversely impact the value of the investment portfolio. The Directors have also considered the Company's leverage and liquidity in the context of the revolving credit facility which expires in April 2026 (which they are seeking to renew) with specific leverage and liquidity stress testing conducted during the year, including consideration of the risk of further market volatility resulting from increasing geopolitical tensions. In addition, the Board and the Managers monitor the covenant levels included in the revolving credit facility regularly. The majority of the Company's investments are listed at present and readily realisable and can be sold to meet its liabilities as they fall due. Borrowings may not exceed 25% of gross asset value, and are not expected to exceed 20% of gross asset value. In addition, all of the key operations required by the Company are outsourced to third party service providers and it is reasonably considered that alternative providers could be engaged at relatively short notice where necessary. Based on the Company's processes for monitoring revenue projections and operating costs, share price discount/premium, the Managers' compliance with the investment objective, asset allocation, the portfolio risk profile, leverage, counterparty exposure, liquidity risk, financial controls and the Managers' operational resilience, the Directors have concluded that there is a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the next five years. 34 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Principal and emerging risks As explained on pages 72 and 73 there is an ongoing process for identifying, evaluating and managing the risks faced by the Company on a regular basis. The Directors have undertaken a robust assessment of the principal and emerging risks facing the Company, including those that would threaten the business model, future performance, solvency or liquidity. There have been no significant changes to the principal risks during the year. A description of these risks, an assessment of the risk level and how they are being managed or mitigated together with the change in assessment of any increase or decrease in risk during the year is set out below: ### Financial risk #### What is the risk? The Company's assets consist mainly of listed securities (87.8% of the investment portfolio) and its principal and emerging financial risks are therefore market related and include market risk (comprising currency risk, interest rate risk and other price risk), liquidity risk and credit risk. An explanation of those risks and how they are managed is contained in note 18 to the Financial Statements on pages 107 to 112. #### How is it managed? The Board has, in particular, considered the impact of heightened market volatility due to macroeconomic factors such as higher inflation and continued high interest rates and geopolitical concerns. In order to oversee this risk, the Board considers at each meeting various metrics including industrial sector weightings, top and bottom stock contributors to performance along with sales and purchases of investments. Individual investments are discussed with the portfolio manager together with general views on the investment markets and sectors. A strategy session is held annually. #### Rating and change #### Current assessment of risk This risk is considered to have increased as market volatility remains due to continuing macroeconomic and geopolitical concerns. ### Investment strategy risk #### What is the risk? Inappropriate business strategy and/or changes in the financial services market leads to lack of demand for the Company's shares and its shares trading at a persistent and anomalous discount to the NAV. Poor investment performance, including through inappropriate asset allocation, leads to value loss for shareholders in comparison to the benchmark or the peer group. #### How is it managed? The Board reviews its strategy at an annual strategy meeting. It considers investor feedback, consults with its broker and reviews its marketing strategy. It regularly reviews its discount/premium policy. The strategy is considered in the context of developments in the wider financial services industry. The performance of the Managers is reviewed at each Board meeting and compared against the benchmark and peer group. Exposures are reviewed against benchmark exposures to identify the highest risk exposures. The Board regularly reviews and monitors the Company's objective and investment policy and strategy. #### Rating and change #### Current assessment of risk During the year the NAV total return was 34.0% compared to the benchmark return of 22.2%. Market conditions for growth stocks typically held by the Company are improving. ![img-20.jpeg](img-20.jpeg) 35 --- Strategic report ## Discount risk ### What is the risk? The discount/premium at which the Company's shares trade relative to its net asset value can change. The risk of a widening discount is that it may undermine investor confidence in the Company. ### How is it managed? To manage this risk, the Board monitors the level of discount/premium at which the shares trade and the Company has authority to buy back its existing shares, when deemed by the Board to be in the best interests of the Company and its shareholders. ### Rating and change ### Current assessment of risk The Company's discount narrowed during the year (see chart on page 28). The Company has been buying back shares during the year to 31 January 2026. On 13 November 2024, the Board announced a conditional tender offer, see page 76. ## Regulatory risk ### What is the risk? Failure to comply with applicable legal and regulatory requirements such as the tax rules for investment trust companies, the UK Listing Rules and the Companies Act could lead to suspension of the Company's Stock Exchange listing, financial penalties, a qualified audit report or the Company being subject to tax on capital gains. Changes to the regulatory environment could negatively impact the Company. ### How is it managed? To mitigate this risk, Baillie Gifford's Business Risk, Internal Audit and Compliance Departments provide regular reports to the Audit Committee on Baillie Gifford's monitoring programmes. Major regulatory change could impose disproportionate compliance burdens on the Company. In such circumstances representation is made to ensure that the special circumstances of investment trusts are recognised. Shareholder documents and announcements, including the Company's published Interim and Annual Report and Financial Statements, are subject to stringent review processes and procedures are in place to ensure adherence to the Transparency Directive and the Market Abuse Directive with reference to inside information. ### Rating and change ### Current assessment of risk All control processes are working effectively. There have been no material regulatory changes that have impacted the Company during the year. ![img-21.jpeg](img-21.jpeg) 36 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Custody and Depositary risk ### What is the risk? Safe custody of the Company's assets may be compromised through control failures by the Depositary, including breaches of cyber security. ### How is it managed? To mitigate this risk, the Audit Committee receives six-monthly reports from the Depositary confirming safe custody of the Company's assets held by the Custodian. Cash and portfolio holdings are independently reconciled to the Custodian's records by the Managers who also agree uncertificated private portfolio holdings to confirmations from investee companies. The Custodian's audited internal controls reports are reviewed by Baillie Gifford's Business Risk Department and a summary of the key points is reported to the Audit Committee and any concerns investigated. In addition, the existence of assets is subject to annual external audit. ### Rating and change ### Current assessment of risk All control procedures are working effectively. ## Operational risk ### What is the risk? Failure of Baillie Gifford's systems or those of other third party service providers could lead to an inability to provide accurate reporting and monitoring or a misappropriation of assets. ### How is it managed? To mitigate this risk, Baillie Gifford has a comprehensive business continuity plan which facilitates continued operation of the business in the event of a service disruption or major disaster. The Audit Committee reviews Baillie Gifford's Report on Internal Controls and the reports by other key third party providers are reviewed by Baillie Gifford on behalf of the Board and a summary of the key points is reported to the Audit Committee and any concerns investigated. In the year under review, the other key third party service providers have not experienced significant operational difficulties affecting their respective services to the Company. ### Rating and change ### Current assessment of risk All control procedures are working effectively. ![img-22.jpeg](img-22.jpeg) 37 --- Strategic report ## Leverage risk ### What is the risk? The Company may utilise borrowings in order to increase its investment exposure. While such leverage\* presents opportunities for increasing total returns, it can also have the opposite effect of increasing losses. If income and capital appreciation on investments acquired with borrowed funds are less than the costs of the leverage, the Company's net asset value will decrease. The use of leverage also increases the investment exposure, which means that if the market moves adversely, the resulting loss to capital would be greater than if leverage were not used. ### How is it managed? Under the Investment Policy, the maximum gearing is 25% of gross assets, though the Company does not expect borrowing to be in excess of 20% of gross assets. All borrowing facilities are approved by the Board and gearing levels are discussed by the Board and the Managers at every meeting. Covenant levels are monitored regularly by the Board and the Managers. The Managers perform biannual liquidity stress tests which are reviewed by the Board to assess the portfolio's ability to meet its obligations under adverse market conditions. ### Rating and change ### Current assessment of risk No significant change in risk level. The Company continues to deploy gearing and has a revolving credit facility in place which expires in April 2026. The Company is in discussions with lenders regarding renewal of the loan facility, and the Board does not currently anticipate any issues with its renewal. ## Climate and governance risk ### What is the risk? As investors place increased emphasis on climate change and other Environmental, Social and Governance ('ESG') issues, perceived problems with these matters in an investee company could lead to that company's shares being less attractive to investors, adversely affecting its share price. In addition, potential valuation issues could arise from any direct impact of the failure to address the ESG weakness on the operations or management of the investee company (for example in the event of an industrial accident or spillage). Repeated failure by the Investment Manager to identify climate/ESG weaknesses in investee companies could lead to the Company's own shares being less attractive to investors, adversely affecting its own share price. ### How is it managed? As described on page 74, the consideration of ESG (including climate change) is a core component of Baillie Gifford's investment process, with the Board overseeing and challenging Baillie Gifford on ESG matters. The Board meets with the Investment Manager and discuss the investment portfolio, including the application of Baillie Gifford's ESG framework. Baillie Gifford's Governance and Sustainability team undertake specific ESG reviews on investment portfolios. ### Rating and change ### Current assessment of risk The Investment Manager continues to employ strong ESG stewardship and engagement policies. ![img-23.jpeg](img-23.jpeg) \* See Glossary of terms and alternative performance measures on pages 126 to 128. 38 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Cyber security risk ### What is the risk? A cyber-attack on Baillie Gifford's network or that of a third party service provider could impact the confidentiality, integrity or availability of data and systems. ### How is it managed? The Audit Committee reviews Reports on Internal Controls published by Baillie Gifford and other third party service providers. Baillie Gifford's Business Risk Department report to the Audit Committee on the effectiveness of information security controls in place at Baillie Gifford and its business continuity framework. Cyber security due diligence is performed by Baillie Gifford on third party service providers which includes a review of crisis management and business continuity frameworks. ### Rating and change ### Current assessment of risk This risk is considered to be increasing due to ongoing geopolitical tensions and an observed increase in malign cyber activity. Emerging technologies, including AI, could potentially increase information security risks. In addition, service providers operate a hybrid approach of remote and office working, thereby increasing the potential of a cyber security threat. ## Single country risk ### What is the risk? The Company invests predominantly in equities of companies which are incorporated or domiciled, or which conduct a significant portion of their business, in China. Investing in a single country is generally considered a higher risk investment strategy than investing more widely, as it exposes the investor to the fluctuations of a single geographical market, in this case the Chinese market. ### How is it managed? The Company's exposure to a single country, China, is an integral part of its investment strategy. Risk is mitigated to a degree by appropriate portfolio diversification and careful analysis of investment opportunities. ### Rating and change ### Current assessment of risk This risk is seen as increasing due to concerns over geopolitical risks. ![img-24.jpeg](img-24.jpeg) 39 --- Strategic report ## Emerging market risk ### What is the risk? Investing in an emerging market such as China subjects the Company to a higher level of market risk than investment in a more developed market. This is due, among other things, to the existence of greater market volatility, lower trading volumes, the risk of political and economic instability, legal and regulatory risks, risks relating to accounting practices, disclosure and settlement, a greater risk of market shut down, standards of corporate governance and more governmental limitations on foreign investment than are typically found in developed markets. Geopolitical tensions between the US and China, in particular relating to Taiwan, remain heightened with the potential for further sanctions to be imposed. Investing in China is often through contractual structures, such as Variable Interest Entities ('VIEs', see Glossary of terms and alternative performance measures on page 128) that are complex and could be open to challenge. ### How is it managed? The Managers are cognisant of the risks associated with investing in emerging markets such as China, and they shape their investment strategy and due diligence accordingly. The Board is kept informed of political and regulatory issues impacting China and the portfolio. The Board monitors the risks associated with any complex investment structures, including the proportion of investments held in VIEs (estimated to be 29% as at 31 January 2026). The Board evaluate sanctions risk with the Manager and where appropriate with input from external advisers. ### Rating and change ### Current assessment of risk Rising concerns over geopolitical risk. ## Unlisted securities risk ### What is the risk? The Company may invest in unlisted securities, which are not readily realisable and are more difficult to value given the absence of a quoted price. There may be less available information and there will be less regulation in respect of disclosures and corporate governance ### How is it managed? Baillie Gifford conducts appropriate due diligence in respect of all unlisted investments, and has an established valuation approach (as described on page 54), which is carefully reviewed by the Board. The Board considers the unlisted investments in the context of the overall investment strategy and provides guidance to the Managers on the maximum exposure to unlisted securities. The investment policy limits the amount which may be invested in unlisted securities to 20% of the total assets of the Company in aggregate, measured at the time of investment. ### Rating and change ### Current assessment of risk No change in assessment of risk. ![img-25.jpeg](img-25.jpeg) 40 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Emerging risk As explained on pages 72 to 74, the Board has regular discussions on principal risks and uncertainties, including any risks which are not an immediate threat but could arise in the longer term. The Board considers that the key emerging risks arise from the interconnectedness of global economies and the related exposure of the investment portfolio to external and emerging threats such as escalating geopolitical tensions, cyber security risks including developing AI and quantum computing capabilities, and new coronavirus variants or similar public health threats. This is mitigated by the Board discussing at each Board meeting the impact of such threats on both markets globally and also more specifically on the Chinese market. This is mitigated by the Managers' close links to the investee companies and their ability to ask questions on contingency plans. The Managers believe the impact of such events may be to slow growth rather than to invalidate the investment rationale over the long term. The Managers monitor certain emerging risks and have established a group to manage the response to any future events that might result in heightened levels of market volatility. Regular exercises are carried out to test the Managers' response to various scenarios. The Company also monitors its service providers to ensure there is adequate business continuity. ### Promoting the success of the Company (section 172 statement) Under section 172 of the Companies Act 2006, the directors of a company must act in the way they consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole, and in doing so have regard (amongst other matters and to the extent applicable) to: a) the likely consequences of any decision in the long term; b) the interests of the company's employees; c) the need to foster the company's business relationships with suppliers, customers and others; d) the impact of the company's operations on the community and the environment; e) the desirability of the company maintaining a reputation for high standards of business conduct; and f) the need to act fairly as between members of the company. In this context and having regard to the Company being an externally-managed investment company with no employees, the Board considers that the Company's key stakeholders to be: its existing and potential new shareholders; its externally-appointed Managers and Secretaries (Baillie Gifford); other professional service providers (corporate broker, registrar, auditors and depositary); lenders; wider society and the environment. The Board considers that the interests of the Company's key stakeholders are aligned, in terms of wishing to see the Company deliver sustainable long-term growth, in line with the Company's stated objective and strategy, and meet the highest standards of legal, regulatory, and commercial conduct, with the differences between stakeholders being merely a matter of emphasis on those elements. 41 --- Strategic report The Board's methods for assessing the Company's progress in the context of its stakeholders' interests are set out below. | Stakeholder | Why we engage | How we engage and what we do | | --- | --- | --- | | Shareholder | Shareholders are, collectively, the Company's owners: providing them with a return for their investment in accordance with the Company's investment policy and objective is the reason for its existence. | The Board places great importance on communication with shareholders. The Annual General Meeting provides an opportunity for the Board and Managers to present to shareholders on the Company's performance, future plans and prospects. It also allows shareholders the opportunity to meet with the Board and Managers and raise questions and concerns. The Chair and Senior Independent Director ('SID') are available to meet with shareholders independently of the Managers as appropriate. The Managers meet regularly with shareholders and their respective representatives, reporting their views back to the Board. Directors also attend certain shareholder presentations, in order to gauge shareholder sentiment first hand. Shareholders may also communicate with members of the Board at any time by writing to them at the Company's registered office or to the Company's broker (see contact details on page 129). These communication opportunities help inform the Board when considering how best to promote the success of the Company for the benefit of all shareholders over the long term. | | Baillie Gifford – Managers and Secretaries | The Company's Board has delegated the management of the Company's portfolio, and the administration of the Company's operations including fulfilment of regulatory and taxation reporting requirements, to Baillie Gifford. Baillie Gifford is therefore responsible for the substantial activities of the Company and has the most immediate influence on its conduct towards the other stakeholders, subject to the oversight and strategic direction provided by the Board. | The Board seeks to engage with its Managers and Secretaries, and other service providers, in a collaborative and collegiate manner, encouraging open and constructive discussion and debate, while also ensuring that appropriate and regular challenge is brought and evaluation conducted. This approach aims to enhance service levels and strengthen relationships with the Company's providers, with a view to ensuring the interests of the Company's shareholders are best served by keeping cost levels proportionate and competitive, and by maintaining the highest standards of business conduct. | | Portfolio companies | As all of the Company's operations are conducted by third party professional providers, it is the companies held in its investment portfolio which have the primary real-world impact in terms of social and environmental change, both positively and negatively, as well as generating, through their commercial success, the investment growth sought by the Company's shareholders. The investee companies have an interest in understanding their shareholders' investment rationale in order to assure themselves that long-term business strategies will be supported. | The Board is cognisant of the need to consider the impact of the Company's investment strategy and policy on wider society and the environment. The Board considers that its oversight of environmental, social and governance ('ESG') matters is an important part of its responsibility to all stakeholders. The Board's review of the Managers includes an assessment of their ESG approach and its application in making investment decisions. The Board regularly reviews Governance Engagement reports, which document the Managers' interactions with investee companies on ESG matters (see pages 45 to 50). | | Brokers | The Company's brokers provide an interface between the Company's Board and its institutional shareholders. | The Company's brokers regularly attend Board meetings, and provide reports to those meetings, in order to keep the Board apprised of shareholder and wider market sentiment regarding the Company. They also arrange forums for shareholders to meet the Chair, or other Directors, outwith the normal general meeting cycle. | 42 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc | Stakeholder | Why we engage | How we engage and what we do | | --- | --- | --- | | Registrars | The Company's registrars provide an interface with those shareholders who hold the Company's shares directly. | The Company Secretaries liaise with the registrars to ensure the frequency and accuracy of communications to shareholders is appropriate, and monitor shareholder correspondence to ensure that the level of service provided by the registrars is acceptable. The Managers' risk function reviews the registrars' internal controls report and reports on the outcome of this review to the Audit Committee. | | Auditor | The Company's Auditor has a responsibility to provide an opinion on whether the Company's Financial Statements as a whole are free from material misstatement, as set out in more detail in the Auditor's report to the members on page 85. | The Company's Auditor meets with the Audit Committee, in the absence of the Managers where deemed necessary, and the Managers undertake to provide all information requested by the Auditor in connection with the Company's annual audit promptly and to ensure that it is complete and accurate in all respects. | | Depository and Custodian | The Depository is responsible for the safekeeping of the Company's financial instruments, as set out in more detail on page 64. | The Depository provides the Audit Committee with a report on its monitoring activities. The Board and Managers seek to engage with the Depository and Custodian in a collaborative and collegiate manner, encouraging open and constructive discussion and debate, while also ensuring that appropriate and regular challenge is brought and evaluation conducted. This approach aims to enhance service levels and strengthen relationships with the Company's providers, with a view to ensuring the interests of the Company's shareholders are best served by keeping cost levels proportionate and competitive, and by maintaining the highest standards of business conduct. | | Lenders | Lenders such as holders of debt instruments (debentures, bonds and private placement loan notes) and banks providing fixed or revolving credit facilities or overdrafts provide the Company's gearing and have an interest in the Company's ongoing financial health and viability. | The Company's legal advisers review all legal agreements in connection with the Company's debt arrangements and advise the Board on the appropriateness of the terms and covenants therein. The Managers and Secretaries ensure that the frequency and accuracy of reporting on, for example, covenant certification, is appropriate and that correspondence from the lenders receives a prompt response. | | AIC/industry peers | The Association of Investment Companies ('AIC') and the Company's investment trust industry peers have an interest in the Company's conduct and performance, as adverse market sentiment towards one investment trust can affect attitudes towards the wider industry. | The Company is a member of the AIC, and the Directors and/or the Managers and Secretaries (as appropriate) participate in technical reviews, requests for feedback on proposed legislation or regulatory developments, corporate governance discussions and/or training. | | Investment platforms | Investment platforms provide an interface with shareholders who invest in the Company indirectly. | The Managers liaise with the various investment platforms on strategies for improving communications with the Company's shareholders who hold their shares via these platforms. An annual timetable of key dates is published on the Company's website, for the ease of reference of such shareholders. | | Wider society and the environment | No entity, corporate or otherwise, can exist without having an influence on the society in which it operates or utilising the planet's resources. Through its third-party relationships, as noted above, the Company seeks to be a positive influence and, in circumstances where that is not possible, to mitigate its negative impacts insofar as is possible. | The Board and Managers' interactions with the various stakeholders as noted above form the principal forms of direct engagement with wider society and in respect of the environment (commercial, financial, and in terms of planetary health and resources). | 43 --- Strategic report The Board recognises the importance of maintaining the interests of the Company and its stakeholders, in aggregate, firmly front of mind in its key decision making and Baillie Gifford & Co Limited, the Company Secretaries, are at all times available to the Board to ensure that suitable consideration is given to the range of factors to which the Directors should have regard. In addition to ensuring that the Company's stated investment objective was being pursued, key decisions and actions during the year which have required the Directors to have regard to applicable section 172 factors include: - the purchase of 1,728,219 of the Company's own shares into treasury at a discount to net asset value (2.9% of share capital as at 31 January 2025), for subsequent reissue, in order to ensure the Company's shareholders found liquidity for their shares when natural market demand was insufficient, and on terms that enhance net asset value for remaining shareholders; - the Board met with shareholders representing approximately 30% of the register to discuss the Company's strategy; - the Board's decision to declare a final dividend of 2.5p. ### **Employees, human rights and community issues** The Board recognises the requirement to provide information about employees, human rights and community issues. As the Company has no employees, all its Directors are non-executive and all its functions are outsourced, there are no disclosures to be made in respect of employees, human rights and community issues. Further information on the Company's approach to Environmental, Social and Governance matters are provided below. ### **Gender representation** At 31 January 2026, and at the date of this report, the Board comprised five Directors, three male and two female. The Company has no employees. The Board's policy on diversity is set out on page 71. ### **Environmental, social and governance policy** Details of the Company's policy on socially responsible investment can be found under Corporate Governance and Stewardship on page 74. The Company considers that it does not fall within the scope of the Modern Slavery Act 2015 and it is not, therefore, obliged to make a slavery and human trafficking statement. In any event, the Company considers its supply chains to be of low risk as its suppliers are typically professional advisers. A statement by the Managers under the Act has been published on the Managers' website at bailliegifford.com. ### **Future developments of the Company** The outlook for the Company is set out in the Chair's statement on pages 7 to 11 and the Managers' report on pages 12 to 21. The Strategic report, which includes pages 6 to 58 was approved by the Board of Directors and signed on its behalf on 31 March 2026. Nicholas Pink Chair 44 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Managers’ report on environmental, social and governance engagement Stewardship for us means responsibly managing capital to create long-term value for clients and sustainable benefits for the economy, environment, and society. The Managers of the Trust have always embedded stewardship into their investment philosophy and process. The six ESG principles for the Chinese Equity team are in Box 1, with country-based knowledge a foundational principle. Context matters and shapes our integration of ESG in China. Without a grounded understanding of how politics, policy, and culture shape corporate behaviour, ESG analysis risks missing the mark. When paired with global awareness, however, local fluency not only sharpens our investment judgments but also helps us anticipate reputational risks that may not be visible through a purely domestic or international lens alone. Thus, it underpins how we evaluate governance, interpret disclosure, assess sustainability, and engage with companies. Our investment process begins with a fundamental question that anchors our research process: “Does this company contribute to or benefit from China’s economic, social, or environmental development—and how does it fit within the global context?” In China, where economic policy, social objectives, and company outcomes are deeply intertwined, alignment with the country’s long-term development goals is not just a philosophical consideration. It’s a material factor that affects a company’s ability to generate value and its long-term share price returns. We supplement our 10Q research framework with a detailed due diligence checklist to identify material downside risks—spanning corporate governance, environmental, and social dimensions. These tools support a consistent, repeatable process while allowing room for local judgment and engagement. ## Box 1 Our approach is guided by our ESG principles ---1. 