| 29. | CAPITAL RISK MANAGEMENT |
The Group manages its capital to ensure that entities in the Group will be able to continue as a going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The Group’s overall strategy remains unchanged during the reporting periods.
The capital structure of the Group consists of debts, which includes bank borrowings as disclosed in Note 21, and equity attributable to equity holders of the Company, comprising capital and reserves.
The directors of the Company review the capital structure regularly. As part of this review, the directors consider the cost and the risks associated with each class of the capital. Based on the recommendations of the directors, the Group will balance its overall capital structure through the payment of dividends, raise of new capital as well as the raise of new borrowings or the repayment of existing borrowings.
Neither the Company nor any of its subsidiaries are subject to externally imposed capital requirements.
The Group manages capital risk by reference to total equity compared with total borrowings. As of December 31, 2016 and 2017, these metrics were as follows:
| As of December 31, | ||||||||||||
| 2016 | 2017 | 2017 | ||||||||||
| RMB’000 | RMB’000 | US$’000 | ||||||||||
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Bank borrowings |
558,000 | 558,000 | 85,763 | |||||||||
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Advances from an unrelated party |
983 | 38 | 6 | |||||||||
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Amount due to a shareholder |
1,398 | 8,742 | 1,344 | |||||||||
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Total borrowings |
560,381 | 566,780 | 87,113 | |||||||||
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Total Equity |
2,537,570 | 2,546,622 | 391,409 | |||||||||
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Debt (total liabilities) to equity ratio |
52.1 | % | 51.1 | % | ||||||||
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