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GLOBAL OFFERING
(A joint stock company incorporated in the People’s Republic of China with limited liability)
Stock Code : 2479
天聚地合 (蘇州)科技股份有限公司
Tianju Dihe (Suzhou) Technology Co., Ltd.
Sole Overall Coordinator, Joint Global Coordinator,
Joint Bookrunner and Joint Lead Manager
Sole Sponsor


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If you are in any doubt about any of the contents of this prospectus, you should obtain independent professional advice.
Tianju Dihe (Suzhou) Technology Co., Ltd.
˂ၳήΥ (ᘽψ )ʮ̡
(A joint stock company incorporated in the People’ s Republic of China with limited liability)
GLOBAL OFFERING
Number of Offer Shares under
the Global Offering
: 4,818,200 H Shares
Number of Hong Kong Offer Shares : 481,850 H Shares (subject to reallocation)
Number of International Offer Shares : 4,336,350 H Shares (subject to
reallocation)
Offer Price : HK$83.33 per H Share, plus brokerage of
1.0%, SFC transaction levy of 0.0027%,
AFRC transaction levy of 0.00015% and
Stock Exchange trading fee of 0.00565%
(payable in full on application in Hong
Kong dollars and subject to refund)
Nominal value : RMB1.0 per H Share
Stock code : 2479
Sole Sponsor
Sole Overall Coordinator, Joint Global Coordinator, Joint Bookrunner
and Joint Lead Manager
Joint Global Coordinators, Joint Bookrunners and Joint Lead Managers
Joint Bookrunners and Joint Lead Managers
Hong Kong Exchanges and Clearing Limited, The Stock Exchange of Hong Kong Limited and Hong Kong Securities Clearing Company Limited take no responsib ility for the
contents of this prospectus, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss h owsoever arising from or in
reliance upon the whole or any part of the contents of this prospectus.
A copy of this prospectus, having attached thereto the documents specified in “Documents Delivered to the Registrar of Companies and Available on Dis play” in Appendix VIII
to this prospectus, has been registered by the Registrar of Companies in Hong Kong as required by Section 342C of the Companies (Winding Up and Miscella neous Provisions)
Ordinance, Chapter 32 of the Laws of Hong Kong. The Securities and Futures Commission of Hong Kong and the Registrar of Companies in Hong Kong take no res ponsibility as
to the contents of this prospectus or any other documents referred to above.
The Offer Price will be HK$83.33 per Offer Share, unless otherwise announced.
Applicants for Hong Kong Offer Shares are required to pay, on application, the Offer Price of HK$83.33 for each Hong Kong Offer Share together with a bro kerage of 1.0%, a
SFC transaction levy of 0.0027%, AFRC transaction levy of 0.00015% and a Stock Exchange trading fee of 0.00565%.
The Sole Overall Coordinator (for itself and on behalf of the Underwriters) may, where considered appropriate and with our consent, reduce the number of Hong Kong
Offer Shares being offered under the Global Offering and/or the Offer Price that is stated in this prospectus at any time prior to the morning of the last day for lodging
applications under the Hong Kong Public Offering. In such a case, notices of the reduction in the number of Hong Kong Offer Shares and/or the Offer Price and the
cancellation of the Global Offering and relaunch of the offer at the revised number of offer shares and/or the revised offer price will be published on o ur Company’s website
at www.juhe.cn
and the Stock Exchange’s website at www.hkexnews.hk as soon as practicable following the decision to make such reduction, and in any event not later
than the morning of the day which is the last day for lodging applications under the Hong Kong Public Offering. In the absence of any such notices, the Off er Price will
be fixed as stated in this prospectus and the number of Offer Shares as stated in this prospectus will be final and conclusive. Further details are set fo rth in “Structure
of the Global Offering” and “How to Apply for Hong Kong Offer Shares” in this prospectus.
We are incorporated, and most of our businesses are operated, in the PRC. Potential investors should be aware of the differences in legal, economic and financial systems between
the PRC and Hong Kong and that there are different risk factors relating to investments in PRC-incorporated businesses. Potential investors should a lso be aware that the regulatory
framework in the PRC is different from the regulatory framework in Hong Kong and should take into consideration the different market nature of our H Sha res. Such differences
and risk factors are set out in the sections headed “Risk Factors,” “Appendix IV – Summary of Principal Legal and Regulatory Provisions” and “Appendix V – Summary of the
Articles of Association.” Potential investors should consider carefully all the information set out in this prospectus and, in particular, the matt ers discussed in the abovementioned
sections.
The obligations of the Hong Kong Underwriters under the Hong Kong Underwriting Agreement are subject to termination by the Sole Overall Coordinator ( for itself and
on behalf of the Hong Kong Underwriters) if certain grounds arise prior to 8:00 a.m. on the Listing Date. See “Underwriting – Underwriting Arrangement s and Expenses
– Hong Kong Public Offering – Grounds for Termination”.
The Offer Shares have not been and will not be registered under the U.S. Securities Act or any state securities law in the United States and may be offered and sold only outside
the United States in an offshore transaction in accordance with Regulation S under the U.S. Securities Act.
ATTENTION
We have adopted a fully electronic application process for the Hong Kong Public Offering. We will not provide printed copies of this prospectus to the p ublic in relation to the
Hong Kong Public Offering.
This prospectus is available at the website of the Stock Exchange at www.hkexnews.hk and our website at www.juhe.cn . If you require a printed copy of this document, you
may download and print from the website addresses above.
IMPORTANT
June 20, 2024


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IMPORTANT NOTICE TO INVESTORS:
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering. We will not provide printed copies of this prospectus in relation to
the Hong Kong Public Offering.
This prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “ HKEXnews > New Listings > New Listing Information ”
section, and our website at www.juhe.cn . Y ou may download and print from these
website addresses if you want a printed copy of this prospectus.
To apply for the Hong Kong Offer Shares, you may:
(1) apply online via the White Form eIPO service at www.eipo.com.hk ;o r
(2) apply electronically through the HKSCC EIPO channel and cause HKSCC
Nominees to apply on your behalf by instructing your broker or custodian who
is a HKSCC Participant to give electronic application instructions via
HKSCC’s FINI system to apply for the Hong Kong Offer Shares on your
behalf.
We will not provide any physical channels to accept any application for the Hong
Kong Offer Shares by the public. The contents of the electronic version of this
prospectus are identical to the printed prospectus as registered with the Registrar of
Companies in Hong Kong pursuant to Section 342C of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance.
If you are an intermediary , broker or agent , please remind your customers, clients
or principals, as applicable, that this prospectus is available online at the website
addresses stated above.
Please refer to the section headed “ How to Apply for the Hong Kong Offer Shares ”
in this prospectus for further details on the procedures through which you can apply for
the Hong Kong Offer Shares electronically.
IMPORTANT


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Y our application through the White Form eIPO service or the HKSCC EIPO channel
must be made for a minimum of 50 Hong Kong Offer Shares and in multiples of that number
of Hong Kong Offer Shares as set out in the table below. No application for any other number
of Hong Kong Offer Shares will be considered and such an application is liable to be rejected.
If you are applying through the White Form eIPO service, you may refer to the table
below for the amount payable for the number of Shares you have selected. Y ou must pay the
respective amount payable on application in full upon application for Hong Kong Offer Shares.
If you are applying through the HKSCC EIPO channel, you are required to pre-fund your
application based on the amount specified by your broker or custodian, as determined based on
the applicable laws and regulations in Hong Kong.
No. of Hong
Kong Offer
Shares
applied for
Amount
payable (2) on
application
No. of Hong
Kong Offer
Shares
applied for
Amount
payable (2) on
application
No. of Hong
Kong Offer
Shares
applied for
Amount
payable (2) on
application
No. of Hong
Kong Offer
Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
50 4,208.53 600 50,502.22 4,000 336,681.53 40,000 3,366,815.33
100 8,417.03 700 58,919.27 4,500 378,766.72 50,000 4,208,519.16
150 12,625.57 800 67,336.31 5,000 420,851.91 60,000 5,050,222.98
200 16,834.07 900 75,753.34 6,000 505,022.30 70,000 5,891,926.81
250 21,042.60 1,000 84,170.38 7,000 589,192.68 80,000 6,733,630.64
300 25,251.11 1,500 126,255.57 8,000 673,363.07 90,000 7,575,334.47
350 29,459.64 2,000 168,340.77 9,000 757,533.44 100,000 8,417,038.30
400 33,668.15 2,500 210,425.95 10,000 841,703.83 150,000 12,625,557.46
450 37,876.68 3,000 252,511.14 20,000 1,683,407.66 200,000 16,834,076.61
500 42,085.18 3,500 294,596.34 30,000 2,525,111.49 240,900
(1) 20,276,645.27
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
IMPORTANT


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If there is any change in the following expected timetable of the Hong Kong Public
Offering, we will issue an announcement in Hong Kong to be published on our Company’ s
website at www.juhe.cn and the website of the Stock Exchange at www.hkexnews.hk .
Hong Kong Public Offering commences ..................... .9:00 a.m. on Thursday,
June 20, 2024
Latest time to complete electronic applications under
White Form eIPO service through the designated
website at www.eipo.com.hk (2) ........................... 1 1:30 a.m. on Tuesday,
June 25, 2024
Application lists open (3) .................................. 1 1:45 a.m. on Tuesday,
June 25, 2024
Latest time to complete payment of White Form eIPO
applications by effecting internet banking
transfers(s) or PPS payment transfer(s) and giving
electronic application instructions to HKSCC
(4) ........... .12:00 noon on Tuesday,
June 25, 2024
If you are instructing your broker or custodian who is a HKSCC Participant to apply for
the Hong Kong Offer Shares on your behalf, you are advised to contact your broker or
custodian for the latest time for giving such instructions which may be different from the
earliest and latest time as stated above, as this may vary by broker or custodian.
Application lists close (3) ................................ .12:00 noon on Tuesday,
June 25, 2024
Announcement of the level of indications
of interest in the International Offering, the level of
applications in the Hong Kong Public Offering and the
basis of allocation of the Hong Kong Offer Shares under
the Hong Kong Public Offering to be published and on
the website of the Stock Exchange at www.hkexnews.hk
and our Company’s website at www.juhe.cn (6)
at or before ........................................1 1:00 p.m. on Thursday,
June 27, 2024
EXPECTED TIMETABLE (1)
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The results of allocations in the Hong Kong
Public Offering (with successful applicants’
identification document numbers, where appropriate)
to be available through a variety of channels, including:
 in the announcement to be posted on our website
and the website of the Stock Exchange at
www.juhe.cn and www.hkexnews.hk respectively ........a to r before 11:00 p.m.
on Thursday,
June 27, 2024
 from the designated results of allocations
website at www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ) ............. .from 11:00 p.m. on Thursday,
June 27, 2024
12:00 midnight on Wednesday,
July 3, 2024
 from the allocation results telephone enquiry by
calling +852 2862 8555 between 9:00 a.m.
and 6:00 p.m. on .................................. Friday, June 28, 2024
Tuesday, July 2, 2024
Wednesday, July 3, 2024 and
Thursday, July 4, 2024
H Share certificates in respect of wholly or partially
successful applications to be dispatched
or deposited into CCASS on or before
(7) .................. Thursday, June 27, 2024
White Form e-Refund payment instructions/refund cheques
in respect of wholly or partially unsuccessful
applications to be dispatched/collected on or before
(8)(9) .................... Friday,
June 28, 2024
Dealings in the H Shares on the Stock Exchange expected
to commenced at ....................................... .9:00 a.m. on Friday,
June 28, 2024
The application for the Hong Kong Offer Shares will commence on Thursday,
June 20, 2024 through Tuesday, June 25, 2024. The application monies (including
brokerage, AFRC transaction levy, SFC transaction levy and Stock Exchange trading fee)
will be held by the receiving bank on behalf of our Company and the refund monies, if
any, will be returned to the applicant(s) without interest on Friday, June 28, 2024.
Investors should be aware that the dealings in H Shares on the Stock Exchange are
expected to commence on Friday, June 28, 2024.
EXPECTED TIMETABLE (1)
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(1) All times and dates refer to Hong Kong local times and dates.
(2) Y ou will not be permitted to submit your application under the White Form eIPO service through the
designated website at www.eipo.com.hk after 11:30 a.m. on the last day for submitting applications. If you
have already submitted your application and obtained an application reference number from the designated
website prior to 11:30 a.m., you will be permitted to continue the application process (by completing payment
of application monies) until 12:00 noon on the last day for submitting applications, when the application lists
close.
(3) If there is/are a “black” rainstorm warning or a tropical cyclone warning signal number 8 or above and/or
Extreme Conditions in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, June 25,
2024, the application lists will not open on that day. For further details, please see “How to Apply for Hong
Kong Offer Shares – E. Severe Weather Arrangements – The Opening and Closing of the Application Lists”.
(4) Applicants who apply for Hong Kong Offer Shares through HKSCC EIPO channel should refer to “How to
Apply for Hong Kong Offer Shares – A. Applications for Hong Kong Offer Shares – 2. Application channels”.
(5) None of the websites or any of the information contained on the websites forms part of this prospectus.
(6) H Share certificates will only become valid evidence of title at 8:00 a.m. on the Listing Date provided that the
Global Offering has become unconditional and the right of termination described in “Underwriting –
Underwriting Arrangements and Expenses – Hong Kong Public Offering – Grounds for Termination” has not
been exercised. Investors who trade H Shares on the basis of publicly available allocation details prior to the
receipt of Share certificates or prior to the H Share certificates becoming valid evidence of title do so entirely
at their own risk.
(7) White Form e-Refund payment instructions/refund cheques will be issued in respect of wholly or partially
unsuccessful applications pursuant to the Hong Kong Public Offering. Part of the applicant’s Hong Kong
identity card number or passport number, or, if the application is made by joint applicants, part of the Hong
Kong identity card number or passport number of the first-named applicant, provided by the applicant(s) may
be printed on the refund cheque, if any. Such data would also be transferred to a third party for refund purposes.
Banks may require verification of an applicant’s Hong Kong identity card number or passport number before
encashment of the refund cheque. Inaccurate completion of an applicant’s Hong Kong identity card number or
passport number may invalidate or delay encashment of the refund cheque.
(8) Applicants being individuals who are eligible for personal collection may not authorize any other person to
collect on their behalf. If you are a corporate applicant which is eligible for personal collection, your
authorized representative must bear a letter of authorization from your corporation stamped with your
corporation’s chop. Both individuals and authorized representatives must produce evidence of identity
acceptable to our H Share Registrar at the time of collection.
Applicants who have applied for Hong Kong Offer Shares through the HKSCC EIPO channel should refer to
“How to Apply for Hong Kong Offer Shares – D. Dispatch/Collection of H Share Certificates and Refund of
Application Monies” for details.
Applicants who have applied through the White Form eIPO service and paid their applications monies
through single bank accounts may have refund monies (if any) dispatched to the bank account in the form of
White Form e-Refund payment instructions. Applicants who have applied through the White Form eIPO
service and paid their application monies through multiple bank accounts may have refund monies (if any)
dispatched to the address as specified in their application instructions in the form of refund cheques by
ordinary post at their own risk.
H Share certificates and/or refund cheques for applicants who have applied for less than 100,000 Hong Kong
Offer Shares and any uncollected H Share certificates and/or refund cheques will be dispatched by ordinary
post, at the applicants’ risk, to the addresses specified in the relevant applications.
Further information is set out in “How to Apply for Hong Kong Offer Shares – D. Dispatch/Collection of H
Share Certificates and Refund of Application Monies”.
EXPECTED TIMETABLE (1)
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The above expected timetable is a summary only. For further details of the structure of
the Global Offering, including its conditions, and the procedures for applications for Hong
Kong Offer Shares, please see “Structure of the Global Offering” and “How to Apply for Hong
Kong Offer Shares”, respectively.
If the Global Offering does not become unconditional or is terminated in accordance with
its terms, the Global Offering will not proceed. In such case, we will make an announcement
as soon as practicable thereafter.
EXPECTED TIMETABLE (1)
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This prospectus is issued by our Company solely in connection with the Hong Kong
Public Offering and the Hong Kong Offer Shares and does not constitute an offer to sell or
a solicitation of an offer to subscribe for or buy any security other than the Hong Kong
Offer Shares. This prospectus may not be used for the purpose of, and does not constitute,
an offer to sell or a solicitation of an offer to subscribe for or buy any security in any other
jurisdiction or in any other circumstances. No action has been taken to permit a public
offering of the Offer Shares or the distribution of this prospectus in any jurisdiction other
than Hong Kong. The distribution of this prospectus and the offering and sale of the Offer
Shares in other jurisdictions are subject to restrictions and may not be made except as
permitted under the applicable securities laws of such jurisdictions pursuant to registration
with or authorization by the relevant securities regulatory authorities or an exemption
therefrom.
You should rely only on the information contained in this prospectus to make your
investment decision. We have not authorized anyone to provide you with information that is
different from what is contained in this prospectus. Any information or representation not
included in this prospectus must not be relied on by you as having been authorized by us,
the Sole Sponsor , the Sole Sponsor-Overall Coordinator , the Sole Overall Coordinator , the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the
Underwriters, the Capital Market Intermediaries, any of our or their respective directors or
advisors, or any other person or party involved in the Global Offering. Information
contained on our website, located at www.juhe.cn , does not form part of this prospectus.
Page
EXPECTED TIMETABLE ........................................... i
CONTENTS ...................................................... v
SUMMARY ....................................................... 1
DEFINITIONS .................................................... 2 5
GLOSSARY OF TECHNICAL TERMS ................................. 4 0
FORW ARD-LOOKING STATEMENTS ................................. 4 5
RISK FACTORS ................................................... 4 7
W AIVERS FROM STRICT COMPLIANCE WITH THE LISTING RULES .... 7 0
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL
OFFERING ..................................................... 7 6
CONTENTS
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DIRECTORS, SUPERVISORS AND PARTIES INVOLVED IN THE GLOBAL
OFFERING ..................................................... 8 1
CORPORATE INFORMATION ....................................... 9 0
INDUSTRY OVERVIEW ............................................ 9 2
REGULATORY OVERVIEW ......................................... 1 0 7
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE ............. 1 2 6
BUSINESS ........................................................ 1 6 7
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS .......... 2 6 3
CONNECTED TRANSACTION ....................................... 2 6 9
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT ............. 2 7 3
SUBSTANTIAL SHAREHOLDERS .................................... 3 0 2
CORNERSTONE INVESTORS ........................................ 3 0 4
SHARE CAPITAL .................................................. 3 0 9
FINANCIAL INFORMATION ........................................ 3 1 2
FUTURE PLANS AND USE OF PROCEEDS ............................ 3 8 3
UNDERWRITING ................................................. 3 8 8
STRUCTURE OF THE GLOBAL OFFERING ........................... 4 0 2
HOW TO APPLY FOR HONG KONG OFFER SHARES ................... 4 1 1
APPENDIX I – ACCOUNTANTS’ REPORT ...................... I - 1
APPENDIX II – UNAUDITED PRO FORMA FINANCIAL
INFORMATION .............................. II-1
APPENDIX III – TAXATION AND FOREIGN EXCHANGE ........... III-1
APPENDIX IV – SUMMARY OF PRINCIPAL LEGAL AND
REGULATORY PROVISIONS .................. I V - 1
CONTENTS
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APPENDIX V – PROPERTY V ALUATION ........................ V - 1
APPENDIX VI – SUMMARY OF THE ARTICLES OF ASSOCIATION . . VI-1
APPENDIX VII – STATUTORY AND GENERAL INFORMATION ...... VII-1
APPENDIX VIII – DOCUMENTS DELIVERED TO THE REGISTRAR
OF COMPANIES AND A V AILABLE ON DISPLAY . . VIII-1
CONTENTS
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This summary aims to give you an overview of the information contained in this
prospectus. As it is a summary, it does not contain all the information that may be
important to you and is qualified in its entirety by, and should be read in conjunction
with, the full text of this prospectus. You should read the entire prospectus before you
decide to invest in the Offer Shares. There are risks associated with any investment. Some
of the particular risks in investing in the Offer Shares are set out in “Risk Factors” in
this prospectus. You should read that section carefully before you decide to invest in the
Offer Shares.
OVERVIEW
We are an integrated API-enabled data exchange service provider in China. We provide
standard API services and customized data management solutions to internet companies,
telecommunications operators, technology companies and other business and government
organizations as well as app developers and technology professionals. The integrated
API-enabled data exchange service market and the industry-specific API-enabled data
exchange service market together comprise the overall API-enabled data exchange service
market, which itself is part of the API-enabled service market.
Application Programming Interface, commonly known as API, is a set of protocols that
allows disconnected applications to communicate with each other. A common example of how
APIs work is when a customer requests weather information on a mobile app, the app sends out
a request via an API to a weather data supply source, which then processes the request,
retrieves the requested information, and sends a response via the API back to the mobile app
for the customer. An alternative to achieving such connectivity would have required the mobile
app developer and the data supply source to work together to build a new system that connects
different applications. However, such an alternative is oftentimes not viable when the
connectivity requires the handling of millions of data requests from various data sources on a
day-to-day basis. APIs are an accessible way to enable applications to exchange data and
functionality within and across organizations. APIs can eliminate data silos and handle the
exchange of large volumes of data.
We are dedicated to eliminating data silos and offering online API services that span
across multiple service types and scenarios. Our API marketplace, a combination of APIs we
offer, matches requests and responses and facilitates exchange of data. These services have
been widely applied in various vertical industries, such as internet services, software
information services, and telecommunications. Since the launch of API marketplace in June
2011, we have developed over 770 proprietary APIs. In 2023, API marketplace handled over
120 billion API requests. Our customers include well-known enterprises such as Tencent,
Alibaba, Baidu, NetEase, Meituan, China Mobile, China Unicom, China Telecom, and many
other internet companies, app developers and individuals. As of December 31, 2023, API
marketplace made available over 380 proprietary APIs to our customers. In 2021, 2022 and
2023, the retention rate of key customers of our API marketplace was 78.9%, 85.7% and 59.1%,
respectively. The net dollar expansion rate of revenue from our API marketplace key customers
in 2021, 2022 and 2023 was 136.4%, 139.1% and 217.3%, respectively.
SUMMARY
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Leveraging our integrated API-enabled data exchange capabilities, in 2020, we started to
provide data management solutions, a type of customized data technology solution that
comprises one or more of our products and services, including APIMaster , which provides
lifecycle management services for APIs; DataArts , which is an integrated data stewardship
platform that collects, cleanses and processes data to empower data; QuickBot, which is an
RPA software designed to execute basic and repetitive tasks with a certain pattern;
SmartShield , which is a privacy computation tool that addresses the issue of privacy protection
in data exchange; and AnchorChain , which is a consortium blockchain tool that ensures the
security of data circulation distributed ledgers.
We offer solutions that assist organizations in their digital transformation. Our
customized, digitalized, and self-deployed data management solutions cater to a diverse range
of customers, including those from government agencies, manufacturing, finance,
telecommunications, and various other industries. Our technologies eliminate data silos and
cleanse data sets with heterogeneity, forming data that adheres to unified standards.
Benefiting from our advanced technologies and service capabilities, we have gained
recognition from our customers, resulting in rapid growth in revenue. In 2021, 2022 and 2023,
our total revenue was RMB260.0 million, RMB328.9 million and RMB441.1 million,
respectively. We recorded a CAGR in revenue of 30.2% from 2021 to 2023. From 2021 to 2023,
the CAGR of the revenue attributable to our data management solutions was 23.1%.
API Marketplace
Our API marketplace provides standard API services. Customers can integrate their
software applications quickly with standardized APIs provided by API marketplace, enabling
them to rapidly implement the functionality required for their scenarios. Our customers
primarily consist of internet companies, software and app developers, and telecommunications
operators, who subscribe to different service types to match their application scenarios. The
APIs we offer on API marketplace cover a wide array of services, such as authentication, SMS
notice, weather, news, IP address inspections and top-ups, which we broadly categorize into the
following three service types:
 Query : Customers utilize our APIs to request the retrieval of data results, such as
identity authentication, mobile online status, online duration, information on
companies, and certain publicly available information such as weather conditions.
We provided approximately 300 paid APIs for query services as of December 31,
2023. One of our most popular query APIs is known as the “three-factor” API. The
“three factors” refer to a person’s name, registered mobile number and PRC identity
card number. Internet platforms in China typically require new customers to provide
these three factors to verify their identity and register a new account. Without
divulging any personal data, our customers will receive a “Y es” or “No” result
confirming whether the three factors match the information previously registered by
the same person. End-users provide their three factors on our customer’s online
interface, such as a mobile app, website or WeChat mini program. The online
SUMMARY
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interface provides encrypted data to data service suppliers through our APIs. Data
service suppliers will return a “Y es” if the data provided match their records. The
chart below provides an illustration of how three-factor API works:
End-user
Data flow: input three factors
Payment based on the number of requests
Data flow: return “Yes” or “No”
“Three-factor” API
Data flow: encrypted real name, registered mobile number
and PRC identity card number
Our Company
Data service supplier
Payment Pa yment
Customer’s online
interface
 SMS notice : Our customers provide services to enable end-users to subscribe for
SMS alerts, status updates and promotions. Our APIs facilitate SMS for account
registration, login, security notice and password reset. We provided approximately
five paid APIs for SMS notice services as of December 31, 2023. In the case of SMS
notice APIs, an end-user initiates an SMS notice request and provides his or her
mobile number to the customer’s online interface. The customer sends an SMS
notice request to a third-party SMS service provider, who further delivers it to a
telecommunications operator. The telecommunications operator sends the SMS to
end-users. For example, when an end-user logs in to an app, the end-user may
choose to log in by mobile authentication. In that case, the app will send a
verification code request, with the end-user’s mobile number encrypted, to a
third-party SMS service provider through our APIs. The third-party SMS service
provider will work with a telecommunications operator, who will send an SMS login
code to the end-user. The chart below provides an illustration of how SMS
verification API works:
Data flow: send SMS notice
SMS notice API
SMS service
providers
Data flow: send encrypted mobile number
and verification code request
Our Company
End-user
Data flow:
initiate SMS
notice and provide
mobile number
Payment Payment
Telecommunications
operators
Customer’s online
interface
Data flow:
send encrypted
mobile number
and verification
code request
Payment
SUMMARY
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--- page 15 ---
Another example of SMS notice API is promotional SMS notice. A customer can
initiate a request to send a promotional SMS notice to third-party SMS service
providers or telecommunications operators. We will request the customer to provide
a template for the SMS notice. Third-party SMS service providers will work with the
telecommunications operators, who will send a promotional SMS notice to the
designated end-users and a confirmation (as to whether or not the SMS notice was
successfully sent) to the customer. The chart below provides an illustration of how
promotional SMS notice API works:
Data flow: send SMS notice
Provide mobile number
promotional SMS notice APIData flow: notice of success or failure
SMS service
providers
Data flow: send encrypted mobile numbers
and promotional SMS notice request
Our Company
End-user
Payment Payment
Telecommunications
operators
Customer’s online
interface
Data flow:
send encrypted
mobile numbers
and promotional
SMS notice
request
Payment
 Top-up: Almost all of our top-up services in 2023 were mobile top-ups. An end-user
initiates a top-up on a customer’s online interface by clicking on a “top-up” button,
inputting its mobile number and top-up amount. The customer’s online interface
sends a top-up request to us through APIs. After receiving the request, we will either
(i) send a request to the telecommunications operators directly, upon which we make
payment to telecommunications operators; or (ii) send top-up requests to top-up
service providers directly and make payments to them. We generally are not
involved in the interaction between telecommunications operators and service
providers. Revenue derived from mobile top-up service contributed to
approximately 80%, 99%, and 99% of the total top-up service revenue for the years
ended December 31, 2021, 2022 and 2023, respectively. We have been strategically
scaling down our top-up service since 2021. The chart below provides an illustration
of how top-up API works:
Mobile top-up service
API
Data flow: send top-up
request and encrypted
mobile number
Top-up service
providersData flow:
send top-up
request and
encrypted mobile
number in
the case of (ii)
Our Company
End-user
Payment
Make prepayments with
subsequent settlementPayment base on
top-up face value
Telecommunications
operators
Customer’s
online interface
Data flow:
send top-up
request and
encrypted mobile
number in the
case of (i) Top-up
arrangement/
payment in the
case of (ii)
in the case of (i)
Make
payment
Data flow:
initiate top-up
and provide
mobile number
in the case
of (ii)
SUMMARY
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--- page 16 ---
In the case of query and SMS notice, we charge customers based on the number of API
requests they make. For certain large customers, we enter into agreements individually and
provide API services and settle their invoices on a monthly basis. For top-up, we earn revenue
based on the difference between the unit price of top-up face value offered to our customers
and our cost of purchase of the same face value from telecommunications operators or service
providers. Our revenue from API marketplace was settled by two methods, prepayment and
post-payment. Revenue settled by prepayment refers to revenue derived from sales where
customers pay us before services are rendered (that is, sales to pre-paid customers). Revenue
settled by post-payment refers to revenue derived from sales where customers pay us after
services are rendered (that is, sales to post-paid customers). In 2021, 2022 and 2023, revenue
from post-payment customers of API marketplace represented 83.7%, 86.4% and 94.4% of the
total revenue of API marketplace, respectively. See “Financial Information – Principal
Components of Consolidated Statements of Profit or Loss – Revenue – Revenue by Settlement
Method”.
Data Management Solutions
Our data management solutions primarily comprise three service types, including external
data management, data stewardship, and data circulation. With our solutions, we enable
organizations to efficiently collect, process, govern, share, and utilize data while preserving
privacy and security, achieving digital transformation. Our data management solutions offer
the following key benefits:
 Promote efficiency through external data management: We empower our
customers to leverage market data and services, enabling them to focus on business
innovation while benefiting from a faster and more convenient access to external
data in a safe and compliant manner. With the help of our data management
solutions, corporate organizations can introduce, access and manage external data
sources for multiple departments. By using them with corporate internal data,
corporate organizations can make informed decision and manage daily operation
effectively. Governments may use a centralized platform to integrate data from
different government departments and manage them in one go. This approach is
more efficient as compared to having each department introduce, manage and use
data source on their own accord. See “Business – Our Services and Solutions – API
Marketplace – Case Studies” for the specific examples of these business
innovations.
 Empower data through optimized data stewardship: We assist our customers in
achieving comprehensive integration and governance of their internal database,
allowing them to build standardized data assets within their organizations. Data with
unified standard is ready for output and utilization through APIs. See “Business –
Our Services and Solutions – Data Management Solutions” for illustrations of data
stewardship.
SUMMARY
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--- page 17 ---
 Facilitate full release of data value: We help our customers establish exchange of
data systems that enable seamless data sharing among internal departments or foster
data circulation with upstream and downstream business partners, unleashing the
value of data. Data management solutions make data available for sharing and
utilizing, which we refer to as “empowerment”. For example, a corporate
organization may wish to share the supply chain data and relevant analytics with its
suppliers, so that suppliers could optimize their warehouse management and
manufacturing process.
Our data management solutions primarily follow a project-based pricing model, where
customers are generally billed for the products and platform development according to
payment terms agreed with customers. Platform construction fees are typically charged for the
implementation of the data management platform. Additionally, in certain cases, we may also
charge fees for supporting operational services and consulting services based on specific
customer requirements. Revenue derived from data management solutions is recognized when
the data management solutions and related services are delivered to and accepted by the
customers.
OUR STRENGTHS
We believe the following strengths contribute to our success:
 One of the first-movers in the digital economy’s key industry;
 An innovator in the industry with strong research and development capabilities and
accumulated advantages in core technologies;
 Well-established and diversified customer base, a stable and diverse array of data
service suppliers, and sustainable monetization capabilities;
 A scalable business model; and
 An entrepreneurial and experienced management team.
OUR STRATEGIES
To achieve our mission and further strengthen our market position, we intend to pursue
the following strategies:
 Seize the significant opportunities arising from government and public data
authorized operations to expand;
 Further explore service capabilities for diverse industries, continuously expanding
regional coverage, service types and scenarios;
 Expand customer base and deepen industry ecosystem stakeholder relationships; and
 Enhance R&D capabilities.
SUMMARY
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OUR INDUSTRY AND MARKET SHARES
We operate in the integrated API-enabled data exchange service market, a sub-segment of
the API-enabled data exchange service market in China, and the data management solution
market in China. According to the F&S Report,
 the size of API-enabled data exchange service market in China reached RMB6.9
billion in 2022, comprising RMB2.37 billion in the integrated API-enabled data
exchange service segment and RMB4.57 billion in the industry-specific API-enabled
data exchange service segment. The size of the API-enabled service market in China
reached RMB37.9 billion in 2022;
 in 2022, we had a market share of 6.1% and 2.1% in the integrated API-enabled data
exchange service market and overall API-enabled data exchange service market,
respectively, in China. To differentiate from our competitors, we are expected to
further leverage our leading position in the market to expand our business scale
through cooperating with different data sources and participating in the
establishment and operation of state-owned data exchanges; and
 the size of data management solution market in China totaled RMB50.7 billion in
2022 and we had a market share of 0.2%.
OUR CUSTOMERS
Our customers include internet companies, telecommunications operators, technology
companies and other business and government organizations seeking digital transformation as
well as individual app developers and technology professionals. For each of the years ended
December 31, 2021, 2022 and 2023, revenue from our five largest customers accounted for
41.1%, 43.7% and 62.3% of our total revenue, respectively, and revenue from our largest
customer accounted for 11.7%, 12.4% and 20.1% of our total revenue, respectively. For further
details, see “Business – Our Customers”.
Customer H (Supplier A), Customer B (Supplier F) and Customer K (Supplier J) are
telecommunications operators in China, which supplied data services to us in our API
marketplace. In the meantime, these suppliers or their affiliates also purchased query, SMS
notice or top-up services, as well as data management solutions, from us. Customer L (Supplier
I)’s business covers four industry groups, namely, cloud data center, cloud service and big data,
smart city and smart enterprise. It supplied us with software development services in
connection with data management solutions and purchased three data management solutions
from us in 2023.
SUMMARY
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--- page 19 ---
Revenue derived from these large customers were RMB51.1 million, RMB42.2 million
and RMB65.4 million for each of the years ended December 31, 2021, 2022 and 2023,
respectively, representing 19.6%, 12.8% and 14.8% of the total revenue, respectively. Our cost
of sales attributable to them was RMB35.8 million, RMB26.3 million and RMB47.2 million for
each of the years ended December 31, 2021, 2022 and 2023, respectively, representing 21.1%,
11.9% and 14.9% of the total cost of sales, respectively. For the respective years, the gross
profit margin of the four customers was 29.9%, 37.6% and 27.8%, respectively, as compared
to 35.7%, 32.0% and 28.3% of other customers, respectively.
OUR SUPPLIERS
Our procurement includes purchases of data services, software, hardware and technology
services. For each of the years ended December 31, 2021, 2022 and 2023, our purchases
amounted to RMB160.5 million, RMB208.0 million and RMB298.6 million, respectively,
representing 94.4%, 94.0% and 94.4% of our total cost of sales, respectively. For further
details, see “Business – Our Suppliers”.
For each of the years ended December 31, 2021, 2022 and 2023, procurement from our
five largest suppliers accounted for 56.2%, 69.9% and 83.2% of our total purchases,
respectively, and purchases from our largest supplier accounted for 36.3%, 42.5% and 46.3%
of our total purchases, respectively.
KEY OPERATING METRICS
The table below sets forth selected key operating metrics of our API marketplace
business:
Y ear ended December 31,
2021 2022 2023
Retention rate of our key customers of our API marketplace (1)(2) ...... 78.9% 85.7% 59.1%
Net dollar expansion rate of revenue from our API marketplace key
customers (3) ................................. 136.4% 139.1% 217.3%
Number of key customers of API marketplace ................ 2 1 2 2 1 7
Average income from our key customers of our API marketplace
(in millions of RMB ) ............................. 7 . 0 8 . 1 18.3
Average revenue per paying customer (4) (in thousands of RMB ) ....... 8 . 1 13.8 28.8
Number of active registered customers (5) (in thousands ) ........... 77.9 65.8 61.7
Number of active registered paying customers ( in thousands )(6) ....... 14.9 12.1 10.7
Retention rate of paying customers of our API marketplace (7) ........ 38.0% 29.6% 36.6%
Net dollar expansion rate of revenue from paying customers of
our API marketplace (8) ............................ 83.8% 119.8% 123.4%
Conversion rate of non-paying customers into paying customers (9) ..... 0.37% 0.52% 0.45%
Number of API requests for query ( in millions )............... 910.8 920.5 1,568.2
Average price per request of API request for query ( in RMB ) ........ 0.137 0.158 0.173
SUMMARY
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--- page 20 ---
Y ear ended December 31,
2021 2022 2023
Number of API requests for SMS notice ( in millions ) ............ 2,037.9 2,130.7 2,097.5
Average price per request of API request for SMS notice ( in RMB ) .... 0.028 0.033 0.031
Aggregate top-up face value ( in millions of RMB ) .............. 2,322.6 774.7 494.3
Revenue per RMB100 top-up (10) (in RMB ) .................. 0.53 0.98 1.25
(1) Key customers refer to customers who contributed revenue of more than RMB1 million in a respective year.
(2) Calculated as the number of key customers of API marketplace in the prior year that remain as our paying
customers in the current year, divided by the number of all key customers of API marketplace in such prior
year.
(3) Calculated as revenue derived from our key customers of API marketplace in any given year divided by the
revenue derived from the same key customers in the previous year, provided that the key customers must be
a paid customer in the previous year. Otherwise the revenue attributable to the key customer will not be
accounted for in the given year.
(4) Calculated as revenue derived from our API marketplace for the respective year divided by the number of
paying customers of API marketplace during the respective year.
(5) Referred to the number of customers who used APIs (whether paid or for free) offered through API marketplace
in the respective year.
(6) Refers to the number of customers who used our APIs (whether paid or for free) offered through API
marketplace in the respective year and historically made payment to us.
(7) Calculated as the number of paying customers of API marketplace in the prior year who contributed to our
revenue in the current year, divided by the number of all paying customers of API marketplace in such prior
year.
(8) Calculated as revenue derived from our paying customers of API marketplace in any given year divided by the
revenue derived from the same paying customers in the previous year, provided that the paying customers must
be a paid customer in the previous year. Otherwise, the revenue attributable to the paying customer will not
be accounted for in the given year.
(9) Calculated as for a given year, the number of paying customers of API marketplace who made their first
payments to us in the given year, provided that such first payments were made at least 60 days after the
registration of the respective customer, divided by the number of new non-paying customers, who registered
or used any free API marketplace services in the respective year. The use of “60-day period” in this calculation
is based on our internal policy regarding customer lifecycle management, and, according to F&S, it is a
common industry method to calculate the customer conversion rate over a 60-day period between registration
and the first payment.
(10) We recognized the difference between the purchase for the top-up face value paid to data service suppliers and
the amount we received from our customer as revenue during the Track Record Period. We are unable to
provide net profit of each RMB100 top-up primarily because certain expenses cannot be allocated to
subsegments of API marketplace.
We typically charge our customers based on their number of API requests for query and
SMS notice services. Our average price per request for query service increased from
RMB0.137 in 2021 to RMB0.158 in 2022, and further increased to RMB0.173 in 2023,
primarily due to increased purchase costs of identity authentication-related API service supply,
which led to a higher price. This trend was also attributable to the increase in the usage of
mobile number-related three-factor authentication, which had a higher price per request. Our
SUMMARY
–9–


--- page 21 ---
average price per request for SMS notice service decreased from RMB0.033 in 2022 to
RMB0.031 in 2023, primarily due to a decrease in the usage of promotional SMS notice
service, which had a higher price per request as compared to the average price per request in
2022 and 2023.
The net dollar expansion rate of revenue from our API marketplace key customers
increased significantly from 139.1% in 2022 to 217.3% in 2023, primarily due to a significant
increase in the revenue contributed by three key customers as a result of their increased
purchases of our query services, mainly attributable to their increased trust in the quality and
reliability of our services based on past collaborations as well as our competitive pricing.
Revenue per RMB100 top-up increased from RMB0.53 in 2021 to RMB0.98 in 2022
primarily because we ceased to offer gas card top-up in 2022, which had a much lower revenue
per RMB100 top-up. In addition, certain mobile top-up service providers lowered their price
as part of their promotional efforts. Revenue per RMB100 top-up increased to RMB1.25 in
2023 primarily because we were more selective in working with mobile top-up service
suppliers to lower our purchase costs and we increased our unit price for certain popular top-up
face values.
The retention rate of our key customers of API marketplace decreased from 85.7% in
2022 to 59.1% in 2023, primarily because certain key customers who used SMS notice and
query APIs ceased to use our services in 2023.
The number of key customers of API marketplace declined from 22 in 2022 to 17 in 2023,
primarily because nine key customers ceased to use our API marketplace service, partially
offset by five new key customers. The nine key customers ceased to use our API marketplace
service because (i) we terminated our business with them due to their prolonged settlement on
amounts payable to us. We have made provision for trade receivables of API marketplace
services to these customers; (ii) customer’s adjustments to their business operations; and (iii)
customer’s refusal to settle amounts overdue, for which we filed a claim.
The average income from our key customers of our API marketplace increased
substantially from RMB8.1 million in 2022 to RMB18.3 million in 2023, primarily due to: (i)
an increase in the total income from our key customers, mainly attributable to (a) a significant
increase in the number of query service requests purchased by three key customers, as
discussed above; and (b) an increase in the proportion of revenue contributed by query services
that commanded relatively higher gross profit margins, mainly due to the increased purchases
from the aforementioned three key customers; and (ii) a decrease in our number of key
customers as we ended our collaboration with nine key customers that, in general, contributed
relatively lower revenue, both as a part of our ordinary course of business and as a result of
our focus on cultivating deeper relationships with key customers that contributed higher
revenue.
SUMMARY
–1 0–