1) Country-based knowledge is essential: we believe it is the gateway to meaningful ESG integration in China. 2. 2) Investment process founded on long-term ownership of growing businesses: We offer both support and challenge to the companies in which we invest in an effort to help them achieve their long-term growth potential and to ignore the short-term pressures of the market. 3. 3) Sustainability is central to our analytical task: Businesses engaging in practices that are harmful to society may be capable of generating attractive returns in the short term, but are unlikely to be sustainable over the periods we seek to invest. 4. 4) We do not believe 'one size fits all': ESG practices need to be assessed case-by-case and not rely on formulaic and backwards-looking screens. 5. 5) Not seeking 'perfect' companies: we prefer to consider the likely direction of change in otherwise promising investments and engage accordingly. 6. 6) China is not a market where ESG sits alongside the investment case. Economic policy, social objectives, and company outcomes are deeply intertwined, so alignment with China's long-term development goals is a material factor shaping a company's ability to compound value, and ultimately its long-term share price returns. This underpins our conviction in bottom-up stock selection and active ownership in China. 45 --- Strategic report ## Company Engagement Highlights Company engagement sits at the centre of our process. Where we believe governance and sustainability factors are material to a company's success, we encourage actions that enhance opportunities and mitigate risks. We determine our engagement priorities through a combination of subjective assessments of an issue's materiality, our capacity to influence outcomes, and other qualitative inputs that help guide our focus. We exercise our voting rights wherever possible and will vote against management if we consider its actions to be contrary to shareholders' interests. Our work is supported by a dedicated China ESG analyst and additional analysts who form part of Baillie Gifford's broader ESG resource. Through engaging with companies, we aim to build constructive relationships that better inform our investment decisions and, where appropriate, drive change within our holdings, with the ultimate objective of delivering improved returns for our shareholders. The three examples that follow illustrate our stewardship approach through constructive, ongoing engagement. ### Box 2 #### Seeking evidence through thorough research and active stewardship rather than divest directly when holdings face adverse allegations or news – Weichai Power Weichai Power is a leading manufacturer of diesel and liquefied natural gas (LNG) engines, automotive components and agricultural machinery. Its investments in new-energy powertrains, as well as in diesel engines used as back-up power for data centres, are closely aligned with the trajectory of China's economic and technological development. In 2024, a global investment fund added the company to its exclusion list, citing unacceptable risks arising from its alleged involvement in the sale of military equipment to the authorities in Russia and Belarus. Following extensive due diligence, we found no evidence to substantiate these allegations regarding Weichai's military-related activities in these markets. Nor did third-party sources identify any weapons-related involvement by the company. We sought an opportunity to meet the company in person in 2025 and were able to corroborate our findings. The military products referenced were linked to foreign corporations with which Weichai had established joint ventures, but were not related to the joint ventures themselves. Moreover, Weichai had already exited the relevant joint ventures, which, in our view, materially reduces the company's exposure to sanctions risk. We also discussed the stability of the management team following the 2024 appointment of a new chairman. The company emphasised that the management structure remains stable, with no changes to its business strategy or long-term development plans. The previous chairman's resignation was attributed to personal reasons related to age. This continuity in leadership further reinforces our confidence in Weichai's prospects for sustainable long-term growth. 46 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # **Box 3** # **Understanding and assessing the implications of labour controversies when holdings march towards overseas – Fuyao Glass** Fuyao Glass, a leading global automotive glass manufacturer, is facing an investigation by the US Department of Homeland Security into labour recruitment at Fuyao's US factories. We had a call with Fuyao and learned that the investigation primarily targeted its labour dispatching partner (using agency workers hired through a third party), and the lawsuit is still ongoing. In response, Fuyao has terminated all forms of labour dispatching in the US and has transitioned to directly recruiting its employees. This strategic shift aims to eradicate future third-party labour recruitment-related risk in the US for Fuyao. The company remains confident in the legality and compliance of its previous partnership, citing trading volumes and price metrics, as well as comprehensive internal audits and ad hoc inspections conducted throughout the relationship. Additionally, Fuyao has strengthened its employee safety management and improved productivity among the overseas local workforce. Despite the investigation, the company has not received any requests or complaints from downstream customers, indicating stable client relations. Fuyao is further addressing the relatively higher turnover rate among its overseas employees compared with domestic staff, with plans to disclose overseas turnover data next year. We consider Fuyao's response to these potential risks to be satisfactory. The company has reinforced its operational integrity and enhanced its approach to employee management by eliminating the dispatching partners, underscoring its commitment to sustainable growth and sound governance. Going forward, we will continue to monitor the progress and results of the ongoing lawsuit. # **Box 4** # **Understanding the regulations on the new employment form and assessing our holding's stance and efforts in the social insurance battle – Meituan** In Q1 2025, provisions of social insurance to riders among Chinese platform companies in the food delivery sector were widely discussed. It demonstrated an increasingly higher level of society's attention to rider welfare and protection as gig workers, a historically under-addressed group, grow. We conducted thorough discussions with policy experts and interviewed Meituan to gain a better understanding of where it stands in protecting its riders. Scale and practicality matter the most. We found that Meituan's innovative approaches are leading in both perspectives and within its capabilities and should serve as a pioneer for its peers. Scale – Success can be achieved with a steady rollout to its one million qualified riders nationwide. Meituan's regulatory efforts have been realised in two pilot cities and are ongoing with other local governments to facilitate a full rollout. Practicality – In the food delivery industry, where many riders choose it as a transitional job, what they need most is pension insurance, in addition to the current accident insurance. Meituan's approach allows a rider to qualify for pension insurance subsidies within a minimum of 3 months and offers full flexibility in payment cycles and where to contribute. Financially, the impact on 2025 Meituan earnings from the pension subsidies in the two pilot cities will be trivial. The implications of an expanding pension subsidy scheme in the next five years will also be controllable. We would like to regard it as a cost of an enhanced social licence to operate and an encouraging outcome from years of endeavour to tackle the social protection of riders. Together with Meituan's continuous improvements in rider protection, such as algorithm transparency and safe riding practices, we remain a happy holder and believe that Meituan's social awareness and support for riders on the platform will keep it in a leading role in the food delivery business. 47 --- Strategic report ## Data Points of the Portfolio vs. Index The following selected data points illustrate the questions that we seek to explore through our broader analysis and company engagement. Data points are shown in relation to the index (MSCI China All Share) for the period from 1 February 2025 to 31 January 2026. It should be noted that there are some data gaps, particularly for the private companies in the Company's portfolio. ### Independence of Audit Committee **What it is** – We look to the independence level of company audit committees at the board level to provide effective oversight. Typical data points are shown below in relation to the index (MSCI China All Share). ![img-26.jpeg](img-26.jpeg) **What does the data tell us** – We believe the independence of audit committees is critical in providing financial oversight. Therefore, in addition to board independence, tenure, and diversity, we also pay specific attention to this factor. Our portfolio's independence % of audit committees is higher than the index. As China streamlines its governance structure by abolishing the Board of Supervisors, companies are strengthening their audit committees, and we expect their roles to continue to develop. While we expect local norms regarding compliant audit committee independence as a minimum, we are encouraging best practices among our holdings that have not yet achieved 100% independent audit committees. We also follow up directly with companies if we have specific concerns or questions about the independence or quality of the audit committee chairperson. ## UN Global Compact Alignment **What it is** – This indicator uses company alignment with the ten UN Global Compact ('UNGC') Principles as a proxy for social performance and exposure to corporate controversies, which can be found at unglobalcompact.org/what-is-gc/mission/principles. The chart shows the percentage of the portfolio assessed by a third-party data provider as 'compliant'. **What does the data tell us** – The data suggests that the majority of holdings are aligned with the principles of the UN Global Compact and conduct themselves responsibly in regard to society and the planet. One is assessed as non-compliant by a third party, and two are on the watchlist. Please note there is no data on UNGC compliance for five of our holdings (outside the third-party assessment coverage), which together account for approximately 16% of the portfolio. For companies without third-party coverage, we conduct an internal manual assessment of their alignment with the 10 UNGC Principles at the pre-buy stage. ![img-27.jpeg](img-27.jpeg) Tencent remains non-compliant on a third-party list with Principle 2 of the UN Global Compact for allegations of complicity in human rights abuses. Our research and engagement have led us to conclude that the company is taking the greatest possible action to comply with domestic legislation while also attempting to comply with international norms. We hold an annual ESG dialogue with Tencent and will continue to monitor it on our in-house watchlist for enhanced due diligence. By the end of January 2026, Tencent had been reassessed as UNGC compliant by another well-known third-party data provider. 48 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Zijin Mining remains on the data provider's watchlist (and is non-compliant on another data providers list). We concluded our three-year engagement plan in September 2025, after seeing tangible progress in relation to transparency and disclosure, external validation, improved governance practices and progress reflected in third-party assessments, alongside a clearer foundation for future monitoring. During the reporting period, Zijin published the results of the third-party audit of the Ashele Copper project and its internal audits in Xinjiang. This is significant because it demonstrates Zijin's willingness to proactively assess and disclose labour practices and human rights protections in a sensitive area. We consult external experts – a mining ESG consultant in China and an international human rights expert in Scotland – to benchmark Zijin's practices and consider other questions. We also engage with one of the third-party rating providers to identify whether Zijin's progress is reflected in controversy assessments. As its overseas gold assets are spun off into Zijin Gold International, our next step is to follow up on how the new entity continues to make progress across safety, workplace and community engagement and environmental performance. BYD was added to the watchlist after its labour controversy in Brazil. Soon after the incident, we conducted our own research, which led us to conclude that cutting ties with the contractor demonstrates the company's swift response and its decision to cease cooperation with problematic partners accused of labour controversies. In November 2025, we held an in-person meeting with the company, during which we discussed the Supplier Code of Conduct, on-site audits, different working practices in overseas markets, and its supply chain management committee and procurement leadership to oversee procurement risks, alongside other interesting social and governance topics. The meeting further strengthened our understanding of the company's efforts to manage partners and suppliers globally. Our expectation for all companies we hold is that they will respect internationally accepted human rights and labour rights throughout their business operations and value chain. This includes the management of exposure to labour and human rights risks and encouraging positive relationships with local communities. ## Carbon Performance Addressing climate change is one of the most significant challenges of our time. From shifting weather patterns that threaten food production and disrupt supply chains, to rising sea levels that increase the risk of catastrophic flooding, the impacts of climate change are global in scope and unprecedented in scale. Growing societal pressure and regulatory action are combining with the physical impacts of climate change to create new risks and opportunities for companies. As long-term investors, we must take cognisance of these to understand the implications for long-term value creation. **What it is** – Carbon footprint analysis identifies the largest direct emitters and which feeds into our prioritisation of research and engagement activities. The relative carbon footprint compares the total carbon emissions of the portfolio with the index per US$1 million invested. Weighted Average Carbon Intensity is the sum product of the portfolio constituent weights and intensities of Carbon Intensity (the total carbon emissions per US$1 million of revenue generated and shows the efficiency of the portfolio in terms of emissions per unit of financial output). These intensity measures allow comparison of emissions across companies of different sizes and in different industries. We recognise that carbon footprinting and emissions intensity analysis is imperfect. Beyond simple concerns about data accuracy and availability, this analysis can only tell us where a company is – not where it is going. This is why we see it as a starting point and not the end. Scope 1 emissions are those deriving directly from company activities (i.e., stack emissions and fuel use); Scope 2 emissions arise indirectly from electricity use. Emissions within these scopes are reasonably under the company's control and are expected to be calculated by all companies. We are continuing to engage with companies and research providers on the availability, comparability and robustness of Scope 3 emissions – those that result from activities of assets not owned or controlled by the reporting organisation, but that the organisation indirectly impacts in its value chain. \* CREDIT stands for carbon footprint, recycling, energy, due diligence, innovation and transparency 49 --- Strategic report **What does the data tell us** – The data demonstrates that our portfolio's carbon intensity and footprint are much lower than the index. This is attributed to the fact that most of our holdings are light in assets, except for a few from the manufacturing and power sectors. For the top portfolio emissions contributors, analysis and engagement are ongoing to understand and monitor their latest updates on their decarbonisation routes and climate-related targets. We have also seen an increase in companies' awareness and efforts in calculating Scope 3 GHG emissions. We expect higher disclosure rates and greater data accuracy in the future. ### Weighted average carbon intensity (tCO₂e/US$ million revenue) ![img-28.jpeg](img-28.jpeg) ### Carbon footprint (tCO₂e/US$ million invested) ![img-29.jpeg](img-29.jpeg) 50 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Baillie Gifford – proxy voting ## How are we voting? Thoughtful voting of our clients' holdings is an integral part of our commitment to stewardship. We believe that voting should be investment led, because how we vote is an important part of the long-term investment process, which is why our strong preference is to be given this responsibility by our clients. The ability to vote our clients' share also strengthens our position when engaging with investee companies. Therefore, we fully exercise our voting rights on behalf of our clients in the reporting period. We look for high-quality management teams and governance structures supportive of long-term investment opportunities. The graph on the right shows our voting for the Baillie Gifford China Growth Trust in the reporting period. It is no surprise that as long-term owners, seeking to invest in a relatively small number of exceptional companies, we are generally supportive of management. Where we disagree or where our engagement has been unsuccessful, there are cases where we will vote against management. For example, during the reporting period, we opposed a resolution to finance a project due to insufficient information on the quantitative assessment of the project's economic benefits and the payment period, which created uncertainty about the company's future shareholder return plans. We also opposed resolutions seeking authority to issue equity because the potential dilution would not be in the shareholders' interests. In 2025, our central voting team has updated our General Principles and market-based guides for voting which serve as a living reference document to all things related to proxy voting. The jurisdiction sheets capture market-specific context and keep reflecting the latest regulations of each market. In addition to the international proxy voting advisers, our in-house voting analyses are also based on input from a local voting service provider with good market knowledge. Our embedded ESG analyst in the region clarifies details with the companies when necessary to make the most informed decisions. ## The data All data is pulled from MSCI, Sustainalytics, ISS and BoardEx, via the Factset platform along with some internal sources. It is fact checked by our ESG analysts and is considered correct at the time of writing. The data covers the calendar year 2025. For more detail, please see bailliegifford.com/en/global/all-users/literature-library/miscellaneous/investment-stewardship-activities-report/ ### Baillie Gifford China Growth Trust proxy voting record 2025 | | % | Votes | | --- | --- | --- | | Votes for | 98.1 | 1,232 | | Votes against | 1.3 | 17 | | Abstain | 0.6 | 7 | | No Vote | - | 0 | | **Total** | **100.0** | **1,256** | Source: MSCI. MSCI makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indexes or any securities or financial products. This report is not approved, endorsed, reviewed or produced by MSCI. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. 51 --- Strategic report # Baillie Gifford – statement on stewardship Baillie Gifford's overarching ethos is that we are 'Actual' investors. That means we seek to invest for the long term. Our role as an engaged owner is core to our mission to be effective stewards for our clients. As an active manager, we invest in companies at different stages of their evolution across many industries and geographies, and focus on their unique circumstances and opportunities. Our approach favours a small number of simple principles rather than overly prescriptive policies. This helps shape our interactions with holdings and ensures our investment teams have the freedom and retain the responsibility to act in clients' best interests. ## Long-term value creation We believe that companies that are run for the long term are more likely to be better investments over our clients' time horizons. We encourage our holdings to be ambitious, focusing on long-term value creation and capital deployment for growth. We know events will not always run according to plan. In these instances we expect management to act deliberately and to provide appropriate transparency. We think helping management to resist short-term demands from shareholders often protects returns. We regard it as our responsibility to encourage holdings away from destructive financial engineering towards activities that create genuine value over the long run. Our value will often be in supporting management when others don't. ## Alignment in vision and practice Alignment is at the heart of our stewardship approach. We seek the fair and equitable treatment of all shareholders alongside the interests of management. While assessing alignment with management often comes down to intangible factors and an understanding built over time, we look for clear evidence of alignment in everything from capital allocation decisions in moments of stress to the details of executive remuneration plans and committed share ownership. We expect companies to deepen alignment with us, rather than weaken it, where the opportunity presents itself. 52 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ### **Governance fit for purpose** Corporate governance is a combination of structures and behaviours; a careful balance between systems, processes and people. Good governance is the essential foundation for long-term company success. We firmly believe that there is no single governance model that delivers the best long-term outcomes. We therefore strive to push back against one-dimensional global governance principles in favour of a deep understanding of each company we invest in. We look, very simply, for structures, people and processes which we think can maximise the likelihood of long-term success. We expect to trust the boards and management teams of the companies we select, but demand accountability if that trust is broken. ### **Sustainable business practices** A company’s ability to grow and generate value for our clients relies on a network of interdependencies between the company and the economy, society and environment in which it operates. We expect holdings to consider how their actions impact and rely on these relationships. We believe long-term success depends on maintaining a social licence to operate and look for holdings to work within the spirit and not just the letter of the laws and regulations that govern them. Material factors should be addressed at the board level as appropriate. 53 --- Strategic report # Baillie Gifford – valuing private companies We aim to hold our private company investments at 'fair value' i.e. the price that would be paid in an open-market transaction. Valuations are adjusted both during regular valuation cycles and on an ad hoc basis in response to 'trigger events'. Our valuation process ensures that private companies are valued in both a fair and timely manner. The valuation process is overseen by a valuations committee at Baillie Gifford which takes advice from an independent third party (S&P Global). The portfolio managers feed into the process, but the valuations committee owns the process and the portfolio managers only receive final valuation notifications once they have been applied. We revalue the private holdings on a three-month rolling cycle, with one-third of the holdings reassessed each month. For investment trusts, the prices are also reviewed twice per year by the respective investment trust boards and are subject to the scrutiny of external auditors in the annual audit process. Continued market volatility has meant that recent pricing has moved much more frequently than would have been the case with the quarterly valuations cycle. Beyond the regular cycle, the valuations team also monitors the portfolio for certain 'trigger events'. These may include: changes in fundamentals; a takeover approach; an intention to carry out an initial public offering; or changes to the valuation of comparable public companies. The valuations team also monitors relevant market indices on a weekly basis and updates valuations in a manner consistent with our external valuer's (S&P Global) most recent valuation report where appropriate. When market volatility is particularly pronounced the team do these checks daily. Any ad hoc change to the fair valuation of any holding is implemented swiftly and reflected in the next published net asset value. There is no delay. More information specific to the valuation of ByteDance and RedNote, the unlisted holdings held by Baillie Gifford China Growth Trust can be found in note 9, on page 103. The Independent Auditor's report on page 85 explains the procedures carried out by the external Auditor on the private companies (unquoted investments) as part of their audit. 54 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # List of investments at 31 January 2026 | Name | Business | Value $'000 | % of total assets * | | --- | --- | --- | --- | | Tencent | Social media and entertainment company | 24,628 | 12.0 | | ByteDance® | Social media and entertainment company | 21,349 | 10.4 | | Alibaba Group | Online retailer, payments and cloud business | 16,939 | 8.2 | | Ping An Insurance | Life and health insurance | 8,376 | 4.1 | | CATL | Electric vehicle battery maker | 6,537 | 3.2 | | Zijin Mining Group | Renewable energy enabler | 6,514 | 3.2 | | Kweichow Moutai | Luxury baijiu maker | 5,426 | 2.6 | | China Merchants Bank | Consumer lending and wealth management | 4,870 | 2.4 | | China Construction Bank Corporation | Commercial bank | 4,818 | 2.3 | | Weichai Power | Construction machinery and heavy duty trucks | 4,737 | 2.3 | | PDD Holdings | Online retailer | 4,448 | 2.2 | | Pop Mart | Toy and collectibles maker | 4,128 | 2.0 | | NetEase | Gaming and entertainment business | 3,765 | 1.8 | | Midea Group | White goods and robotics manufacturer | 3,649 | 1.8 | | RedNote® | Lifestyle content and commerce platform | 3,643 | 1.8 | | Zhongji Innolight | Optical transceiver and component maker for AI chips | 3,369 | 1.6 | | Zijin Gold International | Gold miner | 3,141 | 1.5 | | BeOne Medicines | Immunotherapy biotechnology company | 3,079 | 1.5 | | H World Group | Hotel operator | 2,828 | 1.4 | | BYD | Hybrid and EV automobiles | 2,731 | 1.3 | | Meituan | Online food delivery company | 2,719 | 1.3 | | Jiangsu Azure | Small form batteries | 2,550 | 1.2 | | China Oilfield Services | Oilfield service provider | 2,433 | 1.2 | | Naura Technology GP | Integrated micro-electronics company | 2,430 | 1.2 | 55 --- Strategic report | Name | Business | Value £'000 | % of total assets * | | --- | --- | --- | --- | | Sungrow Power Supply | Component supplier to renewables industry | 2,327 | 1.1 | | Wanhua Chemical Group | Chemicals and advanced materials producer | 2,304 | 1.1 | | Shenzhen Inovance Technology | Factory automation company | 2,257 | 1.1 | | ENN Energy | Gas distributor and provider | 2,240 | 1.1 | | Shandong Sinocera Functional Material | Advanced materials manufacturer | 2,233 | 1.1 | | Centre Testing International | Testing and inspection company | 2,233 | 1.1 | | Fuyao Glass Industry Group | Automotive glass manufacturer | 2,202 | 1.1 | | Luxshare Precision Industry Co | Electronic components manufacturer | 2,186 | 1.1 | | China Yangtze Power | Power generation operator | 2,163 | 1.1 | | Haidilao International | Hot pot restaurant brand | 2,155 | 1.0 | | ANTA Sports Products | Sportswear designer and manufacturer | 2,021 | 1.0 | | Atour Lifestyle Holdings Limited | Hotel operator | 2,010 | 1.0 | | Sunny Optical Technology | Electronic components for smartphones and autos | 1,931 | 0.9 | | Advanced Micro-Fabrication | Etch and deposition semiconductor equipment manufacturer | 1,874 | 0.9 | | Shenzhou International | Garment manufacturer | 1,794 | 0.9 | | Luckin Coffee^{†} | Coffee retailer | 1,755 | 0.9 | | Horizon Robotics | AI chips used in autonomous driving and advanced driving assistance systems | 1,738 | 0.8 | | Tianqi Lithium | Lithium product developer and manufacturer | 1,597 | 0.8 | | MiniMax | Artificial intelligence company | 1,546 | 0.8 | | DiDi Global | Passenger transportation platform operator | 1,536 | 0.7 | | Anker Innovations | Consumer electronics | 1,368 | 0.7 | | Zhejiang Sanhua Intelligent Controls | Heating and cooling component manufacturer | 1,340 | 0.7 | | Inner Mongolia Xingye Mining | Non-ferrous metals miner | 1,267 | 0.6 | | Yifeng Pharmacy Chain | Drug retailer | 1,159 | 0.6 | 56 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc | Name | Business | Value £'000 | % of total assets * | | --- | --- | --- | --- | | SG Micro Corp | Semiconductor designer | 1,146 | 0.6 | | Kingsoft | Software for SMEs and corporates | 1,127 | 0.5 | | Kingdee International Software | Software for SMEs and corporates | 1,104 | 0.5 | | Minth | Automotive parts manufacturer | 1,098 | 0.5 | | Estun Automation | Robotics and factory automation company | 1,076 | 0.5 | | DPC Dash | Franchise fast food restaurant operator | 1,035 | 0.5 | | Ganfeng Lithium Group | Lithium producer and processor | 977 | 0.5 | | Innovent Biologics | Biopharmaceutical company | 836 | 0.4 | | Silergy | Semiconductors & semiconductor equipment | 791 | 0.4 | | Dongguan Yiheda Automation Co | Automation components | 593 | 0.3 | | New Horizon Health^{†} | Early cancer detection | – | 0.0 | | **Total investments** | | **204,126** | **99.4** | | Net liquid assets^{‡} | | **1,214** | **0.6** | | **Total assets*** | | **205,340** | **100.0** | | Borrowings | | **(7,745)** | **(3.8)** | | **Shareholders' funds** | | **197,595** | **96.2** | * Total assets before deduction of loans. † Denotes unlisted investment (private company). ‡ Includes investments in American Depositary Receipt (ADR). § Suspended. ‡ For a definition of terms used, see Glossary of terms and alternative performance measures on pages 126 to 128. | | Listed equities % | Suspended equities % | Unlisted securities % | Net liquid assets % | Total assets % | | --- | --- | --- | --- | --- | --- | | **31 January 2026** | **87.2** | **–** | **12.2** | **0.6** | **100.0** | | 31 January 2025 | 90.5 | 0.1 | 9.1 | 0.3 | 100.0 | Figures represent percentage of total assets. 