27 July, 2011

Dear Shareholder

I am pleased to enclose the audited accounts ending 31 December 2010. In addition to the accounts, the contract between the company and DB Consultants together with a summary thereof has also been placed on the company's website www.londonasiacapital.com, to ensure complete transparency.

As I said in my Chairman's Statement, it has taken some time to get to grips with the current position and to formulate an outline of a plan for the future. The plan seeks to recognise the different interests that shareholders have in relation to the company and to chart a way forward to meet these various interests. The majority of shareholders want to see a return of cash and I have worked on a proposition which I have presented to the representatives of certain Chinese shareholders, which might enable a solution to be found along these lines. It is early days, but I should also report that the major Chinese shareholder has also issued a letter before action in relation to the company's holding in Zhongying, which has been reported in the accounts.

I can further confirm that the overheads have been reduced as a result of the resignation of two executive directors and also the closure of the company's office in Piccadilly. There is still much to be done but at least the journey to find a solution to the problems of London Asia Capital plc has begun, and I will report again in due course.

Later I will write to you with details of the Annual General Meeting and a further update. Please do register on the website for "news alerts" as this will be the way that the company will communicate with its shareholders in the future. You can register at www.londonasiacapital.com

Please Note: To save considerable costs, the Company will in the future place the annual Accounts on the Company Website: www.londonasiacapital.com and only send out the annual Accounts to those shareholders that request them.

Yours sincerely

David Buchler

David Buchler
Executive Chairman