--- page 22 ---
Our average revenue per paying customer increased from approximately RMB8,100 in
2021 to approximately RMB13,800 in 2022, and further increased to approximately
RMB28,800 in 2023, primarily due to: (i) an overall decrease in our number of paying
customers, mainly attributable to a decrease in our number of low-spending paying customers;
and (ii) an increase in our revenue from paying customers, mainly attributable to our strategic
focus on attracting and engaging large customers that contributed much higher revenue on
average than our low-spending paying customers.
The number of active registered customers decreased from approximately 77,900 in 2021
to approximately 65,800 in 2022, which further decreased to approximately 61,700, primarily
because we ceased to offer certain APIs. The number of active registered paying customers
decreased from approximately 14,900 in 2021 to 12,100 in 2022, which further decreased to
10,700 in 2023, which was in line with the decrease in the active registered customers.
Our retention rate of paying customers of our API marketplace decreased from 38.0% in
2021 to 29.6% in 2022, primarily because we ceased to offer paid APIs, such as car ticket
inquiry, car information check and driving license checks. The retention rate of paying
customers of our API marketplace increased to 36.6% in 2023, primarily due to an increase in
usage of multiple paid APIs by our paying customers in 2023, such as invalid mobile number
checks, identity related authentications, telecommunication operators history related checks
and IP address checks.
The number of API query requests increased from 910.8 million in 2021 to 920.5 million
in 2022, primarily because one large customer increased its usage. It further increased to
1,568.2 million in 2023, primarily due to the introduction of new key customers and an
increase in usage by existing customers, partly offset by a decrease in usage by certain existing
customers.
As customers use our API marketplace services, our technology improves as we adapt to
customer needs, and our improved services in turn attract more potential customers and
enhance customer loyalty, resulting in higher retention rates and revenue contribution from our
key customers.
The table below sets forth selected key operating metrics of our data management
solutions:
Y ear ended December 31,
2021 2022 2023
Number of projects delivered to and accepted by the customers ...... 2 0 2 2 6 2
Number of projects delivered to and accepted by government customers . . 2 4 20
Number of projects delivered to and accepted by SOE customers ...... 5 9 2 9
Number of projects delivered to and accepted by other customers ..... 1 3 9 1 3
Number of projects delivered to and accepted in loss ............ – – –
Total revenue ( in millions of RMB ) ...................... 65.3 105.4 99.0
Number of customers ............................. 1 8 2 1 2 9
SUMMARY
–1 1–


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* For the avoidance of doubt, the number of customers was calculated by consolidating contracting parties who
controlled each other or were under common control based on the information provided by the contracting
parties.
We did not have any data management solutions projects that incurred losses during the
Track Record Period and up to the Latest Practicable Date, primarily because we evaluate the
cost for each project before we provide a quote or make a bidding proposal, as required under
our project management operation manual. In addition, a substantial portion of the cost for
each project comes from the labor costs of our programmers, who are paid at a fixed salary on
a monthly basis and therefore we are unlikely to incur substantial unexpected costs. Our project
contracts also include clauses for payment milestones or payment due dates, which reduces our
credit risk for each project.
Our number of projects delivered to and accepted by the customers remained steady in
2021 and 2022, and increased significantly from 22 in 2022 to 62 in 2023. The total revenue
derived from data management solutions decreased from RMB105.4 million in 2022 to
RMB99.0 million in 2023, primarily because in 2023 we provided a large amount of a new
solution, “data police”, which required little customization and each project contributed to a
small amount of revenue as compared to revenue from more customized solutions.
During the Track Record Period, we have continued to attract new high-quality customers
including government organizations, state-owned enterprises, and financial institutions by
enriching our solution offerings and continuously improving our brand reputation.
RISK FACTORS
Our business and the Global Offering involve certain risks as set out in the “Risk Factors”
section. Y ou should read the “Risk Factors” section in its entirety before you decide to invest
in our Company. Some of the major risks that we face include, among others:
 Fluctuations in demand for our services and solutions may adversely affect our
business and results of operations. Any loss of or decline in demand for our products
and services could materially and adversely affect our business, results of operations
and financial condition;
 Unauthorized access to our customers’, suppliers’, or our own data could harm our
reputation and have a negative impact on our business and financial performance;
 Our ability to attract and retain qualified personnel could materially affect our
business and the results of operations. Rising labor costs in China could make it
more costly to attract and retain qualified personnel and adversely affect our results
of operations;
SUMMARY
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--- page 24 ---
 If we cannot continue to innovate or effectively respond to the rapidly evolving
technology, market demands, industry dynamics and other risks and uncertainties,
our business, results of operations and prospects would be materially and adversely
affected;
 Our services and solutions depend on the performance of internet infrastructure,
third-party service providers and our technologies. Unexpected system failures,
interruptions, and inadequacies may harm our business and results of operations;
 We have experienced, and in the future may continue to experience, net operating
cash outflow, an increase in trade receivables turnover days and a substantial amount
of unbilled trade receivables, all of which could expose us to liquidity risks;
 Failure to maintain our advantages in an increasingly competitive market may
adversely affect our business and growth prospects;
 Our business is subject to seasonality; and
 We experienced customer and supplier concentration during the Track Record
Period and may continue to be exposed to the risk of such concentration in the
future.
CONTROLLING SHAREHOLDERS
As of the Latest Practicable Date, Mr. Zuo held an aggregate of approximately 53.33%
interest in our share capital, including approximately (i) 43.59% beneficial interest; (ii) 0.15%
interest of spouse; and (iii) 9.59% interest in Yiju Liuhe and Liuju Liuhe, each being a limited
partnership established in China as our employee shareholding platforms whereby Mr. Zuo is
the sole general partner. Mr. Zuo’s spouse, Ms. Hua, who holds 0.15% beneficial interest in our
share capital, is deemed to be interested in the same number of Shares that Mr. Zuo is interested
in for the purpose of the Securities and Futures Ordinance. Immediately following the
completion of the Global Offering, Mr. Zuo, Yiju Liuhe, Liuju Liuhe and Ms. Hua will hold
an aggregate of approximately 48.21% interest in our share capital, comprising approximately
39.40% beneficial interest, 0.14% interest of spouse and 8.67% interest in controlled
corporations. Accordingly, Mr. Zuo, Ms. Hua, Yiju Liuhe and Liuju Liuhe will remain a group
of Controlling Shareholders upon completion of the Global Offering. For further information,
see “Relationship with our Controlling Shareholders”.
CONTINUING CONNECTED TRANSACTIONS
We have entered into a transaction which would constitute a partially-exempt continuing
connected transaction under Chapter 14A of the Listing Rules after the Listing. For the (i) three
years ended December 31, 2021, 2022 and 2023, the transaction amounts were approximately
RMB5,531,801, RMB4,914,027 and RMB5,055,722, respectively; and (ii) three months ended
March 31, 2024, the transaction amounts were approximately RMB1,800,000. Our Directors
SUMMARY
–1 3–


--- page 25 ---
estimate that the proposed annual caps in respect of this transaction will not exceed
RMB7,000,000 and RMB2,800,000 for the financial year ending December 31, 2024 and the
three months ending March 31, 2025, respectively. Further particulars about such transaction,
together with the application for a waiver from strict compliance with the relevant
requirements under Chapter 14A of the Listing Rules are set out in “Connected Transactions”.
SUMMARY OF HISTORICAL FINANCIAL INFORMATION
The summary of the historical financial information set forth below has been derived
from, and should be read in conjunction with, our consolidated audited financial statements as
of and for the years ended December 31, 2021, 2022 and 2023, including the accompanying
notes, set forth in the Accountants’ Report in Appendix I to this document, as well as the
information set forth in “Financial Information”. Our financial information was prepared in
accordance with IFRSs.
Summary of Consolidated Statements of Profit or Loss
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Revenue ............................. 260,011 328,936 441,083
Cost of sales .......................... (170,099) (221,382) (316,431)
Gross profit .......................... 89,912 107,554 124,652
Other income and other gains, net ........... 16,903 11,019 10,704
Selling and distribution expenses ........... (15,449) (14,378) (12,530)
Research and development costs ............ (16,875) (26,345) (24,250)
Administrative and other expenses .......... (20,490) (32,025) (27,518)
Impairment loss on financial and contract
assets, net .......................... (418) (1,068) (9,915)
Finance costs .......................... (154) (1) (1,014)
Listing expenses ....................... – – (22,354)
Profit before tax ....................... 53,429 44,756 37,775
Income tax expense ..................... (7,463) (3,472) (2,714)
Profit/(loss) for the year ................. 45,966 41,284 35,061
Profit/(loss) for the year attributable to :
Owners of the Company ................ 46,011 41,249 34,751
Non-controlling interests ................ (45) 35 310
45,966 41,284 35,061
SUMMARY
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During the Track Record Period, we generated revenue primarily from API marketplace,
and, to a lesser extent, data management solutions. The table below sets forth a breakdown of
our revenue by service type for the years indicated:
Y ear ended December 31,
2021 2022 2023
RMB % RMB % RMB %
(in thousands, except for percentages)
Query ...................... 124,467 47.9 145,279 44.2 271,356 61.6
SMS notice .................. 57,883 22.2 70,627 21.5 64,543 14.6
Top-up (1) .................... 12,370 4.8 7,626 2.3 6,170 1.4
Revenue from API marketplace .. 194,720 74.9 223,532 68.0 342,069 77.6
Revenue from data management
solutions .................. 65,291 25.1 105,404 32.0 99,014 22.4
Total Revenue ................ 260,011 100.0 328,936 100.0 441,083 100.0
(1) For top-up, we recognize revenue on a net basis pursuant to IFRS 15. See “Financial Information – Material
Accounting Policy Information – Principal versus Agent Consideration in Revenue Recognition”.
During the Track Record Period, our revenue from API marketplace has been increasing
steadily, mainly attributable to revenue growth from both query and SMS notice services,
primarily driven by increasing API requests made by a growing customer base. These growth
trends were partially offset by a decreasing revenue stream from our top-up service during the
Track Record Period due to our strategic scale-down of this service, which we believe has
limited growth potential and negatively impacted our cash flow and liquidity. See “Financial
Information – Results of Operations”.
Our revenue from data management solutions increased from RMB65.3 million in 2021
to RMB105.4 million in 2022, mainly driven by (i) a growing number of new mandates and
existing projects delivered to and accepted by customers as we continued expanding our
customer base and enriching solution offerings, (ii) our efforts to increase our revenue per
project, and/or (iii) our continued efforts to enhance our brand reputation. Our revenue from
data management solutions decreased to RMB99.0 million in 2023, primarily due to a decrease
in the average revenue of our projects, mainly because most of our projects delivered and
accepted had more standardized components, and such projects generally generated lower
revenue.
SUMMARY
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The table below sets forth a breakdown of our cost of sales by nature for the years
indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Labor costs ....................... 7,805 11,674 16,250
Purchase costs – API marketplace ...... 130,309 148,964 241,696
Purchase costs – data management
solutions ....................... 30,222 59,046 56,887
Others (1) ......................... 1,763 1,698 1,598
Total ............................ 170,099 221,382 316,431
(1) Others primarily comprise cloud server, leasing and traveling costs.
During the Track Record Period, our purchase costs for API marketplace constituted the
largest component of our cost of sales. Such costs represent our costs of procuring data services
from suppliers which typically charge us based on the number of customer API requests made
through API marketplace. In addition, we incurred a small amount of costs for the operation
of free APIs, primarily labor and server costs. We allocated these costs to our cost of sales for
paid APIs, but this practice would not have a material impact on our operations and financial
performance as a whole.
During the Track Record Period, our cost of sales had increased steadily, mainly
attributable to our increased purchases of data services for API marketplace and specialized
software and hardware for data management solutions, reflecting the continued growth in both
of our business lines; and, to a lesser extent, a general increase in our labor costs from 2021
to 2023 as a result of an increase in the headcount and average salary.
The table below sets forth our gross profit by service type during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
API marketplace
Query .............................. 43,604 53,947 84,326
SMS notice ......................... 6,708 10,875 7,439
Top-up ............................. 10,466 6,661 5,133
Total API marketplace .................. 60,778 71,483 96,898
Data management solutions .............. 29,134 36,071 27,754
Total ................................ 89,912 107,554 124,652
SUMMARY
–1 6–


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The table below sets forth our gross profit margin by service type during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
API marketplace ....................... 31.2% 32.0% 28.3%
Query .............................. 35.0% 37.1% 31.1%
SMS notice ......................... 1 1.6% 15.4% 11.5%
Top-up ............................. 84.6% 87.3% 83.2%
Data management solutions .............. 44.6% 34.2% 28.0%
Our net profit decreased by 10.2% from RMB46.0 million in 2021 to RMB41.3 million
in 2022, and further decreased by 15.1% to RMB35.1 million in 2023. Our net profit margin
decreased from 17.7% in 2021 to 12.6% in 2022, and further decreased to 7.9% in 2023. The
decreases in our net profit and net profit margin were primarily due to a decrease in our gross
profit margin and an increase in our total expenses mainly attributable to non-recurring listing
expenses of RMB22.4 million in 2023 in connection to the Global Offering and an increase in
our net impairment loss on financial and contract assets.
For further details of our financial performance and key financial data, see “Financial
Information – Principal Components of Consolidated Statements of Profit or Loss”.
Summary of Consolidated Statements of Cash Flows
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Cash and cash equivalents at the beginning of
the year .............................. 403,836 182,287 168,470
Net cash generated from/(used in) operating
activities .............................. (33,796) (36,819) 4,445
Net cash generated from/(used in) investing
activities .............................. (166,628) 22,335 (44,780)
Net cash used in financing activities ........... (20,941) (22) (3,884)
Net decrease in cash and cash equivalents ....... (221,365) (14,506) (44,219)
Exchange differences on translating cash flows of
foreign operations ....................... (184) 689 166
Cash and cash equivalents at the end of the
year ................................. 182,287 168,470 124,417
In 2021 and 2022, we had net cash outflows from operating activities of RMB33.8 million
and RMB36.8 million, respectively. Major working capital changes which adversely affected
our cash flow during these years include: (i) an increase in trade receivables, driven by the
continued growth of our business and an increase in our post-paid API marketplace customers;
SUMMARY
–1 7–


--- page 29 ---
(ii) an increase in prepayments, deposits and other receivables primarily due to our increased
prepayments to suppliers to secure a steady supply of data services; and (iii) an increase in
inventories in 2021, primarily because we had yet to deliver certain data management solutions
to our customers at the end of the year, and the cost of sales related to these projects were
accounted for as inventories. Our cash flow and working capital during the Track Record
Period were adversely affected by an expansion in our customer and supplier base, which
comprise large internet and technology companies and government organizations in China
because they typically settle payments after using our API services or after the delivery and
acceptance of data management solution projects. For API marketplace, our customers may
incur a substantial number of API requests during a period and therefore need more time to
reconcile their internal records with our records in order to ascertain that they have been
charged for the correct number of API requests. For both API marketplace and data
management solutions, before we issue invoices to our customers, we have to wait for the long
internal approval process by our customers’ business and/or finance departments, which can
take weeks or even months. To strengthen our relationships with suppliers, we settle payables
sooner to ensure a steady supply of data services for our API marketplace and specialized
software and hardware for our data management solutions. The increase in our receivable
turnover days and reduction in our payable turnover days during the Track Record Period led
to a longer cash conversion cycle, which further impacted our cash flow and working capital.
See also “Risk Factors – Risks Relating to Our Business and Industry – We have experienced,
and in the future may continue to experience, net operating cash outflow, an increase in trade
receivables turnover days and a substantial amount of unbilled trade receivables, all of which
could expose us to liquidity risks”.
Summary of Consolidated Statements of Financial Position
As of December, 31
2021 2022 2023
(RMB in thousands)
Total current assets .............................. 419,527 433,512 480,963
Total current liabilities ........................... 1 14,950 107,889 138,106
Net current assets .............................. 304,577 325,623 342,857
Total non-current assets ........................... 301,680 310,660 291,096
Total non-current liabilities ........................ 1 1,134 9,328 5,536
Total assets .................................... 721,207 744,172 772,059
Total liabilities ................................. 126,084 117,217 143,642
Net assets .................................... 595,123 626,955 628,417
Equity attributable to owners of the Company ........... 595,515 627,312 628,464
Non-controlling interests .......................... (392) (357) (47)
Total equity ................................... 595,123 626,955 628,417
SUMMARY
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Our net current assets increased by 6.9% from RMB304.6 million as of December 31,
2021 to RMB325.6 million as of December 31, 2022, and further increased by 5.3% to
RMB342.9 million as of December 31, 2023. The increase in our net current assets was
primarily due to increases in our trade receivables, time deposits and prepayments, deposits
and other receivables.
Our total equity increased by 5.3% from RMB595.1 million as of December 31, 2021 to
RMB627.0 million as of December 31, 2022, and remained relatively stable at RMB628.4
million as of December 31, 2023. The increase in our total equity was primarily due to the
contribution from net profit, partially offset by decreases in fair value of financial assets and
the deemed distribution to a shareholder in 2023.
Our trade receivables comprise billed and unbilled receivables. Unbilled receivables
accounted for 91.2%, 76.5% and 72.6% of the total receivables as of December 31, 2021, 2022
and 2023, respectively. The underlying revenue of the unbilled receivables as of the same dates
accounted for 31.2%, 26.2%, and 27.0% of the total revenues in 2021, 2022 and 2023,
respectively. For the detailed analysis of unbilled receivables, see “Financial Information –
Current Assets and Liabilities – Trade Receivables”.
Most of our data management solution customers and large API marketplace customers,
comprising government organizations and large internet companies, are post-paid customers.
Our unbilled receivables were primarily due to the prolonged process from revenue recognition
to payment settlement of our API marketplace and the fact that we issue invoices after the data
management solution customers have fulfilled their internal protocols to make payments.
The settlement process for our post-paid API marketplace customers consists of three
stages: (i) we recognize revenue and make available to our customers a record of the number
of API requests the customers made in the previous month as well as the amounts to be
charged; (ii) the customers check our records against their own records. If the customers
believe there are discrepancies, they discuss the matter with us and we work together to
reconcile the record; and (iii) the customers undergo their internal protocols to initiate the
payment process. Once the customers inform us that their internal protocols have been
satisfied, they will request that we issue an invoice. Among our post-paid API marketplace
customers for each of the years ended December 31, 2021, 2022 and 2023, the average number
of days between our recognition of revenue and our issuance of invoices was 109.4 days, 91.2
days and 129.4 days, respectively.
The settlement process for our post-paid data management solutions customers consists
of two stages: (i) the customers confirm with us their understanding of the contents of the
contract, the relevant milestones, and a payment plan. Once these milestones have been
realized, we issue our invoice; and (ii) we collect amounts outstanding in connection with the
various projects. To maintain our relationships with customers, we issue invoices after the
customers have fulfilled their internal protocols to make payments. Among our post-paid data
management solutions customers for each of the years ended December 31, 2021, 2022 and
2023, the average number of days between our recognition of revenue to our issuance of the
invoices was 280.0 days, 217.4 days and 120.5 days, respectively.
SUMMARY
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For a detailed discussion of the stages in our settlement process, see “Business – Our
Customers – General Terms of Contracts with Customers”. Furthermore, we have experienced
an increase in the turnover days of trade receivables from 114 days in 2021 to 133 days in 2023.
For the reasons of the increase, see “Risk Factors – Risks Relating to Our Business and
Industry – We have experienced, and in the future may continue to experience, net operating
cash outflow, an increase in trade receivables turnover days and a substantial amount of
unbilled trade receivables, all of which could expose us to liquidity risks.”
Key Financial Ratios
The table below sets forth our key financial ratios for the years indicated:
Y ear ended December 31,
2021 2022 2023
(in percentages)
Revenue growth ................................ 45.8% 26.5% 34.1%
Gross profit margin (1) ............................ 34.6% 32.7% 28.3%
Net profit margin (2) .............................. 17.7% 12.6% 7.9%
(1) Gross profit margin equals gross profit divided by revenue for the year and multiplied by 100%.
(2) Net profit margin equals profit/(loss) divided by revenue for the year and multiplied by 100%.
DIVIDENDS
We paid RMB20.0 million of dividends to our shareholders in 2021. No dividend has been
declared and paid in 2022 and 2023.
We do not have a formal dividend policy or a fixed dividend payout ratio. We may
distribute dividends in the future by way of cash or by other means that we consider
appropriate. Pursuant to our Articles of Association, our Board may declare dividends in the
future after taking into account our results of operations, financial condition, cash requirements
and availability and other factors as it may deem relevant at such time. Any declaration and
payment as well as the amount of dividends will be subject to our constitutional documents,
applicable PRC laws and approval by our Shareholders.
OUR PRE-IPO INVESTORS
We had multiple rounds of Pre-IPO Investments since our establishment. We have a total
of 15 principal Pre-IPO Investors, which include (i) individual investors that have made
meaningful investment in our Company and each holding more than 1% of our total issued
share capital immediately prior to the Global Offering; and (ii) corporate Pre-IPO Investors.
Our principal Pre-IPO Investors include, among others, JD Technology, Suzhou Guofa No. 8,
Tahoe Growth and Shanghai Keluopu. For details of our Pre-IPO Investments and background
of our Pre-IPO Investors, see “History, Development and Corporate Structure – Pre-IPO
Investments”. Pursuant to the applicable PRC laws, the Pre-IPO Investors shall not dispose of
any of the Shares held by them within 12 months following the Listing Date.
SUMMARY
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OFFERING STATISTICS
All statistics in the table below are based on the assumption that the Global Offering has
been completed and 4,818,200 new H Shares are issued pursuant to the Global Offering.
Based on the Offer
Price of
HK$83.33
Market capitalization of our H Shares (1) .................................. HK$4,176.3 million
Unaudited pro forma adjusted net tangible assets per Share (2) (3) .................... HK$21.63
(1) The calculation of market capitalization is based on a total of 50,118,200 H Shares expected to be in issue
immediately upon completion of the Global Offering.
(2) The unaudited pro forma adjusted net tangible asset per Share as of December 31, 2023 is calculated after
making the adjustments referred to in “Appendix II – Unaudited Pro Forma Financial Information” and on the
basis that 50,118,200 Shares were in issue assuming the Global Offering had taken place on December 31,
2023 and without taking into account of any Shares that may be allotted and issued or repurchased by our
Company under the general mandate for the allotment and issuance of Shares or the general mandate for
repurchase of Shares.
(3) The subsequent events disclosed in the Accountants’ Report in Appendix I to this prospectus would have no
impact on the unaudited pro forma adjusted consolidated net tangible assets attributable to equity holders of
the Group as of December 31, 2023 per share. For details, see “Appendix II – Unaudited Pro Forma Financial
Information”.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We estimate that our listing expenses will be
approximately RMB52.4 million (assuming the Offer Price of HK$83.33 per Offer Share)
accounting for approximately 14.3% of our gross proceeds, of which approximately RMB23.5
million is directly attributable to the issue of our Offer Shares and will be deducted from
equity, approximately RMB22.4 million has been expensed in our consolidated statements of
profit or loss during the Track Record Period, and approximately RMB6.5 million is expected
to be expensed after the Track Record Period. Our estimated listing expenses include: (i)
underwriting-related expenses, representing underwriting commission and fees of
approximately RMB14.6 million; (ii) sponsor fee of approximately RMB4.3 million; and (iii)
non-underwriting-related expenses, comprising professional fees to the legal advisors,
Reporting Accountant and other professionals of approximately RMB30.1 million for their
services rendered in relation to the Global Offering and the Listing, and other fees and
expenses of approximately RMB3.4 million. The listing expenses above are the best estimate
as of the Latest Practicable Date and for reference only and the actual amount may differ from
this estimate.
SUMMARY
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FUTURE PLANS AND USE OF PROCEEDS
After deducting the underwriting commissions and other estimated offering expenses
payable by us in connection with the Global Offering, and assuming the Offer Price of
HK$83.33 per Offer Share, we estimate that we will receive net proceeds of approximately
HK$344.0 million from the Global Offering. We intend to use the net proceeds from the Global
Offering for the following purposes:
 approximately HK$86.0 million, representing 25% of the net proceeds, will be used
to comprehensively upgrade the existing suite of APIs in our API marketplace, to
seize the significant opportunities arising from the opening and authorized
operations of government and public data, which may create opportunities for future
growth;
 approximately HK$154.8 million, representing 45% of the net proceeds, will be
used to upgrade our existing products and services of our data management
solutions. This aims to develop and expand industry-specific applications,
strengthening our technical capabilities and market competitiveness in data
management solutions;
 approximately HK$68.8 million, representing 20% of the net proceeds, will be used
to research and develop the technologies for data security and privacy protection,
building a comprehensive ecosystem for digital ownership, secure data storage,
trusted data transmission, and collaborative production; and
 approximately HK$34.4 million, representing 10% of the net proceeds will be
allocated for working capital and general corporate purposes.
See “Future Plans and Use of Proceeds” for details.
DATA SECURITY AND REGULATORY COMPLIANCE
We offer our services and solutions with privacy as a core tenet. PRC data privacy and
security laws that are relevant to our business include the PRC Cybersecurity Law, the PRC
Data Security Law, the PRC Personal Information Protection Law and other applicable laws.
As advised by our PRC Legal Advisors, our business has complied with the above laws in all
material respects during the Track Record Period. See “Regulatory Overview – Regulations
Related to Internet Security and Privacy Protection – Regulations on Privacy Protection” for
laws and regulations that affect our business.
SUMMARY
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For our API marketplace, we act as an intermediary technical service provider to provide
query and SMS notice services. For top-up service, our customers collect and transmit top-up
mobile numbers with encrypted technologies. We transmit data among customers and suppliers
based on the entrustment of customers. During the transmission, we ensure personal
information is identity masked. With respect to the personal information of end-users provided
by customers and the personal information included in query results returned by suppliers, we
neither store nor use such information for any other business purpose. We store order
information only to the extent necessary for reconciliation and error handling, with strict
internal clearance protocols in place. If the order information includes personal information,
we make measures of anonymization or encryption. We set forth different retention periods
depending on the types of data and the applicable legal requirements. When providing data
management solutions, we do not collect, transmit or share personal information because these
solutions are hosted by the customer’s IT systems, and we are not involved in their daily
operations. We provide education and training sessions on data security for our employees.
When an alleged or actual leakage incident occurs, we will implement our internal control
protocols. During the Track Record Period and up to the Latest Practicable Date, we have not
experienced any material data leakage or loss of data or information. As of the Latest
Practicable Date, we have obtained all consents from our direct suppliers and customers to
provide and receive API marketplace service. See “Business – Risk Management and Internal
Controls – Data Privacy Risk Management” and “Business – Regulatory Compliance”.
Our Directors confirm that, during the Track Record Period and up to the Latest
Practicable Date, we had not been and were not a party to any material legal, arbitral or
administrative proceedings, and we are not aware of any pending or threatened legal, arbitral
or administrative proceedings against us or our Directors that could, individually or in the
aggregate, have a material adverse effect on our business, financial condition and results of
operations.
During the Track Record Period and up to the Latest Practicable Date, we had not been
and were not involved in any material non-compliance incidents that have led to fines,
enforcement actions or other penalties that could, individually or in the aggregate, have a
material adverse effect on our business, financial condition and results of operations. Our PRC
Legal Advisors advised that during the Track Record Period and up to the Latest Practicable
Date, we have obtained the requisite licences, qualifications and permits from the relevant PRC
regulatory authorities for our operations.
RECENT DEVELOPMENTS
From January to April 2024, we handled 526.8 million query service requests compared
to 558.7 million query service requests for the same period in 2023, while our average price
per request for query service increased significantly from RMB0.15 in January to April 2023
to RMB0.23 for the same period in 2024. The decrease in the number was mainly due to (1)
a decrease in the usage of an identity authentication API frequently utilized by an internet
corporate customer and (2) decreases in two APIs which were mainly used by small individual
and corporate customers, which are priced lower than the average price per query. The increase
in average price of query service requests was mainly driven by an increase in demand from
a large internet company customer for certain three-factor authentication APIs with relatively
high prices, as this customer conducted identity authentication of its existing customers.
SUMMARY
–2 3–


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From January to April 2024, we handled 923.7 million SMS notice service requests
compared to 773.4 million SMS notice service requests for the same period in 2023. The
increase in the number of SMS notice service requests was primarily due to an internet
company increasing its usage in a promotional SMS notice service. Our average price per
request for SMS notice service remained relatively stable at RMB0.03 from January to April
2023 and the same period in 2024.
For data management solutions, ten projects were delivered and accepted in January to
April 2024 compared to nine for the same period in 2023, which remained relatively stable.
We received a letter of intent from the Suzhou Branch of a commercial bank in China in
June 2024. The commercial bank will provide loan facilities of no more than RMB400 million
in aggregate to the Company in the next three years. The loan can be by way of credit and fixed
asset mortgages, with interest rates determined based on the prevailing market rates.
Our Directors have confirmed that there has been no material adverse change in our
financial and trading position or prospects since December 31, 2023, being the date to which
our latest audited consolidated financial statements have been prepared, up to the date of this
prospectus.
SUMMARY
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In this prospectus, unless the context otherwise requires, the following terms and
expressions have the meanings set forth below.
“ABC Investment” Agricultural Bank of China Financial Assets Investment
Co., Ltd. (ʮ̡), a company
established in the PRC with limited liability on August 1,
2017 and wholly-owned by Agricultural Bank of China
Limited (ʮ̡), which is one of
our Pre-IPO Investors
“Accountants’ Report” the accountants’ report of our Company prepared by BDO
Limited, details of which are set out in Appendix I to this
prospectus
“AFRC” Accounting and Financial Reporting Council
“Articles of Association” or
“Articles”
the articles of association of our Company, as amended,
which shall become effective on the Listing Date, a
summary of which is set out in Appendix VI to this
prospectus
“Audit Committee” the audit committee of the Board
“Beijing Sidike” Beijing Sidike Technology Co., Ltd. (ҦϞ
ʮ̡), a company established in the PRC with limited
liability on January 8, 2015 and a subsidiary of our
Company
“Board” or “Board of Directors” the Board of Directors of our Company
“Board Diversity Policy” the board diversity policy of our Company
“business day” a day on which banks in Hong Kong are generally open
to the public for normal banking business and which is
not a Saturday, Sunday or public holiday in Hong Kong
“CAAI” the Chinese Association for Artificial Intelligence ( ʕ਷
ɛʈ౽ঐኪึ)
“CAC” Cyberspace Administration of China (፬
܃)
Capital Market Intermediaries” the capital market intermediaries participating in the
Global Offering and has the meaning ascribed thereto
under the Listing Rules
DEFINITIONS
–2 5–


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“CCASS” the Central Clearing and Settlement System operated by
HKSCC
“CCRC” the China Cybersecurity Review Technology and
Certification Center (ҦஔၾႩᗇʕː)
“China”, “Mainland China” or
the “PRC”
the People’s Republic of China, excluding, for the
purpose of this prospectus (unless otherwise indicated),
the Hong Kong Special Administrative Region, the
Macau Special Administrative Region and Taiwan Region
“China-Singapore V entures” China-Singapore Suzhou Industrial Park V entures Co.,
Ltd. (ʮ̡), a company
established in the PRC with limited liability on
November 28, 2001 and one of our Pre-IPO Investors
“Companies (Winding Up and
Miscellaneous Provisions)
Ordinance”
the Companies (Winding Up and Miscellaneous
Provisions) Ordinance (Chapter 32 of the Laws of Hong
Kong), as amended, supplemented or otherwise modified
from time to time
“Companies Ordinance” the Companies Ordinance (Chapter 622 of the Laws of
Hong Kong), as amended, supplemented or otherwise
modified from time to time
“Company Law” or “PRC
Company Law”
Company Law of the People’s Republic of China ( ʕശɛ
جas amended and adopted by the
Standing Committee of the Tenth National People’s
Congress on October 27, 2005 and effective on January 1,
2006, as amended, supplemented or otherwise modified
from time to time, which was further amended on
December 29, 2023
“Company” or “our Company” Tianju Dihe (Suzhou) Technology Co., Ltd. ( ˂ၳήΥ(ᘽ
ψ)ʮ̡), previously named Tianju Dihe
(Suzhou) Data Co., Ltd. ( ˂ၳήΥ(ᘽψ)ʮ
̡), whose predecessor was named Suzhou ThinkLand
Technology Co., Ltd. (ʮ̡), was
established in China on February 25, 2010 and converted
into a joint stock company with limited liability on
September 20, 2017
“Controlling Shareholder(s)” Mr. Zuo, Ms. Hua, Liuju Liuhe and Yiju Liuhe
“CPC” the Communist Party of China
DEFINITIONS
–2 6–


--- page 38 ---
“CPC Central Committee” the Central Committee of the Communist Party of China
(ึ)
“CSDC” China Securities Depository and Clearing Corporation
Limited (ப΂ʮ̡)
“CSRC” the China Securities Regulatory Commission ( ʕ਷ᗇՎ
ึ)
“Culture Fund” China Culture Industrial Investment Fund (Limited
Partnership) (ږ(Υྫ)), a
limited partnership established in the PRC on September
15, 2011, which is an investment fund registered under
the Asset Management Association of China and our
former Shareholder
“Cybersecurity Review
Measures”
Cybersecurity Review Measures (፬
), which took effect on February 15, 2022
“Data Security Law” Data Security Law of the People’s Republic of China
(), which took effect on
September 1, 2021
“Datong Qikai” Zhejiang Datong Qikai Investment Management Co., Ltd.
(ʮ̡), a company
established in the PRC with limited liability on February
20, 2017 and one of our Pre-IPO Investors
“Designated Bank” HKSCC Participant’s EIPO Designated Bank
“Directors” the directors of our Company, including all executive,
non-executive and independent non-executive Directors
“Donghe Huaming” Suzhou Donghe Huaming Investment Partnership
Enterprise (Limited Partnership) (ҳ༟Υྫ
Άุ(Υྫ)), a limited partnership established in the
PRC on May 25, 2016 and subsequently revoked on July
28, 2022, which is our former Shareholder
“ECLs” expected credit losses, as defined in “Material
Accounting Policy Information” of the Appendix I,
Accountants’ Report.
“EIT” enterprise income tax
DEFINITIONS
–2 7–


--- page 39 ---
“EIT Law” Enterprise Income Tax Law of the People’s Republic of
China (جas amended,
supplemented or otherwise modified from time to time
“Exchange Participant(s)” a person (a) who, in accordance with the Rules of the
Stock Exchange, may trade on or through the Stock
Exchange; and (b) whose name is entered in a list,
register or roll kept by the Stock Exchange as a person
who may trade on or through the Stock Exchange
“Extreme Conditions” extreme conditions caused by a super typhoon as
announced by the government of Hong Kong
“FINI” Fast Interface for New Issuance, an online platform
operated by HKSCC that is mandatory for admission to
trading and, where applicable, the collection and
processing of specified information on subscription in
and settlement for all new issues
“F&S” Frost & Sullivan (Beijing) Inc., Shanghai Branch Co., our
industry consultant and an Independent Third Party
“F&S Report” an independent market research report prepared by F&S,
which was commissioned by our Company for the
purpose of this prospectus
“GDP” gross domestic product
“General Rules of HKSCC” the General Rules of HKSCC as may be amended or
modified from time to time and where the context so
permits, shall include the HKSCC Operational
Procedures
“Global Offering” the Hong Kong Public Offering and the International
Offering
“Group,” “our Group,” “we”,
“Juhe Data” or “us”
our Company and its subsidiaries (or our Company and
any one or more of its subsidiaries, as the context may
require)
“Guide” Guide for New Listing Applicants issued by the Stock
Exchange (as amended, supplemented or otherwise
modified from time to time)
DEFINITIONS
–2 8–


--- page 40 ---
“H Share(s)” shares in the share capital of our Company with nominal
value of RMB1.0 each, which is/are to be subscribed for
and traded in HK dollars and to be listed on the Stock
Exchange
“H Shareholder(s)” holder(s) of H Share(s)
“H Share Registrar” Computershare Hong Kong Investor Services Limited
“HKSCC” Hong Kong Securities Clearing Company Limited, a
wholly owned subsidiary of Hong Kong Exchanges and
Clearing Limited
“HKSCC EIPO” the application for the Hong Kong Offer Shares to be
issued in the name of HKSCC Nominees and deposited
directly into CCASS to be credited to your designated
HKSCC Participant’s stock account through causing
HKSCC Nominees to apply on your behalf, including by
instructing your broker or custodian who is a HKSCC
Participant to give electronic application instructions via
HKSCC’s FINI system to apply for the Hong Kong Offer
Shares on your behalf
“HKSCC Operational
Procedures”
the operational procedures of HKSCC, containing the
practices, procedures and administrative or other
requirements relating to HKSCC’s services and the
operations and functions of CCASS, FINI or any other
platform, facility or system established, operated and/or
otherwise provided by or through HKSCC, as from time
to time in force
“HKSCC Nominees” HKSCC Nominees Limited, a wholly owned subsidiary
of HKSCC
“HKSCC Participant” a participant admitted to participate in CCASS as a direct
clearing participant, a general clearing participant or a
custodian participant
“General Rules of HKSCC” the General Rules of HKSCC as may be amended or
modified from time to time and where the context so
permits, shall include the HKSCC Operational
Procedures
DEFINITIONS
–2 9–


--- page 41 ---
“HKSCC Systems” CCASS, FINI or any other platform, facility or system
established, operated and/or otherwise provided by or
through HKSCC
“Hong Kong” or “HK” the Hong Kong Special Administrative Region of the
PRC
“Hong Kong dollars” or “HK$” Hong Kong dollars and cents respectively, the lawful
currency of Hong Kong
“Hong Kong Offer Shares” the 481,850 H Shares offered by us for subscription at the
Offer Price pursuant to the Hong Kong Public Offering
(subject to adjustment as described in “Structure of the
Global Offering”)
“Hong Kong Public Offering” the offering of the Hong Kong Offer Shares for
subscription by the public in Hong Kong (subject to
reallocation as described in “Structure of the Global
Offering”) at the Offer Price (plus brokerage, SFC
transaction levy, AFRC transaction levy and Stock
Exchange trading fee), on and subject to the terms and
conditions described in this prospectus, as further
described in “Structure of the Global Offering – Hong
Kong Public Offering”
“Hong Kong Underwriters” the underwriters of the Hong Kong Public Offering listed
in “Underwriting – Hong Kong Underwriters”
“Hong Kong Underwriting
Agreement”
the underwriting agreement dated June 19, 2024 relating
to the Hong Kong Public Offering entered into by our
Company, our Controlling Shareholders, the Sole
Sponsor, the Sole Overall Coordinator, the Hong Kong
Underwriters, the Joint Global Coordinators, the Joint
Bookrunners and the Joint Lead Managers
“IFRSs” International Financial Reporting Standards, which
include standards, amendments and interpretations
promulgated by the International Accounting Standards
Board and the International Accounting Standards and
interpretation issued by the International Accounting
Standards Committee
“Independent Third Party(ies)” any entity(ies) or person(s) who, to the best of our
Directors’ knowledge, information and belief, having
made all reasonable enquiries, is not a connected person
of our Company within the meaning of the Listing Rules
DEFINITIONS
–3 0–