57 --- Strategic report # Distribution of total assets* Sector at 31 January 2026 ![img-30.jpeg](img-30.jpeg) | Sector | 2026 % | 2025 % | | --- | --- | --- | | 1 Consumer discretionary | 25 | 29 | | 2 Communication services | 25 | 24 | | 3 Consumer staples | 3 | 7 | | 4 Financials | 9 | 6 | | 5 Healthcare | 2 | 3 | | 6 Industrials | 12 | 15 | | 7 Information technology | 11 | 10 | | 8 Materials | 9 | 3 | | 9 Real estate | - | 1 | | 10 Utilities | 2 | 1 | | 11 Energy | 1 | - | | 12 Net liquid assets | 1 | 1 | * Total assets represents total net assets before deduction of borrowings. 58 Annual Report and Financial Statements 2026 --- # Governance report This governance report, which includes pages 59 to 83 outlines the Board's approach to the governance of your Company. We believe that good governance builds better outcomes and we are committed to high standards of corporate governance and transparency. --- Governance report # Directors and management ## Directors ![img-31.jpeg](img-31.jpeg) **Nicholas Pink** Chair Appointed 2023 Nicholas Pink has extensive senior management experience in financial services with previous roles at UBS Investment Bank including Global Head of Research and Head of Asia Research. Nicholas is currently the Chairman of Ruffer Investment Company Limited. He was previously an independent director of Redburn (Europe) Limited, and a non-executive director of JP Morgan Emerging Europe, Middle East and Africa Securities plc. He was appointed as a Director of the Company in 2023 and appointed Chair in 2024. ![img-32.jpeg](img-32.jpeg) **Tim Clissold** Director Appointed 2021 Tim Clissold qualified as a Chartered Accountant and has worked in Australia, Hong Kong and extensively in China, where he was co-founder of one of the first private equity groups in the country. He later ran Goldman Sachs China's distressed investment business in Beijing. Tim is a Senior Advisor to Highgate, where he assists resolving disputes between foreign investors and Chinese companies. He is a Visiting Fellow at Jesus College, Cambridge University and a non executive director of Henderson Far East Income Limited. He was a member of the Strategic Advisory Board of Braemar Energy Ventures, a New York venture capital fund focused on energy efficiency technologies. He is the author of Mr China and Chinese Rules and speaks, reads and writes Mandarin Chinese. 60 Annual Report and Financial Statements 2026 --- Bailie Gifford China Growth Trust plc ![img-33.jpeg](img-33.jpeg) **Magdalene Miller** Director Appointed 2020 Magdalene Miller is a former investment director with Aberdeen Standard Investments' global emerging market team. Based in London and Edinburgh, she spent 32 years managing listed equity portfolios, investing in Japanese, Asian Pacific and UK markets. In the 10 years before her retirement in 2018, she ran the Standard Life China Sicav, one of the top performing funds in its sector. A native of Hong Kong, Magdalene is fluent in Cantonese and Mandarin and has travelled extensively in China and Asia over the course of her career. She is a non-executive director of Templeton Emerging Markets Investment Trust plc. She also currently serves as a trustee for an educational endowment fund and participates in volunteering work. ![img-34.jpeg](img-34.jpeg) **Sarah MacAulay** Director Appointed 2024 Sarah MacAulay has over twenty years of Asian fund management experience based in both London and Hong Kong, managing unit trusts and institutional assets. She was formerly a Director of Baring Asset Management (Asia) Ltd in Hong Kong, Asian Investment Manager at Kleinwort Benson Investment Management and Eagle Star in London. She is currently Chairman of Schroder Asian Total Return Investment Company plc and a non-executive Director of Bellevue Healthcare Trust plc and Ashoka India Equity Investment Trust plc. Until March 2024, Sarah was Chair of JPMorgan Multi-Asset Growth and Income plc and Senior Independent Director of abdn China Investment Company Ltd. ![img-35.jpeg](img-35.jpeg) **Jonathan Silver** Audit Committee Chair Appointed 2022 Jonathan Silver is a qualified accountant and member of the Institute of Chartered Accountants of Scotland. Jonathan has held various senior financial positions throughout his career, including 21 years as Chief Financial Officer on the main Board of Laird plc from 1994 until 2015. Jonathan was the chairman of the audit committee at Invesco Income and Growth Trust plc from 2007 until 2021. Jonathan is a non-executive director and chairman of the audit and risk committee of Henderson High Income Trust plc, a position he has held since 2019 and is also a non-executive director of Synthomer PLC, a position he has held since 2025. All of the Directors are members of the Audit Committee. 61 --- Governance report ## Managers and secretaries The Company has appointed Baillie Gifford & Co Limited, a wholly owned subsidiary of Baillie Gifford & Co, as its Alternative Investment Fund Managers ('AIFM') and Company Secretary. Baillie Gifford & Co Limited has delegated investment management services to Baillie Gifford & Co. Baillie Gifford & Co is an investment management firm formed in 1927 out of the legal firm Baillie Gifford, WS, which had been involved in investment management since 1908. Baillie Gifford is one of the largest investment trust managers in the UK and currently manages eleven investment trusts. Baillie Gifford also manages unit trusts and open ended investment companies, together with investment portfolios on behalf of pension funds, charities and other institutional clients, both in the UK and overseas. Funds under the management or advice of Baillie Gifford totalled around £183 billion as at 26 March 2026. Based in Edinburgh, it is one of the leading privately owned investment management firms in the UK, with 59 partners and a staff of around 1,616. During the year ended 31 January 2026, the Managers of Baillie Gifford China Growth Trust were Linda Lin and Sophie Earnshaw. Sophie joined Baillie Gifford in 2010 and is an investment manager in the Emerging Markets and China A-share Teams. She has also been co-manager of the China Fund and a member of the International Focus Portfolio Construction Group since 2014. Sophie is a CFA Charter holder. She graduated MA in English Literature from the University of Edinburgh in 2008 and MPhil in Eighteenth Century and Romantic Literature from the University of Cambridge in 2009. Linda is an investment manager in the China Equities team and a decision maker on Baillie Gifford's All China and China A share strategies. She is also a member of the Long Term Global Growth team. Linda joined Baillie Gifford in September 2014 and worked in Edinburgh until relocating to Shanghai in 2019 as Head of the Investment Team. She became a partner of the firm in May 2022 and is now based in Edinburgh. Prior to joining Baillie Gifford, Linda spent four years as a global equity analyst with Aubrey Capital and two years in real estate investment in China. She graduated BComm in Accounting and Finance from the University of Auckland, New Zealand in 2007 and MSc in Finance and Investment from the University of Edinburgh in 2011. Linda is a native Mandarin speaker. Baillie Gifford & Co and Baillie Gifford & Co Limited are both authorised and regulated by the Financial Conduct Authority. ![img-36.jpeg](img-36.jpeg) Investment Manager ![img-37.jpeg](img-37.jpeg) Investment Manager 62 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Directors’ report **The Directors present their Report together with the audited Financial Statements of the Company for the year to 31 January 2026.** ## Corporate governance The Corporate governance report is set out on pages 68 to 74 and forms part of this Report. ## Managers and company secretaries Baillie Gifford & Co Limited, a wholly owned subsidiary of Baillie Gifford & Co, was appointed as the Company’s Alternative Investment Fund Managers (AIFM) and Company Secretaries on 16 September 2020. Baillie Gifford & Co Limited has delegated portfolio management services to Baillie Gifford & Co. Dealing activity and transaction reporting has been further sub-delegated to Baillie Gifford Overseas Limited and Baillie Gifford Asia (Hong Kong) Limited. The Investment Management Agreement between the AIFM and the Company sets out the matters over which the Managers have authority in accordance with the policies and directions of, and subject to restrictions imposed by, the Board. The Investment Management Agreement is terminable on not less than three months’ notice or on shorter notice in certain circumstances. Compensation would only be payable if termination occurred prior to the expiry of the notice period. The annual management fee is (i) 0.75% of the first £50 million of net asset value; plus (ii) 0.65% of net asset value between £50 million and £250 million; plus (iii) 0.55% of net asset value in excess of £250 million, calculated and payable quarterly. 63 --- Governance report The Board considers the Company's investment management and secretarial arrangements on an ongoing basis and a formal review is conducted annually. The Board considered, amongst others, the following topics in its review: the quality of the personnel assigned to handle the Company's affairs; the investment process and the results achieved to date; investment performance; the administrative services provided by the Secretaries and the quality of information provided; the marketing efforts undertaken by the Managers; the relationship with the Managers; and comparative peer group charges and fees. Following the most recent review, the Board concluded that the continuing appointment of Baillie Gifford & Co Limited as AIFM and the delegation of investment management services to Baillie Gifford & Co, on the terms agreed, is in the interests of shareholders as a whole. ## Depository In accordance with the UK Alternative Investment Fund Managers Regulations, The Bank of New York Mellon (International) Limited has been appointed as Depository to the Company. The Depository's responsibilities include cash monitoring, safe keeping of the Company's financial instruments, verifying ownership and maintaining a record of other assets and monitoring the Company's compliance with investment limits and leverage requirements. Custody services are provided by The Bank of New York Mellon (International) Limited (as a delegate of the Depository) (the 'Custodian'). ## Directors Information about the Directors, including their relevant experience, can be found on pages 60 and 61. All Directors will retire at the Annual General Meeting and offer themselves for re-election. Following a formal performance evaluation, the Chair confirms that the Board considers that each Director's performance continues to be effective and that each Director remains committed to the Company and capable of devoting sufficient time to their roles. The Board recommends their re-election to shareholders. ## Director indemnification and insurance To the extent permitted by law and by the Company's Articles, the Company has entered into deeds of indemnity for the benefit of each Director of the Company in respect of liabilities which may attach to them in their capacity as Directors of the Company. These provisions, which are qualifying third party indemnity provisions as defined by section 234 of the Companies Act 2006, were in place throughout the year and as at the date of approval of the Financial Statements. The Company maintains Directors' and Officers' Liability Insurance. ## Conflicts of interest Each Director submits a list of potential conflicts of interest to the Board for consideration and approval at each meeting. The Board considers these carefully, taking into account the circumstances surrounding them prior to authorisation. Having considered the lists of potential conflicts there were no situations which gave rise to a direct or indirect interest of a Director which conflicted with the interests of the Company. ## Dividends The Board recommends a final dividend of 2.50p per ordinary share (2025 – 2.20p). No interim dividend is paid. Dividends will be by way of a final dividend and be not less than the minimum required for the Company to maintain its investment trust status. If approved by shareholders at the Annual General Meeting, the recommended final dividend per ordinary share will be paid on 22 July 2026 to shareholders on the register at the close of business on 19 June 2026. The ex-dividend date is 18 June 2026. ## Share capital ### Capital structure The Company's capital structure at 31 January 2026 consists of 68,348,151 ordinary shares of 25p each (2025 – 68,348,151) of which 57,367,461 (2025 – 59,095,680) are allotted and fully paid and 10,980,690 (2025 – 9,252,471) are held in treasury. 64 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc There are no restrictions concerning the holding or transfer of the Company's ordinary shares and there are no special rights attached to any of the shares. ### Dividends The ordinary shares carry a right to receive dividends. Interim dividends are determined by the Directors, whereas the proposed final dividend is subject to shareholder approval. ### Capital entitlement On a winding up, after meeting the liabilities of the Company, the surplus assets will be paid to ordinary shareholders in proportion to their shareholdings. ### Voting Each ordinary shareholder present in person or by proxy is entitled to one vote on a show of hands and, on a poll, to one vote for every share held. Information on the deadlines for proxy appointments can be found on pages 114 to 119. ### Major interests disclosed in the Company's shares The Company has received notifications in accordance with the Financial Conduct Authority's Disclosure and Transparency Rule 5.1.2R of the following interests in 3% or more of the voting rights attached to the Company's issued share capital. | Name | Number of ordinary 25p shares notified as at 31 January 2026 | % of issue * | | --- | --- | --- | | City of London Investment Management | 11,580,409 | 20.2 | | Rathbone Nominees | 3,076,669 | 5.4 | * Ordinary shares in issue excluding treasury shares. In the period from 31 January 2026 to 26 March 2026, the Company was notified that City of London Investment Management held 11,847,577 shares (21.4% of the shares in issue as at 26 March 2026). There have been no other changes to the major interests in the Company's shares intimated up to 26 March 2026. ### Analysis of shareholders at 31 January | | 2026 Number of shares held | 2026 % | 2025 Number of shares held | 2025 % | | --- | --- | --- | --- | --- | | Institutions | 19,630,850 | 34.2 | 19,110,755 | 32.3 | | Intermediaries/ Retail savings platforms | 33,612,205 | 58.6 | 34,842,353 | 59.0 | | Individuals | 3,680,694 | 6.4 | 3,983,263 | 6.7 | | Marketmakers | 443,712 | 0.8 | 1,159,309 | 2.0 | | | **57,367,461** | **100.0** | **59,095,680** | **100.0** | ### Annual General Meeting The details of this year's AGM, including the proposed resolutions and information on the deadlines for proxy appointments, can be found on pages 114 to 119. Shareholders who hold shares in their own name on the main register will be provided with a form of proxy. If you hold shares through a share platform or other nominee, the Board would encourage you to contact these organisations directly as soon as possible to arrange for you to vote at the AGM. The resolutions relating to the renewal of the Directors' authorities to issue and buy back shares, and proposed capital reduction are explained in more detail below. ### Share issuance authority Resolution 12 in the Notice of Annual General Meeting seeks to renew the Directors' general authority to issue shares up to an aggregate nominal amount of £4,615,260. This amount represents one third of the Company's total ordinary share capital currently in issue and meets institutional guidelines. No issue of ordinary shares will be made pursuant to the authorisation of Resolution 12 which would effectively alter the control of the Company without the prior approval of shareholders in General Meeting. 65 --- Governance report Resolution 13, which is being proposed as a special resolution, seeks to renew the Directors' authority to issue shares or sell shares held in treasury on a non pre-emptive basis for cash up to an aggregate nominal amount of £1,384,577 (representing 10% of the issued ordinary share capital of the Company as at 26 March 2026). This authority will continue until the conclusion of the Annual General Meeting to be held in 2027 or on the expiry of 15 months from the passing of the resolution, if earlier. The authority proposed to be granted by Resolution 13 will only be used to issue shares or sell shares from treasury at, or at a premium to, net asset value and only when the Directors believe that it would be in the best interests of the Company to do so. During the year to 31 January 2026, the Company did not issue any shares. #### **Market purchases of own shares** At the last Annual General Meeting the Company was granted authority to purchase up to 8,780,456 ordinary shares (equivalent to 14.99% of its issued share capital), such authority to expire at the 2026 Annual General Meeting. The Directors are seeking shareholders' approval at the Annual General Meeting to renew the authority to make market purchases up to 14.99% of the Company's ordinary shares in issue (excluding treasury shares) at the date of passing of the resolution, such authority to expire at the Annual General Meeting of the Company to be held in 2027. Such purchases will only be made at a discount to the prevailing net asset value. During the year to 31 January 2026, 1,728,219 shares (2025 – 2,756,602 shares) were bought back under the buy-back authority, representing 2.9% of share capital as at 31 January 2025. The Company may hold bought-back shares in treasury and then: i. sell such shares (or any of them) for cash (or its equivalent under the Companies Act 2006); or ii. cancel the shares (or any of them). Shares will only be resold from treasury at a premium to the net asset value per ordinary share. Treasury shares do not receive distributions and the Company will not be entitled to exercise the voting rights attaching to them. In accordance with the UK Listing Rules the maximum price (excluding expenses) that may be paid on the exercise of the authority must not exceed the higher of: i. 5% above the average closing price on the London Stock Exchange of an ordinary share over the five business days immediately preceding the date of purchase; and ii. an amount equal to the higher of the price of the last independent trade of an ordinary share and the highest current independent bid for an ordinary share on the trading venue where the purchase is carried out. The minimum price (exclusive of expenses) that may be paid will be the nominal value of an ordinary share. Purchases of ordinary shares will be made within guidelines established, from time to time, by the Board. Your attention is drawn to Resolution 14 in the Notice of Annual General Meeting. This authority, if conferred, will only be exercised if to do so would result in an increase in net asset value per ordinary share for the remaining shareholders and if it is considered in the best interests of shareholders generally. #### **Articles of Association** The Company's Articles of Association may only be amended by special resolution at a general meeting of shareholders. #### **Financial instruments** The Company's financial instruments comprise its investment portfolio, cash balances, borrowings and debtors and creditors that arise directly from its operations such as sales and purchases awaiting settlement and accrued income. The financial risk management objectives and policies arising from its financial instruments and the exposure of the Company to risk are disclosed in note 18 to the Financial Statements. 66 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Disclosure of information to Auditor The Directors confirm that, so far as each of the Directors is aware, there is no relevant audit information of which the Company's Auditor is unaware and the Directors have taken all the steps that they might reasonably be expected to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the Company's Auditor is aware of that information. ## Independent Auditor The Auditor, Ernst & Young LLP, is willing to continue in office, and in accordance with section 489 and section 491(1) of the Companies Act 2006, resolutions concerning Ernst & Young LLP's re-appointment and remuneration will be submitted to the Annual General Meeting. ## Post Balance sheet events The Directors confirm that there have been no significant post Balance sheet events which require adjustment to, or disclosure in, the Financial Statements or notes up to 31 March 2026. Subsequent to the year-end, the Company has repurchased an additional 2,069,724 shares, placed into Treasury, for a total consideration of £6,287,409. ## Stakeholder engagement Although the Company has no employees, trade suppliers or customers, the Directors give regular consideration to the need to foster the Company's business relationships with its stakeholders, in particular with shareholders, its externally appointed Managers, other professional service providers and lenders. The effect of this consideration upon the key decisions taken by the Company during the financial year is set out in further detail in the Strategic report on pages 6 to 58. ## Greenhouse gas emissions and Streamlined Energy & Carbon Reporting ('SECR') All of the Company's activities are outsourced to third parties. The Company therefore has no greenhouse gas emissions to report from its operations, nor does it have responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors' Reports) Regulations 2013. For the reason set out above, the Company considers itself to be a low energy user and has no energy and carbon information to disclose under the SECR regulations. ## Bribery Act The Company has a zero tolerance policy towards bribery and is committed to carrying out business fairly, honestly and openly. The Managers also adopt a zero tolerance approach and have policies and procedures in place to prevent bribery. ## Criminal Finances Act 2017 The Company has a commitment to zero tolerance towards the criminal facilitation of tax evasion. ## Recommendation The Directors unanimously recommend you vote in favour of the resolutions to be proposed at the Annual General Meeting as it is their view that the resolutions are in the best interests of shareholders as a whole. On behalf of the Board Nicholas Pink Chair 31 March 2026 67 --- Governance report # Corporate governance report The Board is committed to achieving and demonstrating high standards of Corporate Governance. This statement outlines how the principles of the 2024 UK Corporate Governance Code (the 'UK Code') which can be found at frc.org.uk and the relevant principles of the Association of Investment Companies ('AIC') Code of Corporate Governance (the 'AIC Code') published in 2024 were applied throughout the financial year. The AIC Code provides a framework of best practice for investment companies and can be found at theaic.co.uk. ## Compliance The Board confirms that the Company has complied throughout the year under review with the relevant provisions of the UK Code and the recommendations of the AIC Code. The Code includes provisions relating to the role of the chief executive, executive directors' remuneration and the need for an internal audit function. Given that the Company is an externally-managed investment trust, the Board considers these provisions are not relevant to the Company (the need for an internal audit function specific to the Company has been addressed on page 77). The FRC has confirmed that AIC member companies who report against the AIC Code will be meeting their obligations in relation to the UK Code (the AIC Code can be found at theaic.co.uk). ## The Board The Board has overall responsibility for the Company's affairs. It has a number of matters formally reserved for its approval including strategy, investment policy, gearing, discount/premium policy, treasury matters, dividend and corporate governance policy. The Board seeks to contribute to the delivery of the Company's strategy by engaging with the Managers in a collaborative and collegiate manner with open and respectful discussion and debate being encouraged, whilst also ensuring that appropriate and regular challenge is brought and evaluation is conducted. The Board also reviews the Financial Statements, investment transactions, revenue budgets and performance of the Company. Full and timely information is provided to the Board to enable it to function effectively and to allow Directors to discharge their responsibilities. 68 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Board of Directors Comprises independent non-executive directors Chair: Nicholas Pink Senior Independent Director: Magdalene Miller ## Audit Committee Chair: Jonathan Silver **Purpose:** The primary purpose of the Company's Audit Committee is to provide oversight of the financial reporting process, the audit process, the Company's system of internal controls, compliance with laws and regulations. The Company does not have a Management Engagement Committee, the function of a Management Engagement Committee is performed by the Board. That function is to ensure that the Managers remain suitable to manage the portfolio, that the management contract is competitive and reasonable for the shareholders, and that the Company maintains appropriate administrative and company secretarial support. ## Nomination Committee Chair: Nicholas Pink **Purpose:** The main purpose of the Nomination Committee is to oversee Board recruitment and succession planning as well as Board appraisals including identifying training needs. ## Third party service providers appointed by the Board Alternative Investment Fund Manager and Company Secretary: Baillie Gifford & Co Limited (wholly owned subsidiary of Baillie Gifford & Co) Dealing activity and transaction reporting: Baillie Gifford Overseas Limited and Baillie Gifford Asia (Hong Kong) Limited Ernst & Young LLP Auditor The Bank of New York Mellon (International) Limited Depository and Custodian Computershare Investor Services PLC Registrar JP Morgan Cazenove Company broker 69 --- Governance report The Board comprises five Directors, all of whom are non-executive. The Chair is responsible for organising the business of the Board, ensuring its effectiveness and setting its agenda. The executive responsibility for investment management has been delegated to the Company's Alternative Investment Fund Manager ('AIFM'), Baillie Gifford & Co Limited, and, in the context of a Board comprising only non-executive Directors, there is no chief executive officer. The Senior Independent Director is Magdalene Miller. The Directors believe that the Board has a balance of skills and experience that enables it to provide effective strategic leadership and proper governance of the Company. Information about the Directors, including their relevant experience, can be found on pages 60 to 62. There is an agreed procedure for Directors to seek independent professional advice, if necessary, at the Company's expense. ## Appointments to the Board The terms and conditions of Directors' appointments are set out in formal letters of appointment which are available for inspection on request. Under the provisions of the Company's Articles of Association, Directors are subject to election by shareholders at the first AGM after their appointment. Thereafter, all Directors will retire at each AGM and, if appropriate, offer themselves for re-election. ## Independence of Directors All the Directors are considered by the Board to be independent of the Managers and free of any business or other relationship which could interfere with the exercise of their independent judgement. The Directors recognise the importance of succession planning for company boards and review the Board composition annually. The Board is of the view that length of service will not necessarily compromise the independence or contribution of Directors of an investment trust company, where continuity and experience can be a benefit to the Board. ## Meetings There is an annual cycle of Board meetings which is designed to address, in a systematic way, overall strategy, review of Investment Policy, investment performance, marketing, revenue budgets, dividend policy and communication with shareholders. The Board considers that it meets sufficiently regularly to discharge its duties effectively. The table below shows the attendance record for the Board and Committee meetings held during the year. The Annual General Meeting was attended by all Directors serving at that date. ## Directors' attendance at meetings | | Board | Nominations Committee | Strategy | Audit Committee | | --- | --- | --- | --- | --- | | Number of meetings | 4 | 2 | 1 | 4 | | Nicholas Pink | 4 | 2 | 1 | 4 | | Tim Clissold | 4 | 2 | 1 | 4 | | Magdalene Miller | 4 | 2 | 1 | 3 | | Sarah MacAulay* | 4 | 2 | 1 | 4 | | Jonathan Silver | 4 | 2 | 1 | 4 | ## Policy on Board and Chair's tenure The Board's policy is that all Directors, including the Chair, shall normally have tenure limited to nine years from their first appointment to the Board. Exceptions may be made in exceptional circumstances, particularly in respect of the Chair for example to facilitate effective succession planning or if the Company were in the middle of a corporate action, when an extension may be appropriate. However, the Board believes that long serving Directors should not be prevented from forming part of an independent majority and that the length of a Director's tenure does not necessarily reduce his or her ability to act independently. ## Performance evaluation An appraisal of the Chair, each Director and a performance evaluation and review of the Board as a whole and the Audit Committee was carried out during the year. Each Director and the Chair responded to an evaluation questionnaire. The Chair's appraisal was led by Magdalene Miller, the Senior Independent Director. The appraisals and evaluations considered, amongst other criteria, the balance of skills of the Board, training and development requirements, the contribution of 70 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc individual Directors and the overall effectiveness of the Board and the Audit Committee. Following this process it was concluded that there was a diverse range of skills within the Board, and the performance of each Director, the Chair, the Board and the Audit Committee continues to be effective and that each Director and the Chair remain committed to the Company. A review of the Chair's and the other Directors' commitments was carried out and the Board is satisfied that they are capable of devoting sufficient time to the Company. There were no significant changes to the Chair's other commitments during the year. ## Diversity Appointments to the Board are made on merit and based on objective criteria, including the promotion of diversity of gender, social and ethnic backgrounds, and cognitive and personal strengths. The priority in succession planning and appointing new Directors is to identify candidates with the best range of skills and experience to complement those of the existing Directors, with a view to ensuring that the Board remains well placed to help the Company achieve its investment and governance objectives. ## Board composition In order to fulfil its obligations, the Board recognises the importance of having a range of skilled and experienced Directors, balancing the benefits of length of service and knowledge of the Company with the desirability of ensuring regular refreshment of the Board. The Board reviews its composition annually. The following disclosures are provided in respect of the UK Listing Rules targets that: i) 40% of a board should be women; ii) at least one senior role should be held by a woman; and iii) at least one board member should be from a non-white ethnic background, as defined by the Office of National Statistics criteria. As an externally managed investment company with no chief executive officer or chief financial officer, the roles which qualify as senior under FCA guidance are Chair and Senior Independent Director ('SID'). The Board also considers Audit Committee Chair to represent a senior role within this context. The Board has resolved that the Company's year end date be the most appropriate date for disclosure purposes. There have been no changes since 31 January 2026, and data has been collected on a self reporting basis. | Gender | Number | % | Senior roles * | | --- | --- | --- | --- | | Men | 3 | 60% | 2 | | Women | 2 | 40% | 1 | | Ethnic background | Number | % | Senior roles * | | --- | --- | --- | --- | | White British or Other White (including minority white groups) | 4 | 80% | 2 | | Asian/Asian British | 1 | 20% | 1 | * As an externally managed investment company with no chief executive officer or chief financial officer, the roles which qualify as senior under FCA guidance are Chair and Senior Independent Director ('SID'). The Chair is a man and the SID a woman. The Board also considers the role of Audit Committee Chair to represent a senior role within this context and this role is performed by a man. The Board meets the UK Listing Rules diversity targets that at least 40% of the individuals on the Board are women, at least one of the senior positions on the Board is held by a woman and that there is at least one Director of an ethnic minority background. All recruitment for new Board members will be external, through the use of an external recruitment agency. The recruitment agency will be engaged to undertake the selection of a list of suitable candidates for consideration and approval by the Nominations Committee. The external recruitment agency will be asked to put forward candidates with the desired skillset and also with a diverse range of backgrounds, cultures and identities. The Nominations Committee will take the UK Listing Rule diversity targets and any other best practice matters into account when determining the appropriateness of a candidate and final appointment. ## Induction and training New Directors are provided with an induction programme which is tailored to the particular circumstances of the appointee. Regular briefings were provided during the year on industry and regulatory matters. Directors receive other relevant training as necessary. 71 --- Governance report ## Remuneration As all the Directors are non-executive, there is no requirement for a separate Remuneration Committee. Directors' fees are considered by the Board as a whole within the limits approved by shareholders. The Company's policy on remuneration is set out in the Directors' remuneration report on pages 78 to 81. ## Management Engagement Committee The Directors have considered that a separate Management Engagement Committee is not required given the small size of the Board. ## Audit Committee The report of the Audit Committee is set out on pages 75 to 77. ## Nomination Committee The Nomination Committee consists of the whole Board due to the small size of the Board. Mr Pink is Chair of the Nomination Committee. The Committee meets at least annually and at such other times as may be required. The Committee has written terms of reference that include reviewing the Board, identifying and nominating new candidates for appointment to the Board, Board appraisal, succession planning and training. The Committee also considers whether Directors should be recommended for re-election by shareholders. The Committee is also responsible for considering Directors' potential conflicts of interest and for making recommendations to the Board on whether or not the potential conflicts should be authorised. The Committee's terms of reference are available on request from the Company and on the Company's website: bailliegiffordchinagrowthtrust.com ## Internal controls and risk management The Directors acknowledge their responsibility for the Company's risk management and internal control systems and for reviewing their effectiveness, including with regard to preparation of the Company's Annual Report and Financial Statements. The systems are designed to manage rather than eliminate the risk of failure to achieve business objectives and can only provide reasonable but not absolute assurance against material misstatement or loss. The Board confirms that there is an ongoing process for identifying, evaluating and managing the significant risks faced by the Company in accordance with the FRC guidance 'Guidance on Risk Management, Internal Control and Related Financial and Business Reporting'. The practical measures in relation to the design, implementation and maintenance of control policies and procedures to safeguard the Company's assets and to manage its affairs properly, including the maintenance of effective operational and compliance controls have been delegated to the Managers and Secretaries. The Board oversees the functions delegated to the Managers and Secretaries and the controls managed by the AIFM in accordance with the UK Alternative Investment Fund Managers Regulations (as detailed below). Baillie Gifford & Co's Internal Audit and Compliance Departments and the AIFM's permanent risk function provide the Audit Committee with regular reports on their monitoring programmes. The reporting procedures for these departments are defined and formalised within a service level agreement. Baillie Gifford & Co conducts an annual review of its system of internal controls which is documented within an internal controls report which complies with ISAE 3402 and Technical Release AAF 01/06 – Assurance Reports on Internal Controls of Service Organisations made available to Third Parties. This report is independently reviewed by Baillie Gifford & Co's Auditor and a copy is submitted to the Audit Committee. A report identifying the material risks faced by the Company and the key controls employed to manage these risks is reviewed by the Audit Committee. These procedures ensure that consideration is given regularly to the nature and extent of risks facing the Company and that they are being actively monitored. Where changes in risk have been identified during the year they also provide a mechanism to assess whether further action is required to manage these risks. The Directors confirm that they have reviewed the effectiveness of the Company's risk management and internal controls systems, which accord with the FRC 'Guidance on Risk Management, Internal Control and Related Financial and Business Reporting' and they have procedures in place to review their effectiveness on a regular basis. No significant weaknesses were identified in the year under review and up to the date of this report. 72 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc The Board confirms that these procedures have been in place throughout the Company's financial year and continue to be in place up to the date of approval of this report. To comply with the UK Alternative Investment Fund Managers Regulations, The Bank of New York Mellon (International) Limited acts as the Company's Depositary and Baillie Gifford & Co Limited as its AIFM. The Depositary's responsibilities include cash monitoring, safe keeping of the Company's financial instruments, verifying ownership and maintaining a record of other assets and monitoring the Company's compliance with investment limits and leverage requirements. The Depositary is liable for the loss of financial instruments held in custody. The Company's Custodian is The Bank of New York Mellon (International) Limited. The Custodian prepares reports on its key controls and safeguards which are independently reviewed by KPMG LLP. The reports are reviewed by Baillie Gifford's Business Risk Department and a summary of the key points is reported to the Audit Committee and any concerns are investigated. The Depositary provides the Audit Committee with a report on its monitoring activities. The AIFM has established a permanent risk management function to ensure that effective risk management policies and procedures are in place and to monitor compliance with risk limits. The AIFM has a risk management policy which covers the risks associated with the management of the portfolio, and the adequacy and effectiveness of this policy is reviewed and approved at least annually. This review includes the risk management processes and systems and limits for each risk area. The risk limits, which are set by the AIFM and approved by the Board, take into account the objectives, strategy and risk profile of the portfolio. These limits, including leverage (see page 38), are monitored and the sensitivity of the portfolio to key risks is undertaken periodically as appropriate to ascertain the impact of changes in key variables in the portfolio. Exceptions from limits monitoring and stress testing undertaken by Baillie Gifford's Business Risk Department are escalated to the AIFM and reported to the Board along with any remedial measures being taken. ## Going concern In accordance with the Financial Reporting Council's guidance on going concern and liquidity risk, the Directors have undertaken a rigorous review of the Company's ability to continue as a going concern. An explanation of the Company's principal and emerging risks and how they are managed is on pages 35 to 41 and contained in note 1 to the Financial Statements. The Board has, in particular, considered the impact of increasing geopolitical tensions and conflicts, including increased macroeconomic concerns alongside specific leverage and liquidity stress testing but does not believe the Company's going concern status is affected. The Company's assets, the majority of which are investments in quoted securities which are readily realisable, exceed its liabilities significantly. All borrowings require the prior approval of the Board, and the current revolving credit facility expires in April 2026. Gearing levels and compliance with borrowing covenants are reviewed by the Board on a regular basis. The Company has continued to comply with the investment trust status requirements of section 1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011. The Company's primary third party suppliers, including its Managers and Secretaries, Custodian, Depositary, Registrar, Auditor and Corporate Broker, are not experiencing significant operational difficulties affecting their respective services to the Company. Accordingly, the Financial Statements have been prepared on the going concern basis as it is the Directors' opinion, having assessed the principal risks and other matters as set out in the Viability Statement on page 34, that the Company will continue in operational existence until 30 April 2027, which is for a period of at least 12 months from the date of approval of these Financial Statements. 73 --- Governance report ## Relations with shareholders The Board places great importance on communication with shareholders. The Company's Managers communicate regularly with shareholders and their representatives. The Chair also meets shareholders independently of the Managers, from time to time, and reports shareholders' views to the Board. Shareholders wishing to communicate with any members of the Board may do so by writing to them at the Company's registered office or through the Company's broker, J.P. Morgan Cazenove (see contact details on page 129). All correspondence addressed to the Chair is dealt with directly by the Chair. The Company's Annual General Meeting provides a further forum for communication with all shareholders. The level of proxies lodged for each resolution is announced at the meeting and is published at bailliegiffordchinagrowthtrust.com subsequent to the meeting. The notice period for the Annual General Meeting is at least 21 clear days. Shareholders and potential investors may obtain up-to-date information on the Company from the Managers' website at bailliegiffordchinagrowthtrust.com. ## Corporate governance and stewardship The Company has given discretionary voting powers to Baillie Gifford & Co. The Managers vote against resolutions they consider may damage shareholders' rights or economic interests and their actions are reported at Board meetings. The Company believes that it is in the shareholders' interests to consider environmental, social and governance ('ESG') factors when selecting and retaining investments and has asked the Managers to take these issues into account. The Managers do not exclude companies from their investment universe purely on the grounds of ESG factors but adopt a positive engagement approach whereby matters are discussed with management with the aim of improving the relevant policies and management systems and enabling the Managers to consider how ESG factors could impact long-term investment returns. The Managers' report on ESG on pages 45 to 50 provides more detail. The statement of compliance with the UK Stewardship Code can be found on the Managers' website at bailliegifford.com. Baillie Gifford & Co, the Managers, has considered the Sustainable Finance Disclosure Regulation ('SFDR') and further details can be found on page 125. The Managers are signatories to the United Nations Principles for Responsible Investment and are also members of the of the Asian Corporate Governance Association and the International Corporate Governance Network. ## Climate change The Board recognises that climate change poses a serious threat to our environment, our society and to economies and companies around the globe. Addressing the underlying causes is likely to result in companies that are high emitters of carbon facing greater societal and regulatory scrutiny and higher costs to account for the true environmental impact of their activities. The Managers have engaged an external provider to map the carbon footprint of the equity portfolio using the information to prioritise engagement and understand what higher emitting companies are doing to manage climate risk better. The carbon intensity of the Company portfolio is provided in the Managers' report on ESG on pages 45 to 50. Baillie Gifford's Task Force on Climate-Related Financial Disclosures ('TCFD') Climate Report is available on the Managers' website at bailliegifford.com. A Company specific TCFD climate report is also available on the Company's page of the Company's website at bailliegiffordchinagrowthtrust.com. The Managers, Baillie Gifford & Co, are signatories to the CDP (formerly the Carbon Disclosure Project). On behalf of the Board Nicholas Pink Chair 31 March 2026 74 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Audit Committee report **The Audit Committee consists of all Directors. The members of the Committee consider that they have the requisite financial skills and experience to fulfil the responsibilities of the Committee. Jonathan Silver is the Chair of the Committee.** The Committee's authority and duties are clearly defined within its written terms of reference which are available on request from the Company and on the Company's page of the Managers' website: bailliegiffordchinagrowthtrust.com. The terms of reference are reviewed annually. The Committee's effectiveness is reviewed on an annual basis as part of the Board's performance evaluation process (see page 70). At least once a year the Committee meets with the external Auditor without any representatives of the Managers being present. ## Main activities of the Committee The Committee met four times during the year to 31 January 2026, with two of the meetings focussed on the review of the Company's private company valuation. Baillie Gifford attended all meetings. Baillie Gifford & Co's Internal Audit and Compliance Departments and the AIFM's permanent risk function provided reports on their monitoring programmes for the two meetings focussed on governance matters and the approval of the financial statements, Ernst & Young LLP, the external Auditor attended two of those meetings. The following significant issues have been considered in relation to the Annual Report and Accounts for the year ended 31 January 2026: 75 --- Governance report ## Valuation and existence The prices of all the listed investments at 31 January 2026 were agreed to external price sources. The majority of the investments are in listed securities and market prices are readily available from independent external pricing sources. The Committee reviewed the Managers' valuation policy for investments in unlisted companies (as described on page 54) and approved the valuation of the unlisted and suspended investments following a detailed review of the valuation of the investments and relevant challenge where appropriate. The listed portfolio holdings were agreed to confirmations from the Company's Custodian. The unlisted holdings in ByteDance and RedNote were agreed to external confirmations from the Company's custodian. ## Recognition of income Income received is accounted for in line with the Company's accounting policy. There were no significant matters during the year to report. The Audit Committee reviews the treatment of any special dividends received during the year, and also reviews total income against both prior year income and forecast income. ## Risk review and emerging risks The Committee regularly reviews the Company's risk matrix and keeps the key strategic risks facing the Company under particular scrutiny. Please see the discussion of principal risks on pages 35 to 41. In addition, the Audit Committee considered its processes for identifying and monitoring emerging risks. It was agreed that at each Audit Committee meeting there should be a discussion on emerging risks, and any identified emerging risks should be recorded in the risk matrix. ## Going concern and viability statement The Committee considered the factors, including increasing geopolitical tensions, that might affect the Company's viability over a period of five years and its ability to continue as a going concern for at least twelve months from the date of signing of the Financial Statements. It has also reviewed the reports from the Managers on the cash position and income projections of the Company, the liquidity of the investment portfolio, compliance with debt covenants and the Company's ability to meet its obligations as they fall due. The Company announced the introduction of a performance related tender offer (the 'Conditional Tender Offer') in November 2024. In the event that the Company's net asset value total return does not exceed the benchmark total return (MSCI China All Shares index in sterling terms) over the period beginning from the NAV announcement in relation to 29 November 2024 to the NAV announcement in relation to 30 November 2028, then the Conditional Tender Offer will be held as soon as practicable thereafter. The Committee also reviewed the Viability statement on page 34 and the statement on going concern on page 73 including the impact of increasing geopolitical tensions. Following this assessment, the Committee recommended to the Board the appropriateness of the Going Concern basis in preparing the Financial Statements and confirmed the accuracy of the Viability Statement and statement on Going Concern. ## Other Matters Considered During the Year During the year, the Audit Committee also considered the following: - Independent Auditor: Ernst & Young ('EY') were re-appointed as Independent Auditor for the year ended 31 January 2026. Details are provided on page 77 in the section External Auditor. - Compliance with section 1158 of the Corporation Tax Act 2010: The Directors regularly receive updates from the Managers on the Company's compliance with the requirements of investment trust status. There were no significant matters during the year to report. - Cyber security: The threat of a cyber attack is a concern for all organisations. The Audit Committee considered the principal risks, and reviewed information from relevant service providers on their cyber security arrangements. - Service providers: The Audit Committee reviewed the performance and internal controls of its major operational service providers. The Committee also reviewed the arrangements in place within Baillie Gifford & Co whereby their staff may, in confidence, raise concerns about possible improprieties in matters of financial reporting or other matters. - Allocation of costs: The Audit Committee reviewed the Company's policy on the allocation of certain costs (principally management fees and interest costs) between capital and revenue and recommended to the Board that there should be no change in the following proportion: capital 75%; revenue 25%. This split reflected the Board's view of the expected long-term split of returns, in compliance with the SORP. The recommendation was accepted by the Board. 76 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc - Fair, balanced and understandable: The Audit Committee reviewed the integrity of financial statements and ensured that, taken as a whole, they presented fair, balanced and understandable assessment of the Company's position and prospects. ### **Internal audit** The Committee continues to believe that the compliance and internal control systems and the internal audit function in place within the Managers provide sufficient assurance that a sound system of internal control, which safeguards shareholders' investment and the Company's assets, is maintained. An internal audit function, specific to the Company, is therefore considered unnecessary. ### **Internal controls and risk management** The Committee reviewed the effectiveness of the Company's risk management and internal controls systems as described on pages 72 and 73. No significant weaknesses were identified in the year under review. ### **External Auditor** To fulfil its responsibility regarding the independence and objectivity of the external Auditor, the Committee reviewed: - the audit plan for the year to 31 January 2026; - a report from the Auditor describing its arrangements to manage auditor independence and received confirmation of its independence; and - the extent of non-audit services provided by the external Auditor. There were no non-audit fees for the year to 31 January 2026. To assess the effectiveness of the external Auditor, the Committee reviewed and considered: - the Auditor's fulfilment of the agreed audit plan; - feedback from the Secretaries on the performance of the audit team; - the Audit Quality Inspection Report from the FRC; and - detailed discussion with audit personnel to challenge audit processes and deliverables. To fulfil its responsibility for oversight of the external audit process the Committee considered and reviewed: - the Auditor's engagement letter; - the Auditor's proposed audit strategy; - the audit fee; and - a report from the Auditor on the conclusion of the audit. Ernst & Young LLP has been engaged as the Company's Auditor since 2020. The audit Partner responsible for the audit is rotated at least every five years in accordance with professional and regulatory standards in order to protect independence and objectivity and to provide fresh challenge to the business. Ahmer Huda is the lead audit partner, has held the role since the conclusion of the 2024 audit and will continue as audit partner until the conclusion of the 2029 audit. Ernst & Young LLP has confirmed that it believes it is independent within the meaning of regulatory and professional requirements and that the objectivity of the audit partner and staff is not impaired. Having carried out the review process described above, the Committee is satisfied that the Auditor has remained independent and effective. There are no contractual obligations restricting the Committee's choice of external Auditor. ### **Accountability and audit** The respective responsibilities of the Directors and the Auditor in connection with the Financial Statements are set out on pages 82 to 83. On behalf of the Board Jonathan Silver Audit Committee Chair 31 March 2026 77 --- Governance report # Directors’ remuneration report **This report has been prepared in accordance with the requirements of the Companies Act 2006.** ## Statement by the Chair The Directors’ Remuneration Policy is subject to shareholder approval every three years or sooner if an alteration to the policy is proposed. The Remuneration Policy which is set out below was last approved at the Annual General Meeting in June 2023 and no changes are proposed to the policy to be approved at the Annual General Meeting to be held on 27 May 2026. The Board reviewed the level of fees during the year and considered the rate of inflation, independent industry surveys of Investment Company Director fees and peer group comparatives, and it was agreed that with effect from 1 February 2026, the Chair’s fee should increase from £44,000 to £45,760, and the non-executive Director fee should increase by £1,120 to £29,120. The additional fee for the Chairman of the Audit Committee and the additional fee for the Senior Independent Director should increase by £220 to £5,720 and by £60 to £1,560 respectively. ## Directors’ Remuneration Policy The Company’s policy is that the remuneration of non-executive Directors should reflect the experience of the Board as a whole and be determined with reference to the Company’s peer group and the investment trust industry generally. Directors are not eligible for bonuses, pension benefits, share options, long-term incentive schemes or other performance-related benefits as the Board does not believe that this is appropriate for non-executive Directors. The Board has set four levels of fees: one for the Chair, one for the other non-executive Directors, an additional fee that is paid to the Director who chairs the Audit Committee and an additional fee paid to the Senior Independent Director. Fees are reviewed annually in accordance with the policy. The fee for any new Director appointed will be determined on the same basis. Any changes to Directors’ fees are considered by the Board as a whole. 78 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Any views expressed by shareholders on the fees being paid to Directors will be taken into consideration by the Board when reviewing the Directors' Remuneration Policy and in the annual review of Directors' fees. Under the Articles of Association, Directors are entitled to be paid all reasonable travel, hotel and incidental expenses incurred in or about the performance of their duties as Directors, including expenses incurred in attending Board or shareholder meetings. If any Director is called upon to perform extra or special services of any kind, under the Articles of Association, they shall be entitled to receive such extra remuneration as the Board may decide in addition to any remuneration they may be entitled to receive. The Company does not enter into service contracts with its Directors. Instead, the Company has a policy of entering into a letter of appointment with each of its Directors, copies of which are available on request from the Company Secretary. Under the Directors' letters of appointment, there is a notice period of one month and no compensation is payable to a Director on leaving office. No compensation is payable in the event of a takeover bid. The terms of their appointment requires all Directors to retire and be subject to election at the first Annual General Meeting after their appointment. Thereafter all Directors will seek annual re-election at the Company's AGMs. ### Limits on Directors' remuneration The fees paid to the non-executive Directors are determined within the limit set out in the Company's Articles of Association which is currently £200,000 per annum in aggregate. Any change to this limit requires shareholder approval. The fees for the non-executive Directors are payable monthly in arrears and the fees paid in respect of the year ended 31 January 2026 together with the expected fees payable in respect of the year ending 31 January 2027 are set out in the table below. The fees payable to the Directors in the subsequent financial years will be determined following an annual review of the Directors' fees. | | Expected fees for year ending 31 January 2027 £ | Fees paid for the year to 31 January 2026 £ | | --- | --- | --- | | Chair's fee | 45,760 | 44,000 | | Non-executive Director's fee | 29,120 | 28,000 | | Additional fee for the Chairman of the Audit Committee | 5,720 | 5,500 | | Additional fee for Senior Independent Director | 1,560 | 1,500 | | Total aggregate annual fees that can be paid to the Directors in any year under the Directors' Remuneration Policy, as set out in the Company's Articles of Association | 200,000 | 200,000 | 79 --- Governance report ## Annual report on remuneration An ordinary resolution for the approval of this report will be put to the members at the forthcoming Annual General Meeting. The law requires the Company's Auditor to audit certain of the disclosures provided in this report. Where disclosures have been audited, they are indicated as such. The Auditor's opinion is included in the Independent Auditor's report on pages 85 to 92. ### Directors' remuneration for the year (audited) The Directors who served during the year received the following remuneration in the form of fees and taxable benefits. This represents the entire remuneration paid to the Directors. | Name | 2026 Fees ₤ | 2026 Taxable benefits * ₤ | 2026 Total ₤ | 2025 Fees ₤ | 2025 Taxable benefits * ₤ | 2025 Total ₤ | | --- | --- | --- | --- | --- | --- | --- | | Nicholas Pink† | 44,000 | 3,435 | **47,435** | 39,750 | 1,836 | **41,586** | | Susan Platts-Martin # | – | – | – | 11,000 | 621 | **11,621** | | Tim Clissold | 28,000 | 283 | **28,283** | 27,000 | 1,392 | **28,392** | | Magdalene Miller‡ | 29,500 | 2,028 | **31,528** | 28,000 | 1,612 | **29,612** | | Sarah MacAulay¶ | 28,000 | 1,763 | **29,763** | 20,250 | 510 | **20,760** | | Jonathan Silver^ | 33,500 | 314 | **33,814** | 32,000 | 619 | **32,619** | | | **163,000** | **7,823** | **170,823** | **158,000** | **6,590** | **164,590** | ### Annual percentage change in remuneration This represents the annual percentage change in the entire remuneration paid to the Directors. | Name | % from 2025 to 2026 | % from 2024 to 2025 | % from 2023 to 2024 | % from 2022 to 2023 | % from 2021 to 2022 | | --- | --- | --- | --- | --- | --- | | Nicholas Pink† | 14 | 228 | – | – | – | | Susan Platts-Martin # | – | (76) | 11 | 2 | (17) | | Tim Clissold ** | – | – | 10 | 206 | – | | Dermot McMeekin †† | – | – | – | – | (61) | | Magdalene Miller‡ | 6 | 1 | 11 | 2 | 492 | | Sarah MacAulay¶ | 43 | – | – | – | – | | Chris Ralph ^^ | – | – | – | (59) | 7 | | Andrew Robson § | – | (97) | (60) | 2 | 12 | | Jonathan Silver^ | 4 | 5 | 296 | – | – | * Comprises expenses incurred by Directors in the course of travel to attend Board and Committee meetings. † Mr Pink was appointed as a Director on 1 September 2023 and as Chair on 1 May 2024. # Ms Platts-Martin retired as Chair on 30 April 2024 and was paid an additional £10,000 for the year to 31 January 2021 to reflect the exceptional work done in relation to the selection of the new Managers. ‡ Ms Miller was appointed as a Director on 26 November 2020 and was appointed Senior Independent Director on 15 June 2023. ¶ Ms MacAulay was appointed as a Director on 1 May 2024. ^ Mr Silver was appointed as a Director on 1 September 2022 and appointed as Audit Chair on 15 June 2023. ** Mr Clissold was appointed as a Director on 1 October 2021. § Mr Robson retired as a Director on 15 June 2023. †† Mr McMeekin retired as a Director on 16 June 2021. ^^ Mr Ralph retired as a Director on 16 June 2022. 