--- page 42 ---
“International Offer Shares” the 4,336,350 H Shares being initially offered by our
Company for subscription under the International
Offering, subject to reallocation as described in the
section headed “Structure of the Global Offering” in this
prospectus
“International Offering” the offer of the International Offer Shares outside the
United States in offshore transactions in reliance on
Regulation S under the U.S. Securities Act, including to
professional investors in Hong Kong, as further described
in the section headed “Structure of the Global Offering”
in this prospectus
“International Underwriter(s)” the underwriter(s) of the International Offering
“International Underwriting
Agreement”
the underwriting agreement relating to the International
Offering expected to be entered into by, among others,
our Company, our Controlling Shareholders, the Sole
Overall Coordinator and the International Underwriters
on or around June 26, 2024, as further described in the
section headed “Underwriting” in this prospectus
“JD Technology” JD Technology Holding Co., Ltd. (΅Ϟ
ʮ̡) (formerly known as (i) JD Digits Technology
Holding Company Limited (ࠢ
ʮ̡), (ii) JD Digits Technology Company Limited
(ʮ̡); (iii) Beijing JD Fintech
Company Limited (ʮ̡);
(iv) Beijing JD Shangbo Guangyi Investment
Management Co., Ltd. (ࠢ
ʮ̡); and (v) Beijing Shangbo Guangyi Investment
Management Co., Ltd. (ʮ
̡)), a joint stock company with limited liability
established in the PRC on September 5, 2012 and one of
our substantial Shareholders and Pre-IPO Investors,
details of which are set out in “History, Development and
Corporate Structure – Pre-IPO Investors”
“Joint Bookrunners” CLSA Limited, CMB International Capital Limited,
ABCI Capital Limited, Soochow Securities International
Brokerage Limited, ICBC International Securities
Limited, CCB International Capital Limited, SPDB
International Capital Limited, Livermore Holdings
Limited, Futu Securities International (Hong Kong)
Limited and Tiger Brokers (HK) Global Limited
DEFINITIONS
–3 1–


--- page 43 ---
“Joint Global Coordinators” CLSA Limited and CMB International Capital Limited
“Joint Lead Managers” CLSA Limited, CMB International Capital Limited,
ABCI Securities Company Limited, Soochow Securities
International Brokerage Limited, ICBC International
Securities Limited, CCB International Capital Limited,
SPDB International Capital Limited, Livermore Holdings
Limited, Futu Securities International (Hong Kong)
Limited and Tiger Brokers (HK) Global Limited
“JuheData HK” JuheData HK Limited, a company incorporated in Hong
Kong with limited liability on January 7, 2016 and a
wholly-owned subsidiary of our Company
“Juli Wanhe” Beijing Juli Wanhe Management Consulting Co., Ltd. ( ̏
ʮ̡), a company established in
the PRC with limited liability on April 22, 2015 and a
wholly-owned subsidiary of our Company
“Latest Practicable Date” June 11, 2024, being the latest practicable date for the
purpose of ascertaining certain information contained in
this prospectus prior to its publication
“Listing” listing of our H Shares on the Main Board of the Stock
Exchange
“Listing Date” the date on which dealings in our H Shares first
commence on the Main Board of the Stock Exchange
“Listing Rules” the Rules Governing the Listing of Securities on The
Stock Exchange of Hong Kong Limited (as amended
from time to time)
“Liuju Liuhe” Suzhou Liuju Liuhe Investment Consulting Enterprise
(Limited Partnership) ( ᘽψʬၳʬΥҳ༟ፔ༔Άุ(ࠢ
Υྫ)) (formerly known as Suzhou Juhe Cloud Data
Technology Enterprise (Limited Partnership) ( ᘽψၳΥ
ථᅰኽҦஔΆุ(Υྫ)), a limited partnership
established in the PRC on September 12, 2016 and one of
our employee shareholding platforms
“Macau” the Macau Special Administrative Region of the PRC
DEFINITIONS
–3 2–


--- page 44 ---
“Main Board” the stock exchange (excluding the option market)
operated by the Stock Exchange, which is independent
from and operated in parallel with the GEM of the Stock
Exchange
“MIIT” the Ministry of Industry and Information Technology of
the PRC (ʷ௅)
“MOFCOM” the Ministry of Commerce of the PRC ( ʕശɛ͏΍ձ਷
ਠਕ௅)
“Mr. Qiu” Mr. QIU Jianqiang (਺੶), a non-executive Director of
our Company and one of our Pre-IPO Investors
“Mr. Zuo” Mr. ZUO Lei ( ̸ᆾ), the founder, chairman, chief
executive officer and executive Director of our Company
“Ms. Hua” Ms. HUA Huan (ހthe spouse of Mr. Zuo
“Ms. Ren” Ms. REN Y uan ( ΂෤), a Supervisor of our Company and
one of our Pre-IPO Investors
“Ms. Y ang” Ms. Y ANG Y anjun (ё), an executive Director,
deputy general manager, secretary to our Board and one
of our joint company secretaries
“NDRC” the National Development and Reform Commission of
the PRC (ึ)
“Offer Price” HK$83.33 per Offer Share in Hong Kong dollars
(exclusive of a brokerage fee of 1.0%, a SFC transaction
levy of 0.0027%, AFRC transaction levy of 0.00015%
and a Stock Exchange trading fee of 0.00565%) at which
the Offer Shares are to be subscribed for pursuant to the
Global Offering
“Offer Shares” the Hong Kong Offer Shares and the International Offer
Shares
“PBOC” the People’s Bank of China ( ʕ਷ɛ͏ვБ), the central
bank of the PRC
DEFINITIONS
–3 3–


--- page 45 ---
“People’s Congress” the PRC’s legislative apparatus, including the National
People’s Congress and all the local people’s congresses
(including provincial, municipal and other regional or
local people’s congresses) as the context may require, or
any of them
“PRC government” or “Central
Government” or “State”
the central government of the PRC, including all
governmental subdivisions (including provincial,
municipal and other regional or local government
entities) and their instrumentalities or, where the context
requires, any of them
“PRC Legal Advisors” King & Wood Mallesons, our legal advisors as to PRC
laws
“PRC Personal Information
Protection Law”
Personal Information Protection Law of the People’s
Republic of China (ᚐ
), which entered into effect on November 1, 2021
“PRC Securities Law” the Securities Law of the PRC ( ʕശɛ͏΍ձ਷ᗇՎ
), as amended, supplemented or otherwise modified
from time to time
“Pre-IPO Investment(s)” the pre-IPO investments in our Company undertaken by
our Pre-IPO Investors, details of which are set out in
“History, Development and Corporate Structure – Pre-
IPO Investments”
“Pre-IPO Investor(s)” Ms. Ren, JD Technology, Mr. Zhou Lijun, Tahoe Growth,
Mr. Hua Y ong, Mr. Qiu, Shanghai Keluopu, Mr. Wang
Bin, Ms. Hua, Tahoe Growth II, Tahoe Lande, Mr. Cai
Yitao, Mr. Chen Zhixin, Mr. Chu Xiaogang, Datong
Qikai, Mr. Fan Shebin, Ms. Gong Juhui, Mr. Gu Guomin,
Suzhou Guofa No. 8, Mr. Li Zhicong, Ms. Lu Fen, Ms.
Mao Sipian, Mr. Shao Zhenkai, Ms. Wang Liping, Mr.
Y ang Xiaoning, Mr. Y u Fangbiao, Mr. Zhong Weiwei,
ABC Investment and China-Singapore V entures, details
of our principal Pre-IPO Investors are set out in “History,
Development and Corporate Structure – Pre-IPO
Investors”
DEFINITIONS
–3 4–


--- page 46 ---
“Project 985 universities” universities that belong to Project 985, a terminated
project that was first announced at the 100th anniversary
of Peking University on May 4, 1998, to promote the
development and reputation of the Chinese higher
education system by founding world-class universities in
the 21st century. In 2019, the Ministry of Education of
China reconfirmed that the Project 985 had been repealed
and replaced by the Double First-Class University Plan
“province” a province or, where the context requires, a provincial
level autonomous region or municipality, under the direct
supervision of the central government of the PRC
“Regulation S” Regulation S under the U.S. Securities Act
“Relevant Persons” the Sole Sponsor, the Sole Overall Coordinator, the Joint
Global Coordinators, the Joint Bookrunners, the Joint
Lead Managers, the Capital Market Intermediaries, the
Underwriters, any of their or the Company’s respective
directors, officers or representatives or any other parties
involved in the Global Offering
“Remuneration and Assessment
Committee”
the remuneration and assessment committee of the Board
“R&D” research and development
“RMB” or “Renminbi” Renminbi, the lawful currency of the PRC
“SAFE” the State Administration of Foreign Exchange of the PRC
(̮ි၍ଣ҅)
“SA T” the State Administration of Taxation of the PRC (೼
ਕᐼ҅)
“SFC” the Securities and Futures Commission of Hong Kong
“SFO” the Securities and Futures Ordinance (Chapter 571 of the
Laws of Hong Kong), as amended, supplemented or
otherwise modified from time to time
DEFINITIONS
–3 5–


--- page 47 ---
“Shanghai Keluopu” Shanghai Keluopu Asset Management Center (Limited
Partnership) (र౷༟ପ၍ଣʕː(Υྫ)), a
limited partnership established in the PRC on July 8,
2014, which is an investment fund registered under the
Asset Management Association of China and one of our
Pre-IPO Investors
“Share(s)” ordinary shares in the capital of our Company with a
nominal value of RMB1.0 each
“Shareholders(s)” holder(s) of the Share(s)
“SOE(s)” state-owned enterprise(s)
“Sole Overall Coordinator” CLSA Limited
“Sole Sponsor” CITIC Securities (Hong Kong) Limited
“Sole Sponsor-Overall
Coordinator”
CLSA Limited
“sq.m.” square meters
“State Council” State Council of the People’s Republic of China ( ʕശɛ
͏΍ձ਷਷ਕ৫)
“Stock Exchange” The Stock Exchange of Hong Kong Limited, a wholly-
owned subsidiary of Hong Kong Exchanges and Clearing
Limited
“Supervisor(s)” the supervisors of our Company
“Supervisory Committee” the supervisory committee of our Company
“Suzhou Guofa No. 8” Suzhou Guofa No. 8 Industrial Investment
and Development Partnership (Limited Partnership) ( ᘽ
ΥྫΆุ(Υྫ)), a limited
partnership established in the PRC on July 23, 2019,
which is an investment fund registered under the Asset
Management Association of China and one of our Pre-
IPO Investors
DEFINITIONS
–3 6–


--- page 48 ---
“Tahoe Growth” Suzhou Tahoe Growth V enture Capital Partnership
(Limited Partnership) (௴ุҳ༟ΥྫΆุ
(Υྫ)), a limited partnership established in the PRC
on November 5, 2014, which is an investment fund
registered under the Asset Management Association of
China and one of our Pre-IPO Investors
“Tahoe Growth II” Suzhou Industrial Park Tahoe Growth Phase II V enture
Capital Investment Partnership (Limited Partnership) ( ᘽ
ɚಂ௴ุҳ༟ΥྫΆุ(Υྫ)),
a limited partnership established in the PRC on January
22, 2016, which is an investment fund registered under
the Asset Management Association of China and one of
our Pre-IPO Investors
“Tahoe Lande” Suzhou Tahoe Lande V enture Capital Investment
Partnership (Limited Partnership) ( ᘽψ˄खᚆᅃ௴ุҳ
༟ΥྫΆุ(Υྫ)), a limited partnership established
in the PRC on December 21, 2016, which is an
investment fund registered under the Asset Management
Association of China and one of our Pre-IPO Investors
“Tahoe V enture Capital” Suzhou Tahoe V enture Capital Investment Management
Partnership (General Partnership) ( ᘽψ˄ख௴ุҳ༟၍
ଣΥྫΆุ(౷ஷΥྫ)), a general partnership established
in the PRC on June 6, 2014, which is an investment fund
registered under the Asset Management Association of
China and one of our Pre-IPO Investors
“Takeovers Code” The Codes on Takeovers and Mergers and Share Buy-
back issued by the SFC, as amended, supplemented or
otherwise modified from time to time
“Tianju Renhe” Suzhou Tianju Renhe Technology Co., Ltd. ( ᘽψ˂ၳɛ
ʮ̡) (formerly known as Zhuhai Alitaoka
Network Technology Co., Ltd. (Ԣଇ̔ၣഖҦஔ
ʮ̡)), a company established in the PRC with
limited liability on September 7, 2009 and a wholly-
owned subsidiary of our Company
“Tianju Xinghe” Suzhou Tianju Xinghe Technology Co., Ltd. (݋
ʮ̡), a company established in the PRC with
limited liability on December 3, 2019 and a wholly-
owned subsidiary of our Company
DEFINITIONS
–3 7–


--- page 49 ---
“Track Record Period” the period comprising the years ended December 31,
2021, 2022 and 2023
“Underwriters” the Hong Kong Underwriters
“Underwriting Agreements” the Hong Kong Underwriting Agreement and the
International Underwriting Agreement
“Unlisted Share(s)” ordinary shares in the capital of our Company with a
nominal value of RMB1.0 each, which is/are not listed on
any stock exchange
“U.S.” or “United States” the United States of America, its territories, its
possessions and all areas subject to its jurisdiction
“U.S. Securities Act” United States Securities Act of 1933, as amended
“V A T” value-added tax, which is an indirect tax levied on the
value added at each stage in selling goods or labor
services of processing, repair or replacement, selling
services, intangible assets, or immovables, or importing
goods within the territory of the PRC
“White Form eIPO ” the application process for Hong Kong Offer Shares with
applications issued in applicant’s own name and
submitted online through the designated website of the
White Form eIPO Service Provider at
www.eipo.com.hk
“White Form eIPO Service
Provider”
Computershare Hong Kong Investor Services Limited
“Wuhan Jushunhe” Wuhan Jushunhe Technology Co., Ltd. (Ҧ
ʮ̡), a company established in the PRC with
limited liability on August 9, 2021 and a subsidiary of our
Company
“Xuzhou Juhe” Xuzhou Juhe Data Technology Co., Ltd. (ψၳΥᅰኽ
ʮ̡), a company established in the PRC with
limited liability on March 28, 2024 and an indirect
wholly-owned subsidiary of our Company
DEFINITIONS
–3 8–


--- page 50 ---
“Yiju Liuhe” Suzhou Yiju Liuhe Investment Consulting Enterprise
(Limited Partnership) ( ᘽψɓၳʬΥҳ༟ፔ༔Άุ(ࠢ
Υྫ)) (formerly known as Suzhou Yiju Liuhe Data
Technology Partnership (Limited Partnership) ( ᘽψɓၳ
ҦΥྫΆุ(Υྫ)), a limited partnership
established in the PRC on September 6, 2016 and one of
our employee shareholding platforms
“Zhonghui Juhe” Suzhou Zhonghui Juhe Information Technology Co., Ltd.
(ʮ̡), a company established
in the PRC with limited liability on November 16, 2016 and
a subsidiary of our Company
“%” per cent
“14th Five-Y ear Plan” The “14th Five-Y ear Plan for National Economic and
Social Development and the Long-Range Objectives
Through the Y ear 2035” (ٟ
ʞϋ஝ྌձ2035ࠅo ft h e
People’s Republic of China issued by the CPC Central
Committee and State Council in March 2021
Unless expressly stated or the context otherwise requires, all information and data in this
prospectus is as of the Latest Practicable Date.
In this prospectus, the terms “associate”, “close associate”, “connected person”, “core
connected person”, “connected transaction”, “controlling shareholder”, “subsidiary” and
“substantial shareholder” shall have the meanings given to such terms in the Listing Rules,
unless the context otherwise requires.
Certain amounts and percentage figures included in this prospectus have been subject to
rounding. Accordingly, figures shown as totals in certain tables may not be an arithmetic
aggregation of the figures preceding them. Any discrepancies in any table or chart between the
total shown and the sum of the amounts listed are due to rounding.
For ease of reference, the names of Chinese laws and regulations, governmental
authorities, institutions, natural persons or other entities (including certain of our
subsidiaries) have been included in the prospectus in both the Chinese and English languages
and in the event of any inconsistency, the Chinese version shall prevail. English translations
of company names and other terms from the Chinese language are provided for identification
purposes only.
DEFINITIONS
–3 9–


--- page 51 ---
This glossary contains definitions of certain technical terms used in this document
in connection with our Company. Such terms and their meanings may not correspond to
standard industry definitions or usage.
“AI” artificial intelligence
“API” Application Programming Interface, a set of rules and
protocols permitting software applications to
communicate with each other.
“CAGR” compound annual growth rate
“canary deployment” the practice of releasing new features only to a subset of
services or a portion of customers during product
updates, gradually rolling out the new features to all
customers
“CPU” central processing unit
“data circulation” data flow or exchange of data among organization or
across different departments
“data silo” a collection of data held by one group that is not easily or
fully accessible by other groups in the same organization
“DevOps” a set of practices, tools, and a cultural philosophy that
automate and integrate the processes between software
development and IT teams
“data factor” data as a factor of production, which is used in the
production process to produce goods or services
“data opening” the process of an organization to selectively release the
data it possesses to external parties with proper
management and planning
“digital digest” a numeric representation of a message that is computed
by an algorithm or function and used to ensure the
integrity of a message transmitted over an unsecured
channel
GLOSSARY OF TECHNICAL TERMS
–4 0–


--- page 52 ---
“Robots Exclusion Protocol” a standard used by websites to indicate to visiting web
crawlers and other web robots which portions of the
website they are allowed to visit, website platform
service agreements, and follow the requirements for data
collection
“digital transformation” a process to increasingly integrate advanced digital
technology, explore the economic value of data,
accelerate optimization and innovation of an
organization, with the aim of enhancing operational
efficiency, customer experience, and overall business
performance. It encompasses the adoption and utilization
of digital tools, platforms, and data-driven insights to
drive innovation, streamline operations, and create
sustainable competitive advantage
“elastic expansion” a strategy that allows an API gateway to quickly and
automatically increase or decrease server resource usage
based on performance requirements. It enables dynamic
adjustment of resources to meet fluctuating demands,
ensuring optimal performance even during peak usage
periods and supporting rapid business growth
“end-users” in the context of describing our API business, individuals
who use our customers’ applications, websites, or
services and who during this process provide personal
information, as defined by the PRC Personal Information
Protection Law. Unless otherwise stated, this definition
does not apply to “Regulatory Overview” and “Industry
Overview” sections in this prospectus
“entrusted personal information
processor”
An entity that is entrusted to process personal
information. It has the same meaning set forth in the PRC
Personal Information Protection Law
“federated learning” a machine learning approach that allows for the
development and refinement of models across multiple
decentralized edge devices or servers holding local data
samples, without the necessity to exchange the data itself
GLOSSARY OF TECHNICAL TERMS
–4 1–


--- page 53 ---
“heterogeneous data” data that is composed of different types, version or forms
of information with different structure. These differences
can arise from multiple sources, formats, structures, or
nature of the data. When data from different sources are
collected, the system may encounter data quality issues
because data was collected in different formats. The
complexity of heterogeneous data requires specialized
methods and tools for its processing, integration, and
analysis
“high concurrency” the capability of a system to serve a large number of
concurrent users
“homomorphic encryption” a form of encryption that allows computations to be
performed on encrypted data without having to decrypt
the data
“HTML5” a markup language used for structuring and presenting
content on the World Wide Web. It is the fifth and final
major HTML version
“HTTP” Hypertext Transfer Protocol, an application layer
protocol in the internet protocol suite model for
distributed, collaborative, hypermedia information
systems
“IoT” Internet of Things, which refers to the connection of
equipment and objects to the network through
information sensing devices under certain protocols,
allowing for information exchange and communication
and achieving certain functions, such as intelligent
identification and monitoring management
“key customers of API
marketplace”
customers who contributed revenue of more than RMB1
million in a respective year. For the avoidance of doubt,
the number of customers were calculated based on the
number of our contracting parties and were not calculated
on a consolidated basis, i.e., not taking account of
whether any of them controlled each other or were under
common control
GLOSSARY OF TECHNICAL TERMS
–4 2–


--- page 54 ---
“MVCC” Multiversion Concurrency Control Conflicts, a database
optimization technique that creates duplicate copies of
records so that data can be safely read and updated at the
same time
“net dollar expansion rate of
revenue from our key API
marketplace customers”
revenue derived from our key customers of API
marketplace in any given year divided by the revenue
derived from the same key customers in the previous
year, provided that the key customers must also have
been a paid customer in the previous year. Otherwise the
revenue attributable to the key customer will not be
accounted for in the given year
“privacy-preserving computation” a combination of technologies that allow computation
and analysis to be jointly completed among different
organizations based on their respective data without
revealing original data to others to ensure the privacy of
their data assets
“retention rate of our key
customers of our API
marketplace”
for a given year is calculated as the number of key
customers of API marketplace in the prior year that
remain as our paying customers in the current year,
divided by the number of all key customers of API
marketplace in such prior year
“RPA” Robotic Process Automation
“smart contract” Smart contracts are programs stored on a blockchain that
run when predetermined conditions are met. They are
often used to automate protocols or workflows, triggering
next steps when conditions are met. Smart contracts work
by following simple “if/when...then...” statements written
into the code of the blockchain. When predetermined
conditions are met and verified, the computer network
performs operations. When a transaction is completed,
the blockchain is updated. This means that transactions
cannot be changed and the results are visible only to
permitted parties. Smart contracts can be programmed by
developers. Organizations using blockchain for business
are increasingly providing templates, web interfaces, and
other online tools to simplify the construction of smart
contracts
GLOSSARY OF TECHNICAL TERMS
–4 3–


--- page 55 ---
“SaaS” Software as a service, a software licensing and delivery
model in which software is licensed on a subscription
basis and is centrally hosted. SaaS is also known as
on-demand software, web-based software, or web-hosted
software
“SMS” short message service
“SMS notice” short message service notices are text messages sent in
response to events or transactions
“SQL” Structured Query Language, a domain-specific language
used in programming and designed for managing data
held in a relational database management system, or for
stream processing in a relational data stream management
system
“TPS” Transactions Per Second
“vertical service capabilities” the capabilities to understand and provide services and
solutions to customers in a certain industry sector
“zero-knowledge proof” a cryptographic method where one party, the prover, can
demonstrate to another party, the verifier, that the prover
possesses specific knowledge or a particular secret,
without revealing any information about the knowledge
or secret itself. This proof satisfies three properties:
completeness (an honest prover can convince an honest
verifier), soundness (a dishonest prover cannot convince
an honest verifier), and zero-knowledge (the verifier
learns nothing about the secret apart from the fact that the
prover possesses it)
GLOSSARY OF TECHNICAL TERMS
–4 4–


--- page 56 ---
This prospectus includes forward-looking statements. All statements other than
statements of historical facts contained in this prospectus, including, without limitation, those
regarding our future financial position, our strategy, plans, objectives, goals, targets and future
developments in the markets where we participate or are seeking to participate, and any
statements preceded by, followed by or that include the words “believe”, “expect”, “estimate”,
“predict”, “aim”, “intend”, “will”, “may”, “plan”, “consider”, “anticipate”, “seek”, “should”,
“could”, “would”, “continue” or similar expressions or the negative thereof, are forward-
looking statements. These forward-looking statements involve known and unknown risks,
uncertainties and other factors, some of which are beyond our control, which may cause our
actual results, performance or achievements, or industry results, to be materially different from
any future results, performance or achievements expressed or implied by the forward-looking
statements. These forward-looking statements are based on numerous assumptions regarding
our present and future business strategies and the environment in which we will operate in the
future. Important factors that could cause our actual performance or achievements to differ
materially from those in the forward-looking statements include, among others, the following:
 general political and economic conditions;
 our business prospects and our ability to successfully implement our business plans
and strategies;
 future developments, trends and conditions in the data service industry and markets
in which we operate or into which we intend to expand;
 our capital expenditure plans;
 the actions and developments of our competitors;
 our financial condition and performance;
 our dividend policy;
 any changes in the laws, rules and regulations of the central and local governments
and the rules, regulations and policies of the relevant governmental authorities
relating to all aspects of our business and our business plans;
 changes or volatility in interest rates, foreign exchange rates, equity prices or other
rates or prices, including those pertaining to China and the industry and markets in
which we operate;
 various business opportunities that we may pursue; and
 capital market developments, changes in the global economic conditions and
material volatility in the global financial markets.
FORW ARD-LOOKING STATEMENTS
–4 5–


--- page 57 ---
Additional factors that could cause actual performance or achievements to differ
materially include, but are not limited to, those discussed under “Risk Factors” and elsewhere
in this prospectus. We caution you not to place undue reliance on these forward-looking
statements, which reflect our management’s view only as of the date of this prospectus. We
undertake no obligation to update or revise any forward-looking statements, whether as a result
of new information, future events or otherwise. In light of these risks, uncertainties and
assumptions, the forward-looking events discussed in this prospectus might not occur. All
forward-looking statements contained in this prospectus are qualified by reference to the
cautionary statements set out in this section.
FORW ARD-LOOKING STATEMENTS
–4 6–