80 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Directors' interests (audited) The Directors at the end of the year under review, and their interests in the Company, are shown in the following table. There is no requirement under the Company's Articles of Association for Directors to hold shares in the Company. There have been no changes intimated in the Directors' interests up to 31 March 2026. | Name | Nature of interest | Ordinary 25p shares held at 31 January 2026 | Ordinary 25p shares held at 31 January 2025 | | --- | --- | --- | --- | | Nicholas Pink | Beneficial | 26,158 | 26,158 | | Tim Clissold | Beneficial | 50,000 | 50,000 | | Magdalene Miller | Beneficial | 10,000 | 10,000 | | Sarah MacAulay | Beneficial | 60,000 | 27,000 | | Jonathan Silver | Beneficial | 25,000 | 25,000 | ## Statement of voting at Annual General Meeting At the last Annual General Meeting, of the proxy votes received in respect of the Directors' remuneration report, 99.6% were in favour, 0.4% were against and votes withheld were 0.0%. At the last Annual General Meeting at which the Directors' Remuneration Policy was considered (June 2023), 99.4% of the proxy votes received were in favour, 0.5% were against and 0.1% votes were withheld. ## Relative importance of spend on pay The table below shows the actual expenditure (fees and taxable benefits) during the year in relation to Directors' remuneration and distributions to shareholders. | | 2026 £'000 | 2025 £'000 | Change % | | --- | --- | --- | --- | | Directors' remuneration | 171 | 165 | 3.6 | | Share buy backs | 4,759 | 5,503 | (13.5) | | Dividends | 1,290 | 1,220 | 5.7 | ## Company performance The following graph compares the share price total return (assuming all dividends are reinvested) to ordinary shareholders compared with the total shareholder return on a notional investment made up of shares in the component parts of the benchmark. The benchmark is the MSCI China All Shares Index (in sterling terms), prior to 16 September 2020 the benchmark was MSCI AC Asia ex Pacific Index. The benchmark was chosen for comparison purposes as it is the index against which the Company measures its performance. ## Performance graph (figures rebased to 100 at 31 January 2016) ![img-38.jpeg](img-38.jpeg) Source: LSEG and relevant underlying index providers. See disclaimer on page 124. All figures are total returns (assuming net dividends are reinvested). See Glossary of terms and alternative performance measures on pages 126 to 128. \* MSCI China All Shares Index (in sterling terms). Prior to 16 September 2020 the benchmark was MSCI AC Asia ex Pacific Index. Past performance is not a guide to future performance. ## Approval The Directors' remuneration report on pages 78 to 81 was approved by the Board of Directors and signed on its behalf on 31 March 2026. Nicholas Pink Chair 81 --- Governance report # Statement of Directors’ responsibilities in respect of the Annual Report and the Financial Statements The Directors are responsible for preparing the Annual Report and Financial Statements in accordance with applicable law and regulations. Company law requires the Directors to prepare Financial Statements for each financial year. Under that law they have elected to prepare the Financial Statements in accordance with applicable law and United Kingdom Accounting Standards, comprising Financial Reporting Standard 102 ‘The Financial Reporting Standard applicable in the UK and Republic of Ireland’ (FRS 102). Under company law the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of its profit or loss for that year. In preparing these Financial Statements, the Directors are required to: - select suitable accounting policies and then apply them consistently; - state whether applicable United Kingdom Accounting Standards, comprising FRS 102, have been followed, subject to any material departures disclosed and explained in the Financial Statements; - make judgements and accounting estimates that are reasonable and prudent; and - prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the Financial Statements and the Directors’ remuneration report comply with the Companies Act 2006. They are responsible for such internal control as they determine is necessary to enable the preparation of Financial Statements that are free from material misstatement, whether due to fraud or error, and are also responsible for safeguarding the assets of the Company and to prevent and detect fraud and other irregularities. Under applicable laws and regulations, the Directors are also responsible for preparing a Strategic report, Directors’ report, Directors’ remuneration report and Corporate governance statement that complies with those laws and regulations. The Directors are responsible for ensuring that the Annual Report and Financial Statements are made available on a website. Financial Statements are published on the Company’s website in accordance with legislation in the United Kingdom governing the preparation and dissemination of Financial Statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company’s page of the Managers’ website is the responsibility of the Directors. The Directors’ responsibility also extends to the ongoing integrity of the Financial Statements contained therein. The Directors have delegated responsibility to the Managers for the maintenance and integrity of the Company’s page of the Managers’ website. 82 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Responsibility statement of the Directors in respect of the annual financial report We confirm that, to the best of our knowledge: - the Financial Statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and net return of the Company; - the Strategic report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties it faces; and - the Annual Report and Financial Statements, taken as a whole, is fair, balanced and understandable and provides the information necessary for shareholders to assess the Company's position and performance, business model and strategy. On behalf of the Board Nicholas Pink Chair 31 March 2026 ### Notes The following notes relate to financial statements published on a website and are not included in the printed version of the Annual Report and Financial Statements: - The maintenance and integrity of the Baillie Gifford & Co website is the responsibility of Baillie Gifford & Co; the work carried out by the auditors does not involve consideration of these matters and accordingly, the auditors accept no responsibility for any changes that may have occurred to the financial statements since they were initially presented on the website. - Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. 83 --- # Financial report The Financial Statements for the year to 31 January 2026 are set out on pages 85 to 112 and have been prepared in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland'. --- Baillie Gifford China Growth Trust plc # Independent auditor's report to the members of Baillie Gifford China Growth Trust plc ## Opinion We have audited the financial statements of Baillie Gifford China Growth Trust plc ("the Company") for the year ended 31 January 2026 which comprise the Income Statement, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement, and the related notes 1 to 18, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" (United Kingdom Generally Accepted Accounting Practice). In our opinion, the financial statements: - give a true and fair view of the Company's affairs as at 31 January 2026 and of its profit for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and - have been prepared in accordance with the requirements of the Companies Act 2006. ## Basis for opinion We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor's responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. ## Independence We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard as applied to public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. The non-audit services prohibited by the FRC's Ethical Standard were not provided to the Company and we remain independent of Company in conducting the audit. 85 --- Financial report ## Conclusions relating to going concern In auditing the financial statements, we have concluded that the Directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate. Our evaluation of the Directors' assessment of the Company's ability to continue to adopt the going concern basis of accounting included: - Confirmation of our understanding of the Company's going concern assessment process by engaging with the Directors and the Company Secretary to determine if all key factors were considered in their assessment. - Inspecting the Directors' assessment of going concern, including the revenue forecast, for the period to 30 April 2027 which is at least 12 months from the date these financial statements were authorised for issue. - Reviewing the factors and assumptions, including the impact of the current economic environment and other significant events that could give rise to market volatility, as applied to the revenue forecast and the liquidity assessment of the investments and determined, through testing of the methodology and calculations, that the methods, inputs and assumptions utilised are appropriate to be able to make an assessment for the Company. - Consideration of the mitigating factors included in the revenue forecasts that are within the control of the Company. We reviewed the Company's assessment of the liquidity of investments held and evaluated the Company's ability to sell those investments in order to cover working capital requirements should revenue decline significantly. - Inspection of the Directors' assessment of the risk of breaching the debt covenants as a result of a reduction in the value of the Company's portfolio. We recalculated the Company's compliance with debt covenants in the scenarios assessed by the Directors and reviewed the Directors' reverse stress testing in order to identify what factors would lead to the Company breaching the financial covenants and in turn impact the going concern. - Review of the Company's going concern disclosures included in the annual report in order to assess that the disclosures were appropriate and in conformity with the reporting standards. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the Company's ability to continue as a going concern for a period assessed by the Directors, being the period to 30 April 2027, which is at least 12 months from the date these financial statements were authorised for issue. In relation to the Company's reporting on how they have applied the UK Corporate Governance Code, we have nothing material to add or draw attention to in relation to the directors' statement in the financial statements about whether the Directors considered it appropriate to adopt the going concern basis of accounting. Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company's ability to continue as a going concern. 86 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Overview of our audit approach | **Key audit matters** | - Risk of incomplete or inaccurate revenue recognition - Risk of incorrect valuation or ownership of the investment portfolio. | | --- | --- | | **Materiality** | - Overall materiality of £1.98m which represents 1% of shareholders' funds. | ## An overview of the scope of our audit ### Tailoring the scope Our assessment of audit risk, our evaluation of materiality and our allocation of performance materiality determine our audit scope for the Company. This enables us to form an opinion on the financial statements. We take into account size, risk profile, the organisation of the Company and effectiveness of controls, the potential impact of climate change and changes in the business environment when assessing the level of work to be performed. All audit work was performed directly by the audit engagement team and relevant specialist. ### Climate change Stakeholders are increasingly interested in how climate change will impact Companies. The Company has determined that the most significant future impacts from climate change on its operations will be from how climate change could affect the Company's investments and overall investment process. This is explained on page 38 under the principal and emerging risks section of the annual report. This disclosure forms part of the 'Other information', rather than the audited financial statements. Our procedures on these unaudited disclosures therefore consisted solely of considering whether they are materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appear to be materially misstated, in line with our responsibilities on 'Other information'. Our audit effort in considering climate change was focused on the adequacy of the Company's disclosures in the financial statements as set out in note 1(a) and conclusion that there was no further impact of climate change to be taken into account other than the unlisted investments as the listed investments are fair valued based on market pricing as required by FRS102. Unlisted investments are fair valued using IPEV Guidelines which require fair value to be assessed for implications related to climate change. We also challenged the Directors' considerations of climate change in their assessment of viability and associated disclosures. ### Key audit matters Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our opinion thereon, and we do not provide a separate opinion on these matters. 87 --- Financial report | Risk | Our response to the risk | Key observations communicated to the Audit Committee | | --- | --- | --- | | **Incomplete or inaccurate revenue recognition** (as described on page 76 in the Audit Committee's Report and as per the accounting policy set out on pages 98 to 100) The total revenue for the year to 31 January 2026 was £3.04m (2025: £2.72m), consisting primarily of dividend income from listed investments. There is a risk of incomplete or inaccurate recognition of revenue through the failure to recognise proper income entitlements or to apply an appropriate accounting treatment. Additionally, in accordance with the AIC SORP, special dividends received by the Company can be included in either the revenue or capital columns of the Statement of Comprehensive Income depending on the commercial circumstances behind the payments. | **We have performed the following procedures:** We obtained an understanding of the Baillie Gifford's (the 'Manager') processes and controls surrounding revenue recognition by performing walkthrough procedures. For all dividends received and accrued, we recalculated the dividend income by multiplying the investment holdings at the ex-dividend date, per the accounting records, by the dividend per share, agreed to an independent data vendor. We also agreed all exchange rates to an independent data vendor and agreed dividend amounts to bank statements where cash has been received. To test completeness, we confirmed that all expected dividends for investee companies held during the year were recorded, based on investee announcements from an independent data vendor. For all dividends accrued at the year end, we reviewed investee announcements to confirm the entitlements arose before 31 January 2026 and agreed any subsequent receipts to post-year end bank statements. We reviewed dividend types for all listed investments using an independent data vendor to identify special dividends. The Company received two such dividends. For a sample of one, we assessed the appropriateness of its classification as capital by reviewing the distribution rationale. | The results of our procedures identified no material misstatements in relation to the risk of incomplete or inaccurate revenue recognition. | 88 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc | Risk | Our response to the risk | Key observations communicated to the Audit Committee | | --- | --- | --- | | **Incorrect valuation or ownership of the investment portfolio** (as described on page 75 in the Audit Committee's Report and as per the accounting policy set out on pages 98 and 99). The valuation of the investment portfolio at 31 January 2026 was £204.13m (2025: £158.68m) consisting of listed equities with an aggregate value of £179.14m (2025: £144.06m) and unlisted equity investments with an aggregate value of £24.99m (2025: £14.62m). The valuation of the assets held in the investment portfolio is the key driver of the Company's net asset value and total return. Incorrect investment pricing, or failure to maintain proper legal title of the investments held by the Company could have a significant impact on the portfolio valuation and the return generated for shareholders. The fair value of listed investments is determined using quoted market bid prices at close of business on the reporting date. The unlisted investments are valued at fair value by the Directors following a detailed review and appropriate challenge of the valuations proposed by the Investment Manager. The unlisted investments policy applies methodologies consistent with the International Private Equity and Venture Capital Valuation guidelines ('IPEV'). The valuation of the unlisted investments, and the resultant impact on the unrealised gains/(losses), is the area requiring the most significant judgement and estimation in the preparation of the financial statements. | **We performed the following procedures:** We obtained an understanding of the Manager's processes and controls surrounding investment valuation and legal title, including an understanding of the operation of the Investment Manager's Private Companies Valuation Group and the Directors' process for review of the unlisted investments valuations, by performing walkthrough procedures. For all listed investments in the portfolio, we compared the market prices and exchange rates applied to an independent pricing vendor and recalculated the investment valuations as at the year end. We inspected the stale price report produced by the Manager to identify prices that have not changed and verified whether the listed price is a valid fair value. We did not identify any listed investments with stale prices. For the unlisted investments held as at the year-end we utilised our specialist Valuations team to review and challenge the valuation. This included: - Reviewing the valuation papers prepared by the Manager as at the year-end; - For the unlisted investments, assessing whether the valuation has been performed in line with the accounting policy and the IPEV guidelines; - Assessing the appropriateness of the data inputs and challenging the assumptions used to support the valuations; - Assessing other facts and circumstances, such as market movement and comparative company information, that have an impact on the fair market value of the unlisted investments; and - Determining a fair value range for the valuation and assessing whether Management's valuation is within this range. We recalculated the unrealised gains/losses on investments as at the year-end using the book-cost reconciliation. We compared the Company's investment holdings as at 31 January 2026 to an independent confirmation received directly from the Company's Depository. | The results of our procedures identified no material misstatements in relation to the risk of incorrect valuation or ownership of the investment portfolio. | 89 --- Financial report ## Our application of materiality We apply the concept of materiality in planning and performing the audit, in evaluating the effect of identified misstatements on the audit and in forming our audit opinion. ### Materiality The magnitude of an omission or misstatement that, individually or in the aggregate, could reasonably be expected to influence the economic decisions of the users of the financial statements. Materiality provides a basis for determining the nature and extent of our audit procedures. We determined materiality for the Company to be £1.98 million (2025: £1.53 million), which is 1% (2025: 1%) of shareholders' funds. We believe that shareholders' funds provides us with materiality aligned to the key measurement of the Company's performance. ### Performance materiality The application of materiality at the individual account or balance level. It is set at an amount to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality. On the basis of our risk assessments, together with our assessment of the Company's overall control environment, our judgement was that performance materiality was 75% (2025: 75%) of our planning materiality, namely £1.48 m (2025: £1.15m). We have set performance materiality at this percentage due to past experience of the audit that indicates a lower risk of misstatements, both corrected and uncorrected. Given the importance of the distinction between revenue and capital for investment trusts, we also applied a separate testing threshold for the revenue column of the Income Statement of £0.10m (2025: £0.08m), being 5% of net return on ordinary activities before taxation. ### Reporting threshold An amount below which identified misstatements are considered as being clearly trivial. We agreed with the Audit Committee that we would report to them all uncorrected audit differences in excess of £0.10m (2025: £0.07m), which is set at 5% of planning materiality, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We evaluate any uncorrected misstatements against both the quantitative measures of materiality discussed above and in light of other relevant qualitative considerations in forming our opinion. ## Other information The other information comprises the information included in the annual report, other than the financial statements and our auditor's report thereon. The Directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in this report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the course of the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard. ## Opinions on other matters prescribed by the Companies Act 2006 In our opinion the part of the Directors' remuneration report to be audited has been properly prepared in accordance with the Companies Act 2006. In our opinion, based on the work undertaken in the course of the audit: - the information given in the strategic report and the Directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and - the strategic report and Directors' reports have been prepared in accordance with applicable legal requirements; 90 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Matters on which we are required to report by exception In the light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or Directors' report. We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion: - adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or - the financial statements and the part of the Directors' Remuneration Report to be audited are not in agreement with the accounting records and returns; or - certain disclosures of Directors' remuneration specified by law are not made; or - we have not received all the information and explanations we require for our audit ## Corporate Governance Statement We have reviewed the Directors' statement in relation to going concern, longer-term viability and that part of the Corporate Governance Statement relating to the Company's compliance with the provisions of the UK Corporate Governance Code specified for our review by the UK Listing Rules. Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance Statement is materially consistent with the financial statements or our knowledge obtained during the audit: - Directors' statement with regards to the appropriateness of adopting the going concern basis of accounting and any material uncertainties identified set out on page 73; - Directors' explanation as to its assessment of the Company's prospects, the period this assessment covers and why the period is appropriate set out on page 34; - Director's statement on whether it has a reasonable expectation that the Company will be able to continue in operation and meets its liabilities set out on page 76; - Directors' statement on fair, balanced and understandable set out on page 83; - Board's confirmation that it has carried out a robust assessment of the emerging and principal risks set out on page 35; - The section of the annual report that describes the review of effectiveness of risk management and internal control systems set out on page 72; and; - The section describing the work of the audit committee set out on pages 75 to 77. ## Responsibilities of Directors As explained more fully in the Directors' responsibilities statement set out on pages 82 and 83, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Directors are responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so. ## Auditor's responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. 91 --- Financial report ## Explanation as to what extent the audit was considered capable of detecting irregularities, including fraud Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect irregularities, including fraud. The risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. The extent to which our procedures are capable of detecting irregularities, including fraud is detailed below. However, the primary responsibility for the prevention and detection of fraud rests with both those charged with governance of the Company and management. - We obtained an understanding of the legal and regulatory frameworks that are applicable to the Company and determined that the most significant are FRS 102, the Companies Act 2006, the UK Listing Rules, the UK Corporate Governance Code, The Companies (Miscellaneous Reporting) Regulations 2018, the Association of Investment Companies' Code and Statement of Recommended Practice and Section 1158 of the Corporation Tax Act 2010. - We understood how the Company is complying with those frameworks through discussions with the Audit Committee and Company Secretary, and review of Board minutes and the Company's documented policies and procedures related to controls over the financial reporting process. - We assessed the susceptibility of the Company's financial statements to material misstatement, including how fraud might occur by testing specific accounting journal entries and considering the key risks impacting the financial statements. We identified fraud risks with respect to incorrect valuation of the unlisted investments and the resultant impact on unrealised gains and (losses). Further discussion of our approach is set out in the key audit matters above. - Based on this understanding we designed our audit procedures to identify non-compliance with such laws and regulations. Our procedures involved review of the reporting to the Directors with respect to the application of the documented policies and procedures related to controls over the financial reporting process, and review of the financial statements to ensure compliance with the reporting requirements of the Company. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report. ## Other matters we are required to address - Following the recommendation from the audit committee, we were appointed by the Company on 12 June 2019 to audit the financial statements for the year ending 31 January 2020 and subsequent financial periods. - The period of total uninterrupted engagement including previous renewals and reappointments is seven years, covering the years ending 31 January 2020 to 31 January 2026. - The audit opinion is consistent with the additional report to the audit committee. ## Use of our report This report is made solely to the Company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Company's members those matters we are required to state to them in an auditor's report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company's members as a body, for our audit work, for this report, or for the opinions we have formed. Ahmer Huda (Senior statutory auditor) for and on behalf of Ernst & Young LLP, Statutory Auditor London 31 March 2026 92 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ![img-39.jpeg](img-39.jpeg) 93 --- Financial report # Income statement For the year ended 31 January | | Notes | 2026 Revenue £'000 | 2026 Capital £'000 | 2026 Total £'000 | 2025 Revenue £'000 | 2025 Capital £'000 | 2025 Total £'000 | | --- | --- | --- | --- | --- | --- | --- | --- | | Gains/(losses) on investments | 9 | – | 49,431 | **49,431** | – | 40,068 | **40,068** | | Currency (losses)/gains | 13 | – | 645 | **645** | – | (1) | **(1)** | | Income | 2 | 3,039 | – | **3,039** | 2,718 | – | **2,718** | | Investment management fee | 3 | (309) | (926) | **(1,235)** | (246) | (737) | **(983)** | | Other administrative expenses | 4 | (671) | – | **(671)** | (584) | – | **(584)** | | **Net return before finance costs and taxation** | | **2,059** | **49,150** | **51,209** | **1,888** | **39,330** | **41,218** | | Finance costs of borrowings | 5 | (113) | (339) | **(452)** | (149) | (448) | **(597)** | | **Net return before taxation** | | **1,946** | **48,811** | **50,757** | **1,739** | **38,882** | **40,621** | | Tax | 6 | (212) | – | **(212)** | (210) | – | **(210)** | | **Net return after taxation** | | **1,734** | **48,811** | **50,545** | **1,529** | **38,882** | **40,411** | | **Net return per ordinary share** | **7** | **2.98p** | **83.83p** | **86.81p** | **2.53p** | **64.39p** | **66.92p** | The total column of this statement is the profit and loss account of the Company. The supplementary revenue and capital return columns are prepared under guidance published by the Association of Investment Companies. All revenue and capital items in this statement derive from continuing operations. A Statement of Comprehensive Income is not required as all gains and losses of the Company have been reflected in the above statement. The accompanying notes on pages 98 to 112 are an integral part of the Financial Statements. 94 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Balance sheet | | Notes | As at 31 January | | As at 31 January | | | --- | --- | --- | --- | --- | --- | | | | 2026 $'000 | 2026 $'000 | 2025 $'000 | 2025 $'000 | | **Fixed assets** | | | | | | | Investments held at fair value through profit or loss | 9 | | 204,126 | | 158,682 | | **Current assets** | | | | | | | Debtors | 10 | 156 | | 40 | | | Cash and cash equivalents | 15 | 1,668 | | 975 | | | | | 1,824 | | 1,015 | | | **Creditors** | | | | | | | Amounts falling due within one year | 11 | (8,355) | | (6,598) | | | **Net current liabilities** | | | (6,531) | | (5,583) | | **Total assets less current liabilities** | | | **197,595** | | **153,099** | | **Capital and reserves** | | | | | | | Share capital | 12 | | 17,087 | | 17,087 | | Share premium account | 13 | | – | | 31,780 | | Distributable capital reserve | 13 | | 31,780 | | – | | Capital redemption reserve | 13 | | 41,085 | | 41,085 | | Capital reserve | 13 | | 100,206 | | 56,154 | | Revenue reserve | 13 | | 7,437 | | 6,993 | | **Shareholders' funds** | | | **197,595** | | **153,099** | | **Net asset value per ordinary share*** | **14** | | **344.44p** | | **259.07p** | The Financial Statements of Baillie Gifford China Growth Trust plc (Company registration number 91798) were approved and authorised for issue by the Board and were signed on 31 March 2026. Nicholas Pink Chair The accompanying notes on pages 98 to 112 are an integral part of the Financial Statements. \* See Glossary of terms and alternative performance measures on pages 126 to 128. 95 --- Financial report # Statement of changes in equity ## For the year ended 31 January 2026 | | Notes | Share capital £'000 | Share premium account £'000 | Distributable capital reserve £'000 | Capital redemption reserve £'000 | Capital reserve £'000 | Revenue reserve £'000 | Shareholders' funds £'000 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Shareholders' funds at 1 February 2025 | | 17,087 | 31,780 | - | 41,085 | 56,154 | 6,993 | 153,099 | | Dividends paid during the year | 8 | - | - | - | - | - | (1,290) | (1,290) | | Net return after taxation | 7 | - | - | - | - | 48,811 | 1,734 | 50,545 | | Ordinary shares bought back into treasury | | - | - | - | - | (4,759) | - | (4,759) | | Cancellation of share premium account | | - | (31,780) | 31,780 | - | - | - | - | | **Shareholders' funds at 31 January 2026** | | **17,087** | **-** | **31,780** | **41,085** | **100,206** | **7,437** | **197,595** | ## For the year ended 31 January 2025 | | Notes | Share capital £'000 | Share premium account £'000 | Capital redemption reserve £'000 | Capital reserve £'000 | Revenue reserve £'000 | Shareholders' funds £'000 | | --- | --- | --- | --- | --- | --- | --- | --- | | Shareholders' funds at 1 February 2024 | | 17,087 | 31,780 | 41,085 | 22,775 | 6,684 | 119,411 | | Dividends paid during the year | 8 | - | - | - | - | (1,220) | (1,220) | | Net return after taxation | 7 | - | - | - | 38,882 | 1,529 | 40,411 | | Ordinary shares bought back into treasury | | - | - | - | (5,503) | - | (5,503) | | **Shareholders' funds at 31 January 2025** | | **17,087** | **31,780** | **41,085** | **56,154** | **6,993** | **153,099** | The accompanying notes on pages 98 to 112 are an integral part of the Financial Statements. 96 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Cash flow statement For the year ended 31 January | | Notes | 2026 £'000 | 2026 £'000 | 2025 £'000 | 2025 £'000 | | --- | --- | --- | --- | --- | --- | | **Cash flows from operating activities** | | | | | | | Net return before taxation | | 50,757 | | 40,621 | | | *Adjustments to reconcile company profit before tax to net cash flow from operating activities* | | | | | | | Net (gains)/losses on investments | 9 | (49,431) | | (40,068) | | | Currency losses/(gains) | | (645) | | 1 | | | Finance costs of borrowings | 5 | 452 | | 597 | | | *Other capital movements* | | | | | | | Changes in debtors | | (116) | | (16) | | | Change in creditors | | 88 | | 40 | | | *Taxation* | | | | | | | Overseas withholding tax suffered | 6 | (212) | | (212) | | | Overseas withholding tax reclaims received | | – | | 2 | | | **Cash from operations*** | | | 893 | | 965 | | Interest paid | | | (433) | | (534) | | **Net cash inflow from operating activities** | | | **460** | | **431** | | **Cash flows from investing activities** | | | | | | | Acquisitions of investments | 9 | (42,356) | | (31,284) | | | Disposals of investments | 9 | 46,343 | | 37,421 | | | **Net cash inflow/(outflow) from investing activities** | | | **3,987** | | **6,137** | | **Cash flows from financing activities** | | | | | | | Equity dividends | 8 | (1,290) | | (1,220) | | | Bank loans repaid | | – | | (5,906) | | | Bank loans drawn down | | 2,451 | | 5,970 | | | Shares bought back | 13 | (4,759) | | (5,503) | | | **Net cash outflow from financing activities** | | | **(3,598)** | | **(6,659)** | | **Increase/(decrease) in cash and cash equivalents** | | | **849** | | **(91)** | | Exchange movements | | | (156) | | 140 | | Cash and cash equivalents at start of year | 15 | | 975 | | 926 | | **Cash and cash equivalents at end of year** | 15 | | **1,668** | | **975** | * Cash from operations includes dividends received of £3,017,000 (2025 – £2,697,000) and interest received of £22,000 (2025 – £21,000). The accompanying notes on pages 98 to 112 are an integral part of the Financial Statements. 97 --- Financial report # Notes to the Financial Statements ## 01 Principal accounting policies The Financial Statements for the year to 31 January 2026 have been prepared in accordance with FRS 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' on the basis of the accounting policies set out below which are consistent with those applied for the year ended 31 January 2025. ### a. Basis of accounting All of the Company's operations are of a continuing nature and the Financial Statements are prepared on a going concern basis under the historical cost convention, modified to include the revaluation of fixed asset investments and on the assumption that approval as an investment trust under section 1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011 will be retained. The Board has, in particular, considered the impact of increasing market volatility due to macroeconomic and geopolitical concerns, but does not believe the Company's going concern status is affected. The Company's assets, which at present are mainly investments in quoted securities which are readily realisable, exceed its liabilities significantly. All borrowings require the prior approval of the Board. Gearing levels and compliance with borrowing covenants are reviewed by the Board on a regular basis. The Company has continued to comply with the investment trust status requirements of section 1158 of the Corporation Tax Act 2010 and the Investment Trust (Approved Company) (Tax) Regulations 2011. The Company's primary third party suppliers, including its Managers and Secretaries, Custodian, Depositary, Registrar, Auditor and Corporate Broker, are not experiencing significant operational difficulties affecting their respective services to the Company. Accordingly, the Financial Statements have been prepared on the going concern basis as it is the Directors' opinion, having assessed the principal and emerging risks and other matters, as set out in the Viability Statement on page 34, that the Company will continue in operational existence until 30 April 2027, which is for a period of at least 12 months from the date of approval of these Financial Statements. In preparing these Financial Statements the Directors have considered the impact of climate change risk as a principal risk as set out on page 38, and have concluded that it does not have a material impact on the Company's investments. They have considered the impact of climate change on the value of both the listed and unlisted investments included in the Financial Statements. The listed investments should already include the impact in their prices as quoted on the relevant exchange and consistent with that view, we do not believe the impact on the unlisted investments would be material. The Financial Statements have been prepared in accordance with the Companies Act 2006, applicable UK Accounting Standards and with the AIC's Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' issued in November 2014 and updated in July 2022 with consequential amendments. In order to reflect better the activities of the Company and in accordance with guidance issued by the AIC, supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented. Financial assets and financial liabilities are recognised in the Company's Balance sheet when it becomes a party to the contractual provisions of the instrument. The Directors consider the Company's functional currency to be sterling as the entity is listed on a sterling stock exchange in the UK, the Company's share capital and dividends paid are denominated in sterling, Company's shareholders are predominantly based in the UK and the Company and its Investment Manager, who are subject to the UK's regulatory environment, are also UK based. The financial statements are presented in Pounds Sterling rounded to the nearest thousand, except where otherwise indicated. ### b. Significant accounting estimates and judgements The preparation of the Financial Statements requires the use of estimates, assumptions and judgements. These estimates, assumptions and judgements affect the reported amounts of assets and liabilities, at the reporting date. While estimates are based on best judgement using information and financial data available, the actual outcome may differ from these estimates. The key sources of estimation and uncertainty relate to the assumptions used in the determination of the fair value of the unlisted investments, which are detailed in note 9 on pages 103 and 104. 98 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # **Judgements** The Directors consider that the preparation of the Financial Statements involves the following key judgements: i. the determination of the functional currency of the Company as sterling (see rationale in 1(a) above); and ii. the fair valuation of the unlisted and suspended investments. The key judgements in the fair valuation process are: i. the Managers' determination of the appropriate application of the International Private Equity and Venture Capital Guidelines 2025 ('IPEV Guidelines') to each unlisted investment; and ii. the Directors' consideration of whether each fair value is appropriate following detailed review and challenge. The judgement applied in the selection of the methodology used for determining the fair value of each unlisted investment can have a significant impact upon the valuation. # **Estimates** The key estimate in the Financial Statements is the determination of the fair value of the unlisted investments by the Managers for consideration by the Directors. This estimate is key as it significantly impacts the valuation of the unlisted investments at the Balance sheet date. The fair valuation process involves estimation using subjective inputs that are unobservable (for which market data is unavailable). The main estimates involved in the selection of the valuation process inputs are: i. the selection of appropriate comparable companies in order to derive revenue multiples and meaningful relationships between enterprise value, revenue and earnings growth. Comparable companies are chosen on the basis of their business characteristics and growth patterns; ii. the selection of a revenue metric (either historic or forecast); iii. the application of an appropriate discount factor to reflect the reduced liquidity of unlisted companies versus their listed peers; iv. the estimation of the probability assigned to an exit being through an initial public offering ('IPO') or a company sale; v. the selection of an appropriate industry benchmark index to assist with the valuation validation or the application of valuation adjustments, particularly in the absence of established earnings or closely comparable peers; and vi. the calculation of valuation adjustments derived from milestone analysis (i.e. incorporating operational success against the plan/forecasts of the business into the valuation). # **c. Investments** The Company's investments are classified as held at fair value through profit and loss in accordance with sections 11 and 12 of FRS 102. Purchases and sales of investments are recognised on a trade date basis. Expenses incidental to the purchase and sale of investments are recognised in the Income Statement as capital items. Investments are classified as held at fair value through profit or loss on initial recognition and are measured at subsequent reporting dates at fair value. The fair value of listed security investments is bid price or last traded price. The fair value of the suspended investment is the last traded price, adjusted for the estimated impact on the business of the suspension. Unlisted investments are valued at fair value by the Directors following a detailed review and appropriate challenge of the valuations proposed by the Managers. The Managers' unlisted investment policy applies methodologies consistent with IPEV Guidelines. These methodologies can be categorised as follows (a) market approach (multiples, industry valuation benchmarks and available market prices); (b) income approach (discounted cash flows); and (c) replacement cost approach (net assets). The valuation process recognises also, as stated in the IPEV Guidelines, that the price of a recent investment may be an appropriate starting point for estimating fair value, however it should be evaluated using the techniques described above. # **d. Cash and cash equivalents** Cash and cash equivalents include cash in hand and deposits repayable on demand. Deposits are repayable on demand if they can be withdrawn at any time without notice and without penalty or if they have a maturity or period of notice of not more than one working day. 99 --- Financial report **e. Income** i. Income from equity investments is brought into account on the date on which the investments are quoted ex-dividend or, where no ex-dividend date is quoted, when the Company's right to receive payment is established. ii. Special dividends are treated as repayments of capital or income depending on the facts of each particular case. iii. Interest receivable/payable on bank deposits is recognised on an accruals basis. iv. Overseas dividends include the taxes deducted at source. v. If scrip is taken in lieu of dividends in cash, the net amount of the cash dividend declared is credited to the revenue account. Any excess in the value of the shares received over the amount of the cash dividend foregone is recognised as capital. vi. Interest from fixed interest securities is recognised on an effective yield basis. **f. Expenses** All expenses are accounted for on an accruals basis. Expenses are charged through the revenue account except: i. where they relate directly to the acquisition or disposal of an investment, (transaction costs), in which case they are recognised as capital within losses/gains on investments; and these expenses are commonly referred to as transaction costs and comprise brokerage commission and stamp duty. ii. they relate directly to the buy-back/issuance of shares, in which case they are added to the buy-back cost or deducted from the share issuance proceeds. The management fee is allocated 25% to revenue and 75% to capital in line with the Board's expected long-term split of revenue and capital return from the Company's investment portfolio. The Board reviews the expense allocation policy on a yearly basis and considers whether it remains appropriate. **g. Long term borrowings, overdrafts and finance costs** Bank loans and overdrafts are classified as loans and are measured at amortised cost. They are initially recorded at the proceeds received net of direct costs. Finance costs are accounted for on an accruals basis and are allocated 25% to revenue and 75% to capital in line with the Board's expected long-term split of revenue and capital return from the Company's investment portfolio. The Board reviews the expense allocation policy on a yearly basis and considers whether it remains appropriate. **h. Taxation** The taxation charge represents the sum of current tax and the movement in the provision for deferred taxation during the year. Current taxation represents non-recoverable overseas taxes which is charged to the revenue accounts where it relates to income received and to capital where it relates to items of a capital nature. Deferred taxation is provided on all timing differences which have originated but not reversed by the Balance sheet date, calculated on a non-discounted basis at the tax rates expected to apply when the timing differences reverse, based on what has been enacted or substantively enacted, relevant to the benefit or liability. Deferred tax assets are recognised only to the extent that it is more likely than not that there will be taxable profits from which underlying timing differences can be deducted. **i. Dividend distributions** Interim dividends are recognised in the year in which they are paid and final dividends are recognised in the year in which the dividends are approved by the Company's shareholders in a General Meeting. **j. Foreign currencies** Transactions involving foreign currencies are converted at the rate ruling at the time of the transaction. Monetary assets and liabilities and fixed asset investment in foreign currencies are translated at the closing rates of exchange at the Balance Sheet date. Any gain or loss arising from a change in exchange rate subsequent to the date of the transaction is included as an exchange gain or loss in the Income Statement. **k. Capital reserve** Gains and losses on disposal of investments, changes in the fair value of investments held, exchange differences of a capital nature and the amount by which other assets and liabilities valued at fair value differ from their book cost are dealt with in the capital reserve. Purchases of the Company's own shares are also funded from this reserve and the weighted average purchase price paid to purchase the shares is credited to this reserve if the shares are subsequently sold from treasury. The nominal value of such shares is transferred from share capital to the capital redemption reserve if the shares are subsequently cancelled. **l. Share premium** The share premium reserve represents: - the proceeds of sales of shares held in treasury in excess of the weighted average purchase price paid by the Company to repurchase the shares; and - the excess of the proceeds of issuance of new shares over the nominal value. **m. Capital redemption reserve** The nominal value of ordinary share capital purchased and cancelled is transferred out of called-up share capital and into the capital redemption reserve on the relevant trade date. **n. Revenue reserve** The revenue profit or loss for the year is taken to or from this reserve. The revenue reserve may be distributed by way of a dividend. **o. Single segment reporting** The Company is engaged in a single segment of business, being investment business, consequently no business segmental analysis is provided. 100 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 02 Income | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | **Income from investments** | | | | Overseas dividends | 3,017 | 2,697 | | **Other income** | | | | Interest | 22 | 21 | | **Total income** | **3,039** | **2,718** | ## 03 Investment management fee | | 2026 Revenue £'000 | 2026 Capital £'000 | 2026 Total £'000 | 2025 Revenue £'000 | 2025 Capital £'000 | 2025 Total £'000 | | --- | --- | --- | --- | --- | --- | --- | | Investment management fee | 309 | 926 | 1,235 | 246 | 737 | 983 | Details of the Investment Management Agreement are disclosed on pages 63 and 64. Baillie Gifford & Co Limited's annual management fee is (i) 0.75% of the first £50 million of net asset value; plus (ii) 0.65% of net asset value between £50 million and £250 million; plus (iii) 0.55% of net asset value in excess of £250 million, calculated and payable quarterly. ## 04 Other administrative expenses | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | General administrative expenses | 258 | 196 | | Directors' fees (see Directors' remuneration report on page 78) | 163 | 158 | | Marketing* | 97 | 99 | | Custody fees | 52 | 37 | | Registrar fees | 33 | 31 | | Depository fees | 16 | 13 | | Auditor's remuneration – statutory audit of Company's Annual Financial Statements | 52 | 50 | | | **671** | **584** | * The Company is part of a marketing programme which includes all the Investment Trusts managed by the Managers. The marketing strategy has an ongoing objective to stimulate demand for the Company's shares. The cost of this marketing strategy is borne in partnership by the Company and the Managers. The Managers matches the Company's marketing contribution and provides the resource to manage and run the programme. ## 05 Finance costs of borrowing | | 2026 Revenue £'000 | 2026 Capital £'000 | 2026 Total £'000 | 2025 Revenue £'000 | 2025 Capital £'000 | 2025 Total £'000 | | --- | --- | --- | --- | --- | --- | --- | | Interest on bank loans | 113 | 339 | 452 | 149 | 448 | 597 | 101 --- Financial report ## 06 Tax on ordinary activities | | 2026 Revenue £'000 | 2026 Capital £'000 | 2026 Total £'000 | 2025 £'000 | 2025 £'000 | 2025 £'000 | | --- | --- | --- | --- | --- | --- | --- | | **Analysis of charge in year** | | | | | | | | Overseas withholding taxation | 212 | - | 212 | 210 | - | 210 | | **Factors affecting tax charge for year** | | | | | | | | The tax charge for the year is lower than the standard rate of corporation tax in the UK of 25%. The differences are explained below: | | | | | | | | **Net return before taxation** | 1,946 | - | 1,946 | 1,739 | 38,882 | 40,621 | | Net return on ordinary activities multiplied by the standard rate of corporation tax in the UK of 25% | 487 | 12,203 | 12,690 | 435 | 9,721 | 10,156 | | Effects of: | | | | | | | | Capital returns not taxable | - | (12,519) | (12,519) | - | (10,017) | (10,017) | | Income not taxable | (754) | - | (754) | (674) | - | (674) | | Overseas withholding tax incurred | 212 | - | 212 | 212 | - | 212 | | Taxable losses in year not utilised | 267 | 316 | 583 | 239 | 296 | 535 | | Tax repayment received | - | - | - | (2) | - | (2) | | **Revenue tax charge for the year** | **212** | **-** | **212** | **210** | **-** | **210** | As an investment trust, the Company's capital gains are not taxable. ### Factors that may affect future tax charges At 31 January 2026 the Company had a potential deferred tax asset of £7,640,835 (2025 – £7,073,000) on taxable losses which is available to be carried forward and offset against future taxable profits. A deferred tax asset has not been recognised on these losses as it is considered unlikely that the Company will make taxable revenue profits in the future and it is not liable to tax on its capital gains. The potential deferred tax asset has been calculated using a corporation tax rate of 25%. Due to the Company's status as an investment trust, and the intention to continue meeting the conditions required to obtain approval in the foreseeable future, the Company has not provided for deferred tax on any capital gains and losses arising on the revaluation or disposal of investments. The Company has filed protective claims with HMRC in order to seek recovery of potentially overpaid taxes from HMRC in relation to the UK's pre-2009 dividend tax rules. The claims cover accounting periods ending 2005–2007 and accounting periods ending 2008 and 2009 in which the Company paid UK tax under Schedule D Case V. In such periods, the Company is seeking recovery of the tax paid together with interest. The decision of the First Tier Tribunal (FTT) in the Post Prudential case was issued in December 2021 and was largely in favour of the claimants. However, many of the decisions of the FTT were appealed by HMRC. Subsequently, in January 2024, the Upper Tribunal (UT) issued a further judgement overturning some but not all the FTT's decisions. HMRC and the claimants appealed the UT's decision to the Court of Appeal, which was heard in January 2025; the judgment was issued on 25 February, ruling against the taxpayers. The Supreme Court has refused permission to appeal, so the Court of Appeal's judgment in the PPCN litigation is now final and binding. The decision means that the taxes in respect of the accounting periods ending 2005–2007 will not be repaid. The claims covering the accounting periods ending in 2008 & 2009 remain under dispute with HMRC and have been formally referred to the First-tier Tribunal. A hearing date has not yet been set. ### Contingent asset HMRC have indicated they will repay overpaid taxes for the accounting periods ending 2008 and 2009 of £1.1 million plus interest. As the repayment is probable, but not virtually certain, the Company is disclosing £1.1 million as a contingent asset. 102 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 07 Net return per ordinary share | | 2026 Revenue | 2026 Capital | 2026 Total | 2025 Revenue | 2025 Capital | 2025 Total | | --- | --- | --- | --- | --- | --- | --- | | Net return per ordinary share | 2.98p | 83.83p | **86.81p** | 2.53p | 64.39p | **66.92p** | Revenue return per ordinary share is based on the net revenue return on ordinary activities after taxation of £1,734,000 (2025 – £1,529,000), and on 58,224,680 (2025 – 60,389,282) ordinary shares, being the weighted average number of ordinary shares in issue during each year. Capital return per ordinary share is based on the net capital gain for the financial year of £48,811,000 (2025 – gain of £38,882,000) and on 58,224,680 (2025 – 60,389,282) ordinary shares, being the weighted average number of ordinary shares in issue during each year. There are no dilutive or potentially dilutive shares in issue. ## 08 Ordinary dividends | | 2026 | 2025 | 2026 £'000 | 2025 £'000 | | --- | --- | --- | --- | --- | | **Amounts recognised as distributions in the period:** | | | | | | Previous year's final dividend (paid 25 July 2025) | 2.20p | 2.00p | 1,290 | 1,220 | Also set out below are the total dividends paid and proposed in respect of the financial year, which is the basis on which the requirements of section 1158 of the Corporation Tax Act 2010 are considered. The revenue available for distribution by way of dividends for the year is £1,734,000 (2025 – £1,529,000). | | 2026 | 2025 | 2026 £'000 | 2025 £'000 | | --- | --- | --- | --- | --- | | **Dividends paid and proposed in the period:** | | | | | | Proposed final dividend per ordinary share (payable 22 July 2026) | 2.50p | 2.20p | 1,385 | 1,296 | ## 09 Investments | As at 31 January 2026 | Level 1 £'000 | Level 2 £'000 | Level 3 £'000 | Total £'000 | | --- | --- | --- | --- | --- | | **Securities** | | | | | | Listed equities | 179,134 | – | – | **179,134** | | Suspended equities* | – | – | – | – | | Unlisted equities | – | – | 24,992 | **24,992** | | Total financial asset investments | **179,134** | – | **24,992** | **204,126** | | As at 31 January 2025 | Level 1 £'000 | Level 2 £'000 | Level 3 £'000 | Total £'000 | | --- | --- | --- | --- | --- | | **Securities** | | | | | | Listed equities | 144,059 | – | – | **144,059** | | Suspended equities* | – | – | 194 | **194** | | Unlisted equities | – | – | 14,429 | **14,429** | | Total financial asset investments | **144,059** | – | **14,623** | **158,682** | Investments in securities are financial assets held at fair value through profit or loss on initial recognition. In accordance with FRS 102 the tables above provide an analysis of these investments based on the fair value hierarchy described below which reflects the reliability and significance of the information used to measure their fair value. * New Horizon Health was a Listed equity from 1 February 2024 until suspension on 28 March 2024. 103 --- Financial report ## 09 Investments (continued) ### Fair value hierarchy The levels are determined by the lowest (that is the least reliable or least independently observable) level of input that is significant to the fair value measurement for the individual investment in its entirety as follows: **Level 1** – using unadjusted quoted prices for identical instruments in an active market; **Level 2** – using inputs, other than quoted prices included within Level 1, that are directly or indirectly observable (based on market data); and **Level 3** – using inputs that are unobservable (for which market data is unavailable). The valuation techniques used by the Company are explained in the accounting policies on page 98. The Company's unlisted ordinary share investments at 31 January 2026 were valued using the market approach using the price of recent transaction. A sensitivity analysis of the unlisted securities is on page 110. ### Significant Holdings Disclosure Requirements – AIC SORP Details are disclosed below in accordance with the requirements of paragraph 82 of the AIC Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (updated in July 2022) in relation to unlisted investments included in the ten largest holdings disclosed on page 55. As required, this disclosure includes turnover, pre-tax profits and net assets attributable to investors, as reported within the most recently audited financial statements of the investee companies where possible. | As at 31 January 2026 | | Latest Financial Statements | Book cost £'000 | Market value £'000 | Income recognised from holding in the period £'000 | Turnover (£'000) | Pre-tax profit/ (loss) (£'000) | Net assets attributable to shareholders (£'000) | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Name | Business | | | | | | | | | ByteDance | Social Media | n/a | 8,212 | 21,349 | Nil | Information not publicly available* | | | | As at 31 January 2025 | | Latest Financial Statements | Book cost £'000 | Market value £'000 | Income recognised from holding in the period £'000 | Turnover (£'000) | Pre-tax profit/ (loss) (£'000) | Net assets attributable to shareholders (£'000) | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Name | Business | | | | | | | | | ByteDance | Social Media | n/a | 8,212 | 14,429 | Nil | Information not publicly available* | | | * Confidentiality agreements prevent the disclosure of this information. | | Listed equities £'000 | Suspended equities £'000 | Unlisted equities * £'000 | Total £'000 | | --- | --- | --- | --- | --- | | Cost of investments held at 1 February 2025 | 182,095 | 1,515 | 8,212 | 191,822 | | Unrealised holding (losses)/gains at 1 February 2025 | (38,036) | (1,321) | 6,217 | (33,140) | | Value of investments held at 1 February 2025 | 144,059 | 194 | 14,429 | 158,682 | | **Analysis of transactions during the year:** | | | | | | Purchases at cost | 38,659 | – | 3,697 | 42,356 | | Sales proceeds received | (46,343) | – | – | (46,343) | | Realised losses on sales | (9,188) | – | – | (9,188) | | Changes in investment holding gains/(losses) | 51,947 | (194) | 6,866 | 58,619 | | Value of investments held at 31 January 2026 | **179,134** | **–** | **24,992** | **204,126** | | Cost of investments held at 31 January 2026 | 165,223 | 1,515 | 11,909 | 178,647 | | Investment holding (losses)/gains at 31 January 2026 | 13,911 | (1,515) | 13,083 | 25,479 | | Value of investments at 31 January 2026 | **179,134** | **–** | **24,992** | **204,126** | * The unlisted security investments represent holdings in ByteDance and RedNote. 