--- page 58 ---
You should carefully consider all the information in this prospectus and, in
particular , the risks and uncertainties described below before making an investment in
our H Shares. The occurrence of any of the following events could materially and
adversely affect our business, financial condition, results of operations or prospects. If
any of these events occur , the trading price of our H Shares could decline and you may
lose all or part of your investment.
These factors are contingencies that may or may not occur , and we are not in a
position to express a view on the likelihood of any such contingency occurring. The
information given is as of the Latest Practicable Date unless otherwise stated, will not
be updated after the date hereof, and is subject to the cautionary statements in
“Forward-Looking Statements” in this prospectus.
RISKS RELATING TO OUR BUSINESS AND INDUSTRY
Fluctuations in demand for our services and solutions may adversely affect our business
and results of operations. Any loss of or decline in demand for our products and services
could materially and adversely affect our business, results of operations and financial
condition.
We provide API marketplace and data management solutions based on the demand of our
customers. For API marketplace, we charge customers based on the number of requests they
make and the price of each request. For data management solutions, our revenue depends on
the number of projects, the price of each project and our ability to develop new customer
relationships in a timely manner. Any decrease in demand for our products and services, such
as a decrease in the number of requests or the price of each request, as well as project prices
or our failure to develop new customer relationships in a timely manner, may have a material
adverse effect on our business, financial performance, and results of operations. A number of
factors could negatively affect our demand for our products and services, including if:
 we fail to update or expand our existing services and solutions or develop new
technologies;
 we suffer from negative publicity, fail to maintain our brand image or our reputation
is damaged;
 we fail to address customers’ concerns related to privacy, safety or security;
 we make adverse changes to our services or become unable to provide services in
response to new legislation, regulations or government policies; and
 we fail to compete effectively.
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We had a market share of 2.1% in the API-enabled data exchange service market in China
and 0.2% market share in the data management solution market in China as measured by
revenue in 2022. There is no guarantee that we will be able to maintain our current market
position or compete with our peers effectively. See “– Failure to maintain our advantages in an
increasingly competitive market may adversely affect our business and growth prospects.”
Furthermore, our customers include government entities and state-owned enterprises in the
public sector and companies from the internet, manufacturing, telecommunications and
financial industries in the private sector. Any legislation or industrial policy that adversely
affects the business in which our customers operate, or measures taken that reduce the size of
such industries, may lead to a decrease in demand, thus materially and adversely impacting our
business, financial condition, and results of operations. Many of our customers and suppliers
are also subject to laws that safeguard data privacy and security in China, as well as licensing
requirements for telecommunications services and regulations on e-commerce. Changes in
their internal policies as a result of regulatory changes may also prohibit them from supplying
us with data or purchasing services and solutions from us. Any termination of our access to
some or all of the data sources provided by our key suppliers could materially and adversely
affect our ability to meet customer demand. In addition, any reduction in the purchase of our
services and solutions by our key customers could materially and adversely affect their
respective revenue contribution. As we pursue new business opportunities, we may also need
to implement additional compliance requirements at the request of our customers and suppliers
to facilitate these endeavors. This could result in significant costs, which may in turn adversely
affect our results of operations.
Unauthorized access to our customers’, suppliers’, or our own data could harm our
reputation and have a negative impact on our business and financial performance.
Our service offerings and IT systems may be vulnerable to security breaches by hackers,
employee errors, and malfeasance. Such breaches could result in unauthorized access to, or
denial of authorized access to, our IT systems, our customers’ and suppliers’ data or our data.
The techniques used to breach IT systems are constantly evolving and growing more
complex over time. As a result, we may be unable to anticipate or implement adequate
measures to prevent future breaches. The detection, prevention and remediation of known or
potential security vulnerabilities may result in additional costs and materially and adversely
affect our business, financial condition and results of operations.
Moreover, we do not control our customers, suppliers or their partners’ IT or compliance
systems and cannot guarantee that they have sufficient measures in place to safeguard data
privacy and security. Malicious third parties may also conduct attacks designed to deny
customers access to our services. A security breach could result in a loss of confidence in the
security of our services and solutions or our Company, materially and adversely affecting our
business, financial condition and prospects. We also cannot guarantee that our customers and
their end-users would not misuse the data they process using our services and solutions, and
that such misuse would not adversely affect our business and reputation.
Finally, in recent years, there have been growing concerns about data security and privacy
in China. Such concerns, even if unfounded, could damage our reputation and business
operations.
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Our ability to attract and retain qualified personnel could materially affect our business
and the results of operations. Rising labor costs in China could make it more costly to
attract and retain qualified personnel and adversely affect our results of operations.
Our business requires a large number of information technology talents, including
software development engineers, algorithm engineers, and core technology personnel.
Competition for high-end talents in the industry is fierce. If we lose key R&D professionals to
competitors and fail to attract talents that can effectively replace them in time, our core
technical and R&D teams will be negatively affected, and our business and results of
operations may be materially affected. Our financial performance in the future will also
depend, in part, on our ability to recruit, train and retain a sufficient number of new
experienced research and development, sales and other key employees. Our recent hires and
planned hires may not become as productive and efficient as we expect, and we may be unable
to hire or retain sufficient numbers of qualified individuals in the future. Our future
performance also depends on the continued services and contributions of our senior
management. Any loss of service of our senior management can significantly delay or prevent
us from achieving our strategic business objectives, and adversely affect our business, financial
condition and results of operations.
In addition, the average wage in China has risen in recent years and is expected to
continue to rise. In the technology and data service industry, in particular, fierce competition
for high-end talents has led to a notable increase in wages for experienced and highly educated
personnel. Moreover, we are required by PRC laws and regulations to pay various statutory
employee benefits, such as pension, housing fund, medical insurance, work-related injury
insurance, unemployment insurance and maternity insurance. Unless we are able to control our
labor costs or pass on these increased labor costs to our customers, we may not be able to
attract and retain qualified personnel, and our financial condition and results of operations may
be adversely affected.
If we cannot continue to innovate or effectively respond to the rapidly evolving
technology, market demands, industry dynamics and other risks and uncertainties, our
business, results of operations and prospects would be materially and adversely affected.
If we fail to innovate, our position in the industry could be damaged, which in turn would
materially and adversely affect our business, financial condition, results of operations and
prospects. Sustained innovation requires us to invest significant resources in identifying unmet
or underserved customer needs, developing new technologies and services, and attracting
talents, among other things. Our investments in innovation, which could be costly, may not
generate the expected economic benefits in the near term, or at all, in which case our business,
results of operations, financial condition and prospects may be materially and adversely
affected. In addition, if we are unable to respond to technological developments or changing
market dynamics in a cost-effective and timely manner, our business, financial condition and
results of operations may also be materially and adversely affected.
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We need to anticipate customer preferences and market trends and respond to changes in
our markets in a timely and effective manner. In addition, we face uncertainties in relation to
the intensifying competition and evolving regulatory environment in China’s data technology
sector. Market changes and developments may from time to time require us to re-evaluate and
adjust our business model, upgrade our offerings, and adopt significant changes to our business
strategies and plans. We cannot assure you that we will be successful in implementing these
initiatives. If we fail to adapt to these developments promptly, or at all, our business, financial
condition, results of operations and prospects may be materially and adversely affected.
Our services and solutions depend on the performance of internet infrastructure,
third-party service providers and our technologies. Unexpected system failures,
interruptions, and inadequacies may harm our business and results of operations.
Our API marketplace relies on the proper functioning of cloud-based internet
infrastructure leased from third-party service providers. Our data management solutions rely on
the proper functioning of our customers’ internet infrastructure. We cannot guarantee that the
internet infrastructure we lease will be able to accommodate the rising number of API requests
made by our customers. Regarding our data management solutions, we typically have no
control over our customers’ internet infrastructure. Hence, we cannot assure you of the
continued efficient operation of our data management solutions. With the expansion of our
business, we may be required to upgrade our IT systems or lease additional internet
infrastructure to keep up with the increasing traffic we need to run our systems. There is no
guarantee that we can do so in a timely and cost-efficient manner or secure additional internet
infrastructure that meets our needs, if at all.
The services and solutions we offer are reliant upon our technologies and the software and
hardware from our suppliers, which we also use in developing our services and solutions.
However, our suppliers may encounter technical errors that prevent their products or services
from operating properly, which could in turn adversely affect the quality of our services and
solutions and other aspects of our business where we rely upon their services. Our query APIs
rely on the supply from data service suppliers. We offer SMS notice services through SMS
service providers and mobile top-up services through top-up service providers or
telecommunication operators. See “Business – Our Services and Solutions – API Marketplace
– Service Types” for more details. Uninterrupted services of API marketplace rely on the
proper functioning of data service providers, SMS service providers, top-up service providers
and telecommunications operators and their continued abilities and qualifications to supply
services to us. Any disruptions in, or failure to procure their services could lead to interruptions
or low quality of our services, which could adversely affect our business and results of
operations. In addition, performance problems, defects or errors in our data management
solutions may arise and may result from any defects and errors that were undetected in our
testing. Such defects and errors, and any failure by us to identify and address them, could result
in a loss of revenue or market share, diversion of R&D resources, harm to our reputation and
increased service and maintenance costs. If our services and solutions do not function reliably
or fail to meet our customers’ expectations in terms of performance, we may lose existing
customers or fail to attract new ones, which may damage our reputation and adversely affect
our business.
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Furthermore, we have no control over the costs of the services provided by
telecommunications operators. If the prices we pay for telecommunications and internet
services rise significantly, and we fail to mitigate the increased costs by passing on them to our
customers, our results of operations may be materially and adversely affected. Our internet
infrastructure may encounter disruptions or other outages caused by problems or defects in our
technologies and systems, such as software malfunctions or network overload. We may
encounter problems when upgrading our systems or services and solutions and there may be
undetected programming errors, which could adversely affect the performance of our operating
systems and customer experience.
We have experienced, and in the future may continue to experience, net operating cash
outflow, an increase in trade receivables turnover days and a substantial amount of
unbilled trade receivables, all of which could expose us to liquidity risks.
For the years ended December 31, 2021 and 2022, we had net cash outflows from
operating activities of RMB33.8 million and RMB36.8 million, respectively. We had net
operating cash outflows during these years primarily because of (i) increases in our trade
receivables, driven by increases in our post-paid API marketplace customers and data
management solution customers; (ii) increases in our prepayments, deposits and other
receivables to strengthen our relationships with our suppliers and ensure steady supply of data
services for our API marketplace and specialized software and hardware for our data
management solutions; and (iii) an increase in our inventories in 2021, primarily because we
had yet to deliver certain data management solutions to our customers at the end of the year,
and the cost of sales related to these projects were accounted for as inventories.
The increase in our receivable turnover days and reduction in our payable turnover days
during the Track Record Period also led to a longer cash conversion cycle, which further
impacted our cash flow and working capital. A large portion of our current assets consists of
trade receivables. As of December 31, 2021, 2022 and 2023, our trade receivables, net of
impairment loss allowance, totaled RMB91.2 million, RMB124.0 million, and RMB175.1
million, respectively. These amounts accounted for 21.7%, 28.6%, and 36.4% of our total
current assets, respectively. A substantial portion of the trade receivables were unbilled trade
receivables. As of December 31, 2021, 2022 and 2023, the unbilled receivables for API
marketplace were RMB43.9 million, RMB60.2 million and RMB90.0 million, respectively, and
the unbilled receivables for data management solutions were RMB39.3 million, RMB34.7
million and RMB37.1 million, respectively. These unbilled receivables were primarily due to
the prolonged process from revenue recognition to payment settlement of our API marketplace
and the fact that we issue invoices after the data management solution customers have fulfilled
their internal protocols to make payments. See “Business – Our Customers – General Terms of
Contracts with Customers”. We have experienced an increase in the turnover days of trade
receivables from 114 days in 2021 to 133 days in 2023. This increase was primarily due to our
acquisition of major customers, which include large internet companies and government
organizations, which typically settle payments after using our API services or after the delivery
and acceptance of data management solution projects. In addition, before we issue invoices to
our customers, we have to wait for the long internal approval process by our customers’
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business and/or finance departments, which can take weeks or even months. For our monthly
settled API marketplace customers, they take time to reconcile their internal records with our
records in order to ascertain that they have been charged for the correct number of API
requests. All these reasons contribute to our increased turnover days of trade receivables. The
increased turnover days potentially expose us to higher credit risks. If our customers encounter
capital turnover issues, some of our trade receivables may not be collected on time, or they may
even become bad debts. This could affect our capital turnover, liquidity, and cash flow.
Our trade payables primarily consist of amounts owed to our suppliers. There was a
decrease in turnover days for our trade payables from 95 days in 2021 to 57 days in 2023. This
decrease was primarily due to our efforts to accelerate the settlement of payables to ensure a
steady supply of data services and specialized software and hardware, and to strengthen our
relationships with our suppliers. The reduction in turnover days may lead to a longer cash
conversion cycle, which could further add pressure to our cash flow and working capital.
Due to the changes in turnover days of our trade receivables and trade payables, we
recorded net cash outflows from operating activities of RMB33.8 million and RMB36.8 million
in 2021 and 2022, respectively. Beyond these changes, we cannot guarantee that future
business activities or other external factors, such as market competition and macroeconomic
shifts, will not negatively impact our operating cash flow, potentially leading to net operating
cash outflows in the future. Net operating cash outflow may require us to seek additional
financing from offering or issuing our H Shares, and/or other sources such as external debt,
which may not be available on terms favorable or commercially reasonable to us or at all. Any
difficulty or failure to meet our liquidity needs as and when needed may have a material
adverse effect on our business, financial condition, results of operations and prospects.
Failure to maintain our advantages in an increasingly competitive market may adversely
affect our business and growth prospects.
We face competition from large internet companies who possess strong technological and
financial resources, are well-known in the market and have well-established customer
networks. It would be difficult for us to reach a comparable business scale in the short term
that would allow us to compete against them on the same level. We had a market share of 2.1%
in the API-enabled data exchange service market in China and 0.2% market share in the data
management solution market in China as measured by revenue in 2022. The top market players
of the integrated API-enabled data exchange service market, which is a component of the
API-enabled data exchange service market, include a business unit of a leading public AI
company listed on both the Stock Exchange and NASDAQ, a business unit of a Chinese
multinational technology company listed on the Stock Exchange and the New Y ork Stock
Exchange, and two API-enabled data exchange companies that specialize in providing
API-enabled data exchange platforms. There is no guarantee that we will be able to maintain
our market position or compete with large internet and technology competitors effectively.
Another type of market player in API-enabled data exchange service market is industry-
specific API-enabled data exchange service providers. They focus on providing API-enabled
data exchange service with specific types of data. We also face competition from them on
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certain projects. There are three types of participants in the data management solution market:
traditional IT infrastructure providers, whose competitive advantages are that they are
experienced in providing hardware products to enterprises; internet giant-affiliated service
providers, whose competitive advantages are that they enjoy a strong reputation in providing
data management services; and data management service providers such as us. We had a
relatively small market share in the data management solution market. Participants like internet
giant-affiliated service providers and traditional IT infrastructure providers may negatively
affect our market position by leveraging their business scale, customer networks or their
reputation. Failure to compete with other players in the API-enabled data exchange service or
data management solution market effectively may lead to a loss of our current market position
and a decrease in our revenue, in turn negatively affecting our business, financial condition,
results of operations and prospects. In addition, as the PRC government has been supporting
the development of China’s digital economy, the API-enabled service market and data
management solution market in China have been developing rapidly. The increasing number of
new market entrants has led to heightened competition. If we cannot keep up with new market
trends and maintain our competitive advantages, we may lose market share to competitors, and
our business, financial condition, results of operations and prospects may be adversely
affected.
Our business is subject to seasonality.
Both our API marketplace and data management solution business lines are subject to
seasonal fluctuations and generally experience higher revenue and profitability in the fourth
quarter of the year. Our revenue from API marketplace, in particular revenue derived from our
internet company customers, generally experiences spikes in the fourth quarter due to these
internet companies’ increased customer flow from online shopping festivals that occur toward
the end of the year, such as annual sales on November 11, or “Double Eleven” ( ᕐɤɓ), and
annual sales on December 12, or “Double Twelve” ( ᕐɤɚ). For data management solutions,
we generally provide solutions to customers in the form of projects, for which we commence
work in the first quarter and deliver our solutions in the fourth quarter. We recognize the
revenue from these projects when the software platform and related services are delivered to
and accepted by the customers. As a result, our business typically experiences seasonal
fluctuations. Comparing our results of operations on a quarter-by-quarter basis, whether for our
API marketplace or data management solutions, may not be meaningful.
We experienced customer and supplier concentration during the Track Record Period and
may continue to be exposed to the risk of such concentration in the future.
During the Track Record Period, our top five suppliers and top five customers included
PRC government entities, local SOEs, telecommunications operators and internet companies.
Our revenue generated from our top five customers accounted for approximately 41.1%,
43.7%, and 62.3% of our total revenue for each of the years ended December 31, 2021, 2022
and 2023, respectively. Our purchases from our top five suppliers combined accounted for
56.2%, 69.9% and 83.2% of our total purchases for each of the years ended December 31, 2021,
2022 and 2023, respectively. Furthermore, we had only limited number of data management
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solution customers during the Track Record Period. In 2021, 2022 and 2023, 18, 21 and 29
customers purchased our data management solutions, respectively. There is no guarantee that
we will be able to maintain our business relationship with our existing customers and suppliers
or secure new contracts from them in the future. If we are unable to secure projects of
comparable contract value and quantity from new customers, or obtain sufficient new business
from existing customers in a timely manner or at all, our business, results of operations and
financial condition would be materially and adversely affected, and it may cause material
fluctuations in our revenue. In addition, should any of our major customers delay or default in
making payments to us or at all, our cash flow and financial position would be adversely
affected. Meanwhile, any significant increase in the prices charged by our suppliers will
increase our costs and may adversely affect our results of operations if we are not able to pass
on the increased costs to our customers in a timely manner or at all. The prices charged by our
suppliers may be affected by factors beyond our control, such as inflation, regulatory
developments and economic cycles. We cannot assure you that we will not experience any of
the above factors in the future.
We are subject to risks relating to Third-Party Payment Arrangements.
Our customers may use the Third-Party Payment Arrangements (as defined in “Business
– Regulatory Compliance – Third-Party Payment Arrangements”) to pay for our services. Such
Third-Party Payment Arrangements include, among other things, circumstances where settling
payments through their affiliates, including their shareholders, subsidiaries or entities that are
under common control, or their employees, business partners or friends and families to make
payments on their behalf or mainly through Alipay. We have not and will not acquire all
third-party payment authorization letters due to several reasons, such as dissolution of some
corporate customers, their refusal to cooperate or our failure to reach such customers. We have
not been subject to any disputes or complaints over the Third-Party Payment Arrangements
during the Track Record Period. However, we cannot guarantee that in the future, we will not
be subject to potential disputes, claims or liabilities in relation thereto, which may adversely
affect our reputation and business.
In addition, we are subject to various risks and uncertainties associated with the
Third-Party Payment Arrangements, such as payment collection issues, fraud, money
laundering and other illegal activities in connection with these payments. In addition, we do not
have control over the third-party paying entities. If these third-party payment entities
experience any non-compliance incidents, they may be subject to fines and may make us liable
for the non-compliance payments and may not be able to provide uninterrupted payment to our
Group, which in turn would adversely affect our business. In addition, we have ceased all
Third-Party Payment Arrangements since November 27, 2023, upon which some customers
need to rectify their payment approach. If they cannot timely rectify, our business and financial
results may be adversely affected.
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Our failure to comply with existing or future laws and regulations related to data security,
data protection, cybersecurity or personal information protection could lead to
suspension of our business operations, liabilities, administrative penalties or other
regulatory actions, which could negatively affect our results of operations and business.
Similar to many other jurisdictions, the PRC government has in recent years tightened the
regulation of data collection, storage, sharing, use, disclosure and protection. To address
concerns regarding misuse of data, the PRC government has enacted a series of laws to
safeguard data privacy and security, including without limitation the PRC Cybersecurity Law
(), the PRC Data Security Law ( ʕശɛ͏΍ձ਷ᅰኽτΌ
), the PRC Personal Information Protection Law, Cybersecurity Review Measures ( ၣഖ
), the Measures on Security Assessment of Cross-border Data Transfer ( ᅰ
), and the Network Data Security Management Regulations (Draft for
Comments) ( ၣഖᅰኽτΌ၍ଣૢԷ(ᅄӋจԈᇃ)). These PRC laws and regulations
require internet service providers and other network operators, among other things, to clearly
state the authorized purpose, methods and scope of the collection and usage of data and obtain
the consent of users for the processing of this data, and to establish user information protection
systems with remedial measures. For example, the PRC Personal Information Protection Law
stipulates details of the general rules and principles on personal information processing and
further increases the potential liability of personal information processor.
Cybersecurity Review Measures stipulate that critical information infrastructure
operators (the “ CIIOs ”) (٫who purchase network products and
services that affect or may affect national security, as well as internet platform operators
conducting data processing activities that affect or may affect national security, shall be subject
to a cybersecurity review. Internet platform operators who hold more than one million users’
personal information must also apply for a cybersecurity review before seeking a listing abroad
(਷̮ɪ̹).
Uncertainties remain with respect to the regulatory regime, and there is no assurance that
we will always be deemed to fully comply with the requirements of the Cybersecurity Review
Measures or other similar legal and regulatory developments. In such cases, we may be ordered
to rectify or terminate our activities that are deemed illegal by regulatory authorities.
The CAC promulgated the Regulations on Network Data Security Management (Draft for
Comments) ( ၣഖᅰኽτΌ၍ଣૢԷ(ᅄӋจԈᇃ)) on November 14, 2021. The draft
stipulates that a data processor contemplating to list its securities on a stock exchange in Hong
Kong is required to apply for a cybersecurity review pursuant to relevant rules and regulations,
if the proposed listing will affect or may affect national security. However, the draft does not
provide the standard to determine under what specific circumstances such listings would
“affect or may affect national security.” As of the Latest Practicable Date, the draft was only
released for public comments and its final version and effective date may be subject to change
and uncertainty. Provided that the draft is implemented in its current form, and our proposed
listing were deemed to “affect or may affect national security,” and we failed to initiate and
apply for a cybersecurity review in line with relevant requirements, we would be subject to
requests of rectification, warning, suspension or termination of operations, or other penalties,
which may materially affect our business and financial conditions.
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Pursuant to the Measures for the Security Assessment of Outbound Data ( ᅰኽ̈ྤτ
), which were promulgated by the CAC on July 7, 2022 and came into effect on
September 1, 2022, to provide data abroad, a data processor falling under any of the following
circumstances shall, through the local cyberspace administration at the provincial level, apply
to the CAC for security assessment of outbound data: (i) where a data processor provides
important data abroad; (ii) where a CIIO or a data processor processing the personal
information of more than one million individuals provides personal information abroad; (iii)
where a data processor has provided personal information of 100,000 individuals or sensitive
personal information of 10,000 individuals in total abroad since January 1 of the previous year;
and (iv) other circumstances prescribed by the CAC for which declaration for security
assessment for outbound data transfers is required. As of the Latest Practicable Date, we had
not been involved in any cross-border data transfer during our daily operations. However, in
the event that the regulatory authorities deem certain of our activities as a cross-border data
transfer, we will be subject to the relevant requirements. Such failure to report or any material
legal impediments during the process of reporting security assessments for cross-border data
transfers for us may materially and adversely impact on our business operation or the Global
Offering.
Compliance with applicable personal information and data security laws and regulations
is a rigorous and time-intensive process. As data protection laws and regulations increase in
number and complexity, we cannot assure you that our data protection systems will be
considered sufficient under all applicable laws and regulations. Furthermore, we cannot assure
you that the information we process for our customers and the information we receive from our
suppliers are obtained and transmitted to us in full compliance with relevant laws and
regulations by our customers and suppliers. Moreover, there could be new laws, regulations or
industry standards that require us to acquire additional licenses, change our business practices
and privacy policies, and we may also be required to put in place additional mechanisms
ensuring compliance with new data protection laws, all of which may increase our costs and
materially harm our business, prospects, financial condition and results of operations. Any
failure or perceived failure by us to comply with applicable laws and regulations or acquire
additional licenses could result in the suspension of our business operations, monetary damage,
or proceedings or actions against us by governmental entities, individuals or others. Our
reputation could also be adversely affected by actions taken by the PRC government in
response to data security and privacy threats. Future government actions and unfavorable
restrictions, whether targeted at us or imposed on all companies that offer data-related services
and solutions, may materially and adversely affect our business, financial conditions, results of
operations and prospects.
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Any leak of our core technologies and business secrets could adversely affect our business
and results of operations.
There can be no assurance that our core technologies and other business secrets would not
be leaked due to illegal competition or other reasons. Our confidentiality and non-compete
agreements with key personnel and other precautionary measures may not be sufficient to
protect our core technologies and other business secrets. If any of our core technologies or
business secrets is leaked, our competitive advantage may suffer as a result, and our business
and results of operations may be materially and adversely affected.
Our research and development efforts may not yield the benefits we expect, and our
business and results of operations may be materially and adversely affected.
Our research and development costs incurred were approximately RMB16.9 million,
RMB26.3 million and RMB24.3 million in 2021, 2022 and 2023, respectively, accounting for
approximately 6.5%, 8.0% and 5.5% of our revenue for each of the corresponding years,
respectively. However, we need to continuously invest financial and human resources in
technological research and development to remain competitive in the market.
In addition, the outcome of research and development is inherently uncertain, and we may
encounter practical difficulties in commercializing our research development results. Our
expenditures on research and development may not generate benefits as we expect. We may not
be able to timely upgrade our technologies in an efficient and cost-effective manner, or at all.
New technologies in our industry could render our research and development efforts and the
services and solutions that we are developing or expect to develop in the future obsolete, not
commercially viable or unattractive, thereby limiting our ability to recover related
development costs, which could result in a decline in our revenue, profitability and market
share.
Failure to comply with the labor and social insurance-related laws and regulations may
adversely affect our business, financial condition, and results of operations.
The PRC government has issued various labor-related regulations to further protect the
rights of employees. Companies operating in China are required to complete related
registration with the competent authorities and contribute to the government-sponsored
employee benefits plans in amounts equal to certain percentages of salaries, including bonuses
and allowances, of employees up to a maximum amount specified by the local government
from time to time at locations where our employees are based.
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During the Track Record Period, we did not pay social insurance and housing provident
fund in full for certain of our employees, primarily in relation to their discretionary bonus. We
have also engaged third-party human resources agencies to pay on our behalf social insurance
premium and housing provident funds for a small portion of our Company and Tianju Renhe
employees (the “ Employee Third-Party HRA Payment ”). As a result, we may be required by
competent authorities to pay the outstanding amount and may be subject to additional
contribution and late payment penalties. For the years ended December 31, 2021, 2022 and
2023, we estimate the shortfall in the aggregate amount of contributions made by the Group to
its employees’ social insurance was approximately RMB1.5 million, and the shortfall in the
aggregate amount of unpaid housing provident fund was approximately RMB0.7 million.
During the Track Record Period, due to the shortfall of social insurance and housing provident
fund contributions, the maximum potential late payment fee that we may be subject to would
be approximately RMB0.4 million and the maximum potential penalties that we may be subject
to would be approximately RMB6.7 million. In addition, the aggregate amount of social
insurance contributions and housing provident fund made through third-party human resources
agencies was approximately RMB1.5 million and RMB0.7 million, respectively. If the
Employee Third-Party HRA Payment is challenged by government authorities, we may be
deemed to have failed to have discharged our obligations in relation to the payment of social
insurance and housing provident funds through our own accounts as an employer. Our Group
undertakes that if we are ordered by the competent government authorities to pay additional
contributions in respect of the Employee Third-Party HRA Payment, we would do so within the
prescribed period. We estimate that in the event that we are ordered to make up for the social
insurance and housing provident funds contributions made by third party agencies on behalf of
us during the Track Record Period, the maximum late payment fee would be approximately
RMB0.7 million. See “Business – Employees” for details of our non-compliance. We cannot
guarantee you that the competent government authorities will not require us to settle the
outstanding amount within the specified time limit or impose late payment penalties on us.
Such actions may have a material and adverse impact on our financial position and results of
operations.
Unauthorized use or other violation of our intellectual property rights by our customers,
employees and/or third parties may harm our brand and reputation, and the expenses
incurred in protecting our intellectual property rights may materially and adversely
affect our business. We may also be subject to intellectual property infringement claims,
which may be expensive to defend and may disrupt our business and operations.
We rely on a combination of patent, trademark and copyright laws, trade secrets
protection, restrictions on disclosure and other agreements that restrict the use of our
intellectual property to protect our intellectual property rights. The steps we have taken to
protect our intellectual property, such as entering into confidentiality agreements and
intellectual property ownership agreements with our employees, may not be adequate to
prevent the infringement or misappropriation of our proprietary technology, know-how or other
intellectual property. Infringement, misappropriation or challenges of our intellectual property
rights, unauthorised use or disclosure of our trade secrets and other intellectual property,
significant impairments to our intellectual property rights and limitations on our ability to
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assert our intellectual property rights against others, may result in a material and adverse effect
on our business. Third parties may independently discover trade secrets and proprietary
information, limiting our ability to assert any trade secret rights against such parties. Further,
others may engage in conduct that constitutes unfair competition, defamation or other
violations of our rights, which could harm our business, reputation and competitive position.
If there arises the need to use litigation to enforce our intellectual property rights, such
litigation could result in substantial costs and diversion of our resources and disrupt our
business.
We cannot be certain that our operations or any aspects of our business do not or will not
infringe upon or otherwise violate patents, copyrights, trademarks or other intellectual property
rights held by third parties. We may be subject to penalties, legal proceedings and claims
relating to the intellectual property rights of others in the future. Allegations that we have
infringed the intellectual property rights of third parties, may harm our brand and reputation,
even if they do not result in liability. For details, see “Appendix VII – Statutory and General
Information – B. Further Information about Our Business – 2. Intellectual Property Rights of
our Group”. We cannot assure you that any of our intellectual property applications will
ultimately proceed to registration or will result in registration with adequate scope for our
business, or that any of our intellectual properties or pending applications or registrations
would not be challenged by third parties or found by competent authority to be invalid or
unenforceable. Third parties may also file applications to register intellectual property that is
the same as or similar to that we are applying for. If our intellectual property applications are
rejected by the relevant regulatory authority, we may be prohibited from using the relevant
intellectual property, which may have an adverse effect on our business and operations.
Any litigation, legal and contractual disputes, claims or administrative proceedings
against us could be costly and time-consuming to defend or settle, and could result in
negative publicity.
Our business is subject to the risk of disputes, claims or legal proceedings brought by
customers, suppliers, employees, government agencies and others in the forms of private
actions, administrative proceedings, regulatory actions or other litigation. The outcome of such
proceedings can be difficult to assess or quantify. Claimants in such proceedings may seek
recovery of large or indeterminate amounts, and the magnitude of potential losses relating to
such disputes may remain unknown for a substantial period of time. The cost of defending
future disputes or proceedings may be significant and could negatively affect our results of
operations if changes to our business operations are required. There could also be negative
publicity associated with such disputes or proceedings, regardless of whether the allegations
are valid or whether we are ultimately found liable. As a result, any significant disputes or
proceedings could adversely affect our business, results of operations, financial condition or
reputation.
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We may not be able to identify or pursue suitable expansion opportunities or achieve
optimal results in future expansions.
We intend to further expand our business in the future. However, expansion plans may not
be successfully completed and we may not be able to find or consummate suitable alternatives.
New expansion plans may also result in our incurrence of debts and other liabilities,
assumption of potential legal liabilities in respect of new acquisitions, and incurrence of
impairment charges related to goodwill and other intangible assets, any of which could harm
our businesses, financial condition and results of operations. It may also be difficult for us to
win market share from established industry players despite our expansion efforts. As a result,
there can be no assurance that we will be able to realize the strategy behind an expansion plan,
reach the desired level of operational integration or achieve our investment return goals.
If we fail to effectively manage our growth, our business, results of operations and
financial condition could be adversely affected.
We cannot assure you that our revenue growth will continue, or that our business will be
able to maintain its growth rate as in the past. In addition, as market competition intensifies and
our industry matures, the growth rate of our revenue may decrease. Our historical results of
operations and financial performance may not be indicative of our future growth.
We must improve our corporate governance and structure to effectively manage our
business on a larger scale. We will also need to continue training and managing our workforce,
especially our R&D personnel. All these efforts will require significant managerial, financial
and human resources. If we fail to allocate such resources effectively to support our growth or
implement our business strategies, we may face issues such as a decrease in operational
efficiency, an increase in operational costs and a decrease in profitability. Our business,
financial condition, results of operations and prospects may be materially and adversely
affected as a result.
Our inability to use software licensed from third parties, including open-source software,
could negatively affect our ability to sell our solutions and subject us to possible litigation.
Our technology platform incorporates software licensed from third parties, including
open-source software and code such as HTML5, which we use without charge. The terms of
many open-source licenses that we are subject to have not been interpreted by courts, and there
is a risk that these licenses could be construed to impose unanticipated conditions or
restrictions on our ability to provide our services and solutions. In addition, the terms of
open-source software licenses may require us to provide software that we develop to others on
unfavorable license terms. For example, certain open-source licenses may require us to offer
the components of our platform that incorporate open-source software for free, to make the
source code for modifications or derivative works available to others, and to license such
modifications or derivative works under the terms of the particular open-source license. In
addition, we could be required to seek licenses from third parties in order to continue offering
our services and solutions, and these licenses may not be available on terms acceptable to us,
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or at all. Alternatively, we may need to re-engineer our services and solutions or discontinue
using certain functionalities of our services and solutions. Our inability to use third-party
software could result in disruptions to our business or delays in developing future offerings or
enhancements of our existing services and solutions, which could materially and adversely
affect our business and results of operations.
We are exposed to changes in the fair value of financial assets at FVOCI and financial
assets at FVTPL and valuation uncertainties due to the use of unobservable inputs.
We are exposed to fair value changes for financial assets at FVOCI and financial assets
at FVTPL and valuation uncertainty due to the use of unobservable inputs that require
judgment and assumptions which are inherently uncertain. As of December 31, 2021, 2022 and
2023, our financial assets at FVOCI were RMB88.2 million, RMB76.0 million and RMB61.7
million, respectively. For details, see “Financial Information – Non-Current Assets and
Liabilities – Financial Assets at FVOCI”. As of December 31, 2021, 2022 and 2023, our current
and non-current financial assets at FVTPL totaled RMB103.1 million, RMB35.2 million and
RMB5.2 million, respectively. For details, see “Financial Information – Current Assets and
Liabilities – Financial Assets at FVTPL”. These financial assets are level 3 financial
instruments and are valued at least once every year to determine their fair value.
Since the value of our financial assets depends on the investment performance of the
underlying financial instruments, our investments are subject to all the risks associated with
those underlying financial instruments, including the possibility of bankruptcy of the unlisted
entities. Any potential realised or unrealised losses in our investments in the future resulting
from the changes in the value of the financial instruments we invested in may adversely affect
our business, our results of operations and our financial condition.
The fair value of our financial assets that are not traded in an active market is determined
using valuation techniques, which require judgment and assumptions and involve the use of
unobservable input, such as the discount for lack of marketability. Changes in the basis and
assumptions used in the valuation of the fair values could materially affect the fair value of
these financial assets. Factors beyond our control can significantly influence and cause adverse
changes to the estimates and thereby affect the fair value. These factors include, but are not
limited to, general economic conditions, changes in market interest rates and stability of the
capital markets. The valuation may involve a significant degree of judgment and assumptions
which are inherently uncertain, and may result in material adjustment, which in turn may
materially and adversely affect our results of operations.
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Our top-up business requires a substantial amount of prepayments. Fraudulent activities
by or affecting our top-up service providers could materially affect our reputation and
business.
According to F&S, in line with the industry practice, our top-up business requires a
substantial amount of prepayments to be made to service providers to ensure a steady supply
of top-up services. It is common for our top-up service providers to make prepayments to their
suppliers before supplying services to us. In the past, due to the fraudulent activity by a
supplier of our key top-up service providers and their subsequent failure to provide service and
refund prepayments to us, we have experienced a total loss in prepayments of approximately
RMB74.9 million in 2017. Additionally, certain of our top-up service providers issued
fraudulent V A T invoices, which resulted in the closure of their business and subjected their
controlling persons to civil and criminal liabilities. See “Business – V A TS Services
Compliance – Incidents related to our top-up services”.
Our internal control procedures are designed to monitor our operations and overall
compliance. However, we may be unable to identify any suspicious activity promptly, or at all.
Furthermore, it is not always possible to detect and prevent fraud or any arrangements
unknown to or unauthorized by us committed by our top-up providers or their suppliers, and
the precautions we take to prevent and detect such activities may not be effective. Therefore,
our top-up business may expose us to the risk of fraud and potentially losses in prepayments,
which could materially adversely affect our reputation, business, financial condition and
results of operations.
We are subject to credit risks related to our trade receivables and prepayments, deposits
and other receivables.
During the Track Record Period, our business continued to grow and we experienced an
increase in our number of post-paid customers, which resulted in an increase in our trade
receivables. As of December 31, 2021, 2022 and 2023, our trade receivables, net of impairment
loss allowance, totaled RMB91.2 million, RMB124.0 million, and RMB175.1 million,
respectively. We cannot assure you that all our customers are creditworthy and will not default
on us in the future. As a result, we are exposed to credit risk in relation to our trade receivables.
As we plan to continue expanding our business, we cannot guarantee that our trade receivables
will not continue to increase in the future, which may adversely affect our liquidity. Our
impairment loss allowance for trade receivables was RMB4.1 million, RMB5.8 million and
RMB15.9 million as of December 31, 2021, 2022 and 2023, respectively.
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Our prepayments, deposits and other receivables primarily consisted of our prepayments
to suppliers, prepaid input V A T, bidding deposits, and advances to employees in daily
operations. Our prepayments, deposits and other receivables amounted to RMB20.4 million,
RMB59.5 million and RMB78.8 million as of December 31, 2021, 2022 and 2023, respectively.
There is no guarantee that suppliers and other third parties will perform their obligations or do
so in a timely manner, and we are subject to credit risk in relation to prepayments, deposits and
other receivables. Our impairment loss allowance for prepayments, deposits and other
receivables was RMB1.0 million, RMB0.3 million and RMB0.2 million as of December 31,
2021, 2022 and 2023, respectively.
We cannot assure you that our past provisioning practice will not change in the future or
that our provision levels will be sufficient to cover defaults in our trade receivables,
prepayments, deposits and other receivables. If we need to make additional impairment
allowances in the future, our business, cash flows, and results of operations may be adversely
affected.
Any change in or discontinuation of preferential tax treatments or government grants that
are currently available to us could adversely affect our business, financial condition and
results of operations.
During the Track Record Period, some of our operating subsidiaries in China were subject
to Corporate Income Tax rate of 25% on the taxable income. Our Company and our subsidiary
Tianju Renhe were recognized as High-Technology Enterprises and benefited from a
preferential tax rate of 15% starting from December 2018 and November 2021, respectively.
Some of our subsidiaries were eligible for a preferential tax rate for small and micro-
enterprises ranging from 2.5% to 5.0%. However, there is no guarantee that we can receive the
same or similar preferential tax treatments, or at all, in the future if other income tax laws and
regulations or other regulatory measures come into effect. If we no longer receive the same or
similar tax treatments, our financial condition may be adversely affected.
In 2021, 2022 and 2023, we received government grants totaling RMB7.4 million,
RMB5.6 million and RMB8.4 million, respectively, in consideration of our research and
development activities, innovations, IP development, talent recruitments and other aspects of
our operations conducted in the ordinary course of business. These government grants and their
amounts were subject to the discretion of local governments. Thus, we may not continue to
receive such grants in the future. If the amounts of the government grants we receive are
reduced in the future, or if the government eliminates such grants altogether, our results of
operations and profitability may be adversely affected.
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We incurred, and in the future may continue to incur, net losses.
In the case of API marketplace, our revenue and profit are usually much higher in the
fourth quarter of the year; and in the case of our data management solutions, we typically
commence projects in the first quarter and deliver our solutions to customers in the fourth
quarter of the year. As a result, our cost of sales and other expense items recognized during the
first nine months of the year are not proportional to the revenue recognized during the same
period. We expect seasonality to continue to have a negative impact on our profitability during
the first nine months of the year. We may continue to incur net losses during the first nine
months of the year in the future and may not be able to achieve or subsequently maintain
profitability for such time periods.
Our historical growth may not be sustainable or indicative of our future growth.
Our business has grown substantially in recent years, but the past growth may not be
indicative of our future growth. Our revenue continued to grow in 2021, 2022 and 2023. Our
gross profit increased in 2023 compared to 2022, while our gross profit margin had a
period-over-period decrease. In addition, you should also consider our business and prospects
in light of other risks and challenges we may encounter. See “– If we cannot continue to
innovate or effectively respond to the rapidly evolving technology, market demands, industry
dynamics and other risks and uncertainties, our business, results of operations and prospects
would be materially and adversely affected”, “– Failure to maintain our advantages in an
increasingly competitive market may adversely affect our business and growth prospects” and
other risk factors in this “Risk Factors” section. We cannot assure you that we will be able to
achieve performance similar to that we have achieved in the past. Investors should not solely
rely on our historical financial information as an indication of our future financial or operating
performance.
We may not be able to detect or prevent fraud, other misconduct or any arrangements
related to our services unknown to or unauthorized by us that are committed by third
parties or our employees, which may have a negative impact on our reputation and
business .
Fraud, other misconduct or any arrangements unknown to or unauthorized by us by third
parties or our employees, such as unauthorized business transactions or arrangements, bribery,
improper or illegal use of our services or solutions, disputes arising from third parties’
arrangement related to our services unknown to or unauthorized by us and unauthorized access
to or leakage of data, may be difficult to detect or prevent. For example, we cannot rule out
the possibility that our customers may misuse our services and solutions for improper or illegal
ends. These types of incidents could subject us to financial loss, legal, regulatory proceedings
and disputes while seriously damaging our reputation. They may also impair our ability to
effectively attract prospective suppliers or customers, develop customer loyalty, obtain
financing on favorable terms and conduct other business activities. In particular, we may face
risks with respect to fictitious or other fraudulent activities. There can be no assurance that the
measures we have implemented to detect and reduce the occurrence of fraudulent activities
would be effective in combating fraudulent transactions or improving overall satisfaction
among our customers.
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Our risk management systems, information technology systems and internal control
procedures are designed to monitor our operations and overall compliance. However, we may
be unable to identify non-compliance or suspicious transactions promptly, or at all.
Furthermore, it is not always possible to detect and prevent fraud, other misconduct or any
arrangements unknown to or unauthorized by us committed by our employees, platform
participants, customers or other third parties, and the precautions we take to prevent and detect
such activities may not be effective. Therefore, we are subject to the risk that fraud, other
misconduct or any arrangements unknown to us may have occurred but gone undetected, or
may occur in the future. This may materially and adversely affect our business and reputation.
Our insurance coverage may not be sufficient to cover all the losses associated with our
business operations.
We face various risks in connection with our business and as of the Latest Practicable
Date, we maintained insurance policies for our vehicles at the corporate level and directors and
officers’ liability insurance. We provide social security insurance as required by relevant rules
and regulation in China, including general care and work-related injury insurance, for our
employees. We cannot assure you that our insurance coverage is sufficient to prevent us from
any loss, or that we will be able to successfully claim our losses under our current insurance
policies on a timely basis, or at all. If we incur any loss that is not covered by our insurance
policies, or the compensated amount is significantly less than our actual loss, our business,
financial condition and results of operations could be materially and adversely affected.
We may be subject to risks relating to our failure to complete lease registration for our
leased properties.
As of the Latest Practicable Date, we leased several properties as business registration
addresses. Pursuant to the applicable PRC laws and regulations, property lease agreements
should be registered with the relevant local housing or urban-rural development authorities in
the PRC. As of the Latest Practicable Date, lease registration was not completed with the
relevant authorities for nine of our lease agreements of properties which were in use as offices
and business registration addresses. The relevant government authorities may order us to
complete the lease registration for such lease agreements within a prescribed period, failing
which we may be subject to a fine from RMB1,000 to RMB10,000 for each non-registered
lease. We cannot assure you that we will be able to complete the lease registration on a timely
basis or at all in such cases, and we may be subject to penalties arising from the failure to
complete the lease registration filing of lease agreements and any disputes arising from our
leased properties in the future. See “Business – Properties – Leased Property” for further
details.
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Any future force majeure events, natural disasters, acts of war or terrorism, the outbreak
of any contagious disease, including COVID-19, or the occurrence of other incidents that
are beyond our control may adversely affect our business, financial condition, and results
of operations.
Any future occurrence of force majeure events, natural disasters or outbreaks of
pandemics and contagious diseases, including avian influenza, severe acute respiratory
syndrome, H1N1 influenza, and the recent COVID-19 pandemic may materially and adversely
affect our business, financial condition and results of operations. In particular, the COVID-19
pandemic has impacted, and could adversely impact, our operations and financial performance.
Our customers may still need time to recover from the economic effects of the pandemic.
Consequently, the COVID-19 pandemic may continue to adversely affect our business,
financial condition and results of operations in the current and future years.
In addition, China has experienced natural disasters such as earthquakes, floods and
droughts during the Track Record Period. Any future occurrence of natural disasters or
pandemics in China may severely impact the economy in the regions affected, seriously disrupt
our operations or those of our customers, and therefore materially and adversely affect our
business, financial condition and results of operations.
RISKS RELATING TO THE GLOBAL OFFERING
There has been no prior public market for our H Shares and there can be no assurance
that an active market would develop or be sustained after the Global Offering. Y ou may
not be able to resell our H Shares at or above the price you pay, or at all.
Prior to this Global Offering, there was no public market for our H Shares. There can be
no guarantee that an active trading market for our H Shares will develop or be sustained after
completion of the Global Offering. The Offer Price is the result of negotiations between us and
the Sole Overall Coordinator (for itself and on behalf of the Underwriters), and they may differ
significantly from the market price of our H Shares following the Global Offering.
The price and trading volume of our H Shares may be highly volatile. Several factors,
some of which are beyond our control, such as variations in our financial position and/or
results of operations, changes in our pricing policy, the addition or departure of key personnel,
changes in profit forecast or recommendations by financial analysts, and announcements made
by us or our competitors, could cause large and sudden changes to the volume and price at
which our H Shares will trade.
In addition, the Stock Exchange and other securities markets have, from time to time,
experienced significant price and volume volatility that is not related to the operating
performance of any particular company. These broad market fluctuations may materially and
adversely affect the price of our H Shares.
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Y ou will incur immediate and substantial dilution and may experience further dilution if
we issue additional Shares in the future.
The Offer Price of the Offer Shares is higher than the net tangible asset value per Share
immediately prior to the Global Offering. Therefore, purchasers of the Offer Shares in the
Global Offering will experience an immediate dilution in pro forma consolidated net tangible
asset value. There can be no assurance that if we were to immediately liquidate after the Global
Offering, any assets will be distributed to Shareholders after the creditors’ claims. To expand
our business, we may consider offering and issuing additional Shares in the future. Purchasers
of the Offer Shares may experience dilution in the net tangible asset value per Share of their
Shares if we issue additional Shares in the future at a price that is lower than the net tangible
asset value per Share at that time.
Future sales or market perception of sales of a substantial number of our H Shares on the
public market could adversely affect the trading price of our H Shares.
After the completion of the Global Offering, future sales of a substantial number of our
H Shares or other securities relating to our H Shares on the public market, the issuance of new
Shares or other securities relating to our H Shares, or the market perception that such sales or
issuances may occur, could adversely affect the market price of our H Shares and our ability
to raise future capital at a favorable time and price. We cannot predict the effect of any future
sales or market perception of sales of a substantial number of our H Shares on the public
market on the market price of our H Shares.
Certain statistics and information in this prospectus have not been independently verified
and may not be reliable.
Facts, forecasts and statistics in this prospectus relating to the data technology industry
are obtained from various sources that we believe are reliable, including official government
publications and third-party reports, either commissioned by us or publicly accessible, and
other publicly available sources. We have taken reasonable care in the reproduction or
extraction of the official government publications and other third-party reports for the purpose
of disclosure in this prospectus. However, we cannot guarantee the quality or reliability of
these sources. Specifically, neither we, the Sole Sponsor, the Sole Overall Coordinator, the
Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries, the Underwriters nor our or their respective affiliates or advisers have verified
the facts, forecasts and statistics or ascertained the underlying assumptions relied upon in those
facts, forecasts and statistics obtained from the aforementioned official government
publications. Due to possibly flawed or ineffective collection methods or discrepancies
between published information and market practice and other problems, the statistics in this
prospectus relating to the data technology industry may be inaccurate or may not be
comparable to statistics produced for other markets. As such, no representation as to the
accuracy of such facts, forecasts and statistics obtained from various sources is made.
Moreover, these facts, forecasts and statistics involve risk and uncertainties and are subject to
change based on various factors. Further, there can be no assurance that they are stated or
compiled on the same basis or with the same degree of accuracy, as may be the case elsewhere.
RISK FACTORS
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Y ou should read the entire prospectus carefully and should not rely on any information
contained in press, media or internet regarding us and the Global Offering.
There may be press, media or internet coverage regarding us, the Global Offering or other
corporate activities, which may contain, among other things, certain financial information,
projections, valuations and other forward-looking information about us or the Global Offering
or certain allegation against us. We have not authorized the disclosure of any such information
in the press or media or on the internet and do not accept responsibility for the accuracy or
completeness thereof. We make no representation as to the appropriateness, accuracy,
completeness or reliability of any of the projections, valuations or other forward-looking
information about us. To the extent such statements are inconsistent with, or conflict with, the
information contained in this prospectus, we disclaim responsibility for them. Accordingly,
prospective investors are cautioned to make their decisions on the basis of the information
contained in this prospectus only and should not rely on any other information.
We cannot assure you whether and when we will declare and pay dividends in the future.
Our ability to pay dividends will depend on whether we are able to generate sufficient
earnings. Distribution of dividends shall be decided by our Board of Directors at their
discretion and will be subject to the approval of the general meeting. A decision to declare or
to pay dividends and the amount thereof depend on various factors, including but not limited
to our results of operations, cash flows and financial position, operating and capital
expenditure requirements, distributable profits as determined under the generally accepted
accounting principles of the PRC or IFRSs (whichever is lower), our Articles of Association
and other constitutional documents, the PRC Company Law and any other applicable PRC laws
and regulations, market conditions, our strategy and projection for our business, contractual
restrictions and obligations, taxation, regulatory restrictions and any other factors from time to
time deemed by our Board of Directors as relevant to the declaration or suspension of
dividends. As a result, there can be no assurance whether, when and in what form we will pay
dividends in the future.
Holders of our H Shares may be subject to PRC income tax on dividends from us or on
any gain realized on the transfer of our H Shares.
As is customary with all major economies, China has tax treaties or similar arrangements
with jurisdictions across the world. Under the EIT Law and its implementation rules, subject
to any applicable tax treaty or similar arrangement between China and your jurisdiction of
residence that provides for a different income tax arrangement, PRC withholding tax at the rate
of 10% is normally applicable to dividends from PRC sources payable to investors that are
resident enterprises outside of China, which do not have an establishment or place of business
in China, or which have such establishment or place of business if the relevant income is not
effectively connected with the establishment or place of business. Any gain realized on the
transfer of shares by such investors is subject to 10% (or a lower rate) PRC income tax if such
gain is regarded as income derived from sources within China unless a treaty or similar
arrangement provides otherwise. Under the Individual Income Tax Law of the People’s
RISK FACTORS
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Republic of China () and its implementation rules,
dividends from sources within China paid to foreign individual investors who are not residents
in China are generally subject to a PRC withholding tax at a rate of 20% and gains from PRC
sources realized by such investors on the transfer of shares are generally subject to 20% PRC
income tax, in each case subject to any reduction or exemption set forth in applicable tax
treaties and PRC laws. Although our business operations are in China, it is unclear whether
dividends we pay with respect to our H Shares, or the gains realized from the transfer of our
H Shares, would be treated as income derived from sources within China and as a result be
subject to PRC income tax. If PRC income tax is imposed on gains realized through the transfer
of our H Shares or on dividends paid to our non-resident investors, the value of your
investment in our H Shares may be adversely affected. Furthermore, our Shareholders whose
jurisdictions of residence have tax treaties or arrangements with China may not qualify for
benefits under such tax treaties or arrangements.
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In preparation for the Global Offering, our Company has applied for the following
waivers from strict compliance with the relevant provisions of the Listing Rules.
MANAGEMENT PRESENCE IN HONG KONG
Pursuant to Rule 8.12 of the Listing Rules, we must have sufficient management presence
in Hong Kong. This normally means that at least two of our executive Directors must be
ordinarily resident in Hong Kong. As of the Latest Practicable Date, none of our executive
Directors resided in Hong Kong.
Pursuant to Rule 19A.15 of the Listing Rules, the requirement in Rule 8.12 may be
waived by having regard to, among other considerations, our arrangements for maintaining
regular communication with the Stock Exchange.
Since all of the business operations of our Group are managed and conducted outside of
Hong Kong, and all of our executive Directors ordinarily reside outside Hong Kong, our
Company considers that it would be practically difficult and commercially unreasonable and
undesirable for our Company to arrange for two executive Directors to be ordinarily resident
in Hong Kong, either by means of relocation of existing executive Directors or appointment of
additional executive Directors. Therefore, our Company does not have, and does not
contemplate in the foreseeable future that we will have sufficient management presence in
Hong Kong for the purpose of satisfying the requirements under Rule 8.12 of the Listing Rules.
Accordingly, pursuant to Rule 19A.15 of the Listing Rules, we have applied for, and the
Stock Exchange has granted, a waiver from strict compliance with the requirements under Rule
8.12 of the Listing Rules, subject to the following conditions. We will ensure that there is an
effective channel of communication between us and the Stock Exchange by way of the
following arrangements:
(i) Authorized representatives : we have appointed Ms. Y ang and Ms. Ching Shuk Wah
Shirley (“ Ms. Ching ”) as the authorized representatives (the “ Authorized
Representatives ”) for the purpose of Rule 3.05 of the Listing Rules. Our Authorized
Representatives will act as our principal channel of communication with the Stock
Exchange and would be readily contactable by phone, facsimile and e-mail to deal
promptly with enquiries from the Stock Exchange. Accordingly, our Authorized
Representatives will be able to meet with the relevant members of the Stock
Exchange to discuss any matters in relation to our Company within a reasonable
period of time. Our Company will also inform the Stock Exchange promptly in
respect of any change in our Authorized Representatives. See “Directors,
Supervisors and Senior Management” for more information about our Authorized
Representatives;
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(ii) Directors : to facilitate communication with the Stock Exchange, we have provided
our Authorized Representatives and the Stock Exchange with the contact details
(such as mobile phone numbers, office phone numbers, facsimile number and e-mail
addresses, to the extent possible) of each of our Directors such that our Authorized
Representatives would have the means for contacting all our Directors promptly at
all times as and when the Stock Exchange wishes to contact our Directors on any
matters. In the event that any Director expects to travel or otherwise be out of office,
they will provide their phone number of the place of their accommodation to our
Authorized Representatives. To the best of our knowledge and information, each
Director who does not ordinarily reside in Hong Kong possesses or can apply for
valid travel documents to visit Hong Kong and can meet with the Stock Exchange
within a reasonable period upon request of the Stock Exchange. We will also inform
the Stock Exchange promptly in respect of any change in our Directors;
(iii) Compliance advisor : we have appointed Rainbow Capital (HK) Limited as our
compliance advisor (the “ Compliance Advisor ”) upon Listing pursuant to Rule
3A.19 of the Listing Rules for a period commencing on the Listing Date and ending
on the date on which we comply with Rule 13.46 of the Listing Rules in respect of
our financial results for the first full financial year commencing after the Listing
Date. Pursuant to the Note to Rule 3A.23 of the Listing Rules, our Compliance
Advisor will have access at all times to our Authorized Representatives, our
Directors, Supervisors, senior management and other officers of our Company and
act as the additional channel of communication with the Stock Exchange and answer
enquiries from the Stock Exchange. The contact details of our Compliance Advisor
have been provided to the Stock Exchange. We will also inform the Stock Exchange
promptly in respect of any change in our Compliance Advisor;
(iv) Meetings between the Stock Exchange and the Directors could be arranged through
the Authorized Representatives or the Compliance Advisor, or directly with the
Directors within a reasonable time frame;
(v) We will also appoint professional advisors (including legal advisors and
accountants) after the Listing, if necessary, to assist us in dealing with any questions
or queries raised by our Company and to ensure that there will be efficient
communication with the Stock Exchange; and
(vi) The Compliance Advisor will also advise on the on-going compliance requirements
and other issues arising under the Listing Rules and other applicable laws and
regulations in Hong Kong after the Listing.
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APPOINTMENT OF JOINT COMPANY SECRETARIES
Pursuant to Rule 8.17 of the Listing Rules, we must appoint a company secretary who
satisfies the requirements under Rule 3.28 of the Listing Rules. According to Rule 3.28 of the
Listing Rules, we must appoint an individual as our company secretary, who, by virtue of his
or her academic or professional qualifications or relevant experience, is, in the opinion of the
Stock Exchange, capable of discharging the functions of company secretary.
Pursuant to Note 1 to Rule 3.28 of the Listing Rules, the Stock Exchange considers the
following academic or professional qualifications to be acceptable:
(i) a Member of The Hong Kong Chartered Governance Institute;
(ii) a solicitor or barrister (as defined in the Legal Practitioners Ordinance); and
(iii) a certified public accountant (as defined in the Professional Accountants
Ordinance).
In addition, pursuant to Note 2 to Rule 3.28 of the Listing Rules, in assessing “relevant
experience”, the Stock Exchange will consider the individual’s:
(i) length of employment with the issuer and other issuers and the roles he/she played;
(ii) familiarity with the Listing Rules and other relevant laws and regulations including
the SFO, the Companies (Winding Up and Miscellaneous) Ordinance and the
Takeovers Code;
(iii) relevant training taken and/or to be taken in addition to the minimum requirement
under Rule 3.29 of the Listing Rules; and
(iv) professional qualifications in other jurisdictions.
We have appointed Ms. Y ang as one of our joint company secretaries. She has extensive
experience in corporate governance matters, information disclosure, investor relationship and
secretarial affairs. However, as she presently does not possess the qualifications required under
Rules 3.28 and 8.17 of the Listing Rules, we have appointed Ms. Ching as our other joint
company secretary to assist Ms. Y ang in discharging the duties of a company secretary. Ms.
Ching is a Chartered Secretary, a Chartered Governance Professional and an associate of both
The Hong Kong Chartered Governance Institute and The Chartered Governance Institute in the
United Kingdom. Ms. Ching therefore meets the qualification requirements under Note 1 to
Rule 3.28 of the Listing Rules and is in compliance with Rule 8.17 of the Listing Rules.
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Our joint company secretaries will be jointly discharging the duties and responsibilities
of a company secretary. Ms. Ching will be assisting Ms. Y ang in gaining the relevant
experience required under Rules 3.28 and 8.17 of the Listing Rules. Ms. Y ang will also be
assisted by (i) our Compliance Advisor for the first full financial year starting from the Listing
Date, particularly in relation to Hong Kong corporate governance practice and compliance
matters; and (ii) the Hong Kong legal advisor of our Company, on matters regarding our
Company’s ongoing compliance with the Listing Rules and the applicable Hong Kong laws and
regulations. In addition, Ms. Y ang will endeavor to attend relevant trainings and familiarize
herself with the Listing Rules and duties required of a company secretary of an issuer listed on
the Stock Exchange. We have applied to the Stock Exchange for, and the Stock Exchange has
granted, a waiver from strict compliance with the requirements under Rules 3.28 and 8.17 of
the Listing Rules such that Ms. Y ang may be appointed as a joint company secretary of our
Company.
Pursuant to the Chapter 3.10 (Directors, Supervisors and Senior Management) of the
Guide, the waiver will be for a fixed period of time not exceeding three years (the “ Waiver
Period ”) and on the following conditions: (i) the proposed company secretary must be assisted
by a person who possesses the qualifications or experience as required under Rule 3.28 of the
Listing Rules and is appointed as a joint company secretary throughout the Waiver Period; and
(ii) the waiver can be revoked if there are material breaches of the Listing Rules by the issuer.
The waiver is valid for an initial three-year period on the condition that Ms. Ching, as a joint
company secretary of our Company, will work closely with and provide assistance to Ms. Y ang
in the discharge of her duties as a joint company secretary and in gaining the relevant
experience as required under Rule 3.28 of the Listing Rules and to become familiar with the
requirements of the Listing Rules and other applicable Hong Kong laws and regulations. The
waiver will be revoked immediately if Ms. Ching ceases to provide assistance to Ms. Y ang as
the joint company secretary for the three-year period after Listing.
Our Company will further ensure that Ms. Y ang has access to the relevant training and
support that would enhance her understanding of the Listing Rules and the duties of a company
secretary of an issuer listed on the Stock Exchange, and to receive updates on the latest changes
to the applicable Hong Kong laws, regulations and the Listing Rules. Prior to the end of the
three-year period, the qualifications and experience of Ms. Y ang and the need for ongoing
assistance of Ms. Ching will be further evaluated by our Company. We will liaise with the
Stock Exchange to enable it to assess whether Ms. Y ang, having benefited from the assistance
of Ms. Ching for the preceding three years, will have acquired the skills necessary to carry out
the duties of company secretary and the “relevant experience” within the meaning of Note 2
to Rule 3.28 of the Listing Rules so that a further waiver will not be necessary.
See “Directors, Supervisors and Senior Management” for further information regarding
the background of Ms. Y ang and Ms. Ching.
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CONTINUING CONNECTED TRANSACTION
We have entered into, and expect to continue, a transaction that will constitute
partially-exempt continuing connected transaction of our Company under the Listing Rules
upon Listing as described in the section headed “Connected Transaction” of this prospectus.
Our Directors consider that strict compliance with the applicable requirement under the Listing
Rules would be impractical, unduly burdensome and would impose unnecessary administrative
costs on our Company. Accordingly, we have applied for, and the Stock Exchange has granted
to us, a waiver from strict compliance with the applicable requirements under Chapter 14A of
the Listing Rules once the H Shares are listed on the Stock Exchange in respect of such
partially exempt continuing connected transaction. For further details, see “Connected
Transaction” in this prospectus.
PLACING TO A CLOSE ASSOCIATE OF AN EXISTING SHAREHOLDER AS
CORNERSTONE INVESTOR
Rule 10.04 of the Listing Rules provides that a person who is an existing shareholder of
the issuer may only subscribe for or purchase any securities for which listing is sought which
are being marketed by or on behalf of a new applicant either in his or its own name or through
nominees if the conditions in Rules 10.03(1) and (2) of the Listing Rules are fulfilled. The
conditions in Rules 10.03(1) and (2) of the Listing Rules are that (a) no securities are offered
to the existing shareholders on a preferential basis and no preferential treatment is given to
them in the allocation of the securities; and (b) the minimum prescribed percentage of public
shareholders required by Rule 8.08(1) of the Listing Rules is achieved.
Paragraph 5(2) of Appendix F1 to the Listing Rules provides that, unless with the prior
written consent of the Stock Exchange, no allocations will be permitted to directors or existing
shareholders of the applicant or their close associates, whether in their own names or through
nominees unless the conditions set out in Rules 10.03 and 10.04 of the Listing Rules are
fulfilled.
As further described in the section headed “Cornerstone Investors”, Suzhou Industrial
Park Industrial Investment Fund (Limited Partnership) (ږ(Υ
ྫ)) (the “ Relevant Cornerstone Investor ”) is a close associate of China-Singapore V entures
(an existing Shareholder) and has entered into a cornerstone investment agreement with our
Company.
We have applied to the Stock Exchange for, and the Stock Exchange has granted us, a
waiver from strict compliance with the requirements under Rule 10.04 of, and consent under
paragraph 5(2) of Appendix F1 to, the Listing Rules to allow the Relevant Cornerstone Investor
to participate in the Global Offering as a cornerstone investor, subject to the following
conditions:
1. China-Singapore V entures is interested in less than 5% of our Company’s voting
rights before the Global Offering;
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2. each of China-Singapore V entures and its close associates (including the Relevant
Cornerstone Investor) is not a core connected person (as defined in the Listing
Rules) of our Company or our close associate;
3. each of China-Singapore V entures and its close associates (including the Relevant
Cornerstone Investor) does not have the power to appoint Directors or any other
special rights in our Company;
4. the allocation to China-Singapore V entures or its close associates (including the
Relevant Cornerstone Investor) will not affect our Company’s ability to satisfy the
minimum public float requirement under Rule 8.08(1) of the Listing Rules; and
5. written confirmations pursuant to paragraph 12 of Chapter 4.15 (Placing-related
Matters) of the Guide being provided to the Stock Exchange, which includes:
a. the Sole Sponsor having confirmed that, based on (i) their discussions with our
Company and the Sole Overall Coordinator; and (ii) the confirmation provided
to the Stock Exchange by our Company (the confirmation mentioned in
sub-paragraph (b) below), and to the best of their knowledge and belief, they
have no reason to believe that China-Singapore V entures or its close associates
(including the Relevant Cornerstone Investor) received any preferential
treatment in the allocation in the International Offering as a cornerstone
investor by virtue of its relationship with our Company other than the
preferential treatment of assured entitlement under a cornerstone investment
following the principles set out in Chapter 4.15 (Placing-related Matters) of the
Guide, and details of the allocation will be disclosed in the prospectus and/or
the allotment results announcement of our Company; and
b. our Company having confirmed that no preferential treatment has been, nor
will be, given to China-Singapore V entures or its close associates (including
the Relevant Cornerstone Investor) by virtue of its relationship with our
Company other than the preferential treatment of assured entitlement under a
cornerstone investment following the principles set out in Chapter 4.15
(Placing-related Matters) of the Guide, and that the Relevant Cornerstone
Investor’s cornerstone investment agreement does not contain any material
terms which are more favorable to it than those in other cornerstone investment
agreements.
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DIRECTORS’ RESPONSIBILITY STATEMENT
This prospectus, for which our Directors collectively and individually accept full
responsibility, includes particulars given in compliance with the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Securities and Futures (Stock Market Listing) Rules
(Chapter 571V of the Laws of Hong Kong) and the Listing Rules for the purpose of giving
information to the public with regard to our Group. Our Directors, having made all reasonable
enquiries, confirm that to the best of their knowledge and belief, the information contained in
this prospectus is accurate and complete in all material respects and not misleading or
deceptive, and there are no other matters the omission of which would make any statement
herein or this prospectus misleading.
THE HONG KONG PUBLIC OFFERING AND THIS PROSPECTUS
This prospectus is published solely in connection with the Hong Kong Public Offering,
which forms part of the Global Offering. The Global Offering comprises the Hong Kong Public
Offering of initially 481,850 H Shares and the International Offering of initially 4,336,350 H
Shares (subject to reallocation on the basis referred to in the section headed “Structure of the
Global Offering”).
For applicants under the Hong Kong Public Offering, this prospectus set out the terms and
conditions of the Hong Kong Public Offering.
The Hong Kong Offer Shares are offered solely on the basis of the information contained
and representations made in this prospectus and on the terms and subject to the conditions set
out herein and therein. No person is authorized to give any information in connection with the
Global Offering or to make any representation not contained in this prospectus, and any
information or representation not contained herein must not be relied upon as having been
authorized by our Company, the Sole Sponsor, the Sole Sponsor-Overall Coordinator, the Sole
Overall Coordinator, the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead
Managers, the Capital Market Intermediaries, the Underwriters, any of their respective
directors, agents, employees or advisors or any other party involved in the Global Offering.
The Listing is sponsored by the Sole Sponsor and the Global Offering is managed by the
Sole Overall Coordinator. The Hong Kong Public Offering is fully underwritten by the Hong
Kong Underwriters under the terms and conditions of the Hong Kong Underwriting Agreement
and is subject to us and the Sole Overall Coordinator (for itself and on behalf of the Hong Kong
Underwriters) agreeing on the Offer Price. The International Offering is expected to be fully
underwritten by the International Underwriters subject to the terms and conditions of the
International Underwriting Agreement, which is expected to be entered into on or around
June 26, 2024.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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Neither the delivery of this prospectus nor any offering, sale or delivery made in
connection with the H Shares should, under any circumstances, constitute a representation that
there has been no change or development reasonably likely to involve a change in our affairs
since the date of this prospectus or imply that the information contained in this prospectus is
correct as of any date subsequent to the date of this prospectus.
INFORMATION ON THE CONVERSION OF UNLISTED SHARES INTO H SHARES
Our Company has applied for conversion of Unlisted Shares into H Shares, which
involves 45,300,000 Unlisted Shares held by 32 existing Shareholders. See “History,
Development and Corporate Structure” and “Share Capital” for details of our existing
Shareholders and their respective interests in our Company and relevant procedures for the
conversion of Unlisted Shares into H Shares. Such H Shares to be converted from Unlisted
Shares (including the Shares held by our Pre-IPO Investors) are restricted from trading for a
period of one year after the Listing. The conversion of Unlisted Shares into H Shares has been
approved by the CSRC on November 28, 2023 and is still subject to the approval by the Stock
Exchange.
PROCEDURES FOR APPLICATION FOR THE HONG KONG OFFER SHARES
The procedures for applying for the Hong Kong Offer Shares are set forth in the section
headed “How to Apply for the Hong Kong Offer Shares”.
STRUCTURE AND CONDITIONS OF THE GLOBAL OFFERING
For details of the structure of the Global Offering, including its conditions, see “Structure
of the Global Offering”.
RESTRICTIONS ON OFFER AND SALE OF THE H SHARES
Each person acquiring the Hong Kong Offer Shares under the Hong Kong Public Offering
will be required to, or be deemed by his/her/its acquisition of Offer Shares to, confirm that
he/she/it is aware of the restrictions on offers and sales of the Offer Shares described in this
prospectus.
No action has been taken to permit a public offering of the Offer Shares or the general
distribution of this prospectus in any jurisdiction other than in Hong Kong. Accordingly, this
prospectus may not be used for the purposes of, and does not constitute, an offer or invitation
in any jurisdiction or in any circumstances in which such an offer or invitation is not authorized
or to any person to whom it is unlawful to make such an offer or invitation. The distribution
of this prospectus and the offering of the Offer Shares in other jurisdictions are subject to
restrictions and may not be made except as permitted under the applicable securities laws of
such jurisdictions and pursuant to registration with or authorization by the relevant securities
regulatory authorities or an exemption therefrom. In particular, the Offer Shares have not been
offered or sold, and will not be offered or sold, directly or indirectly, in the PRC or the U.S.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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Prospective applicants for the Offer Shares should consult their financial advisors and
seek legal advice, as appropriate, to inform themselves of, and to observe, all applicable laws,
rules and regulations of any relevant jurisdiction. Prospective applicants for the Offer Shares
should also inform themselves as to the relevant legal requirements and any applicable
exchange control regulations and applicable taxes in the countries of their respective
citizenship, residence or domicile.
APPLICATION FOR LISTING OF THE H SHARES ON THE STOCK EXCHANGE
We have applied to the Stock Exchange for the approval for the listing of, and permission
to deal in, (i) the H Shares to be issued pursuant to the Global Offering; and (ii) the H Shares
to be converted from Unlisted Shares. Our Unlisted Shares may be converted to H Shares after
obtaining the approval of the CSRC, details of which are set out in “Share Capital – Conversion
of Unlisted Shares into H Shares”.
Except that we have applied for the Listing to the Stock Exchange, no part of our
Company’s share capital or loan capital is listed on or dealt in on any other stock exchange and
no such listing or permission to list is being or proposed to be sought in the near future. All
Offer Shares will be registered on our H Share Registrar in order to enable them to be traded
on the Stock Exchange.
Under section 44B(1) of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance, any allotment made in respect of any application will be invalid if the listing of,
and permission to deal in, the H Shares on the Stock Exchange is refused before the expiration
of three weeks from the date of the Global Offering, or such longer period (not exceeding six
weeks) as may, within the said three weeks, be notified to our Company by the Stock Exchange.
COMMENCEMENT OF DEALINGS IN THE H SHARES
Dealings in the H Shares on the Stock Exchange are expected to commence at 9:00 a.m.
(Hong Kong time) on Friday, June 28, 2024. The H Shares will be traded in board lots of 50
H Shares each. The stock code of the H Shares will be 2479.
H SHARES WILL BE ELIGIBLE FOR ADMISSION INTO CCASS
If the Stock Exchange grants the approval for the listing of, and permission to deal in, the
H Shares and we comply with the stock admission requirements of HKSCC, the H Shares will
be accepted as eligible securities by HKSCC for deposit, clearance and settlement in CCASS
with effect from the Listing Date or any other date as determined by HKSCC. Settlement of
transactions between participants of the Stock Exchange is required to take place in CCASS on
the second settlement day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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Investors should seek the advice of their stockbroker or other professional advisor for
details of the settlement arrangement as such arrangements may affect their rights and interests.
All necessary arrangements have been made to enable the H Shares to be admitted into CCASS.
PROFESSIONAL TAX ADVICE RECOMMENDED
Y ou should consult your professional advisors if you are in any doubt as to the taxation
implications of subscribing for, purchasing, holding or disposing of, and/or dealing in the H
Shares or exercising any rights attached thereto. We emphasize that none of us, the Sole
Sponsor, the Sole Sponsor-Overall Coordinator, the Sole Overall Coordinator, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Capital Market
Intermediaries, the Underwriters, any of our or their respective directors, officers or
representatives or any other person involved in the Global Offering accepts responsibility for
any tax effects or liabilities resulting from your subscription, purchase, holding or disposing
of, or dealing in, the H Shares or your exercise of any rights attached to the H Shares.
H SHARE REGISTER AND STAMP DUTY
All of the H Shares issued pursuant to applications made in the Hong Kong Public
Offering will be registered on our H Share register of members to be maintained in Hong Kong
by our H Share Registrar, Computershare Hong Kong Investor Services Limited, at Shops
1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East, Wan Chai, Hong Kong. Our
principal register of members will be maintained by us at our headquarters in the PRC.
Dealings in the H Shares registered on our H Share register of members will be subject
to Hong Kong stamp duty. See “Statutory and General Information – E. Other Information –
11. Taxation of Holders of H Shares” in Appendix VII. For further details of Hong Kong stamp
duty, please seek professional tax advice.
DIVIDENDS PAYABLE TO HOLDERS OF H SHARES
Unless determined otherwise by the Company, dividends payable in Hong Kong dollars
in respect of our H Shares will be paid to the Shareholders as recorded on the H Share register
of the Company in Hong Kong and sent by ordinary post, at the Shareholders’ risk, to the
registered address of each Shareholder.
According to the Guide to the Program for “Full Circulation” of H-shares promulgated by
CSDC on February 7, 2020, cash dividends to domestic investors of H-share “Full Circulation”
shall be distributed through CSDC. An H-share listed company shall transfer RMB cash
dividends to the designated bank account of the Shenzhen subsidiary of CSDC, who shall
complete the clearing of cash dividends by distributing the cash dividends to investors through
domestic securities companies.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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EXCHANGE RATE CONVERSION
Solely for your convenience, this prospectus contains translations among certain amounts
denominated in Renminbi, Hong Kong dollars and U.S. dollars.
Unless otherwise specified, amounts denominated in Hong Kong dollars and Renminbi
have been translated, for the purpose of illustration only, into U.S. dollars in this prospectus
at the following exchange rates:
HK$1.00: RMB0.91
US$1.00: RMB7.11
US$1.00: HK$7.81
The US$ to RMB and HK$ to RMB exchange rates were quoted by the China Foreign
Exchange Trade System and National Interbank Funding Center of the People’s Bank of China
prevailing on June 11, 2024.
No representation is made that any amounts in Renminbi, Hong Kong dollars or U.S.
dollars can be or could have been at the relevant dates converted at the above rates or any other
rates or at all.
ROUNDING
Certain amounts and percentage figures included in this prospectus have been subject to
rounding adjustments, or have been rounded to a set number of decimal places. Accordingly,
figures shown as totals in certain tables may not be an arithmetic aggregation of the figures
preceding them. Any discrepancies in any table or chart in this prospectus between totals and
sums of amounts listed therein are due to rounding.
LANGUAGE
If there is any inconsistency between the English version of this prospectus and the
Chinese translation of this prospectus, the English version of this prospectus shall prevail
unless otherwise stated. However, if there is any inconsistency between the names of any of
the entities mentioned in the English version of this prospectus which are not in the English
language and their English translations, the names in their respective original language shall
prevail.
INFORMATION ABOUT THIS PROSPECTUS AND THE GLOBAL OFFERING
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DIRECTORS
Name Address Nationality
Executive Directors
Mr. ZUO Lei ( ̸ᆾ) Room 1903
Block 11
Renheng Shuanghuwan
Suzhou, Jiangsu Province
PRC
Chinese
Mr. W ANG Haojin
(ʦ)
Room 505 Building 96
Hupan Xiandaicheng
138 Southeast Avenue Changshu
High-tech Industrial Development Zone
Changshu, Jiangsu Province
PRC
Chinese
Mr. LIN Shan (ӄ) Room 101
Building 9, Hetian Court
No. 19 Ningnan Avenue
Nanjing, Jiangsu Province
PRC
Chinese
Ms. YANG Y anjun
(ё)
Room 1401
Building 1, Rongyu Huayuan
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
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Name Address Nationality
Non-executive Directors
Mr. QIU Jianqiang
(਺੶)
Room 601
No. 11, Lane 3888
Duhui Road
Minhang District
Shanghai
PRC
Chinese
Mr. GAO Yuan
(ࡡ)
608, Building 111
Block 65
Y uanling New Village
Futian District
Shenzhen, Guangdong Province
PRC
Chinese
Independent non-
executive Directors
Mr. HUANG Xuexian
(රኪሬ)
9-404, Fuyuan Community
No. 36 Zhuhui Road
Suzhou, Jiangsu Province
PRC
Chinese
Mr. CHEN Xinhe ( ௓อ
ئ)
3-2-12B05, Y uanyang Shanshui
Shijingshan District
Beijing
PRC
Chinese
Mr. LI Shun Fai ( ҽ૮ฯ) Flat D, 27/F
Loong Shan Mansion
Kao Shan Terrace
No. 21 Taikoo Shing Road
Hong Kong
Chinese
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
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SUPERVISORS
Name Address Nationality
Mr. GAO Qi ( ৷փ) Room 1603, Unit 1
Building 5, Boyunting
No. 33 Chaoyang Road, Xietang Street
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Chinese
Mr. YU Gang ( Я፻) Room 1602
Building 10, Gelin Huayuan
No. 203 Tayuan Road
Gaoxin District
Suzhou, Jiangsu Province
PRC
Chinese
Ms. REN Yuan ( ΂෤) No. 606
Building A15
Huaqing Jiayuan Community
Haidian District
Beijing
PRC
Chinese
For the biographies and other relevant information of the Directors and Supervisors, see
“Directors, Supervisors and Senior Management”.
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
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PARTIES INVOLVED IN THE GLOBAL OFFERING
Sole Sponsor CITIC Securities (Hong Kong) Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Sole Sponsor-Overall Coordinator and
Sole Overall Coordinator
CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
Joint Global Coordinators CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
Joint Bookrunners CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Soochow Securities International
Brokerage Limited
17F, Three Pacific Place
1 Queen’s Road East
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
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ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F
Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Futu Securities International
(Hong Kong) Limited
34/F, United Centre
No. 95 Queensway
Admiralty
Hong Kong
Tiger Brokers (HK) Global Limited
1/F, 308 Des V oeux Road Central
Hong Kong
Joint Lead Managers CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
–8 5–