104 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 09 Investments (continued) The company received £46,343,000 (2025 – £37,421,000) from investments sold in the year. The book cost of these investments when they were purchased was £55,531,000 (2025 – £60,565,000). These investments have been revalued over time and until they were sold any unrealised gains/losses were included in the fair value of the investments. The purchases and sales proceeds figures above include transaction costs of £59,000 (2025 – £35,000) and £58,000 (2025 – £47,000) respectively. | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | **Net gains on investments** | | | | Losses on sales | (9,188) | (23,144) | | Changes in investment holding gains | 58,619 | 63,212 | | | **49,431** | **40,068** | ## 10 Debtors | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | Due within one year: | | | | Accrued income and prepaid expenses | 156 | 40 | | | **156** | **40** | None of the above debtors are investments classified as held at fair value through profit or loss. The carrying amount of debtors is a reasonable approximation of fair value. ## 11 Creditors – amounts falling due within one year | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | The Royal Bank of Scotland (International) Limited loan | 7,745 | 6,094 | | Investment management fee | 334 | 261 | | Other creditors and accruals | 276 | 243 | | | **8,355** | **6,598** | None of the above creditors are financial liabilities held at fair value through profit or loss. At 31 January 2026 borrowings of £7.7m (US$10.6 million) (2025 – £6.1 million (US$7.5 million)) were drawn down under a two year US$25 million revolving credit facility with The Royal Bank of Scotland (International) Limited with a maturity date of 11 April 2026. The main covenants relating to the current facility are: i. The consolidated gross borrowings shall not exceed 30% of the Company's adjusted portfolio value; ii. The Company's adjusted portfolio value is not less than £50,000,000; and iii. Eligible investments held shall not be less than 40 in number. ## 12 Share capital | | 2026 Number | 2026 £'000 | 2025 Number | 2025 £'000 | | --- | --- | --- | --- | --- | | Allotted, called up and fully paid ordinary shares of 25p each | 57,367,461 | 14,342 | 59,095,680 | 14,774 | | Treasury shares of 25p each | 10,980,690 | 2,745 | 9,252,471 | 2,313 | | **Total** | **68,348,151** | **17,087** | **68,348,151** | **17,087** | In the year to 31 January 2026 no shares were issued from treasury (2025 – no shares were issued from treasury). The Company's shareholder authority permits it to hold shares bought back in treasury. Under such authority, treasury shares may be subsequently either sold for cash (at a premium to net asset value per ordinary share) or cancelled. At 31 January 2026 the Company had authority to buy back 7,572,490 ordinary shares. During the year to 31 January 2026, no ordinary shares (2025 – nil) were bought back for cancellation and 1,728,219 ordinary shares (2025 – 2,756,602) were bought back into treasury. Under the provisions of the Company's Articles of Association share buy-backs are funded from the capital reserve. 105 --- Financial report # 13 Capital and reserves | | Share capital £'000 | Share premium account £'000 | Distributable capital reserve £'000 | Capital redemption reserve £'000 | Capital reserve realised £'000 | Capital reserve unrealised £'000 | Revenue reserve £'000 | Shareholders' funds £'000 | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | At 1 February 2025 | 17,087 | 31,780 | - | 41,085 | 89,391 | (33,237) | 6,993 | 153,099 | | Cancellation of share premium account | - | (31,780) | 31,780 | - | - | - | - | - | | Net losses on sales of investments | - | - | - | - | (9,188) | - | - | (9,188) | | Changes in investment holding gains | - | - | - | - | - | 58,619 | - | 58,619 | | Exchange differences | - | - | - | - | (156) | - | - | (156) | | Exchange differences on bank loans | - | - | - | - | - | 801 | - | 801 | | Ordinary shares bought back | - | - | - | - | (4,759) | - | - | (4,759) | | Investment management fee charged to capital | - | - | - | - | (926) | - | - | (926) | | Finance costs of borrowings charged to capital | - | - | - | - | (339) | - | - | (339) | | Dividends paid in year | - | - | - | - | - | - | (1,290) | (1,290) | | Revenue return after taxation | - | - | - | - | - | - | 1,734 | 1,734 | | **At 31 January 2026** | **17,087** | **-** | **31,780** | **41,085** | **74,023** | **26,183** | **7,437** | **197,595** | | | Share capital £'000 | Share premium account £'000 | Capital redemption reserve £'000 | Capital reserve realised £'000 | Capital reserve unrealised £'000 | Revenue reserve £'000 | Shareholders' funds £'000 | | | At 1 February 2024 | 17,087 | 31,780 | 41,085 | 119,089 | (96,314) | 6,684 | 119,411 | | | Net losses on sales of investments | - | - | - | | (23,144) | - | - | (23,144) | | Changes in investment holding gains | - | - | - | - | | 63,212 | - | 63,212 | | Exchange differences | - | - | - | | 140 | - | - | 140 | | Exchange differences on bank loans | - | - | - | | (6) | (135) | - | (141) | | Ordinary shares bought back | - | - | - | | (5,503) | - | - | (5,503) | | Investment management fee charged to capital | - | - | - | | (737) | - | - | (737) | | Finance costs of borrowings charged to capital | - | - | - | | (448) | - | - | (448) | | Dividends paid in year | - | - | - | - | - | | (1,220) | (1,220) | | Revenue return after taxation | - | - | - | - | - | | 1,529 | 1,529 | | **At 31 January 2025** | **17,087** | **31,780** | **41,085** | **89,391** | **(33,237)** | **6,993** | **153,099** | | The capital reserve as at 31 January 2026 is £100,206,000 (2025 – £56,154,000) and is shown in the above table as capital reserve realised £74,023,000 (2025 – £89,391,000) and capital reserve unrealised £26,183,000 (2025 – (£33,237,000)). The capital reserve unrealised includes investment holding gains of £25,479,000 (2025 – losses of £33,140,000). Under the terms of the Company's Articles of Association, sums standing to the credit of the realised capital reserve are available for distribution only by way of redemption, purchase of any of the Company's own shares or by way of dividend. The revenue reserve, distributable capital reserve and the capital reserve realised in the table above, are distributable. The share premium account and the capital redemption reserve in the table above, are not distributable. On 19 August 2025 The Court of Session approved the cancellation of the amount standing to the credit of the Company's share premium account and the crediting of an equivalent amount to the Company's Distributable Capital Reserve. The Court Order became effective when it was filed with the Registrar of Companies on 22 August 2025. 106 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 14 Shareholders' funds per ordinary share | | 2026 | 2025 | 2026 £'000 | 2025 £'000 | | --- | --- | --- | --- | --- | | Shareholders' funds | 344.44p | 259.07p | 197,595 | 153,099 | Net asset value per ordinary share is based on the net assets as shown above and 57,367,461 (2025 – 59,095,680) ordinary shares, being the number of ordinary shares in issue at the year end, excluding shares held in treasury. At 31 January 2026 all borrowings were in the form of short term floating rate borrowings and their fair value is considered equal to their book value, hence there is no difference in the net asset value per share between including debt at book, or fair value, in the calculation. ## 15 Analysis of change in net debt | | 1 February 2025 £'000 | Cash flows £'000 | Exchange movement £'000 | 31 January 2026 £'000 | | --- | --- | --- | --- | --- | | Cash and cash equivalents | 975 | 849 | (156) | 1,668 | | Loans due within one year | (6,094) | (2,452) | 801 | (7,745) | | | **(5,119)** | **(1,603)** | **645** | **(6,077)** | | | 1 February 2024 £'000 | Cash flows £'000 | Exchange movement £'000 | 31 January 2025 £'000 | | --- | --- | --- | --- | --- | | Cash and cash equivalents | 926 | (91) | 140 | 975 | | Loans due within one year | (5,890) | (63) | (141) | (6,094) | | | **(4,964)** | **(154)** | **(1)** | **(5,119)** | ## 16 Contingent liabilities, guarantees and financial commitments There were no contingent liabilities, guarantees or financial commitments at the year end (2025 – none). ## 17 Transactions with related parties and the managers and secretaries The Directors' fees for the year and interests in the Company's shares at the end of the year are detailed in the Directors' remuneration report on pages 78 to 81. No Director has a contract of service with the Company. During the years reported, no Director was interested in any contract or other matter requiring disclosure under section 412 of the Companies Act 2006. The Management fee due to Baillie Gifford & Co Limited is set out in note 3 on page 101 and the amount accrued is set out in note 11 on page 105. Details of the Investment Management Agreement are set out on pages 63 and 64. ## 18 Financial instruments The Company invests in equities for the long term so as to achieve its investment objective of long-term capital growth with the aim of providing a total return in excess of the MSCI China All Shares Index (in sterling terms). The Company borrows money when the Managers have sufficient conviction that the assets funded by borrowed monies will generate a return in excess of the cost of borrowing. In pursuing its investment objective, the Company is exposed to various types of risk that are associated with the financial instruments and markets in which it invests and could result in a reduction in the Company's net assets and/or a reduction in the profits available for dividend. These risks are categorised here as market risk (comprising currency risk, interest rate risk and other price risk), liquidity risk and credit risk. The Board monitors closely the Company's exposures to these risks but does so in order to reduce the likelihood of a permanent loss of capital rather than to minimise short-term volatility. The risk management policies and procedures outlined in this note have not changed substantially from the previous accounting year. ### Market risk The fair value or future cash flows of a financial instrument or other investment held by the Company may fluctuate because of changes in market prices. This market risk comprises three elements – currency, interest rate risk and market price risk. The Board reviews and agrees policies for managing these risks and the Company's Investment Manager assesses the exposure to market risk when making individual investment decisions as well as monitoring the overall level of market risk across the investment portfolio on an ongoing basis. Details of the Company's investment portfolio are shown on pages 55 to 57. 107 --- Financial report ## 18 Financial instruments (continued) ### Currency risk The Company's assets, liabilities and income are denominated in currencies other than sterling (the Company's functional currency and that in which it reports its results). Consequently, movements in exchange rates may affect the sterling value of those items. The Investment Manager monitors the Company's exposure to foreign currencies and reports to the Board on a regular basis. The Investment Manager assesses the risk to the Company of the foreign currency exposure by considering the effect on the Company's net asset value and income of a movement in the rates of exchange to which the Company's assets, liabilities, income and expenses are exposed. However, the country in which a company is listed is not necessarily where it earns its profits. The movement in exchange rates on overseas earnings may have a more significant impact upon a company's valuation than a simple translation of the currency in which the company is quoted. Exposure to currency risk through asset allocation, which is calculated by reference to the currency in which the asset or liability is quoted, or, for unlisted investments, denominated, is shown below. | At 31 January 2026 | Investments £'000 | Cash and deposits £'000 | Bank loans £'000 | Debtors and creditors £'000 | Net exposure £'000 | | --- | --- | --- | --- | --- | --- | | US dollar | 34,740 | 1,614 | – | – | 36,354 | | Hong Kong dollar | 119,107 | – | (7,745) | – | 111,362 | | Chinese renminbi | 49,487 | 17 | – | – | 49,504 | | Taiwanese dollar | 792 | 17 | – | – | 809 | | **Total exposure to currency risk** | **204,126** | **1,648** | **(7,745)** | **–** | **198,029** | | Sterling | – | 20 | – | (454) | (434) | | | **204,126** | **1,668** | **(7,745)** | **(454)** | **197,595** | | At 31 January 2025 | Investments £'000 | Cash and deposits £'000 | Bank loans £'000 | Debtors and creditors £'000 | Net exposure £'000 | | --- | --- | --- | --- | --- | --- | | US dollar | 21,247 | 895 | – | – | 22,142 | | Hong Kong dollar | 85,169 | – | (6,094) | (84) | 78,991 | | Chinese renminbi | 51,029 | 49 | – | – | 51,078 | | Taiwanese dollar | 1,237 | 11 | – | – | 1,248 | | **Total exposure to currency risk** | **158,682** | **955** | **(6,094)** | **(84)** | **153,459** | | Sterling | – | 20 | – | (380) | (360) | | | **158,682** | **975** | **(6,094)** | **(464)** | **153,099** | ### Currency Risk Sensitivity At 31 January 2026, if sterling had strengthened by 10% in relation to all currencies, with all other variables held constant, total net assets and total return on ordinary activities would have decreased by the amounts shown below. A 10% weakening of sterling against all currencies, with all variables held constant, would have had an equal but opposite effect on the Financial Statement amounts. The analysis is performed on the same basis for 2025. | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | US dollar | 3,635 | 2,214 | | Hong Kong dollar | 11,136 | 7,899 | | Chinese renminbi | 4,950 | 5,108 | | Taiwanese dollar | 81 | 125 | | | **19,802** | **15,346** | 108 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 18 Financial instruments (continued) ### Interest rate risk Interest rate movements may affect the level of income receivable and payable on cash deposits and interest payable on variable rate borrowings. They may also impact upon the market value of the Company's investments as the effect of interest rate movements upon the earnings of a company may have a significant impact upon the valuation of that company's equity. The possible effects on cash flows that could arise as a result of changes in interest rates are taken into account when making investment decisions and when entering borrowing agreements. The Board reviews on a regular basis the amount of investments in cash and the income receivable on cash deposits. The Company has the ability to finance part of its activities through borrowings at approved levels. The amount of such borrowings and the approved levels are monitored and reviewed regularly by the Board. During the year to 31 January 2026, the majority of the Company's assets were non-interest bearing, and there was exposure to interest bearing liabilities through the loan agreement. ### Financial assets Cash deposits generally comprise overnight call or short-term money market deposits and earn interest at floating rates based on prevailing bank base rates. ### Financial liabilities The interest risk profile of the Company's financial liabilities and the maturity profile of the undiscounted future cash flows in respect of the Company's contractual financial liabilities at 31 January are shown below: #### Interest rate risk profile The interest rate risk profile of the Company's financial liabilities at 31 January was: | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | Floating rate – HKD denominated | 7,745 | 6,094 | | | **7,745** | **6,094** | #### Maturity profile The maturity profile of the Company's financial liabilities at 31 January was: | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | **In less than three months** | | | | Repayment of loans | 7,745 | 6,094 | | Interest on loan | 102 | 84 | | | **7,847** | **6,178** | #### Interest rate risk sensitivity An increase of 1% in interest rates, with all other variables being held constant, would have decreased the Company's net assets for the year to 31 January 2026 by £70,000 (year to 31 January 2025 – £63,000). A decrease of 1% would have had an equal but opposite effect. #### Other price risk Changes in market prices other than those arising from interest rate risk or currency risk may also affect the value of the Company's net assets. The Company's exposure to changes in market prices relates to the fixed asset investments as disclosed in note 9. The Board manages the market price risks inherent in the investment portfolio by ensuring full and timely access to relevant information from the Investment Manager. The Board meets regularly and at each meeting reviews investment performance, the investment portfolio and the rationale for the current investment positioning to ensure consistency with the Company's objectives and investment policies. The portfolio does not seek to reproduce the index. Investments are selected based upon the merit of individual companies and therefore performance may well diverge from the comparative index. 109 --- Financial report ## 18 Financial instruments (continued) ### Other price risk sensitivity – unlisted A full list of the Company's investments is shown on pages 55 to 57. 87.8% (2025 – 90.8%) of the Company's net assets are invested in Level 1 quoted equities. A 10% increase in quoted equity valuations at 31 January 2026 would have increased total net assets and net return on ordinary activities after taxation by £17,913,000 (2025 – £14,425,000). A decrease of 10% would have had an equal but opposite effect. 12.2% (2025 – 9.1%) of the Company's net assets are invested in unlisted securities. A 25% increase in the fair value at 31 January 2026 would have increased total net assets and net return on ordinary activities after taxation by £6,248,000 (2025 – £3,607,000). A decrease of 25% would have had an equal but opposite effect. The fair valuation of the unlisted investment is influenced by the estimates, assumptions and judgements made in the fair valuation process (see 1(b) on pages 98 and 99). A sensitivity analysis is provided below which recognises that the valuation methodologies employed involve subjectivity in their significant unobservable inputs and illustrates the sensitivity of the valuations to these inputs. The inputs have been flexed by +/-10% with the exception of the recent transaction price valuation approach as it does not involve significant subjectivity. The table also provides the range of values for the key unobservable inputs. | As at 31 January 2026 | Significant unobservable inputs* | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | Fair value of investments £'000 | Key unobservable inputs | Other unobservable inputs | Range | Sensitivity % | Sensitivity to changes in significant unobservable inputs | | Recent transaction price | 24,992 | n/a | a,b | n/a | 10% | If EV/LTM multiples changed by +/- 10%, the fair value would change by £2,499,270 and (£2,499,270) | | As at 31 January 2025 | Significant unobservable inputs* | | | | | | | --- | --- | --- | --- | --- | --- | --- | | | Fair value of investments £'000 | Key unobservable inputs | Other unobservable inputs | Range | Sensitivity % | Sensitivity to changes in significant unobservable inputs | | Market approach using comparable traded multiples | 14,429 | Enterprise value / Last twelve months ( EV/ LTM) revenue multiple | a,b,c,d | 1.3x – 9.9x | 10% | If EV/LTM multiples changed by +/- 10%, the fair value would change by £1,151,741 and (£1,388,422) | | | | Discount for lack of liquidity | e | 10% | 10% | If the illiquidity discount is changed by +/- 10%, the fair value would change by £160,445 and (£160,212) | ### * Significant unobservable inputs The variable inputs applicable to each broad category of valuation basis will vary dependent on the particular circumstances of each private company valuation. An explanation of each of the key variable inputs is provided below. The assumptions made in the production of the inputs are described in note 1(c) on page 99. 110 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## 18 Financial instruments (continued) ### Significant unobservable inputs (continued) #### a. Application of valuation basis Each investment is assessed independently, and the valuation basis applied will vary depending on the circumstances of each investment. When an investment is pre-revenue, the focus of the valuation will be on assessing the recent transaction and the achievement of key milestones since investment. Adjustments may also be made depending on the performance of comparable benchmarks and companies. For those investments where a trading multiples approach can be taken, the methodology will factor in revenue, earnings or net assets as appropriate for the investment, and where a suitable correlation can be identified with the comparable companies then a regression analysis will be performed. Discounted cash flows will also be considered where appropriate forecasts are available. #### b. Probability estimation of liquidation events The probability of a liquidation event such as a company sale, or alternatively an initial public offering ('IPO'), is a key variable input in the transaction-based and multiples-based valuation techniques. The probability of an IPO versus a company sale is typically estimated from the outset to be 50:50 if there has been no indication by the company of pursuing either of these routes. If the company has indicated an intention to IPO, the probability is increased accordingly to 75% and if an IPO has become a certainty the probability is increased to 100%. Likewise, in a scenario where a company is pursuing a trade sale the weightings will be adjusted accordingly in favour of a sale scenario, or in a situation where a company is underperforming expectations significantly and therefore deemed very unlikely to pursue an IPO. #### c. Selection of comparable companies The selection of comparable companies is assessed individually for each investment at the point of investment, and the relevance of the comparable companies is continually evaluated at each valuation. The key criteria used in selecting appropriate comparable companies are the industry sector in which they operate, the geography of the company's operations, the respective revenue and earnings growth rates and the operating margins. Typically, between 4 and 10 comparable companies will be selected for each investment, depending on how many relevant comparable companies are identified. The resultant revenue or earnings multiples or share price movements derived will vary depending on the companies selected and the industries they operate in. #### d. Estimated sustainable earnings The selection of sustainable revenue or earnings will depend on whether the company is profitable or not, and where it is not then revenues will be used in the valuation. The valuation approach will typically assess companies based on the last twelve months of revenue or earnings, as they are the most recent available and therefore viewed as the most reliable. Where a company has reliably forecasted earnings previously or there is a change in circumstance at the business which will impact earnings going forward, then forward estimated revenue or earnings may be used instead. #### e. Application of illiquidity discount The application of an illiquidity discount will be applied either through the calibration of a valuation against the most recent transaction, or by application of a specific discount. The discount applied where a calibration is not appropriate is typically 10%, reflecting that the majority of the investments held are substantial companies with some secondary market activity. ### Liquidity risk This is the risk that the Company will encounter difficulty in meeting obligations associated with financial liabilities as they fall due. Liquidity risk is not significant as the majority of the Company's assets are in investments that are readily realisable. The Company's holdings in unlisted investments, which is not considered to be readily realisable, amounts to 12.2% of net assets at 31 January 2026. The Company has the power to take out borrowings, which give it access to additional funding when required. The maturity profile of the Company's financial liabilities is on page 109. 111 --- Financial report ## 18 Financial instruments (continued) ### Credit risk This is the risk that a failure of a counterparty to a transaction to discharge its obligations under that transaction could result in the Company suffering a loss. This risk is managed as follows: - • where the Investment Manager makes an investment in a bond or other security with credit risk, that credit risk is assessed and then compared to the prospective investment return of the security in question; - • the Depository is liable for the loss of financial instruments held in custody. The Depository will ensure that any delegate segregates the assets of the Company. The Depository has delegated the custody function to The Bank of New York Mellon (International) Limited. Bankruptcy or insolvency of the custodian may cause the Company's rights with respect to securities held by the custodian to be delayed. The Investment Manager monitors the Company's risk by reviewing the custodian's internal control reports and reporting its findings to the Board; - • investment transactions are carried out with a large number of brokers whose creditworthiness is reviewed by the Investment Manager. Transactions are ordinarily undertaken on a delivery versus payment basis whereby the Company's custodian ensures that the counterparty to any transaction entered into by the Company has delivered on its obligations before any transfer of cash or securities away from the Company is completed; - • the creditworthiness of the counterparty to transactions involving derivatives, structured notes and other arrangements, wherein the creditworthiness of the entity acting as broker or counterparty to the transaction is likely to be of sustained interest, is subject to rigorous assessment by the Investment Manager; and - • cash is only held at banks that are regularly reviewed by the Investment Manager. ### Credit risk exposure The exposure to credit risk at 31 January was: | | 2026 £'000 | 2025 £'000 | | --- | --- | --- | | Debtors | 156 | 40 | | Cash and cash equivalents | 1,668 | 975 | | | **1,824** | **1,015** | None of the Company's financial assets are past due or impaired. ### Fair value of financial assets and financial liabilities The Company's investments are stated at fair value and the Directors are of the opinion that the reported values of the Company's other financial assets and liabilities approximate to fair value. ### Capital management The objective of the Company is to maximise the total return to its equity shareholders through an appropriate capital structure. Its borrowings are set out in note 11 on page 105. The Company does not have any externally imposed capital requirements other than the covenants on its loan which are detailed in note 11. The capital of the Company is the ordinary share capital as detailed in note 12. It is managed in accordance with its Investment Policy in pursuit of its investment objective, both of which are detailed on pages 32 and 33 and shares may be repurchased or issued as explained on page 105. 112 Annual Report and Financial Statements 2026 --- # Shareholder information --- Shareholder information # Notice of Annual General Meeting ![img-40.jpeg](img-40.jpeg) ● 1 Moorgate Pl City of London London EC2R 6EA ## Baillie Gifford™ ![img-41.jpeg](img-41.jpeg) The Annual General Meeting of Baillie Gifford China Growth Trust plc will be held at 1 Moorgate Pl, City of London, London, EC2R 6EA on Wednesday 27 May 2026, at 2pm. You will find directions to the venue by scanning the QR code above. The Portfolio Managers responsible for Baillie Gifford China Growth Trust plc will give a short presentation on the investment outlook. To accurately reflect the views of shareholders of the Company, the Board intends to hold the AGM voting on a poll. The Board encourages all shareholders to submit proxy voting forms as soon as possible and, in any event, by no later than 2pm on Monday 25 May 2026. Should shareholders have questions for the Board or the Managers or any queries as to how to vote or how to attend the meeting they are welcome as always to submit them by email to enquiries@bailliegifford.com or call 0800 917 2113. Baillie Gifford may record your call. For details of how to vote your shares if held via a platform please refer to theaic.co.uk/how-to-vote-your-shares. 114 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc Notice is hereby given that an Annual General Meeting of Baillie Gifford China Growth Trust plc will be held at 1 Moorgate Pl, City of London, London, EC2R 6EA on Wednesday 27 May 2026, at 2pm for the following purposes. To consider and, if thought fit, to pass the following Resolutions as Ordinary Resolutions. 1. 01. To receive and adopt the Financial Statements of the Company for the year to 31 January 2026 with the Reports of the Directors and of the Independent Auditor thereon. 2. 02. To approve the Directors' Remuneration Policy. 3. 03. To receive and approve the Directors' Annual Report on Remuneration for the year to 31 January 2026. 4. 04. To declare a final dividend of 2.50p per ordinary share. 5. 05. To re-elect Nicholas Pink as a Director of the Company. 6. 06. To re-elect Tim Clissold as a Director of the Company. 7. 07. To re-elect Magdalene Miller as a Director of the Company. 8. 08. To re-elect Jonathan Silver as a Director of the Company. 9. 09. To re-elect Sarah MacAulay as a Director of the Company. 10. 10. To re-appoint Ernst & Young LLP as Independent Auditor of the Company to hold office from the conclusion of this meeting until the conclusion of the next Annual General Meeting at which the Financial Statements are laid before the Company. 11. 11. To authorise the Directors to determine the remuneration of the Independent Auditor of the Company. 12. 12. That, in substitution for any existing authority, but without prejudice to the exercise of any such authority prior to the date hereof, the Directors of the Company be and they are hereby generally and unconditionally authorised in accordance with section 551 of the Companies Act 2006 (the 'Act') to exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe for or to convert any security into shares in the Company ('Securities') provided that such authority shall be limited to the allotment of shares and the grant of rights in respect of shares with an aggregate nominal value of up to £4,615,260, such authority to expire at the conclusion of the next Annual General Meeting of the Company after the passing of this Resolution or on the expiry of 15 months from the passing of this Resolution, whichever is the earlier, unless previously revoked, varied or extended by the Company in a General Meeting, save that the Company may at any time prior to the expiry of this authority make an offer or enter into an agreement which would or might require Securities to be allotted or granted after the expiry of such authority and the Directors shall be entitled to allot or grant Securities in pursuance of such an offer or agreement as if such authority had not expired. To consider and, if thought fit, to pass Resolutions 13 and 14 as Special Resolutions. 115 --- Shareholder information 13. That, subject to the passing of Resolution 12 above, and in substitution for any existing power but without prejudice to the exercise of any such power prior to the date hereof, the Directors of the Company be and they are hereby generally empowered, pursuant to sections 570 and 573 of the Companies Act 2006 (the 'Act'), to allot equity securities (within the meaning of section 560(1) of the Act), for cash pursuant to the authority given by Resolution 12 above, and to sell treasury shares for cash, as if section 561(1) of the Act did not apply to any such allotment or sale, provided that this power: a. expires at the conclusion of the next Annual General Meeting of the Company after the passing of this Resolution or on the expiry of 15 months from the passing of this Resolution, whichever is the earlier, save that the Company may, before such expiry, make an offer or agreement which would or might require equity securities to be allotted or treasury shares to be sold after such expiry and the Directors may allot equity securities or sell treasury shares in pursuance of any such offer or agreement as if the power conferred hereby had not expired; and b. shall be limited to the allotment of equity securities or the sale of treasury shares up to an aggregate nominal value of £1,384,577, being approximately 10% of the nominal value of the issued share capital of the Company, as at 26 March 2026. 