--- page 97 ---
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Soochow Securities International
Brokerage Limited
17F, Three Pacific Place
1 Queen’s Road East
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
Livermore Holdings Limited
Unit 1214A, 12/F
Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Futu Securities International
(Hong Kong) Limited
34/F, United Centre
No. 95 Queensway
Admiralty
Hong Kong
Tiger Brokers (HK) Global Limited
1/F, 308 Des V oeux Road Central
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
–8 6–


--- page 98 ---
Capital Market Intermediaries CLSA Limited
18/F, One Pacific Place
88 Queensway
Hong Kong
CMB International Capital Limited
45/F, Champion Tower
3 Garden Road
Central
Hong Kong
ABCI Capital Limited
11/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
ABCI Securities Company Limited
10/F, Agricultural Bank of China Tower
50 Connaught Road Central
Hong Kong
Soochow Securities International
Brokerage Limited
17F, Three Pacific Place
1 Queen’s Road East
Hong Kong
ICBC International Securities Limited
37/F, ICBC Tower
3 Garden Road
Central
Hong Kong
CCB International Capital Limited
12/F, CCB Tower
3 Connaught Road Central
Central
Hong Kong
SPDB International Capital Limited
33/F, SPD Bank Tower
One Hennessy
1 Hennessy Road
Hong Kong
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
–8 7–


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Livermore Holdings Limited
Unit 1214A, 12/F
Tower II Cheung Sha Wan Plaza
833 Cheung Sha Wan Road
Kowloon
Futu Securities International
(Hong Kong) Limited
34/F, United Centre
No. 95 Queensway
Admiralty
Hong Kong
Tiger Brokers (HK) Global Limited
1/F, 308 Des V oeux Road Central
Hong Kong
Legal Advisors to the Company As to Hong Kong laws and
United States laws:
King & Wood Mallesons
13/F, Gloucester Tower
The Landmark
15 Queen’s Road Central
Central
Hong Kong
As to PRC laws:
King & Wood Mallesons
17/F, One ICC
Shanghai ICC
999 Huaihai Middle Road
Shanghai
PRC
Legal Advisors to the Sole Sponsor and
the Underwriters
As to Hong Kong laws:
Allen Overy Shearman Sterling
9/F, Three Exchange Square
Central
Hong Kong
As to PRC laws:
Grandall Law Firm (Shanghai)
27/F, Reception Center, Garden Square
No. 968 West Beijing Road, Jing’an District
Shanghai
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
–8 8–


--- page 100 ---
Reporting Accountant and Auditor BDO Limited
Certified Public Accountants and
Registered Public Interest Entity Auditor
25/F, Wing On Centre
111 Connaught Road
Central
Hong Kong
Industry Consultant Frost & Sullivan (Beijing) Inc., Shanghai
Branch Co.
Room 2504-2505, Wheelock Square
1717 West Nanjing Road
Jing’an District
Shanghai 200041
PRC
Compliance Advisor Rainbow Capital (HK) Limited
Office No. 710, 7/F
Wing On House
No. 71 Des V oeux Road Central
Central
Hong Kong
Receiving Bank Industrial and Commercial Bank of China
(Asia) Limited
33/F.
ICBC Tower
3 Garden Road
Central
Hong Kong
Property Valuer Ravia Global Appraisal Advisory Limited
17/F, 83 Wan Chai Road
Wan Chai
Hong Kong
IT Consultant BDO China Shu Lun Pan Certified Public
Accountants LLP
4th Floor
No. 61, Nanjing East Road
Huangpu District
Shanghai
PRC
DIRECTORS, SUPERVISORS AND PARTIES INVOLVED
IN THE GLOBAL OFFERING
–8 9–


--- page 101 ---
Registered Office 16/F
No. 9 Rongfu Street
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Headquarters and Principal Place of
Business in China
16/F
No. 9 Rongfu Street
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Principal Place of Business in Hong Kong 40/F
Dah Sing Financial Centre
248 Queen’s Road East
Wanchai
Hong Kong
Company’s Website www.juhe.cn
(This website and the information contained
on this website do not form part of this
prospectus)
Joint Company Secretaries Ms. Y ang Y anjun (ё)
Room 1401
Building 1, Rongyu Huayuan
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Ms. Ching Shuk Wah Shirley ( ೻ૺശ)
(an associate of both The Hong Kong
Chartered Governance Institute and The
Chartered Governance Institute in the
United Kingdom)
40/F, Dah Sing Financial Centre
248 Queen’s Road East
Wanchai
Hong Kong
Authorized Representatives Ms. Y ang Y anjun (ё)
Room 1401
Building 1, Rongyu Huayuan
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
CORPORATE INFORMATION
–9 0–


--- page 102 ---
Ms. Ching Shuk Wah Shirley ( ೻ૺശ)
40/F, Dah Sing Financial Centre
248 Queen’s Road East
Wanchai
Hong Kong
Audit Committee Mr. Li Shun Fai ( ҽ૮ฯ) (chairperson)
Mr. Chen Xinhe (ئ)
Mr. Qiu Jianqiang (਺੶)
Nomination Committee Mr. Chen Xinhe (ئ)chairperson)
Mr. Lin Shan (ӄ)
Mr. Li Shun Fai ( ҽ૮ฯ)
Remuneration and Assessment Committee Mr. Huang Xuexian ( රኪሬ) (chairperson)
Ms. Y ang Y anjun (ё)
Mr. Chen Xinhe (ئ)
H Share Registrar Computershare Hong Kong Investor
Services Limited
Shops 1712-1716
17th Floor, Hopewell Centre
183 Queen’s Road East
Wan Chai
Hong Kong
Principal Banks Bank of Communications, Suzhou Science
and Technology Sub-branch
North Building
Hanlin Building, Neighborhood Center
No. 598, Linquan Street
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
Agricultural Bank of China Limited,
China (Jiangsu) Pilot Free Trade Zone
Suzhou
Moon Bay International Business Center
No. 9 Cuiwei Street
Suzhou Industrial Park
Suzhou, Jiangsu Province
PRC
CORPORATE INFORMATION
–9 1–


--- page 103 ---
The information contained in this section, unless otherwise indicated, has been
derived from various official government publications and other publications and the
market research report prepared by Frost & Sullivan which we commissioned. We have
taken reasonable care in extracting and reproducing such information. We have no reason
to believe that such information is false or misleading in any material respect or that any
fact has been omitted that would render such information false or misleading in any
material respect. None of our Company, the Sole Sponsor , the Sole Sponsor-Overall
Coordinator , the Sole Overall Coordinator , the Joint Global Coordinators, the Joint
Bookrunners, the Joint Lead Managers, the Capital Market Intermediaries, any of the
Underwriters, or any of their respective directors, officers or representatives or any other
parties involved in the Global Offering, has independently verified the information in the
various official government publications nor give any representation as to the accuracy
or completeness of such information.
SOURCE OF INFORMATION
We have commissioned Frost & Sullivan, an independent market research and consulting
company, to conduct an analysis of and to prepare a report on the API-enabled service market,
the API-enabled data exchange service market, and the data management solution market in
China. The report prepared by Frost & Sullivan for us is referred to in this prospectus as the
F&S Report. We agreed to pay Frost & Sullivan a fee of RMB400,000, which we believe
reflects market rates for reports of this type.
Founded in 1961, Frost & Sullivan has nearly 50 offices with more than 3,000 industry
consultants, market research analysts, technology analysts and economists globally. Frost &
Sullivan’s services include technology research, independent market research, economic
research, corporate best practices advising, training, client research, competitive intelligence
and corporate strategy.
We have included certain information from the F&S Report in this prospectus because we
believe this information facilitates an understanding of the digital economy, API-enabled
service market, the API-enabled data exchange service market, and the data management
solution market in China for prospective investors. Frost & Sullivan’s independent research
consists of both primary and secondary research obtained from various sources. Primary
research involved in-depth interviews with leading industry participants and industry experts.
Secondary research involved reviewing company reports, independent research reports and
data based on Frost & Sullivan’s own research database. Projected data were obtained from
historical data analysis plotted against macroeconomic data with reference to specific
industry-related factors. Except as otherwise noted, all of the data and forecasts contained in
this section are derived from the F&S Report, various official government publications and
other publications. In compiling and preparing the research, Frost & Sullivan assumed that the
social, economic and political environments in the relevant markets are likely to remain stable
in the forecast period.
INDUSTRY OVERVIEW
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The Directors confirm that, to the best of their knowledge and belief, there has been no
material adverse change in the market information since the date of the Frost & Sullivan Report
which may materially qualify, contradict, or limit or adversely affect the information of this
section.
OVERVIEW OF THE DIGITAL ECONOMY IN CHINA
Development of the Digital Economy in China
The digital economy integrates digital technology and the real economy, and includes
digital knowledge and information as key factors of production, digital technology as the core
driving force, and modern digital network as an important information platform.
The development of China’s digital economy is characterized by the following:
 Momentum for economic growth. The size of the digital economy reached
RMB50.2 trillion in 2022 with a year-on-year growth of 10.3%, providing
momentum for the overall economy as government and corporate organizations at all
stages of development underwent digital transformation.
 Demand for external technology services. Government and corporate organizations
have demand for external technology services as they procure and utilize
commercially tested technology services, including API technology, to link with
external data sources or services to reduce cost and maximize efficiency.
 Favorable government policies. In recent years, the PRC government has
introduced favorable policies and industry standards that propose to accelerate the
development of digital economy through closer integration of digital economy and
the real economy to form a globally competitive digital cluster, driving
modernization and growth of China’s economy.
 Demand for high concurrency. Demand for high concurrency has risen significantly
as high concurrency is essential for allowing a large number of customers to use
services simultaneously without encountering any unexpected issues. High
concurrency is a particularly important feature in systems for government
organizations and corporate organizations in the internet and financial service
industries.
The following pain points have also arisen during the development of China’s digital
economy: (i) differences in database architectures result in data silos, which are collections of
data held by one group that are not easily or fully accessible to other groups. Data silos prevent
full access to and utilization of data assets, thus hampering the development of the digital
economy; (ii) stakeholders are increasingly concerned about data security and privacy,
especially data leakage, data misuse and cross-border data transmission; and (iii) industry
standards have yet to be further optimized for certain aspects of the digital economy, such as
the determination of ownership and pricing of data.
INDUSTRY OVERVIEW
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In the digital economy, all government and corporate organizations as well as individuals
generate data and, therefore, participate as data providers. Data exchange and data management
service providers collect, cleanse, process, analyze and share data through API and other
technologies, such as big data technology and blockchain technology, to unlock the economic
value of data and make data available to other participants. API is a set of rules and protocols
that allow data to be exchanged from systems to systems, acting as an intermediary among
systems. Big data technology is adopted to collect, cleanse, process, and derive insights from
vast amount of different types of structured, semi-structured and unstructured data from
different data sources. Blockchain is a distributed and immutable ledger that facilitates a secure
processing of information transmitted in a network. As a result of the nationwide participation
of enterprises and individuals, China’s digital economy experienced steady growth at a CAGR
of 12.5% from 2018 to 2022. In 2022, The market size of China’s digital economy, calculated
as the value added, reached RMB50.2 trillion, representing approximately 41.5% of GDP
compared to approximately 34.0% in 2018. In comparison, the market size of digital economy
of the United States, calculated as the value added, reached approximately US$17.0 trillion in
2022, representing over 65.0% of the total U.S. GDP , China’s digital economy still has strong
growth potential. China’s digital economy is expected to reach RMB82.0 trillion in 2027 at a
CAGR of 10.3% from 2022 to 2027, representing approximately 49.6% of China’s expected
total GDP in 2027.
The market size of digital economy comprises the contribution of digital industrialization
and industry digitalization in terms of value added to the overall GDP in China. Digital
industrialization represents economic activities which provide direct digital technologies,
while industry digitalization represents the provision of final products or services enabled by
digital technologies in traditional industries such as transportation, financial services and
manufacturing. V alue-added is calculated as output of an industry or sector subtracting its
respective intermediate consumptions (the goods and services used to produce the output).
Digital industrialization comprises contributions from information technology service
and non-information technology service. Information technology service refers to provision of
technical service to meet users’ demand for information technology, and non-information
technology services include telecommunication service, electronics manufacturing service and
Internet service. Economic activities of providing technology service such as API, big data and
blockchain, together with others, fall within the information technology services industry. The
contribution of API, big data and blockchain, in terms of value added to GDP , reached
RMB21.2 billion, RMB76.2 billion and RMB4.2 billion in 2022, respectively.
INDUSTRY OVERVIEW
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The table below provides the actual and estimated market size of the digital economy in
China from 2018 to 2027, calculated based on the value added to the overall GDP:
24.9 28.8 31.7 37.2 41.0 45.9 51.1 56.5 62.2 68.07.1 7.5 8.4 9.2 10.1 11.1 12.0
13.0
13.9
6.4
2018 2019 2020 2021 2022 2023E 2024E 2025E 2026E 2027E
31.3 35.9 39.2
45.6 50.2 56.1 62.2
68.5
75.1
82.0
+12.5%
+10.3%
Market Size of the Digital Economy in China, in terms of Value Added
34.0% 38.7%36.4% 46.5%39.7% 41.5% 43.2% 44.9% 49.6%48.1%% of GDP
Digital industrialization
Breakdown of the market size of digital industrialization, in terms of value added
(RMB Billion) 2018 2019 2020 2021 2022 2023E 2024E 2025E 2026E 2027E
Digital industrialization 6,400.0 7,100.0 7,500.0 8,400.0 9,200.0 10,127.7 11,061.7 12,001.3 12,973.5 13,936.6
Information
technology service 542.8 1,179.6 1,453.2 1,768.4 2,050.5 2, 406.4 2,836.2 3,315.7 3,913.2 4,594.9
API 10.6 13.6 17.7 19.2 21.1 23.0 25.3 27.9 31.0 34.5
Big Data 23.0 23.9 30.0 56.6 76.2 95.6 119.9 148.7 185.6 229.7
Blockchain 0.6 1.0 1.6 2.7 4.2 6.4 9.0 12.6 17.0 24.7
Others 508.6 1,141.1 1,403.9 1,689.9 1,949.0 2,281.4 2,682.0 3,126.5 3,679.6 4,306.0
Non-information
technology service 5,857.2 5,920.4 6,046.8 6,631.6 7,149.5 7,721.3 8,225.5 8,685.6 9,060.3 9,341.7
RMB Trillion, 2018-2027E
Industry digitalization
Source: CAICT, Frost & Sullivan
OVERVIEW OF THE API-ENABLED SERVICE MARKET IN CHINA
Development of the API-Enabled Service Market in China
API-enabled services utilize API technology to provide services that enable optimization
and standardization of data interactions across different organizations, including: (i) API-
enabled data exchange service; (ii) API-enabled SMS messaging; and (iii) API-enabled value
top-up service. Juhe Data is involved in all three of the aforementioned services.
The API-enabled service market grew from RMB17.6 billion in 2018 to RMB37.9 billion
in 2022 at a CAGR of 21.2%. API-enabled SMS messaging service, which refers to the
provision of text messaging services to allow government or corporate organizations to easily
engage target audiences for various service types such as sending verification codes and
resetting passwords, remained the largest market segment at RMB28.5 billion in 2022.
API-enabled data exchange service, which refers to the provision of a centralized data
exchange platform or marketplace to enable authorized organizations to easily search for,
locate and retrieve third-party authorized data on various subjects, such as identity
authentication, weather forecasts, news, and IP address inspections, was the second largest
market segment with a size of RMB6.9 billion in 2022. API-enabled value top-up service,
which refers to the provision of interfaces for enterprises to conduct sales and delivery of
virtual goods and services, such as phone credits, leisure and entertainment virtual goods, and
utility payments, reached a market size of RMB2.5 billion in 2022. The API-enabled service
market is expected to reach RMB68.9 billion in 2027, growing at a CAGR of 12.7% from 2022
to 2027, of which the API-enabled data exchange service segment is expected to reach
RMB25.9 billion by 2027.
INDUSTRY OVERVIEW
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The table below shows the actual and estimated size of China’s API-enabled service
market from 2018 to 2027:
2018 2019 2020 2021 2022 2023E 2024E 2025E 2026E 2027E
17.6
2.0
12.4
3.3
17.3
3.7
2.0
23.0
24.0
4.5
2.1
26.0
5.5
2.3
28.5
6.9
2.5
30.6
9.0
2.6
32.8
11.8
2.8
35.1
15.5
3.0
37.3
20.2
3.2
39.6
25.9
3.4
30.6
33.8
37.9
42.2
47.4
53.5
60.7
68.9
RMB Billion, 2018-2027E
Market size of the API Enabled Service Market in China
Total
CAGR 2018-2022
21.2%
2022-2027E
12.7%
Value top-up service 5.6% 6.6%
SMS messaging service 23.2% 6.8%
Data exchange service 20.6% 30.2%
API-enabled value top-up service
API-enabled data exchange service
API-enabled SMS messaging service
Competitive Landscape of the API Enabled Service Market in China
In 2022, Juhe Data had a market share of less than 1% in China’s API-enabled service
market as measured by revenue.
The table below sets forth the ranking of integrated API-enabled service providers in
China by revenue and market share:
Ranking Company Revenue
(RMB Billion, 2022)
Market Share
(%, 2022)
1 Company A 3.3 8.7%
2 Company B 2.0 5.2%
3 Company C 1.2 3.2%
4 Company D 0.5 1.4%
5 Company E 0.3 1.0%
Ranking of API Enabled Service Providers in China, by Revenue
(1). Company A is an enterprise cloud communication service provider in China that was founded in Shenzhen in
2001 and is listed on the Shenzhen Stock Exchange with a registered capital of RMB200 million and over
1,000 employees as of December 31, 2022.
(2). Company B is an enterprise mobile information solution provider that was founded in Beijing in 2007 with a
registered capital of RMB100 million.
(3). Company C is an enterprise mobile information solution provider that was founded in Wuxi in 2012 and is
listed on the Shenzhen Stock Exchange with a registered capital of RMB80 million.
INDUSTRY OVERVIEW
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(4). Company D is an enterprise mobile information solution provider that was founded in Beijing in 2001 with a
registered capital of RMB200 million.
(5). Company E is a leading third-party virtual goods and services platform operator in China that was founded in
Wuhan in 2009 and is now listed on the Hong Kong Stock Exchange with a registered capital of RMB20
million and less than 1,000 employees as of December 31, 2022.
OVERVIEW OF THE API-ENABLED DATA EXCHANGE SERVICE MARKET IN
CHINA
Development of the API-Enabled Data Exchange Service Market in China
There are two types of participants in the API-enabled data exchange service market in
China: (i) integrated API-enabled data exchange service providers; and (ii) industry-specific
API-enabled data exchange service providers. Integrated API-enabled data exchange service
providers provide comprehensive API-enabled data exchange services with a wide spectrum of
data source and supply, such as “three-factor” authentication, transportation, weather, and
others. Industry-specific API-enabled data exchange service providers focus on providing
API-enabled data exchange service with specific types of data such as corporate registration
information. The API-enabled data exchange service market grew at a CAGR of 20.6% from
RMB3.3 billion in 2018 to RMB6.9 billion in 2022, of which the integrated API-enabled data
exchange service segment accounted for RMB2.4 billion in 2022, representing a CAGR of
33.2% from 2018 to 2022. The market size of the industry-specific API-enabled data exchange
service segment was RMB4.6 billion in 2022. The API-enabled data exchange service market
is expected to reach RMB25.9 billion in 2027, representing a CAGR of 30.2% from 2022 to
2027, of which the integrated API-enabled data exchange service segment is expected to reach
RMB9.3 billion in 2027, representing a CAGR of 31.5% from 2022 to 2027. The rapid market
growth reflects strong demand for API-enabled data services from government and corporate
organizations as they continue undergoing digital transformation to improve cost control and
optimize efficiency.
The table below shows the actual and estimated size of China’s API-enabled data
exchange service market from 2018 to 2027:
3.3
2.5
3.7
2.7 3.2
1.3 1.7
3.8
2.4
4.6 5.9
3.1
4.1
7.7
10.0
5.5
7.2
13.0
16.6
9.3
4.5 5.5
6.9
9.0
11.8
15.5
20.2
25.9
2018 2019 2020 2021 2022 2023E 2024E 2025E 2026E 2027E
RMB Billion, 2018-2027E
Market size of the API-enabled Data Exchange Service Market in China
2022-2027E2018-2022CAGR
30.2%20.6%
0.8 0.9
Integrated
Industry-specific
31.6%33.1%Integrated
Industry-specific
Total
29.4%16.0%
INDUSTRY OVERVIEW
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Drivers of the API-Enabled Data Exchange Service Market in China
Increased significance of data in China’s economic development plan
The PRC government has placed strong emphasis on data in China’s economic
development plan by introducing a series of favorable policies. In 2020, the PRC government
named data as a new factor of production in the Opinions of the CPC Central Committee and
the State Council on Improving the Systems and Mechanisms for Market-based Allocation of
Factors of Production (จ
Ԉ), and proposed to accelerate the development of data market by promoting sharing of public
institution data, increasing the value of market-oriented data, strengthening integration of data
as a resource and improving data security. The proposal was followed by a series of favorable
policies in the following years. The PRC government also launched data exchanges to promote
exchange-based data sharing in China. As the PRC government placed increasing emphasis on
developing China’s digital economy, state-owned data exchanges saw spike in number. From
2014 to 2023, 57 state-owned data exchanges were established, including Shanghai Data
Exchange (ה׸Beijing International Data Exchange (ה׸,)
and Shenzhen Data Exchange (ה׸On March 7, 2023, the State
Councilannounced its plan to establish the National Data Bureau (ᅰኽ҅), which will be
responsible for advancing the development of data-related institutions and coordinating the
integration, sharing, development and application of data resources. Strong government
support has helped to create a favorable environment for the development of China’s overall
digital economy and, by extension, the API-enabled data exchange service market.
Development of state-owned data exchanges
A state-owned data exchange refers to a centralized data exchange that is established with
government participation and operated primarily by corporate enterprises with the goal to
promote the exchange of data through an exchange-based system. Government organizations,
state-owned enterprises, and corporate enterprises all invest in a state-owned data exchange at
its inception. The government generally provides guidance on the strategic development plans
of state-owned data exchanges, while corporate enterprises provide services and solutions to
aid the operations of the data exchanges, including the establishment of data exchange
platforms that connect upstream data service suppliers and downstream data requesters.
Expansion of access to public institution data
The PRC government has made more public institution data available to the general
public in recent years. Public institution data is defined as data generated by public institutions
and state-owned enterprises in the course of performing public services or duties. The listing
and exchanging of more public institution data are expected to drive the growth of the
state-owned data exchange market. As the exchange-based data exchange system develops and
more public institution data becomes accessible to the general public, the total addressable
market of state-owned data exchange reached RMB60.0 billion in 2022, and is expected to
reach RMB327.5 billion in 2027.
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Safer data exchange environment supported by innovative technologies
Innovative technologies such as privacy-preserving computation and blockchain help to
prevent data leakage and misuse, providing a safer data exchange environment that further
promotes the growth of the data exchange market. Privacy-preserving computation provides
stronger data protection through technologies such as federated learning, secure multi-party
computation, homomorphic encryption, and zero-knowledge proof. It allows data to be shared
freely and without disruption while ensuring that data with verified ownership would be
properly used in multi-party modeling scenarios. Blockchain technologies offer
decentralization and other high-security features and can be used to write a digital digest that
reflects the ownership of data used in privacy-preserving computation. Empowered by the
development of innovative privacy-preserving computation technologies, the API-enabled data
exchange service market is expected to continue growing steadily.
Competitive Landscape of the Integrated API-Enabled Data Exchange Service Market in
China
Integrated API-enabled data exchange service providers are important participants in the
API-enabled data exchange service market as they provide customers with comprehensive
services in a wide variety of scenarios across different industries. In 2022, Juhe Data had a
market share of 6.1% in the integrated API-enabled data exchange service market in China as
measured by revenue. For the same year, Juhe Data had a market share of 2.1% in the overall
API enabled data exchange service market as measured by revenue. Integrated API-enabled
data exchange service providers enjoy competitive advantages of having extensive and
diversified data sources and service coverage across different industries. Industry-specific
API-enabled data exchange service providers are not expected to have material negative impact
on Juhe Data’s ability to compete for customer demand because Juhe Data could continually
cooperate with different data sources to expand its products and services. Juhe Data is expected
to further leverage its leading position in the market to expand its business scale through
cooperating with different data sources and participating in the establishment and operation of
state-owned data exchanges.
The table below sets forth the ranking of integrated API-enabled data exchange service
providers in China by revenue and market share:
Ranking Company Revenue
(RMB Million, 2022)
Market Share
(%, 2022)
1 Juhe Data
Company F(1)
145 6.1%
2 126 5.3%
Company G(2)3 80 3.4%
Company H(3)4 65 2.7%
Company I(4)5 60 2.5%
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(1). Company F is a leading public AI company listed on both the Stock Exchange and NASDAQ. It was founded
in 2000 with a search engine business enabling web browsing. It has invested in AI since 2010. Company A
had approximately 42,000 employees as of the December 31, 2022.
(2). Company G is a Chinese multinational technology company listed on the Stock Exchange and the New Y ork
Stock Exchange. It was founded in 1999 as an e-commerce platform. Its current business includes e-commerce,
cloud computing, digital media and entertainment and other innovation initiatives. Company B had
approximately 229,000 employees as of June 30, 2023.
(3). Company H is an API-enabled data exchange company that specializes in providing an API-enabled data
exchange platform. It was founded in 2016 and is based in Guiyang, Guizhou province, China with a registered
capital of RMB13.5 million. Company C has invested and participated in the operation of the Jiangsu Big Data
Exchange.
(4). Company I is an API-enabled data exchange company that specializes in providing an API-enabled data
exchange platform. It was founded in 2016 and is based in Hangzhou, Zhejiang province, China with a
registered capital of RMB10 million and had fewer than 100 employees by the December 31, 2022.
Entry Barriers to the API-Enabled Data Exchange Service Market in China
 Extensive data sources. Well-established service providers have already
accumulated extensive data sources across different industries and scenarios. New
entrants may face difficulties in accumulating such extensive sources within a short
time to compete against existing players. In most cases, data-exchange service
providers do not enjoy exclusive relationships with data supply sources. In selecting
their customers, data supply sources consider the following important factors: (i) the
number of data sources which an API-enabled data exchange service provider can
provide; (ii) the respective data security and privacy policies of the data exchange
service provider; and (iii) the availability of protocols and reliability of
technologies.
 Established industry reputation. Customers frequently choose to work with
reputable market players with proven technology and service capabilities. Without
an established reputation, new entrants may find it challenging to attract customers.
 Strong technology capabilities. Service providers must continuously maintain,
optimize and upgrade their technologies as unexpected incidents may adversely
affect customers’ businesses and lead to customer distrust. New entrants may not be
able to match the technology capabilities of existing players due to lack of
experience and expertise.
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Future Trends of the API-Enabled Data Exchange Service Market in China
Data opening initiatives and increased data application scenarios are expected to further
promote data exchange
In several recent policies, the PRC government has addressed data opening initiatives,
which grant public access to non-sensitive data. For example, the General Plan for the Pilot
Program of the Comprehensive Reform of the Market-based Allocation of Factors of
Production (ࣩproposed to form a sound and effective
mechanism to share public institution data, to build a data platform for public institution data,
and to prioritize public access to high value data of regulation on corporate registration, public
health, transportation and weather, among others. Such initiatives are expected to promote data
exchange.
In addition, application scenarios for data are expected to increase, further advancing the
growth of the API-enabled data exchange service market. The Opinions of the CPC Central
Committee and the State Council on Improving the Systems and Mechanisms for Market-based
Allocation of Factors of Production (จԈ),
published in March 2020, proposed to standardize data application scenarios in agriculture,
manufacturing, transportation, education, urban management, public resource trading in order
to increase the value of market-oriented data. As a growing number of scenarios require data
application, the demand for data is expected to continue rising.
Government policies are expected to create clearer industry standards and elevate entry
barriers
Relevant policies are expected to provide clearer industry standards for API-enabled data
exchange services. With the introduction of additional government policies, regulations and
standards, the API-enabled data exchange service market is expected to further mature,
resulting in additional entry barriers. In particular, with the growing emphasis on protecting
data security and privacy while facilitating data exchange, existing service providers are
expected to be equipped with more advanced security and privacy-preserving technologies.
Examples of such policies include: (i) the Opinions of the CPC Central Committee and the
State Council on Building a Fundamental Data System to Better Leverage the Role of Data
Elements (จԈ), published in December
2022, which proposed establishing a credible data exchange system to enhance the availability,
credibility, exchangeable attributes and traceability of data with an improved governance
system developed in a safe manner; and (ii) the General Plan for the Pilot Program of the
Comprehensive Reform of the Market-based Allocation of Factors of Production (९̹ఙʷ
ࣩwhich also proposed the improvement of data sharing
mechanisms.
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Integration of API interfaces on a centralized management platform
As APIs become the backbone of communication among corporate organizations, demand
for the integration of different API interfaces on a centralized management platform is
expected to increase, which better enables enterprises to easily and efficiently manage and
track the performance of API interfaces from different business functions simultaneously.
Diversified product offerings as a new growth engine
Leading service providers are enriching and further diversifying available data within the
same industry or across different industries, and are expected to extend services along the
API-technology value chain to provide other API-related services, such as API management
and API testing, creating additional cross-selling and upselling opportunities. In the near
future, increasingly diversified product offerings are expected to drive market growth and
expand the business operations of market participants.
OVERVIEW OF THE DATA MANAGEMENT SOLUTION MARKET IN CHINA
Development of the Data Management Solution Market in China
Data management solution refers to the provision of comprehensive solutions that help
government and corporate organizations collect, cleanse and analyze data accumulated
throughout the data lifecycle, converting data assets into forms that can be easily used by
different business departments. Data management solution includes the provision of software
used to manage data assets and services including implementation, consultation, and
maintenance provided by data management solution providers to end-users. In general, data
management solutions include the following three key steps: (i) data collection and integration,
which is the process of collecting and integrating multi-source heterogeneous data on a
centralized platform by extracting data from external and internal sources using API
technology; (ii) data cleansing and processing, which is the process of removing repetitive or
invalid data before transforming it into a unified and standardized format that can be more
easily processed and analyzed, followed by the repair of damaged data to ensure greater
analytical accuracy; and (iii) data analytics and visualization, which is the process of
identifying patterns and providing analyses on vast amounts of data through visual
presentations.
The data management solution market in China grew from RMB29.7 billion in 2018 to
RMB50.7 billion in 2022 at a CAGR of 14.3%. The data management solution market is
expected to reach RMB98.6 billion in 2027, representing a CAGR of 14.2% from 2022 to 2027.
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Set forth below is a table showing the actual and estimated size of China’s data
management solution market from 2018 to 2027, calculated based on the revenue generated
from providing data software and data services in China:
29.7
34.9 38.0
44.0
50.7
58.3
66.7
76.1
86.7
98.6
2018 2019 2020 2021 2022 2023E 2024E 2025E 2026E 2027E
7.8% 7.9% 7.9% 8.0% 8.1% 8.2% 8.4% 8.5% 8.6% 8.8%
2022-2027E2018-2022
CAGR
% of
IT Spending
14.2%14.3%
(1) IT spending here excludes spending on hardware and network services.
Competitive Landscape of the Data Management Solution Market in China
Juhe Data’s data management solutions compete in the data management solution market
against other market participants’ solutions. In 2022, Juhe Data enjoyed a market share of 0.2%
in the data management solution market in China, as measured by revenue. There were over
two thousand market players in the data management solution market with the top five players
accounting for approximately 20% of market share in 2022.
There are three types of participants in this market: traditional IT infrastructure providers,
internet giant-affiliated service providers and data management service providers. Traditional
IT infrastructure providers are those who provide hardware such as storages, servers, network
infrastructure products, and others used in IT solutions, and software is usually packed in
integrated solutions for customers. Their competitive advantages are that they are experienced
in providing hardware products to enterprises including SOEs in the financial service industry,
telecommunications industry as well as public institutions, and have gradually expanded to
providing data management solutions. Internet giant-affiliated service providers are those that
provide cloud-centric service including cloud-based software, cloud-based platforms, and
cloud-based infrastructure across wide categories of services such as big data and AI, IoT,
DevOps, security solutions and others. Their competitive advantages are that they enjoy a
strong reputation in providing data management services including cloud-based data
application services, and are strong in providing data management services and digital
transformation services to varied types of enterprises and public institutions depending on each
provider. Data management service providers are those who are specialized in providing data
management service with specialties in certain industries as well as certain modularized
functions. Their competitive advantages are that they are specialized in providing service to
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public institutions and enterprises in certain industries and occasionally serve as subcontractors
to internet giant-affiliated service providers. Juhe Data is a data management service provider.
Even though the competition in data management solution market is fierce, Juhe Data is
expected to continue to satisfy customers’ demand in data management solutions with its
specialties in API technology and compete with existing top players or cooperate with them in
certain large data management projects.
Entry Barriers to the Data Management Solution Market in China
 Established industry reputation . Established service providers have accumulated
extensive project experience across different industries and built strong market
reputation. Leading players also participate in establishing industry standards. Without an
established reputation and lacking experience, new entrants typically find it difficult to
compete with existing players in the short term.
 Strong technology capabilities. To remain competitive in the market, existing players
typically invest heavily in technological research and development. New entrants may
find it hard to match the technological capabilities of well-seasoned players within a short
time.
 Strong capabilities to integrate resources. Developing data management solutions
requires a substantial commitment of labor, time and various resources. Existing players
typically have stronger capabilities to obtain and integrate different resources due to their
experience, larger scale of business and established commercial relationships, which new
entrants lack.
 Extensive sales channels. Existing players typically have extensive sales channels and
well-established customer bases, while new entrants may find it challenging to build
similarly extensive sales channels or commercial relationships in the short term.
Drivers of the Data Management Solution Market in China
Demand for data management solutions from government and corporate organizations
In order to accelerate their digital transformation, government and corporate
organizations have demand for four types of data management solutions, including: (i)
extracting external data onto internal centralized data platforms; (ii) internally sharing data
across different business units and departments; (iii) externally sharing data with authorized
organizations; and (iv) commercializing data platforms as services accessible by others.
Government and corporate organizations have demand primarily for the first two services.
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Supply of innovative digital infrastructure driven by the increasing volume and complexity
of data
Due to the digital transformation of government and corporate organizations throughout
China, the volume and complexity of data from mobile devices and various IoT devices have
increased significantly. There exist many pain points such as data silos, idle resources and high
operational and maintenance costs under the traditional IT architecture and data management
systems. These developments have led to the supply of more advanced digital infrastructure,
including 5G and IoT networks, cloud computing and large-scale data centers, which enable
more efficient real-time data transmission, processing and storage and help optimize data
management efficiency.
Favorable government policies
Policies introduced in recent years have provided a more positive environment for the
development of China’s digital economy and data management solution market. Key favorable
policies include the Guidance of the State Council on Strengthening the Construction of Digital
Government (ኬจԈ), the 14th Five-Y ear Plan for the
Development of the Digital Economy (“ ɤ̬ʞ”஝ྌ), and the 14th Five-Y ear
Plan for the Development of the Big Data Industry (“ ɤ̬ʞ”஝ྌ).
Future Trends of the Data Management Solution Market in China
Further expansion of vertical service capabilities for different industries and service types
Data management solution providers are expected to continue enhancing their service
offerings and expanding their service capabilities. For government organizations, data
management solutions are expected to help them effectively integrate different data on a
centralized platform, breaking down barriers arising from heterogeneous data and promoting
efficiency in governance. For corporate organizations, service providers are expected to
continue leveraging technologies such as RPA, blockchain, and federated learning to tailor
their solutions to the needs of individual customers, helping corporations increase efficiency
and enabling them to make better-informed decisions based on data analysis. Data management
solution providers are also expected to expand their service offering to cover an increasing
number of industries and service types, including the digital transformation of SOEs and
industrial enterprises. The enhanced solutions are expected to attract more customers, in turn
accelerating the nationwide digital transformation of government and corporate enterprises,
and driving the growth of the data management solution market.
Continued emphasis on data management in the development of China’s digital economy
The PRC government is expected to continue fostering the expansion of China’s digital
economy through favorable policies in the next five-year plan. Government and corporate
organizations are expected to continue utilizing data management solutions to facilitate their
digital transformation, driving the expansion of the overall digital economy and the data
management solution market.
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Technological advancement is expected to improve the efficiency of data management
Data management is expected to become more efficient as a result of advancement in
technologies using artificial intelligence, RPA, and blockchain among others, to automatically
identify and verify data rules and discover relationship between data in a more visualized way,
improving the efficiency of data management.
Adoption of low-code data management tools is expected to lower data application threshold
Low-code data management tools allow government and corporate organizations to utilize
data management platforms more easily, as they enable customers to quickly and intuitively
complete configuration of applications through modularized ways. The use of such tools is
becoming a trend in the market and is expected to encourage organizations to increase their use
of data management solutions.
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This section sets out summaries of certain aspects of PRC laws and regulations, which are
relevant to our business operations.
REGULATIONS RELATED TO INTERNET SECURITY AND PRIV ACY PROTECTION
Regulations on Internet Security
As certain of our services are internet-based, the following laws and regulations affect our
businesses.
The Decision in Relation to Protection of Internet Security (Ӕ
) enacted by SCNPC on December 28, 2000 and amended on August 27, 2009, provides
that, among other things, the following activities conducted through the internet, if constituting
a criminal act under the PRC laws, are subject to criminal punishment: (i) hacking into a
computer or system relating to state affairs, national defense or cutting-edge science and
technology; (ii) intentionally inventing and spreading destructive programs such as computer
viruses to attack the computer system and the communications network, thus damaging the
computer system and the communications networks; (iii) violating State regulations,
discontinuing the computer network or the communications service without authorization; (iv)
leaking state secrets; (v) Using the internet to market fake and substandard products or to carry
out false publicity for any commodity or service; or (vi) infringing intellectual property rights
through the internet.
The Provisions on Technological Measures for Internet Security Protection ( ʝᑌၣτ
), promulgated on December 13, 2005 and came into effect on March 1,
2006 by the Ministry of Public Security require internet service providers and organizations
that use interconnection to implement and guarantee the functioning of technical measures for
internet security protection, like technical measures for preventing any matter or act that may
endanger network security, e.g., computer viruses, invasion or attacks to or destruction of the
network, require all internet access service providers to take measures to keep a record of and
preserve user registration information.
According to the Regulations of the People’s Republic of China on the Security
Protection of Computer Information System (ᚐૢ
Է), which were issued by the State Council on February 18, 1994 and amended on January
8, 2011, securing computer information systems includes safeguarding the computer and its
related and supporting sets of equipment and facilities (including network), the operating
environment and information and ensuring the normal performance of computer functions, so
as to maintain the safe operation of computer information systems. According to the
Administrative Measures on Security Protection of Computer Information Networks Linked to
the Internet (), which were issued by the State
Council on December 16, 1997 and amended on January 8, 2011, no entity or individual will
be permitted to make use of international internet connections to harm national security,
disclose State secrets, infringe on the national, social or collective interests or the legal rights
and interests of citizens, or engage in other illegal or criminal activities. If relevant entities
violate any provisions of the measures, such entities may be subject to penalties such as
rectification within a specified period, warnings, confiscation of illegal gains, cancellation of
operating license or interconnection qualifications.
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On June 22, 2007, the Ministry of Public Security, National Administration of State
Secrets Protection, State Council Information Office (subsequently abolished) and State
Cryptography Administration issued the Administrative Measures for the Hierarchical
Protection of Information Security (), which regulate that the
security protection of an information system may be graded into five. As for an information
system of Grade II or above which has been put into operation, its operator or user shall, within
30 days since the date when its security protection grade is determined, complete the
record-filing procedures at the local public security organ at the level of city divided into
districts or above. For an information system of Grade II or above newly built, its operator or
user shall, within 30 days after it is put into operation, complete the record-filing procedures
at the local public security organ at the level of municipality divided into districts or above.
Pursuant to the State Security Law of the PRC (), which
was promulgated by the SCNPC on February 22, 1993 and last amended on July 1, 2015, the
State shall develop network and information security assurance system, enhance network and
information security assurance capabilities, strengthen innovative research and development
and application of network and information technologies and realize the security and
controllability of network and information core technologies, critical infrastructure and
information systems and data in key areas; the State shall also enhance network management,
prevent, deter and punish network criminal acts such as cyber-attacks, network intrusion,
network theft and illegal spread of harmful information in order to safeguard the sovereignty,
security and development interests of the state cyberspace.
According to the Cyber Security Law of the PRC (),
which was promulgated by the SCNPC on November 7, 2016 and came into effect on June 1,
2017, network operators, who are broadly defined as owners and administrators of networks
and network service providers, shall comply with laws and regulations and fulfill their
obligations to ensure the security of the network when conducting business and providing
services. Those who provide services through networks shall take technical measures and other
necessary measures in accordance with laws, regulations and compulsory national
requirements to safeguard the safe and stable operation of the networks, respond to network
security incidents effectively, prevent illegal and criminal activities committed on the network,
and maintain the integrity, confidentiality, and availability of network data. Network operators
shall not collect personal information unrelated to the services they provide, and shall not
collect or use personal information in violation of the provisions of laws and administrative
regulations or in violation of the agreements between both parties.
Pursuant to the Cyber Security Review Measures (2021) (ج2021) )
promulgated by the CAC, MIIT and certain authorities on December 28, 2021 and became
effective on February 15, 2022, operators of critical information infrastructure purchasing
network products and services, and online platform operators carrying out data processing
activities that affect or may affect national security, shall conduct cyber security review. For
any procurement activity which a cyber security review is applied for, an operator of critical
information infrastructure shall require, through the procurement document, agreement or
otherwise, the provider of the product or service procured to cooperate with the cyber security
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review, including undertaking, among others, not to take advantage of the provision of the
product or service to illegally acquire user data or illegally control or operate user equipment,
and not to interrupt the supply of the product or any necessary technical support service
without good cause. In addition, an online platform operator who holds and controls more than
one million users’ personal information must report to the cyber security review office for a
cyber security review if it intends to be listed abroad. According to the Cybersecurity Review
Measures, there are two mechanisms to trigger the cybersecurity review: (i) the review of
voluntary declaration by enterprises: (a) critical information infrastructure operators that
intend to purchase network products and services; (b) a network platform operator that
possesses the personal information of more than one million people that intends to be listed
overseas ( ਷̮ɪ̹); and (ii) initiation of review by regulatory authorities: if any member of
the cybersecurity review working mechanism believes that any network product or service or
data processing activity affects or is likely to affect national security. In such case, the Office
of Cybersecurity Review shall report this circumstance to the Central Cyberspace Affairs
Commission for approval, and conduct a review after approval.
Pursuant to Article 10 of the Cybersecurity Review Measures, the following factors for
assessing national cybersecurity shall be taken into account: (a) risks of illegal control,
interference or destruction of critical information infrastructure brought about by the use of
products and services; (b) the harm caused by supply interruption of products and services to
the business continuity of critical information infrastructure; (c) security, openness,
transparency and diversity of sources of products and services, reliability of supply channels,
and risks of supply interruption due to political, diplomatic, trade or other factors; (d)
compliance with Chinese laws, administrative regulations and departmental rules by product
and service providers; (e) risks of theft, disclosure, damage, illegal use or cross-border transfer
of core data, important data or large amounts of personal information; (f) risks of influence,
control or malicious use of critical information infrastructure, core data, important data or large
amounts of personal information by foreign governments after listing, and risk of network
information security; and (g) other factors that may endanger critical information infrastructure
security, cybersecurity and data security.
According to CII Regulation, which was promulgated by the State Council on July 30,
2021 and came into effect on September 1, 2021, critical information infrastructure refers to
important network infrastructure and information system in public telecommunications,
information services, energy sources, transportation and other critical industries and domains,
in which any destruction or data leakage will have severe impact on national security, the
nation’s welfare, the people’s livelihood and the public interest. The CII Regulations provide
specific requirements for the responsibilities and obligations of the critical information
infrastructure operators (hereinafter referred to as the “ operators ”). For the security protection
of critical information infrastructure, it is imperative to the principles of comprehensive
coordination, division of responsibilities and legal protection, strengthen and implement the
responsibilities of operators as subjects, and give full play to the role of the government and
all sectors of society, so as to jointly protect the security of critical information infrastructure.
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Pursuant to the Data Security Law of the PRC ( )
promulgated by the SCNPC on June 10, 2021, which became effective on September 1, 2021,
data processing activities (including the collection, storage, use, processing, transmission,
provision and disclosure of data) shall be carried out in accordance with the provisions of laws
and regulations, a whole-process data security management system should be established and
improved, data security education and training should be organized and carried out, and
corresponding technical measures and other necessary measures should be taken to ensure data
security. The use of the internet and other information networks to carry out data processing
activities shall fulfill the aforementioned data security protection obligations based on the
network security level protection system. Processors of important data should specify the
person responsible for data security and management agencies to implement data security
protection responsibilities.
Pursuant to the Measures for the Security Assessment of Outbound Data ( ᅰኽ̈ྤτ
), which were promulgated on July 7, 2022, and came into effect on September
1, 2022 by the CAC, to provide data abroad, a data processor falling under any of the following
circumstances shall, through the local cyberspace administration at the provincial level, apply
to the CAC for security assessment of outbound data: (i) where a data processor provides
important data abroad; (ii) where a critical information infrastructure operator or a data
processor processing the personal information of more than one million individuals provides
personal information abroad; (iii) where a data processor has provided personal information of
100,000 individuals or sensitive personal information of 10,000 individuals in total abroad
since January 1 of the previous year; and (iv) other circumstances prescribed by the CAC for
which declaration for security assessment for outbound data transfers is required. The Guide
to Applications for Security Assessment of Outbound Data Transfers (Second Edition) ( ᅰ
یܸ(و)), promulgated and came into effect on March 22, 2024 by
the CAC, further clarifies the scope of application, application method and process for security
assessments for data transfers.
Pursuant to the Regulations on Network Data Security Management (Draft Data Security
Regulations for Comments) ( ၣഖᅰኽτΌ၍ଣૢԷ(ᅄӋจԈᇃ)) promulgated on
November 14, 2021, the State will focus on the protection of personal information and
important data and strictly protect core data. Data processors shall be responsible for the data
security and shall fulfill their obligation of data security protection in data processing. Data
processors shall take necessary measures such as backup, encryption and access control to
protect data from disclosure, theft, tampering, destruction, loss and illegal use, respond to
network security incidents, prevent illegal and criminal activities targeting and using data, and
maintain the integrity, confidentiality and usability of data. It stipulates that data processors
shall, in accordance with relevant national regulations, apply for cyber security review if they
engage in the following activities, including, among others, seeking to be listed abroad where
the issuer control more than one million users’ personal information, and seeking to be listed
in Hong Kong where the issuer affects or may affect national security. As of the Latest
Practicable Date, the Draft Regulations on Network Data Security Management has not been
formally adopted.
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Regulations on Privacy Protection
The Provisions on Technological Measures for Internet Security Protection requires
internet service providers to keep records of certain information about their users (including
user registration information, log-in and log-out times, IP addresses, content and time of posts
by users) for at least 60 days.
On December 28, 2012, the SCNPC promulgated the Decision on Strengthening
Information Protection on Networks () to enhance the
protection of information security and privacy on the internet. In particular, network service
providers and other enterprises and institutions shall, when gathering and using electronic
personal information in business activities, adhere to the principles of legality, rationality and
necessity, explicitly state the purposes, manners and scopes of the collection and use of
information, and obtain the consent of those from whom information is collected, and shall not
collect and use information in violation of laws and regulations and the agreement between
both sides; strictly keep the electronic personal information collected in business activities
confidential and may not divulge, alter, damage, sell, or illegally provide others with such
information; take technical and other necessary measures to ensure information security and
prevent the leakage, damage, or loss of personal electronic information collected in business
activities; and take remedial measures immediately when information leakage, damage or loss
occurs or may occur.
According to the Several Provisions on Regulating the Market Order of the Internet
Information Services ( ), which were promulgated
by the MIIT on December 29, 2011, and came into effect on March 15, 2012, without the
consent of users, the internet information service providers shall neither collect information
which is relevant to users and can serve to identify users solely or in combination with other
information (the “personal information of users”) nor shall they provide personal information
of users to others, unless otherwise provided by laws and administrative regulations. The
Provisions also require that the internet information service providers shall properly preserve
the personal information of users.
Pursuant to the Ninth Amendment to the Criminal Law of the PRC ( ʕശɛ͏΍ձ਷Α
ࣩ(ɘ)) issued by SCNPC on August 29, 2015 which became effective on November
1, 2015, and its subsequent revised versions (the latest version was issued on December 29,
2023 which became effective on March 1, 2024) any internet service provider that fails to
fulfill the obligations related to internet information security administration as required by
applicable laws and refuses to rectify upon orders, shall be subject to criminal penalty for the
consequences arising from: (i) any dissemination of illegal information on a large scale; (ii)
any severe effect due to the leakage of the client’s information; (iii) any serious loss of criminal
evidence; or (iv) other severe situation.
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Any individual or entity that (a) sells or provides personal information to others in a way
violating the applicable law, or (b) steals or illegally obtains any personal information, shall
be subject to criminal penalty in severe situation. In addition, the Interpretations of the
Supreme People’s Court and the Supreme People’s Procuratorate of the PRC on Several Issues
Concerning the Application of Law in Handling Criminal Cases of Infringing Personal
Information, (ܛج
༆ᙑ) issued on May 8, 2017 and effective on June 1, 2017, clarified certain
standards for the conviction and sentencing of criminals in relation to personal information
infringement.
On May 28, 2020, the National People’s Congress of the PRC approved the Civil Code
of the PRC (Պ) (the “ Civil Code ”), which came into effect on
January 1, 2021. Pursuant to the Civil Code, the personal information of a natural person shall
be protected by the law. Any organization or individual that need to obtain personal
information of others shall obtain such information legally and ensure the security of such
information, and shall not illegally collect, use, process or transmit personal information of
others, or illegally purchase, sell, provide or make public personal information of others.
Pursuant to the PRC Personal Information Protection Law promulgated by the SCNPC on
August 20, 2021 and became effective on November 1, 2021, personal information shall be
processed (including the collection, storage, use, processing, transmission, provision,
disclosure and deletion of personal information) following the principles of lawfulness,
legitimacy, necessity and good faith, and shall not be processed through misleading, fraudulent,
coercive and other means. The processing of personal information shall have a clear and
reasonable purpose, and shall be directly related to the purpose of processing, and should adopt
a method that has the least impact on personal rights and interests. The collection of personal
information should be limited to the minimum scope of achieving the purpose of processing,
and excessive collection of personal information shall not be allowed. Processing of personal
information should follow the principles of openness and transparency, with personal
information processing rules disclosed. The purpose, manner and scope of processing should
be explicitly disclosed. Personal information processors shall be responsible for their personal
information processing activities and take necessary measures to ensure the security of the
personal information processed.
In addition to the aforementioned general rules, the PIPL also provides the obligations for
the party which commissioned by the personal information processor to process of personal
information. Personal information processors commissioning the processing of personal
information shall agree with the commissioned party on the purposes and period of the
commissioned processing, processing methods, categories of personal information, protection
measures, as well as the rights and obligations of both parties, among others, and oversee the
personal information processing activities of the commissioned party. The commissioned party
shall process personal information as agreed, and shall not process personal information
beyond the agreed purposes or methods of processing, among others. Where the commission
contract has not taken effect or is null and void, revoked, or rescinded, the commissioned party
shall return personal information to the personal information processor or delete it, and shall
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not retain such information. Without the consent of the personal information processor, the
commissioned party shall not commission the commissioned processing of personal
information. The parties that are commissioned to process personal information shall, in
accordance with the provisions of the PIPL and applicable laws and administrative regulations,
take necessary measures to ensure the security of the personal information processed, and
assist personal information processors in fulfilling the obligations specified in the PIPL.
Article 13 of the PRC Personal Information Protection Law provides that personal information
processors should obtain personal consent when processing personal information, unless it is
exempted by law. If the personal information processor entrusts another party to process the
personal information, this entrusted party is not required to obtain authorization directly from
individuals, as consent shall be obtained by the entrusting personal information processor.
The Cyber Security Law of the PRC sets forth various security protection obligations for
network operators, which are defined as “owners and administrators of networks and network
service providers”, including, among others, complying with a series of requirements of tiered
cyber protection systems, requesting users to provide real identity, localizing the personal
information and important data gathered and produced by key information infrastructure
operators during operations within China and providing assistance and support to government
authorities where necessary for protecting national security and investigating crimes.
REGULATIONS RELATED TO LEASING PROPERTIES
Pursuant to the Administration of Urban Real Estate Law of the PRC ( ʕശɛ͏΍ձ਷
), which was promulgated by the SCNPC on July 5, 1994 and most
recently amended on August 26, 2019 and came into effect on January 1, 2020, a written lease
contract shall be entered into between the lessor and the lessee for leasing a property. The
contract shall include the terms and conditions such as the term, purpose and price of leasing
and liability for maintenance and repair, as well as other rights and obligations of both parties.
The contract shall be filed for registration and record with the real estate administration
department.
The Administrative Measures for Commercial House Leasing (ॡ༣၍ଣ፬
) were promulgated by Ministry of Housing and Urban-Rural Development on December
1, 2010, and became effective on February 1, 2011. These measures set out specific rules for
commercial house leasing. Houses may not be leased in any of the following circumstances:
(i) the house is an illegal structure; (ii) the house fails to meet mandatory engineering
construction standards with respect to safety and disaster preventions; (iii) the house usage is
changed in violation of applicable regulations; and (iv) other circumstances prohibited by laws
and regulations. The lessor and the lessee shall register and file with the local property
administration authority within thirty days after entering into the lease contract. Non-
compliance with such registration and filing requirements shall be subject to fines from
RMB1,000 to RMB10,000 provided that they fail to rectify within required time limits.
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The lease contract shall also comply with the provisions of the Civil Code. Pursuant to
the Civil Code, the contents of a lease contract generally include terms such as the name,
quantity and purpose of the leased property, lease term, lease expense as well as time limit and
method for its payment, and maintenance of the leased property. An owner of immovable or
movable property is entitled to possession, use, earnings, and disposal of such property in
accordance with the law. Subject to the consent of the lessor, the lessee may sublease the leased
premises to a third party. Where a lessee subleases the premises, the lease contract between the
lessee and the lessor remains valid. The lessor is entitled to terminate the lease if the lessee
subleases the premises without the consent of the lessor. In addition, if the ownership of the
leased premises changes during the lessee’s possession in accordance with the terms of the
lease contract, the validity of the lease contract shall not be affected.
REGULATIONS RELATED TO INTELLECTUAL PROPERTY IN THE PRC
Copyright
Pursuant to the Copyright Law of the PRC (), as issued on
September 7, 1990 and latest amended on November 11, 2020, and Implementation Regulations
for the Copyright Law of the PRC (ૢԷ), which came into
effect on June 1, 1991 and was last amended on January 30, 2013, copyrights include personal
rights such as the right of publication and that of attribution as well as property rights such as
the right of production and that of distribution. Reproducing, distributing, performing,
projecting, broadcasting or compiling a work or communicating the same to the public via an
information network without permission from the owner of the copyright therein, unless
otherwise provided in the Copyright Law, shall constitute infringements of copyright.
Pursuant to the Regulation on Computer Software Protection (ᚐૢԷ)
promulgated on June 4, 1991 by the State Council and last amended on January 30, 2013 and
the Measures for the Registration of Computer Software Copyright (ၑዚழ΁ഹЪᛆ೮া
) promulgated on April 6, 1992 and last amended by the National Copyright
Administration on February 20, 2002, the National Copyright Administration is mainly
responsible for the registration and management of software copyright in China and recognizes
the China Copyright Protection Center as the software registration organization. The China
Copyright Protection Center shall grant certificates of registration to computer software
copyright applicants in compliance with the regulations of the Measures for the Registration
of Computer Software Copyright and the Regulation on Computers Software Protection.
Patents
Pursuant to the Patent Law of the PRC (), which was issued
on March 12, 1984 and last amended on October 17, 2020, and the Implementation Regulations
for the Patent Law of the PRC (), which were issued on
June 15, 2001 and last amended on December 11, 2023, a patentable invention, utility model
or design must meet three conditions: novelty, inventiveness and practical applicability. The
Patent Office under the China National Intellectual Property Administration (ᗆପᛆ҅)
is responsible for receiving, examining and approving patent applications.
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A patent is valid for a twenty-year term for an invention, a ten-year term for a utility
model and a fifteen-year term for a design, starting from the application date. Except under
certain specific circumstances provided by law, any third-party user must obtain consent or a
proper license from the patent owner to use the patent, or else the use will constitute an
infringement of the rights of the patent holder.
Trademark
Pursuant to the Trademark Law of the PRC ( ) which was
promulgated on August 23, 1982 and last amended on April 23, 2019 and came into effect on
November 1, 2019, the Implementation Regulations of the Trademark Law of the PRC ( ʕ
ૢԷ) which were issued on August 3, 2002 and last amended on
April 29, 2014, the Trademark Office under the China National Intellectual Property
Administration of the PRC, (the “Trademark Office”), shall handle trademark registrations and
grant a term of ten years to registered trademarks, which may be renewed for an additional ten
year period upon request from the trademark owner. The Trademark Law of the PRC has
adopted a “first-to-file” principle with respect to trademark registration. Where an application
for trademark for which application for registration has been made is identical or similar to
another trademark which has already been registered or is under preliminary examination and
approval for use on the same kind of or similar commodities or services, the application for
registration of such trademark may be rejected. Any person applying for the registration of a
trademark may not prejudice the existing right of others, nor may any person register in
advance a trademark that has already been used by another party and has already gained a
“sufficient degree of reputation” through such party’s use. A trademark registrant may, by
entering into a trademark licensing contract, license another party to use its registered
trademark. Where another party is licensed to use a registered trademark, the licenser shall
report the license to the Trademark Office for recordation, and the Trademark Office shall
publish it. An unrecorded license may not be used as a defense against a third party in good
faith.
Domain Name
Domain names are protected under the Administrative Measures on the Internet Domain
Names () promulgated by the MIIT on August 24, 2017 and became
effective in November 1, 2017. The MIIT is the major regulatory authority of domain names.
The registration of domain names in China is on a “first-apply-first-registration” basis. A
domain name applicant will become the domain name holder upon completion of the
application procedure.
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REGULATIONS RELATED TO EMPLOYMENT AND SOCIAL WELFARE
Employment
The major PRC laws and regulations that govern employment relationship are the Labor
Law of the PRC (), the Labor Contract Law of the PRC ( ʕശɛ
) (the “ Labor Contract Law ”), or the Labor Contract Law and its
implementation, which impose stringent requirements on the employers in relation to entering
into fixed-term employment contracts, hiring of temporary employees and dismissal of
employees.
The Labor Contract Law, which became effective on January 1, 2008, primarily aims at
regulating rights and obligations of employment relationships, including the establishment,
performance, and termination of labor contracts. Pursuant to the Labor Contract Law, labor
contracts must be executed in writing if labor relationships are to be or have been established
between employers and employees. Employers are prohibited from forcing employees to work
above certain time limits and employers must pay employees for overtime work in accordance
with national regulations. In addition, employee wages must not be lower than local standards
on minimum wages and must be paid to employees in a timely manner.
In December 2012, the Labor Contract Law was amended to impose more stringent
requirements on the use of employees of temp agencies, who are known in China as
“dispatched workers”. Dispatched workers are entitled to equal pay with full-time employees
for equal work. Employers are only allowed to use dispatched workers for temporary, auxiliary
or substitutive positions. According to the Interim Provisions on Labor Dispatch (჆
) promulgated by the Ministry of Human Resources and Social Security and came
into effect on March 1, 2014, the number of dispatched workers hired by an employer may not
exceed 10% of the total number of its employees. Where rectification is not made within the
stipulated period, the employers may be subject to a penalty ranging from RMB5,000 to
RMB10,000 per dispatched worker exceeding the 10% threshold.
Social Insurance
According to the Decision of the State Council on Establishing the Basic Medical
Insurance System for Urban Employees (Ӕ
), which was issued on December 14, 1998 and the Decision of the State Council on
Improving the Basic Endowment Insurance System for Enterprise Employees (ҁ
), which was issued on December 3, 2005, all urban
employers, including enterprises (including but not limited to state-owned enterprises,
collective enterprises, foreign-invested enterprises, private enterprises), government agencies,
public institutions, social organizations, private non-enterprise units and their employees, must
participate in basic medical insurance, and all urban enterprise employees, individual industrial
and commercial households and flexible employment personnel must participate in the basic
pension insurance for enterprise employees.
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The Social Insurance Law of the PRC () (the “ Social
Insurance Law ”), issued by the SCNPC on October 28, 2010 and last amended on December
29, 2018, the Regulations on Occupational Injury Insurance (ᎈૢԷ) effective as
of January 1, 2004 and as amended on December 20, 2010, the Interim Measures concerning
the Maternity Insurance for Enterprise Employees () effective
as of January 1, 1995, Unemployment Insurance Regulations (ᎈૢԷ) effective as
of January 22, 1999, have established social insurance systems of basic pension insurance,
basic medical insurance, work-related injury insurance, unemployment insurance and
maternity insurance and has elaborated in detail the legal obligations and liabilities of
employers who fail to comply with relevant laws and regulations on social insurance.
According to the Social Insurance Law and the Provisional Regulations on Collection and
Payment of Social Insurance Premiums (ᎈ൬ᅄᖮᅲБૢԷ) promulgated by the
State Council on January 22, 1999 and most recently amended on March 24, 2019 and effective
from the same date, enterprises shall register social insurance with local social insurance and
pay or withhold relevant social insurance for or on behalf of its employees. Any employer that
fails to make social insurance contributions may be ordered to rectify the non-compliance and
pay the required contributions within a prescribed time limit and be subject to a late fee. If the
employer still fails to rectify the failure to make the relevant contributions within the
prescribed time, it may be subject to a fine ranging from one to three times the amount overdue.
Housing Provident Fund
In accordance with the Regulations on the Administration of Housing Provident Funds
(၍ଣૢԷ) promulgated by the State Council on April 3, 1999, and amended
on March 24, 2002, and March 24, 2019, enterprises must register at the designated
administrative centers and open bank accounts for depositing employees’ housing provident
funds. Employers and employees are also required to pay and deposit housing provident funds,
with an amount no less than 5% of the monthly average salary of the employee in the preceding
year in full and on time. In case of overdue payment or underpayment by employers, orders for
payment within a specified period will be made by the housing fund management center. Where
employers fail to make payment within such period, enforcement by the people’s court will be
applied.
In case of failure to register and open accounts for depositing employees’ housing
provident funds, the housing fund management center shall order employers to go through the
formalities within a specified period, where employers fail to do such formalities within the
prescribed time, a fine of not less than RMB10,000 nor more than RMB50,000 shall be
imposed.
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REGULATIONS ON FOREIGN EXCHANGE
Regulations Relating to Foreign Currency Exchange
The principal regulations governing foreign currency exchange in China are the Foreign
Exchange Administration Regulations of the PRC ( ʕശɛ͏΍ձ਷̮ි၍ଣૢԷ), most
recently amended on August 5, 2008. Under the PRC foreign exchange regulations, payments
of current account items, such as profit distributions, interest payments and trade and service-
related foreign exchange transactions, can be made in foreign currencies without prior approval
from the State Administration of Foreign Exchange, or SAFE, by complying with certain
procedural requirements. By contrast, approval from or registration with appropriate
government authorities is required where Renminbi is to be converted into foreign currency
and remitted out of China to pay capital account items, such as direct investments, repayment
of foreign currency-denominated loans, repatriation of investments and investments in
securities outside of China.
According to the Notice on Relevant Issues Concerning the Administration of Foreign
Exchange for Overseas Listing () issued by the
SAFE on December 26, 2014, the domestic companies shall register the overseas listing with
the foreign exchange control bureau located at its registered address in 15 working days after
completion of the overseas listing and issuance. The funds raised by the domestic companies
through overseas listing may be repatriated to China or deposited overseas, provided that the
intended use of the funds shall be consistent with the contents of the document and other public
disclosure documents.
The SAFE issued the Circular on Reforming of the Management Method of the Settlement
of Foreign Currency Capital of Foreign-Invested Enterprises (̮ਠ
), (the “ SAFE Circular 19 ”), on March 30, 2015,
and it became effective on June 1, 2015, which was partially repealed on December 30, 2019,
and last amended on March 23, 2023. The SAFE Circular 19 expands a pilot reform of the
administration of the settlement of the foreign exchange capitals of foreign-invested
enterprises nationwide. On June 9, 2016, SAFE further promulgated the Notice of the State
Administration of Foreign Exchange on Reforming and Standardizing the Foreign Exchange
Settlement Management Policy of Capital Account (ձ஝ᇍ༟͉ධ
), (the “ SAFE Circular 16 ”), which, among other things, amends
certain provisions of SAFE Circular 19. Pursuant to SAFE Circular 19 and SAFE Circular 16,
the flow and use of the Renminbi capital converted from foreign currency denominated
registered capital of a foreign-invested company is regulated such that Renminbi capital may
not be used for business beyond its business scope or to provide loans to persons other than
affiliates unless otherwise permitted under its business scope.
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On October 23, 2019, SAFE issued the Circular of Further Facilitating Cross-border
Trade and Investment (), and
last amended on December 4, 2023 by the Notice on Further Deepening the Reform to
Facilitate Cross-border Trade and Investment (ආ༨
) or SAFE Circular 28, which cancels the restrictions on domestic
equity investments by capital fund of non-investment foreign invested enterprises and allows
non-investment foreign invested enterprises to use their capital funds to lawfully make equity
investments in China, provided that such investments do not violate the Negative List and the
target investment projects are genuine and in compliance with laws. According to the Circular
on Optimizing Administration of Foreign Exchange to Support the Development of Foreign-
related Business (), or SAFE
Circular 8, issued by SAFE on April 10, 2020, under the prerequisite of ensuring true and
compliant use of funds and compliance with the prevailing administrative provisions on use of
income under the capital account, eligible enterprises are allowed to make domestic payments
by using their capital funds, foreign credits and the income under capital accounts of overseas
listing, without prior provision of the evidentiary materials concerning authenticity to the bank
for each transaction. The handling banks shall conduct spot checks afterwards in accordance
with the relevant requirements. The interpretation and implementation in practice of SAFE
Circular 28 and SAFE Circular 8 are still subject to substantial uncertainties given they are
newly issued regulations.
Regulations Relating to Overseas Investment
According to the Measures for the Administration of Overseas Investment of Enterprises
() promulgated by the NDRC on December 26, 2017 and
implemented on March 1, 2018, an investor shall, in overseas investment, undergo the
formalities for the confirmation or recordation, among others, of an overseas investment
project, report the relevant information, and cooperate in supervisory inspection.
Pursuant to the Measures for the Administration of Overseas Investment ( ྤ̮ҳ༟၍
) promulgated by the MOFCOM on March 16, 2009, lastly amended on September 6,
2014 and implemented on October 6, 2014, “overseas investment” means the acts of an
enterprise legally formed in China to own a non-financial enterprise or obtain the ownership,
control, or right of business management of or any other interest in an existing non-financial
enterprise outside of China by formation, acquisition or merger, or other means. The
MOFCOM and the provincial counterparts promulgate regulations providing that overseas
investment of enterprises to be subject to recordation or confirmation management, depending
on the actual circumstances of investment. Overseas investment involving any sensitive
country or region or any sensitive industry shall be subject to confirmation management.
Overseas investment under other circumstances shall be subject to recordation management.
When an overseas enterprise invested by an enterprise conducts overseas reinvestment, the
enterprise shall report to the commerce departments after completing the overseas legal
procedures.
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Pursuant to the Provisions on the Foreign Exchange Administration of the Overseas
Direct Investment of Domestic Institutions ()
promulgated by the SAFE on July 13, 2009 and implemented on August 1, 2009 and the Notice
on Further Simplifying and Improving Policies for the Foreign Exchange Administration of
Direct Investment () promulgated by
the SAFE on February 13, 2015, implemented on June 1, 2015 and was partially repealed on
December 30, 2019, stipulates that, upon obtaining the approval for overseas investment, the
overseas direct investment of PRC enterprises shall apply for foreign exchange registration to
the banks at their places of registration.
REGULATIONS ON TAXATION
Enterprise Income Tax
On March 16, 2007, the SCNPC promulgated the Law on Enterprise Income Tax of the
PRC () (the “ EIT Law ”), which was amended on February
24, 2017 and December 29, 2018. On December 6, 2007, the State Council enacted the
Regulations for the Implementation of the Law on Enterprise Income Tax of the PRC ( ʕശ
ૢԷ), which came into effect on January 1, 2008 and was
amended on April 23, 2019. Under the EIT Law and its implementing regulations, both resident
enterprises and non-resident enterprises are subject to tax in the PRC. Resident enterprises are
defined as enterprises that are established in China in accordance with PRC laws, or that are
established in accordance with the laws of foreign countries but are actually or in effect
controlled from within the PRC. Under the EIT Law and relevant implementing regulations, a
uniform corporate income tax rate of 25% is applied.
Pursuant to the EIT Law, enterprises qualified as “High and New Technology Enterprises”
are entitled to a 15% enterprise income tax rate rather than the 25% uniform statutory tax rate.
The preferential tax treatment continues as long as an enterprise can retain its “High and New
Technology Enterprise” status. According to the Announcement on Issuing the Revised
Measures for Handling Enterprise Income Tax Preferences (Revision 2018) (੻೼Ꮄ౉
ج2018ࠈࡌwhich was promulgated by the SA T and came into effect on
April 25, 2018, enterprises enjoying enterprise income tax preferences shall adopt the handling
methods of “making independent judgment, declaring for enjoyment and retaining the relevant
materials for future reference”. An enterprise shall, according to its operating condition and
related tax provisions, independently determine whether it satisfies the conditions required for
enterprise income tax preferences. Those who meet the conditions may independently calculate
the tax deductions or exemptions according to the time listed in the Catalog for the
Administration of Enterprise Income Tax Preferences (Revision 2017) (੻೼Ꮄ౉ԫධ၍
ଣͦ፽(2017وand enjoy tax incentives by filing enterprise income tax returns.
Meanwhile, they shall, in accordance with the relevant provisions, collect and retain the
relevant materials for future reference.
Pursuant to the EIT Law, the enterprise income tax on a small meagre-profit enterprise
that meets the prescribed conditions shall be levied at a reduced tax rate of 20%.
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According to the Notice of the Ministry of Finance and the State Administration of
Taxation on Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and
Small Enterprises (ஷ
), during the period from January 1, 2019 to December 31, 2021, the annual taxable
income of small low-profit enterprises that is not more than RMB1 million shall be included
in its taxable income at the reduced rate of 25% with the applicable enterprise income tax rate
of 20%. According to the Announcement on Implementation of Income Tax Incentives for
Micro and Small Enterprises and Individually-owned Businesses (᜗
ʮѓ) and the Announcement of the State Taxation Administration
on Matters Concerning the Implementation of Preferential Income Tax Policies Supporting the
Development of Small Low-Profit Enterprises and Individual Industrial and Commercial
Households (ഄϞ
ʮѓ), during the period from January 1, 2021 to December 31, 2022, the annual
taxable income of a small low-profit enterprise that is not more than 1 million yuan shall be
included in its taxable income at the reduced rate of 12.5%, with the applicable enterprise
income tax rate of 20%. According to the Notice of the MOF and the SA T on the Income Tax
Incentives to Small and Micro Enterprises and Privately-owned Businesses (࢕
ʮѓ) and the Notice of the MOF
and the SA T on the Relevant Tax and Fee Policies for Further Supporting the Development of
Micro and Small Enterprises and Individual Industrial and Commercial Households (௅e
ʮѓ), which shall be in
force from January 1, 2023 to December 31, 2027, for the annual taxable income of a small and
low-profit enterprise, the portion not exceeding RMB1 million shall be treated as 25% for the
purpose of taxable income calculation and subject to the enterprise income tax rate of 20%.
Value-Added Tax
The Provisional Regulations of the PRC on V alue-added Tax (೼
ᅲБૢԷ) were promulgated by the State Council on December 13, 1993 and came into
effect on January 1, 1994 which were subsequently amended on November 10, 2008 and came
into effect on January 1, 2009 and amended on February 6, 2016 and November 19, 2017. The
Detailed Rules for the Implementation of the Provisional Regulations of the PRC on
V alue-added Tax (Revised in 2011) ((2011ࡌ
ࠈwas promulgated by the Ministry of Finance on December 25, 1993 and subsequently
amended on December 15, 2008 and October 28, 2011, or collectively, V A T Law. On November
19, 2017, the State Council promulgated The Decisions on Abolishing the Provisional
Regulations of the PRC on Business Tax and Amending the Provisional Regulations of the PRC
on V alue-added Tax (ᄻ˟<ʕശɛ͏΍ձ਷ᐄุ೼ᅲБૢԷ>ҷ<ʕശɛ͏΍ձ਷
೼ᅲБૢԷ>) (the “ Order 691 ”). According to the V A T Law and Order 691, all
enterprises and individuals engaged in the sale of goods, the provision of processing, repair and
replacement services, sales of services, intangible assets, real property and the importation of
goods within the territory of the PRC are the taxpayers of V A T. The V A T tax rates generally
applicable are simplified as 17%, 11%, 6% and 0%, and the V A T tax rate applicable to the
small-scale taxpayers is 3%. The Notice of the Ministry of Finance and the SA T on Adjusting
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V alue-added Tax Rates () (the “ Value-
added Tax Notice ”), was promulgated on April 4, 2018 and came into effect on May 1, 2018.
The V alue-added Tax Notice adjusted the V A T tax rates of 17% and 11% to 16% and 10%,
respectively. According to the Announcement on Relevant Policies for Deepening V alue-Added
Tax Reform (ʮѓ), with effect from April 1, 2019, the
V A T tax rate of 16% and 10% are changed into 13% and 9%, respectively.
Pursuant to the Announcement of the Ministry of Finance, the State Taxation
Administration and the General Administration of Customs on Relevant Policies for Deepening
the V A T Reform (ʮѓ)
and the Announcement of the Ministry of Finance and the State Taxation Administration on
Relevant V A T Policies for Promoting the Resolution of Difficulties so as to Develop the
Difficulty-Ridden Industries in the Service Sector (ਕุჯਹ
ʮѓ), with effect from April 1, 2019 to December 31,
2022, taxpayers of production service industry shall deduct the tax payable by 10% of the
current deductible input tax amount. Pursuant to the Notice of the MOF and the SA T to Clarify
the Policy of V A T Incentives to Small-Scale V A T Payers (೼
ʮѓ), with effect from January 1, 2023 to December 31,
2023, taxpayers of production service industry shall deduct the tax payable by 5% of the
current deductible input tax amount.
Pursuant to the Notice of the Ministry of Finance and the State Administration of Taxation
on Implementing the Inclusive Tax Deduction and Exemption Policies for Micro and Small
Enterprises (), with
effect from January 1, 2019 to December 31, 2021, small-scale V A T taxpayers with a monthly
sales amount of RMB100,000 or less shall be exempt from V A T. Pursuant to the Announcement
of the Ministry of Finance and the State Taxation Administration on Clarifying the Policy for
Exempting Small-Scale V A T Taxpayers from V alue-added Tax (ᆽ
ʮѓ), from April 1, 2021 to December 31, 2022,
small-scale V A T taxpayers with a monthly sales amount of 150,000 yuan or less shall be
exempt from V A T. Pursuant to the Announcement of the Ministry of Finance and the State
Taxation Administration on Exempting Small-Scale V A T Taxpayers from V A T (௅e೼
ʮѓ), from April 1, 2022 to December 31,
2022, a small-scale V A T taxpayer shall be exempt from V A T if the V A T rate of 3% applies to
its taxable sales income, and the prepayment of V A T on its items subject to prepayment of V A T
at the rate of 3% shall be suspended. Pursuant to the Notice of the MOF and the SA T to Clarify
the Policy of V A T Incentives to Small-Scale V A T Payers (೼
ʮѓ) and Announcement of the Ministry of Finance and
the State Taxation Administration on V alue-Added Tax Reduction and Exemption Policies for
Small-Scale V alue-Added Tax Taxpayers (೼ʃ஝ᅼॶ೼ɛಯе
ʮѓ), from January 1, 2023 to December 31, 2027, small-scale V A T payers
with monthly revenue below RMB100,000 shall be exempted from V A T; for a small-scale V A T
payer, the sales income with a tax rate of 3% shall be subject to a lower V A T rate of 1%, and
the provisional V A T items with a provisional tax rate of 3% shall be subject to a lower
provisional V A T rate of 1%.
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REGULATIONS RELATED TO OVERSEAS LISTING
Regulations on the H-share Full Circulation
“Full circulation” means listing and circulating on the Stock Exchange of the domestic
unlisted shares of an H-share listed company, including unlisted domestic shares held by
domestic shareholders prior to overseas listing, unlisted domestic shares additionally issued
after overseas listing, and unlisted shares held by foreign shareholders. On November 14, 2019,
the CSRC issued the Guidelines for the “Full Circulation” Program for Domestic Unlisted
Shares of H-share Listed Companies ( H΅͡ሗ“ஷ”ˏ)
(the “ Guidelines for the Full Circulation ”), which was revised on August 10, 2023.
According to the Guidelines for the Full Circulation, shareholders of domestic unlisted
shares may determine by themselves through consultation the amount and proportion of shares,
for which an application will be filed for circulation, provided that the requirements laid down
in the relevant laws and regulations and set out in the policies for state-owned asset
administration, foreign investment and industry regulation are met, and the corresponding
H-share listed company may be entrusted to file the said application for full circulation.
On December 31, 2019, CSDC and the Shenzhen Stock Exchange (the “ SZSE ”) jointly
announced the Measures for Implementation of H-share Full Circulation Business ( Hٰ“Ό
ஷ”) (the “ Measures for Implementation ”). The businesses in relation to
the H-share full circulation business, such as cross-border transfer registration, maintenance of
deposit and holding details, transaction entrustment and instruction transmission, settlement,
management of settlement participants, services of nominal holders, etc. are subject to the
Measures for Implementation.
In order to fully promote the reform of H-share full circulation and clarify the business
arrangement and procedures for the relevant shares’ registration, custody, settlement and
delivery, CSDC promulgated the Circular on Issuing the Guide to the Program for Full
Circulation of H-shares ( Hٰ“ ஷ”) on February 7, 2020, which specifies the
business preparation, account arrangement, cross-border share transfer registration and
overseas centralized custody, and other relevant matters. In February 2020, China Securities
Depository and Clearing (Hong Kong) Limited also promulgated the Guide of China Securities
Depository and Clearing (Hong Kong) Limited to the Program for Full Circulation of H-shares
to specify the relevant escrow, custody, agent service, arrangement for settlement and delivery,
risk management measures and other relevant matters.
According to the Measures for Implementation and the Guide to the Program for Full
Circulation of H-shares, shareholders who apply for H-share Full Circulation (the
“Participating Shareholders ”) shall complete the cross-border transfer registration for
conversion of relevant domestic unlisted shares into H Shares before dealing in the shares, i.e.,
CSDC as the nominal shareholder, deposits the relevant securities held by Participating
Shareholders at China Securities Depository and Clearing (Hong Kong) Limited (the “CSDC
REGULATORY OVERVIEW
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(Hong Kong)”), and CSDC (Hong Kong) will then deposit the securities at HKSCC in its own
name, and exercise the rights to the securities issuer through HKSCC, while HKSCC Nominees
as the ultimate nominal shareholder is listed on the register of shareholders of H-share listed
companies.
According to the Guide to the Program for Full Circulation of H-shares, H-share listed
companies shall be authorized by Participating Shareholders to designate the only domestic
securities company (the “ Domestic Securities Company ”) to participate in the transaction of
converted H shares. The specific procedure is as follows:
Participating Shareholders submit trading orders of the converted H-shares through the
Domestic Securities Company, which transmits the orders to the Hong Kong Securities
Company designated by the Domestic Securities Company through Shenzhen Securities
Communications Co., Ltd.; and Hong Kong Securities Company conducts corresponding
securities transactions in the Hong Kong market in accordance with the aforementioned trading
orders and the rules of the Stock Exchange.
According to the Guide to the Program for Full Circulation of H-shares, upon the
completion of the transaction, settlements between each of the Hong Kong Securities Company
and CSDC (Hong Kong), CSDC (Hong Kong) and CSDC, CSDC and the Domestic Securities
Company, and the Domestic Securities Company and the Participating Shareholders, will all be
conducted separately.
Regulations Relating to Overseas Securities Offering and Listing
The CSRC promulgated the Trial Administrative Measures of Overseas Securities
Offering and Listing by Domestic Companies ( ྤʫΆุྤ̮೯БᗇՎձɪ̹၍ଣ༊Б፬
) (the “ Overseas Listing Trial Measures ”) and five relevant guidelines on February 17,
2023, which took effect on March 31, 2023. The Overseas Listing Trial Measures
comprehensively reformed the regulatory regime for overseas offering and listing of PRC
domestic companies’ securities, either directly or indirectly, into a filing-based system.
According to the Overseas Listing Trial Measures, the PRC domestic companies that seek
to offer and list securities in overseas markets, either in direct or indirect means, are required
to fulfill the filing procedure with the CSRC and report relevant information. The Overseas
Listing Trial Measures provides that an overseas listing or offering is explicitly prohibited, if
any of the following applies: (i) such securities offering or listing is explicitly prohibited by
provisions in PRC laws, administrative regulations or relevant state rules; (ii) the proposed
securities offering or listing may endanger national security as reviewed and determined by
competent authorities under the State Council in accordance with laws; (iii) the domestic
company intending to be listed or offer securities in overseas markets, or its controlling
shareholder(s) and the actual controller, have committed crimes such as corruption, bribery,
embezzlement, misappropriation of property or undermining the order of the socialist market
economy during the latest three years; (iv) the domestic company intending to be listed or offer
securities in overseas markets is currently under investigations for suspicion of criminal
REGULATORY OVERVIEW
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offenses or major violations of laws and regulations, and no conclusion has yet been made
thereof; or (v) there are material ownership disputes over equity held by the domestic
company’s controlling shareholder(s) or by other shareholder(s) that are controlled by the
controlling shareholder(s) and/or actual controller.
Where an issuer submits an application for initial public offering to competent overseas
regulators, filing application with the CSRC shall be submitted within three business days
thereafter. Subsequent securities offering of an issuer in the same overseas market where it has
previously offered and listed securities shall be filed with the CSRC within three business days
after the offering is completed. Subsequent securities offering and listing of an issuer in other
overseas markets shall be filed as an initial public offering.
Moreover, upon the occurrence of any of the material events specified below after an
issuer has offered and listed securities in an overseas market, the issuer shall submit a report
thereof to CSRC within three working days after the occurrence and public disclosure of the
event:(i) change of control; (ii) investigations or sanctions imposed by overseas securities
regulatory agencies or other relevant competent authorities; (iii) change of listing status or
transfer of listing segment; (iv) voluntary or mandatory delisting. Where an issuer’s main
business undergoes material changes after overseas offering and listing, and is therefore
beyond the scope of business stated in the filing documents, such issuer shall submit to the
CSRC an ad hoc report and a relevant legal opinion issued by a domestic law firm within three
working days after occurrence of the changes.
On February 24, 2023, the CSRC and other relevant government authorities promulgated
the Provisions on Strengthening the Confidentiality and Archives Administration of Overseas
Securities Issuance and Listing by Domestic Enterprises (̋੶ྤʫΆุྤ̮೯БᗇՎձ
) (the “ Provision on Confidentiality ”), which took
effect on March 31, 2023. Pursuant to the Provision on Confidentiality, where a domestic
enterprise provides or publicly discloses to the relevant securities companies, securities service
institutions, overseas regulatory authorities and other entities and individuals, or provides or
publicly discloses through its overseas listing subjects, documents and materials involving
state secrets and working secrets of state organs, it shall report the same to the competent
department with the examination and approval authority for approval in accordance with the
law, and submit the same to the secrecy administration department of the same level for filing.
Domestic enterprises providing accounting archives or copies thereof to entities and
individuals concerned such as securities companies, securities service institutions and overseas
regulatory authorities shall perform the corresponding procedures pursuant to the relevant
provisions of the State.
REGULATORY OVERVIEW
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OVERVIEW
We are an integrated API-enabled data exchange service provider in China. We provide
standard API services and customized data management solutions. For details, see “Business”.
Our history can be traced back to February 2010 when our predecessor company, Suzhou
ThinkLand Technology Co., Ltd. (ʮ̡)( “ ThinkLand Technology ”),
was established in the PRC by our founder, Mr. Zuo (our chairman, chief executive officer,
executive Director and one of our Controlling Shareholders) and the then Shareholders. After
several changes in our shareholding structure, our predecessor company was converted into a
joint stock company with limited liability (the “ Conversion ”) under the laws of the PRC in
September 2017.
OUR BUSINESS MILESTONES
We set forth below our key business development and milestones:
Y ear Milestone
2010 Our predecessor company ThinkLand Technology was established in
Suzhou.
2011 We launched the first API data interface platform in the PRC.
2014 We completed the Series A Investment and JD Technology became our
second largest Shareholder.
2015 We were awarded two Y unfan Awards ( ථωᆤ), being (i) the
Outstanding Practice Unit Award in Cloud Computing Application ( ථ
ၑᏐ͜ᎴӸྼስఊЗᆤ); and (ii) Top Ten Growing Enterprise in
Cloud Computing (ɢΆุᆤ) by the Center of
International Economic and Technological Cooperation of MIIT ( ʈุ
ʷ௅਷ყ຾᏶ҦஔΥЪʕː) in Cloud China 2015.
We completed the Series B Investment with an aggregate investment of
approximately RMB157.50 million from JD Technology, Culture Fund
and Tahoe Growth.
(Note)
2016 We were recognized as the Major Innovative Platform Medium (ɽ
௴อ̨̻༱᜗), which was the key scientific and technological
innovation project in Suzhou during the period of Thirteenth Five-year
Plan.
2017 Our predecessor company was converted into a joint stock company
with limited liability under the laws of the PRC.
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Y ear Milestone
2019 We were awarded the Wu Wenjun Artificial Intelligence Science and
Technology Progress Award (ҦආӉᆤ) host by
CAAI, which is a well-recognized award for intelligent science and
technology in the PRC.
We recorded over 1 million customers since the commencement of the
operation of our API marketplace.
2020 We were awarded the (i) Recommended List of Product and Activities
of Small and Mid-Size Enterprises Digital Empowerment – Digital
Platform ( ᅰοʷ̨̻ᗳ –ਗપᑥ
ͦ፽); and (ii) Jiangsu Province Excellent Typical Application Project
of Big Data (Ꮠ͜ධͦ) by Jiangsu Provincial
Department of Industry and Information Technology (ڦ
ʷᝂ) and Jiangsu Province Information Technology Leadership
Group Big Data Development Office (ʷჯኬʃଡ଼ɽᅰኽ೯
܃.)
2021 We were recognized as the (i) Big Data Industry Development Pilot
Model Project (༊ᓃͪᇍධͦ) by MIIT and (ii)
Jiangsu Province Artificial Intelligence Benchmark Demonstration
Enterprise (ɛʈ౽ঐᅺ૖ͪᇍΆุ) by Jiangsu Artificial
Intelligence Industry Technology Innovation Strategic Alliance ( Ϫᘽ
ɛʈ౽ঐପุҦஔ௴อ኷ଫᑌຑ).
We won several bids for the government digital transformation
benchmark projects, including a social governance project and also a
data management solutions project for the PRC securities market.
2022 We were recognized as one of the first batch companies selected to be
a member of the digital economy standard working group to join the
National MIIT Committee for Information Technology and
Industrialization Convergence Standardization ( Ό਷ՇʷፄΥ၍ଣᅺ
ึ).
The annual usage of our API marketplace exceeded 100 billion times.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Y ear Milestone
2023 We were (i) awarded the first prize in the Zero-Knowledge Proof Track
at the 2022 World Privacy-Preserving Computing Competition (ڭ
ᒄ༸) sponsored by the MIIT; (ii) included in
the List of Jiangsu Province Blockchain Industry Development Pilot
Model Project (༊ᓃͪᇍධͦΤఊ) by Jiangsu
Provincial Department of Industry and Information Technology ( Ϫᘽ
ʷᝂ); and (iii) recognized as the Fifth Batch of National
Specialized, Refined, Innovative and Outstanding “Little Giant”
Enterprises (ॴୋʞҭਖ਼ၚतอ“ʃ̶ɛ”) by MIIT.
Note: Pursuant to the capital increase agreement in respect of the Series B Investment, each of Culture Fund,
JD Technology and Tahoe Growth has invested RMB120 million, RMB31.50 million and RMB6 million
in ThinkLand Technology, respectively. Culture Fund ceased to be our Shareholder in October 2020,
details of which are set out in the “Major corporate developments of our Company – (g) Equity Transfers
in October 2020”.
OUR CORPORATE HISTORY AND DEVELOPMENT
Our Company
Establishment of our predecessor company
Our predecessor company, ThinkLand Technology, was established in the PRC on
February 25, 2010 with an initial registered capital of RMB3.00 million, which was fully paid
up as of the date of establishment. As of the date of establishment, ThinkLand Technology was
owned as to (i) 46.00% by our founder, chairman, chief executive officer and executive
Director Mr. Zuo; (ii) 33.00% by our former Shareholder Mr. Qin Cheng ( ॢ༐); and (iii)
21.00% by our executive Director Mr. Wang Haojin (ʦ), respectively. Mr. Qin and Mr.
Wang ceased to be our Shareholders in January 2014 after a series of share transfers in tranches
and their registered capital were transferred at a price which was equivalent to their
subscription price. For details of the background and experience of Mr. Zuo and Mr. Wang, see
the section headed “Directors, Supervisors and Senior Management”. Mr. Qin is an
experienced investor with principal investment in solar photovoltaic and other projects and
became acquainted with Mr. Zuo and Mr. Wang in 2006 when they all attended the Nanjing
University of Aeronautics and Astronautics in the PRC together.
Major corporate developments of our Company
Since the establishment of our Company, our Company had undertaken a series of equity
transfers and capital injections to, amongst others, raise funds for the development of our
business and diversify our Shareholders base. Notwithstanding the series of equity transfers
and capital injections, our Company remained controlled by Mr. Zuo since its establishment.
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Set out below are the equity transfers and capital injections by investors who remained
as our Shareholders as of the Latest Practicable Date and the investments of which were
considered material to our Company since its establishment. See “– Pre-IPO Investment” in
this section for details of our Pre-IPO Investors and their corresponding investments.
(a) Series A Investment
Pursuant to the capital increase and shareholders’ agreement dated February 14, 2014
entered into among JD Technology, our Company and the then Shareholders of ThinkLand
Technology, JD Technology invested RMB19.50 million in ThinkLand Technology (the “ Series
A Investment ”), among which approximately RMB1.75 million was injected as the registered
capital of ThinkLand Technology while the remaining amount was recorded as ThinkLand
Technology’s capital reserve. The consideration of the Series A Investment was determined
based on arm’s length negotiation between the parties after considering the operation and
prospect of ThinkLand Technology. Upon completion of such capital injection on February 20,
2014, the registered capital of ThinkLand Technology was increased to RMB8.75 million.
(b) Increase of registered capital by converting capital reserve
On August 28, 2015, ThinkLand Technology passed a shareholders’ resolution pursuant
to which ThinkLand Technology increased its registered capital from RMB8.75 million to
RMB26.00 million by converting its capital reserve to registered capital. The registered capital
of ThinkLand Technology subscribed by the then Shareholders was increased on a pro-rata
basis and upon completion of such increase on September 9, 2015, the registered capital of
ThinkLand Technology was increased to RMB26.00 million.
(c) Series B Investment
Pursuant to the capital increase agreement dated December 17, 2015, among others, (i) JD
Technology invested approximately RMB31.50 million in ThinkLand Technology, among
which RMB972,107 was injected as the registered capital of ThinkLand Technology while the
remaining amount was recorded as ThinkLand Technology’s capital reserve; and (ii) Tahoe
Growth invested RMB6.00 million in ThinkLand Technology, among which RMB185,163 was
injected as the registered capital of ThinkLand Technology while the remaining amount was
recorded as ThinkLand Technology’s capital reserve (the “ Series B Investment ”). The
consideration of the Series B Investment was determined based on arm’s length negotiation
between the parties after considering the operation of ThinkLand Technology and the industry
and market conditions. Upon completion of such capital injection on December 23, 2015, the
registered capital of ThinkLand Technology was increased to approximately RMB30.86
million.
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(d) Capital injection by Yiju Liuhe and Liuju Liuhe
On October 13, 2016, ThinkLand Technology passed a shareholders’ resolution pursuant
to which, among others, (i) Yiju Liuhe invested approximately RMB18.03 million in
ThinkLand Technology, among which approximately RMB2.90 million was injected as the
registered capital of ThinkLand Technology while the remaining amount was recorded as
ThinkLand Technology’s capital reserve; and (ii) Liuju Liuhe invested approximately
RMB4.28 million in ThinkLand Technology, among which RMB689,082 was injected as the
registered capital of ThinkLand Technology while the remaining amount was recorded as
ThinkLand Technology’s capital reserve. The consideration was determined based on the net
asset value of ThinkLand Technology. Yiju Liuhe and Liuju Liuhe are our employee
shareholding platforms set up with the purpose to attract and retain management and key
employees of our Group and to align the participants’ interest with the long-term success of our
Group. For the partnership structure of Yiju Liuhe and Liuju Liuhe, see “– Employee
Shareholding Platforms” in this section below.
Upon completion of such capital injection on October 31, 2016, the registered capital of
ThinkLand Technology was increased to approximately RMB34.45 million.
(e) Series C Investment
Pursuant to the capital increase agreement entered into among ThinkLand Technology, the
then Shareholders and Mr. Qiu in December 2016, Mr. Qiu invested RMB200.00 million in
ThinkLand Technology, among which approximately RMB2.76 million was injected as the
registered capital of ThinkLand Technology while the remaining amount was recorded as
ThinkLand Technology’s capital reserve (the “ Series C Investment ”). The amount of
consideration under the Series C Investment was determined based on arm’s length negotiation
between the parties after considering the operation and prospect of ThinkLand Technology.
Upon completion of such capital injection on January 17, 2017, the registered capital of
ThinkLand Technology was increased to approximately RMB37.21 million.
(f) Conversion into joint stock limited liability company
On August 3, 2017, the then Shareholders of ThinkLand Technology resolved at a
shareholders’ general meeting to convert ThinkLand Technology into a joint stock company
with limited liability, with a registered capital of RMB45.00 million. According to the audit
report prepared by an independent auditor, the net asset value of ThinkLand Technology as of
June 30, 2017 amounted to approximately RMB451.33 million, of which (i) RMB45.00 million
was converted into Shares of RMB1.00 nominal value each; and (ii) the remaining RMB406.33
million was converted into capital reserve. Upon Conversion, all the Shareholders as of the
date of conversion held the Shares in proportion to their respective shareholding ratio.
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Upon the completion of registration with the Jiangsu Administration for Industry and
Commerce (၍ଣ҅) on September 20, 2017, ThinkLand Technology was
converted into a joint stock company with limited liability. Immediately upon completion of
the Conversion, the shareholding structure of our Company was as follows:
Name of Shareholder
Number of
Unlisted Shares
Approximate
percentage of
shareholding
M r . Z u o .......................................... 19,322,123 42.93%
JD Technology ...................................... 7,463,958 16.59%
Culture Fund ...................................... 4,478,374 9.95%
M r . Q i u .......................................... 4,037,978 8.97%
Yiju Liuhe ........................................ 3,512,401 7.81%
Mr. Hua Y ong (ۇ1,060,815 2.36%
Mr. Zhou Lijun (ࠏ943,258 2.10%
Liuju Liuhe ........................................ 833,310 1.85%
M s . R e n ......................................... 628,838 1.40%
Tahoe Growth ...................................... 569,780 1.27%
Tahoe Lande ....................................... 520,819 1.16%
Mr. Ning Xinran (್) ................................ 373,198 0.83%
Shanghai Keluopu .................................... 373,198 0.83%
Donghe Huaming .................................... 373,198 0.83%
Tahoe Growth II ..................................... 208,327 0.46%
Mr. Wang Bin ( ˮⅳ) .................................. 186,599 0.41%
M s . H u a ......................................... 69,042 0.15%
Mr. Dong Mingyan (ܗ44,784 0.10%
Total ........................................... 45,000,000 100.00%
(g) Equity Transfers in October 2020
Pursuant to the equity transfer agreement dated October 30, 2020 entered into between
our former Shareholders Culture Fund and Suzhou Tianju Shundang Management Consulting
Partnership (Limited Partnership) ( ᘽψ˂ၳන຅၍ଣፔ༔ΥྫΆุ(Υྫ)) (“ Tianju
Shundang ”), Culture Fund transferred 4,478,374 Shares, being all the Shares held by Culture
Fund and representing approximately 9.95% equity interest of our Company as of the date of
transfer, to Tianju Shundang at a consideration of approximately RMB182.58 million, which
was determined based on the public auction conducted by China Beijing Equity Exchange (the
“Auction Price ”).
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Subsequent to the above transfer, Culture Fund ceased to be our Shareholder. In October
2020, Tianju Shundang transferred an aggregate of 4,478,374 Shares, representing
approximately 9.95% equity interest of our Company as of the date of transfer, to 17 investors
(the “ Equity Transfers in October 2020 ”). See “Pre-IPO Investments” in this section for
details.
(h) Series D Investment
Pursuant to the capital increase agreement dated November 28, 2020, ABC Investment
invested RMB20.00 million in our Company, among which RMB300,000 was injected as the
registered capital of our Company while the remaining amount was recorded as our Company’s
capital reserve (the “ Series D Investment ”). The consideration of the Series D Investment was
determined based on arm’s length negotiation between the parties after considering the
valuation of our Company as estimated by ABC Investment and the industry prospects. Upon
completion of such capital injection, the registered capital of our Company was increased to
approximately RMB45.30 million.
PRC Legal Advisors’ confirmation
As advised by our PRC Legal Advisors, our Company has obtained all necessary
approvals from competent authorities and made all necessary registration and filings with the
relevant local branch of State Administration for Market Regulation of the PRC (̹ఙ္
ຖ၍ଣᐼ҅) in respect of the material aspects set out above.
EMPLOYEE SHAREHOLDING PLATFORMS
In recognition of the contributions of our employees and to incentivize them to further
promote our development, Yiju Liuhe and Liuju Liuhe, each being a limited partnership
established in the PRC, were established as our employee shareholding platforms in September
2016. As of the Latest Practicable Date, each of Yiju Liuhe and Liuju Liuhe was interested in
3,512,401 Shares and 833,310 Shares, representing approximately 7.75% and 1.84% equity
interest of our Company, respectively.
As of the Latest Practicable Date, Yiju Liuhe was held as to 99.00% by Mr. Zuo as its
general partner and 1.00% by Ms. Hua as its limited partner.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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As of the Latest Practicable Date, all of the partnership interests in Liuju Liuhe have been
granted to the eligible employees in recognition of their contribution to our Group. The
partnership structure of Liuju Liuhe was as follows:
Name of partner Position(s) in our Group
Capital
subscription
amount
Partnership
interest
(RMB’000)
Mr. Zuo (1) Chairman, chief executive officer and
executive Director of our Company
2,985.30 69.75%
Chairman and director of Beijing Sidike
Chairman and director of Zhonghui Juhe
Chairman, director, general manager and
head of finance of Wuhan Jushunhe
Director and manager of Juli Wanhe
Director and general manager of Xuzhou
Juhe
Mr. Wang Haojin
(ʦ)
Executive Director of our Company
Supervisor of Juli Wanhe
Supervisor of Xuzhou Juhe
74.90 1.75%
Mr. Lin Shan (ӄ) Executive Director of our Company
Supervisor of Wuhan Jushunhe
64.20 1.50%
Ms. Y ang Y anjun
(ё)
Executive Director, deputy general manager,
secretary to our Board and joint company
secretary of our Company
64.20 1.50%
Mr. Shao Chuangye
(௴ุ)
Chief financial officer of our Company 64.20 1.50%
Mr. Wei Zheng
(ᕧᅄ)
Deputy general manager of our Company 64.20 1.50%
Director and general manager of
Tianju Renhe
Director of Tianju Xinghe
Mr. Dong Chuanzu
(໨ෂૄ)
Deputy general manager of our Company 80.25 1.88%
Mr. Han Jianfeng
(ᒵᄏቜ)
Deputy general manager of our Company 64.20 1.50%
Mr. Shao Lida
(л༺)
Deputy general manager of our Company 64.20 1.50%
Mr. Huang Y anxiang
(රዲജ)
Sales manager of our Company 64.20 1.50%
Ms. Li Shaona
(ࢆ)
General manager of Zhonghui Juhe 64.20 1.50%
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Name of partner Position(s) in our Group
Capital
subscription
amount
Partnership
interest
(RMB’000)
Mr. Chang Liyou
(੬ͭʾ)
Former deputy general manager of our
Company
80.25 1.88%
Mr. Qiu Jie
(໿௫)
Former deputy general manager of our
Company
64.20 1.50%
Mr. Wang Xiaofeng
(ࢤ)
Former marketing manager of our Company 64.20 1.50%
21 other employees
of our Group (2)
Employees 417.20 9.74%
Total 4,280.00 100.00%
Notes:
(1) Mr. Zuo is the sole general partner of Liuju Liuhe.
(2) As of the Latest Practicable Date, each of the 21 other employees of our Group held no more than 1.25%
partnership interest in Liuju Liuhe.
Mr. Zuo, being the sole general partner of Yiju Liuhe and Liuju Liuhe, is entitled to
exercise the respective voting rights held by Yiju Liuhe and Liuju Liuhe in our Company at his
discretion and also execute the partnerships’ affairs on behalf of the respective limited partners
in accordance with the limited partnership agreements. For details of the Employee Incentive
Scheme, see “Appendix VII – Statutory and General Information – D. Employee Incentive
Scheme”.
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PRE-IPO INVESTMENTS
Overview
Set forth below is a summary of the Pre-IPO Investments in our Company by investors who remained as our Shareholders as of the Latest
Practicable Date:
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment
(1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Equity transfer in
January 2014
Equity transfer Ms. Ren Mr. Wang
Haojin
January 28,
2014
2.50% 175,000 Based on arm’s length
negotiation between
the parties with
reference to the
nominal value of
ThinkLand
Technology
1.00 October 31,
2014
98.80%
Series A Investment Capital
injection
JD Technology N/A February 20,
2014
N/A
(3) 19,500,000 Based on arm’s length
negotiation between
the parties after
considering the
operation and
prospect of
ThinkLand
Technology
11.14 February 25,
2014
86.63%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Equity transfer in
February 2015
(the “ Equity
Transfer in
February 2015 ”)
Equity transfer Mr. Zhou Lijun
(ࠏ)
Mr. Zuo February 25,
2015
2.51% 4,500,000 Based on arm’s length
negotiation between
the parties after
considering the
operation of
ThinkLand
Technology
20.51
(4) February 10,
2015
75.39%
Equity transfers in
July 2015
(the “ Equity
Transfers in
July 2015 ”)
Equity transfer Tahoe Growth Mr. Zuo July 24, 2015 1.10% 3,300,000 Based on arm’s length
negotiation between
the parties after
considering the
operation of
ThinkLand
Technology
34.29
(4) June 3, 2015 58.85%
Mr. Zhou Lijun Mr. Zuo July 24, 2015 0.49% 1,476,000 34.29 (4) July 25, 2015 58.85%
Equity transfers in
November 2015
(the “ Equity
Transfers in
November
2015 ”)
Equity transfer Mr. Hua Y ong
(ۇ)
Mr. Zuo November 18,
2015
1.00% 5,000,000 Based on arm’s length
negotiation between
the parties after
considering the
operation of
ThinkLand
Technology
19.23
(4) June 17, 2015 76.92%
Mr. Qiu Mr. Zuo November 18,
2015
2.00% 10,000,000 19.23 (4) June 9, 2015 76.92%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 148 ---
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Series B Investment Capital
injection
JD Technology N/A December 23,
2015
N/A
(3) 31,500,006 Based on arm’s length
negotiation between
the parties after
considering the
operation of
ThinkLand
Technology and the
industry and market
conditions
32.40 December 29,
2015
(5)
61.12%
Tahoe Growth N/A December 23,
2015
N/A(3) 6,000,000 32.40 December 29,
2015 (5)
61.12%
Equity transfers in
March 2016
Equity transfer Shanghai
Keluopu
Ms. Y ang Jin
(ࣜ)
March 31,
2016
1.00% 10,000,000 Based on arm’s length
negotiation between
the parties after
considering the
operation of
ThinkLand
Technology and with
reference to the
investment cost
under the Series B
Investment
32.40 April 11, 2016 61.12%
Mr. Wang Bin
(ˮⅳ)
Ms. Y ang Jin March 31,
2016
0.50% 5,000,000 32.40 March 30, 2016 61.12%
Ms. Hua Ms. Y ang Jin March 31,
2016
0.19% 1,850,000 32.40 January 29, 2016 61.12%
Mr. Qiu Mr. Zuo March 31,
2016
0.20% 2,000,000 32.40 July 9, 2015 61.12%
Mr. Hua Y ong Mr. Zuo March 31,
2016
2.00% 20,000,000 32.40 March 23, 2016 61.12%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 149 ---
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Equity transfers in
January 2017
Equity transfer Tahoe
Growth II
Mr. Zuo January 17,
2017
0.50% 12,000,000 Based on arm’s length
negotiation between
the parties after
considering the
operation and
prospect of
ThinkLand
Technology
69.66 January 25, 2017 16.40%
Tahoe Lande Mr. Zuo January 17,
2017
1.25% 30,000,000 69.66 July 13, 2017 16.40%
Series C Investment Capital
injection
Mr. Qiu N/A January 17,
2017
N/A
(3) 200,000,000 Based on arm’s length
negotiation between
the parties after
considering the
operation and
prospect of
ThinkLand
Technology
72.53 March 1, 2017 12.96%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 138 –