14. That, in substitution for any existing authority but without prejudice to the exercise of any such authority prior to the date hereof, the Company be and is hereby generally and unconditionally authorised, pursuant to and in accordance with section 701 of the Companies Act 2006 (the 'Act') to make market purchases (within the meaning of section 693(4) of the Act) of fully paid ordinary shares of 25 pence each in the capital of the Company ('ordinary shares') (either for retention as treasury shares for future reissue, resale, transfer or cancellation), provided that: a. the maximum aggregate number of ordinary shares hereby authorised to be purchased is 8,301,929, or, if less, the number representing approximately 14.99% of the issued ordinary share capital of the Company as at the date of the passing of this Resolution; b. the minimum price (excluding expenses) which may be paid for each ordinary share shall be the nominal value of that share; c. the maximum price (excluding expenses) which may be paid for each ordinary share shall not be more than the higher of: i. 5% above the average closing price on the London Stock Exchange of an ordinary share over the five business days immediately preceding the date of purchase; and ii. an amount equal to the higher of the price of the last independent trade of an ordinary share and the highest current independent bid for an ordinary share on the trading venue where the purchase is carried out; and d. unless previously varied, revoked or renewed by the Company in a General Meeting, the authority hereby conferred shall expire at the conclusion of the Annual General Meeting of the Company to be held in respect of the year ending 31 January 2027, save that the Company may, prior to such expiry, enter into a contract to purchase ordinary shares under such authority which will or might be completed or executed wholly or partly after the expiration of such authority and may make a purchase of ordinary shares pursuant to any such contract. By order of the Board Baillie Gifford & Co Limited Managers and Secretaries 31 March 2026 116 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Notes 1. 01. As a member you are entitled to appoint a proxy or proxies to exercise all or any of your rights to attend, speak and vote at the AGM. A proxy need not be a member of the Company but must attend the AGM to represent you. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. You can only appoint a proxy using the procedure set out in these notes and the notes to the proxy form. You may not use any electronic address provided either in this notice or any related documents (including the proxy form) to communicate with the Company for any purpose other than those expressly stated. 2. 02. To be valid any proxy form or other instrument appointing a proxy, together with any power of attorney or other authority under which it is signed or a certified copy thereof, must be received by post or (during normal business hours only) by hand at the Registrars of the Company at Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol, BS99 6ZY or epoxyappointment.com no later than 2 days (excluding non-working days) before the time of the meeting or any adjourned meeting. 3. 03. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the procedures described in the CREST Manual and/or by logging on to the website euroclear.com/CREST. CREST personal members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf. 4. 04. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a 'CREST Proxy Instruction') must be properly authenticated in accordance with Euroclear UK & International Limited's specifications, and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the Company's registrar (ID 3RA50) no later than 2 days (excluding non-working days) before the time of the meeting or any adjournment. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the Company's registrar is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means. 5. 05. CREST members and, where applicable, their CREST sponsors, or voting service providers should note that Euroclear UK & International Limited does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider(s), to procure that his/her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings. 117 --- Shareholder information 1. 06. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. 2. 07. The return of a completed proxy form or other instrument of proxy will not prevent you attending the AGM and voting in person if you wish. 3. 08. Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001 and section 311 of the Companies Act 2006 the Company specifies that to be entitled to attend and vote at the Annual General Meeting (and for the purpose of the determination by the Company of the votes they may cast), shareholders must be registered in the Register of Members of the Company no later than 2 days (excluding non-working days) prior to the commencement of the AGM or any adjourned meeting. Changes to the Register of Members after the relevant deadline shall be disregarded in determining the rights of any person to attend and vote at the meeting. 4. 09. Any person to whom this notice is sent who is a person nominated under section 146 of the Companies Act 2006 to enjoy information rights (a 'Nominated Person') may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights. 5. 10. The statement of the rights of shareholders in relation to the appointment of proxies in Notes 1 and 2 above does not apply to Nominated Persons. The rights described in those Notes can only be exercised by shareholders of the Company. 6. 11. Under section 338 of the Companies Act 2006, members meeting the qualification criteria set out in note 14 below may, subject to certain conditions, require the Company to circulate to members notice of a resolution which may properly be moved and is intended to be moved at that meeting. The conditions are that: 1. a. the resolution must not, if passed, be ineffective (whether by reason of inconsistency with any enactment or the Company's constitution or otherwise); 2. b. the resolution must not be defamatory of any person, frivolous or vexatious; and 3. c. the request: 1. i. may be in hard copy form or in electronic form; 2. ii. must identify the resolution of which notice is to be given by either setting out the resolution in full or, if supporting a resolution sent by another member, clearly identifying the resolution which is being supported; 3. iii. must be authenticated by the person or persons making it; and (iv) must be received by the Company not later than 15 April 2026. 7. 12. Under section 338A of the Companies Act 2006, members meeting the qualification criteria set out at note 14 below may require the Company to include in the business to be dealt with at the Annual General Meeting a matter (other than a proposed resolution) which may properly be included in the business (a matter of business). The request must have been received by the Company not later than Wednesday 15 April 2026. The conditions are that the matter of business must not be defamatory of any person, frivolous or vexatious. The request must identify the matter of business by either setting it out in full or, if supporting a statement sent by another member, clearly identify the matter of business which is being supported. The request must be accompanied by a statement setting out the grounds for the request. Members seeking to do this should write to the Company providing their full name and address. 118 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc 13. Under section 527 of the Companies Act 2006, members meeting the qualification criteria set out in note 14 below may require the Company to publish, on its website, (without payment) a statement (which is also passed to the Auditor) setting out any matter relating to the audit of the Company's Financial Statements, including the Auditor's report and the conduct of the audit. Such requests must be made in writing and must state your full name and address. 14. In order to be able to exercise the members' rights in notes 11 to 13, the relevant request must be made by: a. members representing at least 5% of the total voting rights of all the members who have a right to vote on the resolution to which the requests relate; or b. at least 100 members who have a right to vote on the resolution to which the requests relate and hold shares in the Company on which there has been paid up an average sum, per member, of at least £100. Such requests should be sent to the Company at Calton Square, 1 Greenside Row, Edinburgh, EH1 3AN. Electronic requests permitted under section 338 (see note 11) should be sent to enquiries@bailliegifford.com. 15. Information regarding the Annual General Meeting, including information required by section 311A of the Companies Act 2006, is available from the Company's page of the Managers' website at bailliegiffordchinagrowthtrust.com. 16. All shareholders are strongly encouraged to exercise your votes in respect of the AGM in advance, and to appoint the Chair of the Meeting as your proxy, to ensure that your votes are counted. Furthermore, the Board always welcomes questions from the Company's shareholders at the AGM and shareholders are invited to submit their questions to the Board in advance. The answers to these questions will be posted on the Company's page of the Managers' website after the AGM. Shareholders should submit any questions they may have to enquiries@bailliegifford.com before 20 May 2026. 17. As at 26 March 2026 (being the last practicable day prior to the publication of this notice) the Company's issued share capital consisted of 55,383,116 ordinary shares, carrying one vote each. Therefore, the total voting rights in the Company as at 26 March 2026 were 55,383,116 votes. Voting on the resolutions will be conducted by way of a poll. This will ensure an exact and definitive result. 18. Any person holding 3% or more of the total voting rights of the Company who appoints a person other than the Chair of the meeting as his/her proxy will need to ensure that both he/she and his/her proxy complies with their respective disclosure obligations under the UK Disclosure and Transparency Rules. 19. No Director has a contract of service with the Company. 119 --- Shareholder information # Further shareholder information **Baillie Gifford China Growth Trust is an investment trust. Investment trusts offer investors the following:** - participation in a diversified portfolio of shares; - constant supervision by experienced professional managers; and - the Company is free from capital gains tax on capital profits realised within its portfolio, although investors are still liable for capital gains tax on profits when selling their investment. **How to invest** The Company's shares are traded on the London Stock Exchange. They can be bought by placing an order with a stockbroker, or by asking a professional adviser to do so. If you are interested in investing directly in Baillie Gifford China Growth Trust, you can do so online. There are a number of companies offering real time online dealing services. Find out more by visiting the investment trust pages at bailliegifford.com. **Sources of further information on the Company** The price of shares is quoted daily in the Financial Times and can also be found on the Company's page of the Managers' website at bailliegiffordchinagrowthtrust.com, Trustnet at trustnet.com and on other financial websites. Company factsheets are also available on the Baillie Gifford website and are updated monthly. These are available from Baillie Gifford on request. **Baillie Gifford China Growth Trust identifiers** ISIN GB0003656021 Sedol 0365602 Ticker BGCG Legal Entity Identifier 213800KOK5G3XYI7ZX18 The ordinary shares of the Company are listed on the London Stock Exchange. **Key dates** Ordinary shareholders normally receive a final dividend in respect of each financial year, paid in July. The Annual Report and Financial Statements are normally issued in April and the AGM is normally held in June. **Share register enquiries** Computershare Investor Services PLC maintains the share register on behalf of the Company. In the event of queries regarding shares registered in your own name, please contact the registrars on 0370 707 1410. This helpline also offers an automated self-service functionality (available 24 hours a day, 7 days a week) which allows you to: - hear the latest share price; - confirm your current share holding balance; - confirm your payment history; and - order change of address, dividend bank mandate and stock transfer forms. You can also check your holding on the Registrars' website at investorcentre.co.uk. They also offer a free, secure share management website service which allows you to: - view your share portfolio and see the latest market price of your shares; - calculate the total market price of each shareholding; - view price histories and trading graphs; - register to receive communications from the Company, including the Annual Report and Financial Statements, in electronic format; - update bank mandates and change address details; and - use online dealing services. 120 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc To take advantage of this service, please log in at investorcentre.co.uk and enter your Shareholder Reference Number and Company Code (this information can be found on the last dividend voucher or your share certificate). ### Electronic proxy voting If you hold stock in your own name you can choose to vote by returning proxies electronically at epoxyappointment.com. If you have any questions about this service please contact Computershare on 0370 707 1410. ### CREST proxy voting If you are a user of the CREST system (including a CREST Personal Member), you may appoint one or more proxies or give an instruction to a proxy by having an appropriate CREST message transmitted. For further information please refer to the CREST Manual. ### UK Alternative Investment Fund Managers ('AIFM') Regulations In accordance with the AIFM Regulations, information in relation to the Company's leverage and the remuneration of the Company's AIFM, Baillie Gifford & Co Limited, is required to be made available to investors. In accordance with the Regulations, the AIFM remuneration policy is available at bailliegifford.com or on request (see contact details on page 129). The numerical remuneration disclosures in respect of the AIFM's reporting period are available at bailliegifford.com. ### Leverage The Company's maximum and actual leverage (see Glossary of terms and alternative performance measures on pages 126 to 128) levels at 31 January 2026 are shown below: | | Gross method | Commitment method | | --- | --- | --- | | Maximum limit | 2.50:1 | 2.00:1 | | Actual | 1.03:8 | 1.03:9 | ### Automatic exchange of information In order to fulfil its obligations under UK tax legislation relating to the automatic exchange of information, the Company is required to collect and report certain information about certain shareholders. The legislation requires investment trust companies to provide personal information to HMRC on certain investors who purchase shares in investment trusts. As an affected company, Baillie Gifford China Growth Trust will have to provide information annually to the local tax authority on the tax residencies of a number of non-UK based certificated shareholders and corporate entities. Shareholders, excluding those whose shares are held in CREST, who come on to the share register will be sent a certification form for the purposes of collecting this information. For further information, please see HMRC's Quick Guide: Automatic Exchange of Information – information for account holders gov.uk/government/publications/exchange-of-information-account-holders. ### Data protection The Company is committed to ensuring the confidentiality and security of any personal data provided to it. Further details on how personal data is held and processed on behalf of the Company can be found in the privacy policy available on the Company's website bailliegiffordchinagrowthtrust.com. 121 --- Shareholder information # Communicating with shareholders ![img-42.jpeg](img-42.jpeg) Trust magazine ## Trust magazine **Trust** is the Baillie Gifford investment trust magazine which is published twice a year. It provides an insight to our investment approach by including interviews with our fund managers, as well as containing investment trust news, investment features and articles about the trusts managed by Baillie Gifford, including Baillie Gifford China Growth Trust. **Trust** plays an important role in helping to explain our products so that readers can really understand them. For a copy of **Trust**, please contact the Baillie Gifford Client Relations Team (see contact details on page 129). **You can subscribe to Trust magazine or view a digital copy at bailliegifford.com/trust** ## Suggestions and questions Any suggestions on how communications with shareholders can be improved are welcomed, so please contact the Baillie Gifford Client Relations Team and give them your suggestions. They will also be very happy to answer questions that you may have about Baillie Gifford China Growth Trust. ![img-43.jpeg](img-43.jpeg) Baillie Gifford China Growth Trust web page at bailliegiffordchinagrowthtrust.com ## Baillie Gifford China Growth Trust on the web Up-to-date information about Baillie Gifford China Growth Trust is available on the Company's page of the Managers' website at bailliegiffordchinagrowthtrust.com. You will find full details of the Company, including recent portfolio information and performance figures. ## Client relations team contact details You can contact the Baillie Gifford Client Relations Team by telephone, email or post: Telephone: 0800 917 2113 Your call may be recorded for training or monitoring purposes. Email: enquiries@bailliegifford.com Website: bailliegifford.com Address: Baillie Gifford Client Relations Team Calton Square 1 Greenside Row Edinburgh EH1 3AN **Please note that Baillie Gifford is not permitted to give financial advice. If you would like advice, please ask an authorised intermediary.** 122 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Insights ![img-44.jpeg](img-44.jpeg) **One world, two growth engines** **by Qian Zhang** Going beneath the bonnet of the world's two great generators of growth opportunity. ![img-45.jpeg](img-45.jpeg) **Tencent: Stock Story** **Fernanda Lai** Fernanda Lai explores how Tencent became the super-app pioneer connecting over one billion users. ![img-46.jpeg](img-46.jpeg) **Shanghai, Shenzhen, Beijing** **by Sophie Earnshaw** On the road with the board and managers of China Growth Trust. ![img-47.jpeg](img-47.jpeg) ![img-48.jpeg](img-48.jpeg) ![img-49.jpeg](img-49.jpeg) 123 --- Shareholder information # Third party data provider disclaimer No third party data provider ('Provider') makes any warranty, express or implied, as to the accuracy, completeness or timeliness of the data contained herewith nor as to the results to be obtained by recipients of the data. No Provider shall in any way be liable to any recipient of the data for any inaccuracies, errors or omissions in the index data included in this document, regardless of cause, or for any damages (whether direct or indirect) resulting therefrom. No Provider has any obligation to update, modify or amend the data or to otherwise notify a recipient thereof in the event that any matter stated herein changes or subsequently becomes inaccurate. Without limiting the foregoing, no Provider shall have any liability whatsoever to you, whether in contract (including under an indemnity), in tort (including negligence), under a warranty, under statute or otherwise, in respect of any loss or damage suffered by you as a result of or in connection with any opinions, recommendations, forecasts, judgements, or any other conclusions, or any course of action determined, by you or any third party, whether or not based on the content, information or materials contained herein. ## MSCI index data The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used as a basis for or a component of any financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such. Historical data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. The MSCI information is provided on an 'as is' basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the 'MSCI Parties') expressly disclaims all warranties (including, without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including, without limitation, lost profits) or any other damages (msci.com). 124 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Sustainable Finance Disclosure Regulation ('SFDR') The EU Sustainable Finance Disclosure Regulation ('SFDR') does not have a direct impact in the UK due to Brexit, however, it applies to third-country products marketed in the EU. As Baillie Gifford China Growth Trust is marketed in the EU by the AIFM, Baillie Gifford & Co Limited, via the National Private Placement Regime ('NPPR') the following disclosures have been provided to comply with the high-level requirements of SFDR. The AIFM has adopted Baillie Gifford & Co's stewardship principles and guidelines as its policy on integration of sustainability risks in investment decisions. Baillie Gifford & Co believes that a company cannot be financially sustainable in the long run if its approach to business is fundamentally out of line with changing societal expectations. It defines 'sustainability' as a deliberately broad concept which encapsulates a company's purpose, values, business model, culture, and operating practices. Baillie Gifford & Co's approach to investment is based on identifying and holding high quality growth businesses that enjoy sustainable competitive advantages in their marketplace. To do this it looks beyond current financial performance, undertaking proprietary research to build up an in-depth knowledge of an individual company and a view on its long-term prospects. This includes the consideration of sustainability factors (environmental, social and/or governance matters) which it believes will positively or negatively influence the financial returns of an investment. The likely impact on the return of the portfolio from a potential or actual material decline in the value of investment due to the occurrence of an environmental, social or governance event or condition will vary and will depend on several factors including but not limited to the type, extent, complexity and duration of an event or condition, prevailing market conditions and existence of any mitigating factors. Whilst consideration is given to sustainability matters, there are no restrictions on the investment universe of the Company, unless otherwise stated within its Investment Objective & Policy. Baillie Gifford & Co can invest in any companies it believes could create beneficial long-term returns for investors. However, this might result in investments being made in companies that ultimately cause a negative outcome for the environment or society. More detail on the Investment Managers' approach to sustainability can be found in the ESG Principles and Guidelines document, available publicly on the Baillie Gifford website bailliegifford.com and by scanning the QR code below. The underlying investments do not take into account the EU criteria for environmentally sustainable economic activities established under the EU Taxonomy Regulation. ![img-50.jpeg](img-50.jpeg) 125 --- Shareholder information # Glossary of terms and alternative performance measures ('APM') An alternative performance measure ('APM') is a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure defined or specified in the applicable financial reporting framework. The APMs noted below are commonly used measures within the investment trust industry and serve to improve comparability between investment trusts. The APMs are presented in Pounds Sterling rounded to the nearest thousand, except where otherwise indicated. ## Total adjusted assets This is the Company's definition of adjusted total assets, being the total value of all assets less current liabilities, before deduction of all borrowings. ## Net asset value Net asset value is the value of total assets less liabilities (including borrowings). The net asset value per share ('NAV') is calculated by dividing this amount by the number of ordinary shares in issue (excluding treasury shares). ## Net liquid assets Net liquid assets comprise current assets less current liabilities, excluding borrowings. ## Discount/premium (APM) As stockmarkets and share prices vary, an investment trust's share price is rarely the same as its NAV. When the share price is lower than the NAV it is said to be trading at a discount. The size of the discount is calculated by subtracting the NAV per share from the share price and is usually expressed as a percentage of the NAV. If the share price is higher than the NAV, it is said to be trading at a premium. | | | 2026 | 2025 | | --- | --- | --- | --- | | Closing NAV | (a) | 344.44p | 259.07p | | Closing share price | (b) | 319.00p | 232.00p | | Discount | ((b) - (a)) + (a) | (7.4%) | (10.4%) | 126 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc ## Total return (APM) The total return is the return to shareholders after reinvesting the net dividend on the date that the share price goes ex-dividend. | | | 2026 NAV | 2026 Share price | 2025 NAV | 2025 Share price | | --- | --- | --- | --- | --- | --- | | Closing NAV per share/share price | (a) | 344.44p | 319.00p | 259.07p | 232.00p | | Dividend adjustment factor* | (b) | 1.008036 | 1.009167 | 1.008783 | 1.009852 | | **Adjusted closing NAV per share/share price** | **(c) = (a) x (b)** | **347.21p** | **321.92p** | **261.35p** | **234.29p** | | Opening NAV per share/share price | (d) | 259.07p | 232.00p | 193.06p | 181.00p | | **Total return** | **(c) ÷ (d) -1** | **34.0%** | **38.8%** | **35.4%** | **29.4%** | \* The dividend adjustment factor is calculated on the assumption that the dividend of 2.20p (2025 – 2.00p) paid by the Company during the year was reinvested into shares of the Company at the cum income NAV/share price, as appropriate, at the ex-dividend date. ## Ongoing charges (APM) The total expenses (excluding borrowing costs) incurred by the Company as a percentage of the average net asset value. The ongoing charges have been calculated on the basis prescribed by the Association of Investment Companies. A reconciliation from the expenses detailed in the Income statement on page 94 is provided below. | | | 2026 | 2025 | | --- | --- | --- | --- | | Investment management fee | | £1,235,000 | £983,000 | | Other administrative expenses | | £671,000 | £584,000 | | **Total expenses** | **(a)** | **£1,908,000** | **£1,567,000** | | Average daily cum-income net asset value | (b) | £179,418,000 | £139,358,000 | | **Ongoing charges** | **((a) ÷ (b) expressed as a percentage)** | **1.06%** | **1.12%** | ## Gearing (APM) At its simplest, gearing is borrowing. Just like any other public company, an investment trust can borrow money to invest in additional investments for its portfolio. The effect of the borrowing on shareholders' funds is called 'gearing'. If the Company's assets grow, shareholders' funds grow proportionately more because the debt remains the same. But if the value of the Company's assets falls, the situation is reversed. Gearing can therefore enhance performance in rising markets but can adversely impact performance in falling markets. Gearing is the Company's borrowings adjusted for cash and cash equivalents expressed as a percentage of shareholders' funds. Gross gearing is the Company's borrowings expressed as a percentage of shareholders' funds. | | | 2026 | | 2025 | | | --- | --- | --- | --- | --- | --- | | | | Gearing * £'000 | Gross Gearing † £'000 | Gearing * £'000 | Gross Gearing † £'000 | | Borrowings | (a) | 7,745 | 7,745 | 6,094 | 6,094 | | Cash and cash equivalents | (b) | 1,668 | – | 975 | – | | Shareholders' funds | (c) | 197,595 | 197,595 | 153,099 | 153,099 | | | | **3.1%** | **3.9%** | **3.3%** | **4.0%** | \* Gearing: ((a)–(b)) divided by (c), expressed as a percentage. † Gross gearing: (a) divided by (c), expressed as a percentage. 127 --- Shareholder information ## Leverage (APM) For the purposes of the Alternative Investment Fund Managers ('AIFM') Regulations, leverage is any method which increases the Company's exposure, including the borrowing of cash and the use of derivatives. It is expressed as a ratio between the Company's exposure and its net asset value and can be calculated on a gross and a commitment method. Under the gross method, exposure represents the sum of the Company's positions after the deduction of sterling cash balances, without taking into account any hedging and netting arrangements. Under the commitment method, exposure is calculated without the deduction of sterling cash balances and after certain hedging and netting positions are offset against each other. ## Active share (APM) Active share, a measure of how actively a portfolio is managed, is the percentage of the portfolio that differs from its comparative index. It is calculated by deducting from 100 the percentage of the portfolio that overlaps with the comparative index. An active share of 100 indicates no overlap with the index and an active share of zero indicates a portfolio that tracks the index. ## Unlisted (Private) Company An unlisted (private) company means a company whose shares are not available to the general public for trading and not listed on a stock exchange. ## Variable Interest Entity ('VIE') VIE structures are used by some Chinese companies to facilitate access to foreign investors in sectors of the Chinese domestic economy which prohibit foreign ownership. The purpose of the VIE structure is to give the economic benefits and operational control of ownership without direct equity ownership itself. The structures are bound together by contracts and foreign investors are not directly invested in the underlying company. ## Treasury shares The Company has the authority to make market purchases of its ordinary shares for retention as treasury shares for future reissue, resale, transfer or for cancellation. Treasury shares do not receive distributions and the Company is not entitled to exercise the voting rights attaching to them. 128 Annual Report and Financial Statements 2026 --- Baillie Gifford China Growth Trust plc # Company information Directors Chair: Nicholas Pink Tim Clissold Sarah MacAulay Magdalene Miller Jonathan Silver Registrar Computershare Investor Services PLC The Pavilions Bridgwater Road Bristol BS99 6ZZ T: +44 (0)370 707 1410 Depository and Custodian Bank of New York Mellon (International) Limited 160 Queen Victoria Street London EC4V 4LA Alternative Investment Fund Managers, Secretaries and Registered office Baillie Gifford & Co Limited 3 St Helen's Place London EC3A 6AB T: +44 (0)131 275 2000 bailliegifford.com Company Broker JP Morgan Cazenove 25 Bank Street Canary Wharf London E14 5JP Independent Auditor Ernst & Young LLP Chartered Accountants and Statutory Auditors 25 Churchill Place London E14 5EY Further information Client Relations Team Baillie Gifford & Co Calton Square 1 Greenside Row Edinburgh EH1 3AN T: +44 (0)800 917 2113 enquiries@bailliegifford.com Company details bailliegiffordchinagrowthtrust.com Company Registration No. 91798 ISIN: GB0003656021 Sedol: 0365602 Ticker: BGCG Legal Entity Identifier: 213800KOK5G3XYI7ZX18 129 --- bailliegiffordchinagrowthtrust.com ![img-51.jpeg](img-51.jpeg) Calton Square, 1 Greenside Row, Edinburgh EH1 3AN Telephone +44 (0)131 275 2000