--- page 150 ---
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Equity Transfers in
October 2020
Equity transfer Mr. Cai Yitao
(ᗱ)
Tianju
Shundang
December 23,
2020
0.49% 9,000,000 Based on the Auction
Price, details of
which are set out in
the paragraph
headed “Equity
Transfers in October
2020” above
40.77 October 22,
2020
51.07%
Mr. Chen
Zhixin
(௓қอ)
December 23,
2020
0.19% 3,500,000 40.77 October 23,
2020
51.07%
Mr. Chu
Xiaogang
(࡝)
December 23,
2020
0.82% 15,000,000 40.77 October 27,
2020
51.07%
Datong Qikai December 23,
2020
0.38% 7,000,000 40.77 October 22,
2020
51.07%
Mr. Fan Shebin
(੸)
December 23,
2020
1.20% 22,000,000 40.77 October 20,
2020
51.07%
Ms. Gong
Juhui
(ᛵീሾ)
December 23,
2020
0.27% 5,000,000 40.77 October 24,
2020
51.07%
Mr. Gu
Guomin
(ᚥ਷͏)
December 23,
2020
0.16% 3,000,000 40.77 November 2,
2020
51.07%
Suzhou Guofa
No. 8
December 23,
2020
1.63% 30,000,000 40.77 November 3,
2020
51.07%
Mr. Hua Y ong December 23,
2020
0.77% 14,082,500 40.77 December 9,
2020
51.07%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 139 –


--- page 151 ---
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Mr. Li Zhicong
(ҽқᑋ)
December 23,
2020
0.22% 4,000,000 40.77 October 26,
2020
51.07%
Ms. Lu Fen
(ځ)
December 23,
2020
0.27% 5,000,000 40.77 October 20,
2020
51.07%
Ms. Mao
Sipian
(ᇨ)
December 23,
2020
0.82% 15,000,000 40.77 October 20,
2020
51.07%
Mr. Shao
Zhenkai
(ጲ௱)
December 23,
2020
1.09% 20,000,000 40.77 October 23,
2020
51.07%
Ms. Wang
Liping
(ˮᘆറ)
December 23,
2020
0.06% 1,000,000 40.77 October 26,
2020
51.07%
Mr. Y ang
Xiaoning
(เʃྐྵ)
December 23,
2020
0.11% 2,000,000 40.77 November 2,
2020
51.07%
Mr. Y u
Fangbiao
(Я˙ᅺ)
December 23,
2020
0.65% 12,000,000 40.77 October 20,
2020
51.07%
Mr. Zhong
Weiwei
(ᒤ⒜⒜)
December 23,
2020
0.82% 15,000,000 40.77 October 22,
2020
51.07%
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 152 ---
Relevant
investment
Nature of
investment
Pre-IPO
Investor(s) Transferor(s)
Date of
investment (1)
Equity interest
acquired
Total
consideration
paid Basis of consideration
Investment
cost per
Share
(2)
Date of
settlement
of full
consideration
Discount to
the Offer Price
(RMB) (RMB)
Series D
Investment
Capital
injection
ABC
Investment
N/A December 23,
2020
N/A
(3) 20,000,000 Based on arm’s length
negotiation between
the parties after
considering ABC
Investment’ s
estimate on the
valuation of the
Company and the
industry prospect
66.67 November 30,
2020
19.99%
Equity transfer in
July 2023 (the
“Equity Transfer
in July 2023 ”)
Equity transfer China-
Singapore
V entures
Mr. Zuo July 24, 2023 0.81% 22,000,000 Based on arm’s length
negotiation between
the parties after
considering the
operation of the
Company
59.60 July 24, 2023 28.48%
Notes:
(1) Save for the Equity Transfers in October 2020 and the Equity Transfer in July 2023, the date of investment refers to the date when the registration an d filing of such investments
with local Administration for Market Regulation was completed. The date of investment in respect of the Equity Transfers in October 2020 and the Equit y Transfer in July 2023
refers to the date when our Company updated its register of Shareholders.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 153 ---
(2) The investment cost per Share equals the total consideration paid by the Pre-IPO Investor(s) in each Pre-IPO Investment divided by either (i) the r egistered capital transferred
or subscribed by them; or (ii) the number of Shares acquired by them immediately following their respective Pre-IPO Investment(s).
(3) The equity interest acquired is not applicable to the Pre-IPO Investments which involved capital injections. See “Series A Investment”, “Series B Investment”, “Series C
Investment” and “Series D Investment” for details of such Pre-IPO Investments.
(4) The investment cost per Share increased from RMB20.51 in the Equity Transfer in February 2015 to RMB34.29 in the Equity Transfers in July 2015 demon strated the confidence
of the Pre-IPO Investors in the prospect of ThinkLand Technology. Although the investment cost per Share in the Equity Transfers in November 2015 of RM B19.23 was lower
than that of the Equity Transfers in July 2015, our Company benefited from the management experience and strategic insights brought by Mr. Hua Y ong and Mr. Qiu (each being
a founder of a company listed on the Shenzhen Stock Exchange).
(5) The date of settlement of full consideration of the Series B Investment as set out in a capital contribution verification report issued by certifie d public accountants.
(6) The table above only demonstrates the particular of equity transfers and capital injections made by our Pre-IPO Investors, being investors who re mained as our Shareholders
as of the Latest Practicable Date.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 154 ---
Shareholding structure as of the date of completion each Pre-IPO Investment
The following sets out our Shareholders and shareholding movement after the completion
of each Pre-IPO Investment:
(i) Equity transfer in January 2014
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 6,650.00 95.00
M s .Y a n gJ i n .............................. 175.00 2.50
M s .R e n................................. 175.00 2.50
7,000.00 100.00
(ii) Series A Investment
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 6,650.00 76.00
M s .Y a n gJ i n .............................. 175.00 2.00
M s .R e n................................. 175.00 2.00
JD Technology ............................ 1,750.00 20.00
8,750.00 100.00
(iii) Equity Transfer in February 2015
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 6,430.55 73.49
M s .Y a n gJ i n .............................. 175.00 2.00
M s .R e n................................. 175.00 2.00
JD Technology ............................ 1,750.00 20.00
Mr. Zhou Lijun ............................ 219.45 2.51
8,750.00 100.00
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 155 ---
(iv) Equity Transfers in July 2015
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 6,291.25 71.90
M s .Y a n gJ i n .............................. 175.00 2.00
M s .R e n................................. 175.00 2.00
JD Technology ............................ 1,750.00 20.00
Mr. Zhou Lijun ............................ 262.50 3.00
Tahoe Growth ............................. 96.25 1.10
8,750.00 100.00
(v) Equity Transfers in November 2015
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 17,914.00 68.90
M s .Y a n gJ i n .............................. 520.00 2.00
M s .R e n................................. 520.00 2.00
JD Technology ............................ 5,200.00 20.00
Mr. Zhou Lijun ............................ 780.00 3.00
Tahoe Growth ............................. 286.00 1.10
M r .H u aY o n g ............................. 260.00 1.00
M r .Q i u ................................. 520.00 2.00
26,000.00 100.00
(vi) Series B Investment (Note 1)
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 17,914.00 58.05
M s .Y a n gJ i n .............................. 520.00 1.69
M s .R e n................................. 520.00 1.69
JD Technology ............................ 6,172.11 20.00
Mr. Zhou Lijun ............................ 780.00 2.53
Tahoe Growth ............................. 471.16 1.53
M r .H u aY o n g ............................. 260.00 0.84
M r .Q i u ................................. 520.00 1.69
Culture Fund .............................. 3,703.26 12.00
30,860.53 100.00
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 156 ---
(vii) Equity transfers in March 2016
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 16,750.56 54.28
M s .R e n................................. 520.00 1.69
JD Technology ............................ 6,172.11 20.00
Mr. Zhou Lijun ............................ 780.00 2.53
Tahoe Growth ............................. 471.16 1.53
M r .H u aY o n g ............................. 877.21 2.84
M r .Q i u ................................. 581.72 1.89
Culture Fund .............................. 3,703.26 12.00
Mr. Ning Xinran ........................... 308.61 1.00
Shanghai Keluopu .......................... 308.61 1.00
M r .W a n gB i n ............................. 154.30 0.50
M s .M aX i n .............................. 77.15 0.25
Mr. Zhou Liguo ........................... 61.72 0.20
M s .H u a................................. 57.09 0.19
Mr. Dong Mingyan ......................... 37.03 0.12
30,860.53 100.00
(viii) Equity transfers in January 2017
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 15,977.88 46.35
M s .R e n................................. 520.00 1.51
JD Technology ............................ 6,172.11 17.91
Mr. Zhou Lijun ............................ 780.00 2.26
Tahoe Growth ............................. 471.16 1.37
M r .H u aY o n g ............................. 877.21 2.55
M r .Q i u ................................. 581.72 1.69
Culture Fund .............................. 3,703.26 10.75
Mr. Ning Xinran ........................... 308.61 0.90
Shanghai Keluopu .......................... 308.61 0.90
M r .W a n gB i n ............................. 154.30 0.45
M s .H u a................................. 57.09 0.17
Mr. Dong Mingyan ......................... 37.03 0.11
Yiju Liuhe (Note 2) ......................... 2,904.48 8.43
Liuju Liuhe (Note 2) ........................ 689.08 2.00
Tahoe Growth II ........................... 172.27 0.50
Tahoe Lande .............................. 430.68 1.25
Donghe Huaming .......................... 308.61 0.90
34,454.10 100.00
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 157 ---
(ix) Series C Investment (Note 1)
Shareholder
Approximate
registered capital
contribution
Approximate
equity interest
(RMB’000) (%)
M r .Z u o................................. 15,977.88 42.94
M s .R e n................................. 520.00 1.40
JD Technology ............................ 6,172.11 16.59
Mr. Zhou Lijun ............................ 780.00 2.10
Tahoe Growth ............................. 471.16 1.27
M r .H u aY o n g ............................. 877.21 2.36
M r .Q i u ................................. 3,339.09 8.97
Culture Fund .............................. 3,703.26 9.95
Mr. Ning Xinran ........................... 308.61 0.83
Shanghai Keluopu .......................... 308.61 0.83
M r .W a n gB i n ............................. 154.30 0.41
M s .H u a................................. 57.09 0.15
Mr. Dong Mingyan ......................... 37.03 0.10
Yiju Liuhe (Note 2) ......................... 2,904.48 7.81
Liuju Liuhe (Note 2) ........................ 689.08 1.85
Tahoe Growth II ........................... 172.27 0.46
Tahoe Lande .............................. 430.68 1.16
Donghe Huaming .......................... 308.61 0.83
37,211.47 100.00
(x) Equity transfer in October 2020
Shareholder Number of Shares
Approximate
equity interest
(%)
M r .Z u o................................. 19,740,105 43.86
M s .R e n................................. 628,838 1.40
JD Technology ............................ 7,463,958 16.59
Tahoe Growth ............................. 569,780 1.27
M r .H u aY o n g ............................. 1,406,230 3.13
M r .Q i u ................................. 4,037,978 8.97
Mr. Ning Xinran ........................... 373,198 0.83
Shanghai Keluopu .......................... 373,198 0.83
M r .W a n gB i n ............................. 186,599 0.41
M s .H u a................................. 69,042 0.15
Yiju Liuhe (Note 2) ......................... 3,512,401 7.81
Liuju Liuhe (Note 2) ........................ 833,310 1.85
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 158 ---
Shareholder Number of Shares
Approximate
equity interest
(%)
Tahoe Growth II ........................... 208,327 0.46
Tahoe Lande .............................. 520,819 1.16
Mr. Cai Yitao ............................. 220,751 0.49
Mr. Chen Zhixin ........................... 85,848 0.19
Mr. Chu Xiaogang .......................... 367,919 0.82
Datong Qikai ............................. 171,696 0.38
Mr. Fan Shebin ............................ 539,615 1.20
Ms. Gong Juhui ........................... 122,640 0.27
Mr. Gu Guomin ........................... 73,584 0.16
Suzhou Guofa No. 8 ........................ 735,838 1.63
Mr. Li Zhicong ............................ 98,112 0.22
M s .L uF e n ............................... 122,640 0.27
Ms. Mao Sipian ........................... 367,919 0.82
Mr. Shao Zhenkai .......................... 490,559 1.09
Ms. Wang Liping .......................... 24,528 0.06
Mr. Y ang Xiaoning ......................... 49,056 0.11
Mr. Y u Fangbiao ........................... 294,335 0.65
Mr. Zhong Weiwei ......................... 367,919 0.82
Ms. Li Xuemei ............................ 943,258 2.10
45,000,000 100.00
(xi) Series D Investment (Note 1)
Shareholder Number of Shares
Approximate
equity interest
(%)
M r .Z u o................................. 19,740,105 43.58
M s .R e n................................. 628,838 1.39
JD Technology ............................ 7,463,958 16.48
Tahoe Growth ............................. 569,780 1.26
M r .H u aY o n g ............................. 1,406,230 3.11
M r .Q i u ................................. 4,037,978 8.91
Mr. Ning Xinran ........................... 373,198 0.82
Shanghai Keluopu .......................... 373,198 0.82
M r .W a n gB i n ............................. 186,599 0.41
M s .H u a................................. 69,042 0.15
Yiju Liuhe (Note 2) ......................... 3,512,401 7.75
Liuju Liuhe (Note 2) ........................ 833,310 1.84
Tahoe Growth II ........................... 208,327 0.46
Tahoe Lande .............................. 520,819 1.15
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
– 147 –


--- page 159 ---
Shareholder Number of Shares
Approximate
equity interest
(%)
Mr. Cai Yitao ............................. 220,751 0.49
Mr. Chen Zhixin ........................... 85,848 0.19
Mr. Chu Xiaogang .......................... 367,919 0.81
Datong Qikai ............................. 171,696 0.38
Mr. Fan Shebin ............................ 539,615 1.19
Ms. Gong Juhui ........................... 122,640 0.27
Mr. Gu Guomin ........................... 73,584 0.16
Suzhou Guofa No. 8 ........................ 735,838 1.63
Mr. Li Zhicong ............................ 98,112 0.22
M s .L uF e n ............................... 122,640 0.27
Ms. Mao Sipian ........................... 367,919 0.81
Mr. Shao Zhenkai .......................... 490,559 1.08
Ms. Wang Liping .......................... 24,528 0.06
Mr. Y ang Xiaoning ......................... 49,056 0.11
Mr. Y u Fangbiao ........................... 294,335 0.65
Mr. Zhong Weiwei ......................... 367,919 0.81
Ms. Li Xuemei ............................ 943,258 2.08
ABC Investment ........................... 300,000 0.66
45,300,000 100.00
(xii) Equity transfer in July 2023
Shareholder Number of Shares
Approximate
equity interest
(%)
M r .Z u o................................. 19,744,192 43.59
M s .R e n................................. 628,838 1.39
JD Technology ............................ 7,463,958 16.48
Mr. Zhou Lijun ............................ 943,258 2.08
Tahoe Growth ............................. 569,780 1.26
M r .H u aY o n g ............................. 1,406,230 3.11
M r .Q i u ................................. 4,037,978 8.91
Shanghai Keluopu .......................... 373,198 0.82
M r .W a n gB i n ............................. 186,599 0.41
M s .H u a................................. 69,042 0.15
Yiju Liuhe (Note 2) ......................... 3,512,401 7.75
Liuju Liuhe (Note 2) ........................ 833,310 1.84
Tahoe Growth II ........................... 208,327 0.46
Tahoe Lande .............................. 520,819 1.15
Mr. Cai Yitao ............................. 220,751 0.49
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 160 ---
Shareholder Number of Shares
Approximate
equity interest
(%)
Mr. Chen Zhixin ........................... 85,848 0.19
Mr. Chu Xiaogang .......................... 367,919 0.81
Datong Qikai ............................. 171,696 0.38
Mr. Fan Shebin ............................ 539,615 1.19
Ms. Gong Juhui ........................... 122,640 0.27
Mr. Gu Guomin ........................... 73,584 0.16
Suzhou Guofa No. 8 ........................ 735,838 1.63
Mr. Li Zhicong ............................ 98,112 0.22
M s .L uF e n ............................... 122,640 0.27
Ms. Mao Sipian ........................... 367,919 0.81
Mr. Shao Zhenkai .......................... 490,559 1.08
Ms. Wang Liping .......................... 24,528 0.06
Mr. Y ang Xiaoning ......................... 49,056 0.11
Mr. Y u Fangbiao ........................... 294,335 0.65
Mr. Zhong Weiwei ......................... 367,919 0.81
ABC Investment ........................... 300,000 0.66
China-Singapore V entures .................... 369,111 0.81
45,300,000 100.00
Notes:
(1) The approximate registered capital contribution in respect of Series A Investment, Series B Investment
and Series C Investment represents the approximate amount allocated from the total consideration paid
by our Pre-IPO Investors and recognized as the registered capital contribution in our Company, whereas
the number of Shares in respect of Series D Investment represents the number of Shares corresponding
to the approximate amount allocated from the total consideration paid by ABC Investment and
recognized as the registered capital contribution in our Company. The remaining amount of
consideration was recorded as our Company’s capital reserve. For details, please refer to the paragraph
headed “Major corporate developments of our Company” in this section.
(2) Each of Yiju Liuhe and Liuju Liuhe is an employee shareholding platform of our Company and thus not
a Pre-IPO Investor.
(3) In addition to the above Pre-IPO Investments, our Company has undergone a series of corporate
developments including equity transfers and capital injections which involved Mr. Zuo and/or the then
Shareholder(s) who are not our Pre-IPO Investors. The tables above only demonstrate the shareholding
movement after completion of each Pre-IPO Investment.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 161 ---
Principal terms of the Pre-IPO Investments
Set forth below is a summary of the details of the Pre-IPO Investments:
Use of proceeds Out of the Pre-IPO Investments, our Company
received proceeds from capital injections, namely Series
A Investment, Series B Investment, Series C Investment
and Series D Investment, which amounted to
approximately RMB277.00 million. As of the Latest
Practicable Date, all of the net proceeds from the
Pre-IPO Investments received by our Company have
been utilized for the development and operation of our
business, including but not limited to R&D activities,
recruiting experienced employees and general working
capital.
Strategic benefits of the
Pre-IPO Investors
brought to our Company
Our Group was of the view that we could benefit from
the additional funds provided by our Pre-IPO Investors
for our R&D activities and daily operation, as well as
the insights for industry, the knowledge and experience
of our Pre-IPO Investors. The investments from our
Pre-IPO Investors demonstrated their confidence in our
Group’s operation and capabilities and served as an
endorsement of our Group’s performance and prospect.
Also, our Pre-IPO Investors include experienced
investors and investment funds in the areas of
technology industry, who can share their insights on
business strategies and provide professional advice on
our Group’s operation.
Lock-up period Pursuant to the applicable PRC laws, all Shares issued
by our Company prior to the Global Offering (including
those held by our Pre-IPO Investors) are subject to
transfer restriction for a period of one year from the
Listing Date.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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--- page 162 ---
Special rights granted to our Pre-IPO Investors
Pursuant to the respective shareholders’ agreements and capital increase agreements
(including the supplemental agreements) entered into between our Company and our Pre-IPO
Investors, our Pre-IPO Investors were granted certain customary special rights, including but
not limited to divestment rights, rights of first refusal, tag-along rights, exclusivity rights,
information rights and anti-dilution rights (as the case may be). Save for redemption rights
granted to China-Singapore V entures, none of the other Pre-IPO Investors is entitled to any
special right under the Pre-IPO Investments which would survive upon Listing.
The redemption rights of the China-Singapore V entures shall be terminated before the
first filing of the Listing application by our Company with the Stock Exchange, and shall
resume to be exercisable upon the earliest of (i) the Listing application being voluntarily
withdrawn, returned in writing, revoked, or not approved by the Stock Exchange for any
reason; or (ii) if the Listing of our H Shares does not take place on the Stock Exchange or any
other securities exchange approved by China-Singapore V entures by June 30, 2024.
Considering the redemption rights granted to China-Singapore V entures have been terminated
before the first filing of the Listing application by our Company with the Stock Exchange and
may only resume if the Listing does not take place, the aforesaid arrangements comply with
paragraph 13 of Chapter 4.2 (Pre-IPO Investments) of the Guide.
Save as disclosed above, there are no other side agreements, understandings,
arrangements or undertakings, verbal or in writing, between our Company (including any of
our subsidiaries, their directors, supervisors, shareholders, senior management or any of their
respective associates) and each of our Pre-IPO Investors (including their beneficial owners and
directors), in relation to their investments in our Group, that are subsisting.
Background of our principal Pre-IPO Investors
Below sets out the background information of our principal Pre-IPO Investors based on
information available to us. Our principal Pre-IPO Investors include (i) individual investors
that have made meaningful investment in our Company and each holding more than 1% of our
total issued share capital immediately prior to the Global Offering; and (ii) corporate Pre-IPO
Investors.
(a) JD Technology
JD Technology was established in the PRC on September 5, 2012 and is primarily
engaged in the provision of technology products and solutions to its business partners including
enterprises, financial institutions and government. As of the Latest Practicable Date, JD
Technology was a majority-controlled company (as defined in the Listing Rules) of Mr.
Richard Qiangdong Liu (؇“() Mr. Richard Liu ”) where Mr. Richard Liu was entitled to
exercise majority control over JD Technology through his direct and indirect interest in JD
Technology. JD Technology is also one of our substantial Shareholders.
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(b) Suzhou Guofa No. 8
Suzhou Guofa No. 8 is a limited partnership established in the PRC on July 23, 2019 with
a registered capital of RMB30.02 million and an investment fund registered under the Asset
Management Association of China with an aggregate amount of assets under management of
approximately RMB30.02 million. Suzhou Guofa No. 8 primarily focuses on investment
opportunities in high-tech industries and venture capital. As of the Latest Practicable Date,
Suzhou Guofa No. 8 had four limited partners, with the largest limited partner holding
approximately 46.64% partnership interest in Suzhou Guofa No. 8 and one general partner and
fund manager, Suzhou International Development Asset Management Co., Ltd. ( ᘽψ਷೯༟ପ
ʮ̡)( “ Suzhou International Development ”), which held approximately 0.07%
partnership interest in Suzhou Guofa No. 8. Suzhou International Development was ultimately
wholly-owned by Suzhou Finance Bureau (҅).
(c) Tahoe Growth
Tahoe Growth is a limited partnership established in the PRC on November 5, 2014 with
a registered capital of RMB63.00 million and an investment fund registered under the Asset
Management Association of China with an aggregate amount of assets under management of
approximately RMB63.00 million. Tahoe Growth primarily focuses on investment
opportunities in venture capital with major industry experience in technology, media, and
telecommunications (TMT) and medical health. As of the Latest Practicable Date, the
partnership structure of Tahoe Growth was as follows:
Name of partner
Approximate
partnership
interest
General partner ................................................
Tahoe V enture Capital ............................................. 8.25%
Limited partners ...............................................
Mr. Niu Shengjie ( ඐ᳅௫) ........................................... 28.27%
Suzhou Gelin Investment Management Co., Ltd. (ʮ̡) ............... 23.81%
Suzhou Debt and Fund Management Center (၍ଣʕː)( “ Suzhou Debt and Fund ”)
(formerly known as Suzhou Government Guidance Fund Management Centerږ
၍ଣʕː) ).................................................. 19.05%
Ningbo Xinhui Enterprise Management Partnership (Limited Partnership) (㒥ກΆุ၍ଣΥྫΆุ
(Υྫ) ) .................................................. 10.10%
Mr. Xiong Ju (ދ6.48%
Suzhou Y uanhua Chuangxing Investment Management Co., Ltd. (ʮ̡) . . . 4.04%
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Tahoe V enture Capital (the general partner of Tahoe Growth, Tahoe Lande and Tahoe
Growth II) was in turn owned as to (i) 58.00% by our Supervisor, Mr. Y u Gang, as its general
partner; (ii) 22.00% by Mr. Zhang Xiaoliang (ڥan independent third party of our
Company) as its general partner; and (iii) 20.00% by Mr. Lu Kai ( ጅ௱) (an independent third
party of our Company) as its general partner. For information on Mr. Y u Gang, see “Directors,
Supervisors and Senior Management”.
(d) Tahoe Lande
Tahoe Lande is a limited partnership established in the PRC on December 21, 2016 with
a registered capital of RMB30.00 million and an investment fund registered under the Asset
Management Association of China with an aggregate amount of assets under management of
approximately RMB30.00 million. Tahoe Lande is a special-purpose vehicle established to
invest in our Company. As of the Latest Practicable Date, Tahoe Lande has only invested in our
Company and was interested in approximately 1.15% equity interest in our Company. The
partnership structure of Tahoe Lande was as follows:
Name of partner
Approximate
partnership
interest
General partner ................................................
Tahoe V enture Capital (1) ............................................ 1.67%
Limited partners ................................................
Ningbo Xinhun Enterprise Management Partnership (Limited Partnership) (㒥ກΆุ၍ଣΥྫΆุ
(Υྫ)) (“ Ningbo Xinhun ” ) ...................................... 43.33%
Mr. Zhang Xiaomin ( ੵወᦩ) ......................................... 28.33%
Shihezi Qianwei Equity Investment Partnership (Limited Partnership) (ᛆҳ༟ΥྫΆุ
(Υྫ)) (“ Shihezi Qianwei ”)(2) ..................................... 20.00%
Ms. Zhang Kechun ( ੵ̙ॱ) .......................................... 3.33%
Mr. Wu Shuheng ( юബ㛬)........................................... 3.33%
Notes:
(1) The partnership structure of Tahoe V enture Capital is set out in the paragraph headed “Background of our
principal Pre-IPO Investors – (c) Tahoe Growth” above.
(2) As of the Latest Practicable Date, our executive Directors Mr. Zuo and Mr. Lin Shan were interested in
approximately 5.51% and 9.19% partnership interest in Shihezi Qianwei as its limited partner.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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(e) Tahoe Growth II
Tahoe Growth II is a limited partnership established in the PRC on January 22, 2016 with
a registered capital of RMB49.20 million and an investment fund registered under the Asset
Management Association of China with an aggregate amount of assets under management of
approximately RMB72.50 million. Tahoe Growth II primarily focuses on investment
opportunities in venture capital with major industry experience in TMT and medical health. As
of the Latest Practicable Date, the partnership structure of Tahoe Growth II was as follows:
Name of partner
Approximate
partnership
interest
General partner ................................................
Tahoe V enture Capital (1) ............................................ 8.55%
Limited partners ................................................
Ms. Xue Jianfang (ٹܔ28.97%
Suzhou Debt and Fund ............................................ 16.55%
Suzhou Chuangke Angel Investment Management Co., Ltd. (ʮ̡) ..... 13.79%
Ningbo Xinhun ................................................. 9.92%
Mr. Zhang Xiaomin ( ੵወᦩ) ......................................... 8.93%
Mr. Xu Zhengjiang ( ஢͍Ϫ) .......................................... 3.97%
Ms. Xiao Xin ( ӽอ) .............................................. 3.97%
Suzhou Y uanhua Chuangxing Investment Management Co., Ltd. (ʮ̡) . . . 3.97%
Ms. Chen Qifang (ٹ1.38%
Note:
(1) The partnership structure of Tahoe V enture Capital is set out in the paragraph headed “Background of our
principal Pre-IPO Investors – (c) Tahoe Growth” above.
(f) Shanghai Keluopu
Shanghai Keluopu is a limited partnership established in the PRC on July 8, 2014 with
a registered capital of RMB10.00 million and an investment fund registered under the Asset
Management Association of China with an aggregate amount of assets under management of
approximately RMB68.50 million. Shanghai Keluopu primarily focuses on investment
opportunities in leasing and business services, scientific research and technical services. As of
the Latest Practicable Date, Shanghai Keluopu was owned as to 70.00% by its limited partner
Shanghai Wenxin Business Consulting Center (Limited Partnership) (ਠਕፔ༔ʕː
(Υྫ)) and 30.00% by its general partner Shanghai Puyuan Asset Management Center
(Limited Partnership) ( ɪऎዾ๕༟ପ၍ଣʕː(Υྫ)) (“ Shanghai Puyuan ”). Shanghai
Puyuan was in turn owned as to 99.00% by its limited partner Mr. Wang Yi ( ˮɓ) and 1.00%
by its general partner Shanghai Pushui Investment Management Co., Ltd. ( ɪऎዾ˥ҳ༟၍ଣ
ʮ̡)( “ Shanghai Pushui ”), where Shanghai Pushui was wholly owned by Mr. Wang Yi.
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(g) Datong Qikai
Datong Qikai is a company established in the PRC with limited liability on February 20,
2017 with a registered capital of RMB20.00 million. Datong Qikai is principally engaged in the
provision of investment management and equity investment services and primarily focuses on
investment opportunities in the internet industry with an aggregate amount of investment under
management of approximately RMB240.50 million. As of the Latest Practicable Date, Datong
Qikai was owned as to (i) 40.00% by Zhejiang Datong Holding Group Co., Ltd. ( एϪɽஷછ
ʮ̡)( “ Zhejiang Datong ”); (ii) 30.00% by Ms. Cao Tian ( ૎͞); and (iii) 30.00%
by Mr. Jia Weikang ( ༠ਃੰ). Zhejiang Datong was in turn wholly-owned by Tongxiang
Dayang Industrial Co., Ltd. (ʮ̡), which was in turn owned as to (i)
22.25% by Mr. Wu Rongming (׼ii) 22.25% by Ms. Jiang Ruming (׼iii)
22.25% by Mr. Zhu Xiaozhong (׀iv) 22.25% by Ms. Sheng Xuehua ( ସ௛ശ); (v)
8.00% by Ms. Zhu Qinge (ࢎand (vi) 3.00% by Ms. Jin Juanhua (ശ).
(h) ABC Investment
ABC Investment is a company established in the PRC with limited liability on August 1,
2017 with a registered capital of RMB20.00 billion. ABC Investment is principally engaged in
the marketisation and legalisation of debt-to-equity and relevant supporting services as well as
fundraising from qualified social investors to support the marketisation of debt-to-equity,
issuance of financial bonds and financial advisory and consulting services related to
debt-to-equity business, etc. As of the Latest Practicable Date, ABC Investment is wholly
owned by Agricultural Bank of China Limited (ʮ̡), a joint stock
limited company established in the PRC with limited liability, the H shares of which are listed
on the Main Board of the Stock Exchange (stock code: 1288), and the A shares of which are
listed on the Shanghai Stock Exchange (stock code: 601288), respectively.
(i) China-Singapore V entures
China-Singapore V entures is a company established in the PRC with limited liability on
November 28, 2001 with a registered capital of RMB1.73 billion. China-Singapore V entures is
principally engaged in the investment of new and high-tech enterprises, as well as the provision
of mergers and acquisitions, reorganization and management consulting services. As of the
Latest Practicable Date, China-Singapore V entures was wholly-owned by Suzhou Oriza
Holdings Corporation (ʮ̡), which was in turn owned as to (i) 59.98%
by Suzhou Industrial Park Economic Development Co., Ltd. (ʮ̡)
(“SIP Economic Development ”); (ii) 20.02% by Jiangsu Guoxin Investment Group Limited
(ʮ̡)( “ Jiangsu Guoxin ”); and (iii) 20.00% by Suzhou Industrial Park
State-owned Capital Investment and Operation Holdings Co., Ltd. ( ᘽψʈุ෤ਜ਷Ϟ༟͉ҳ
ʮ̡)( “ SIP State-owned Capital Holding ”). SIP Economic Development
was owned as to 90% by Suzhou Industrial Park Administrative Committee ( ᘽψʈุ෤ਜ၍
ึ) and 10% by Jiangsu Provincial Department of Finance (ᝂ). Jiangsu
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Guoxin was wholly-owned by Jiangsu Provincial People’s Government (ִ݁SIP
State-owned Capital Holding was owned as to 90% by Suzhou Industrial Park Administrative
Committee and 10% by Jiangsu Provincial Department of Finance.
(j) Mr. Qiu
Mr. Qiu is our non-executive Director. For information on Mr. Qiu, see “Directors,
Supervisors and Senior Management”.
(k) Mr. Hua Y ong
Mr. Hua Y ong is a friend of Mr. Zuo (our chairman, chief executive officer and executive
Director) and he became acquainted with Mr. Zuo on a social occasion. Mr. Hua Y ong has over
18 years of experience in technology industry. Mr. Hua Y ong is the founder, former chairman,
former general manager and ultimate beneficial owner of Hangzhou Shunwang Technology
Co., Ltd. (ʮ̡), a company principally engaged in the provision of
computer application services, whose shares are listed on the Shenzhen Stock Exchange (stock
code: 300113). He is also (i) the executive director of (a) Ningbo Shunwangqiang Holding Co.,
Ltd. (ʮ̡), (b) Zhejiang Quanshichen Enterprise Management Co., Ltd.
(ʮ̡), (c) Hangzhou Zihui Property Co., Ltd. (ʮ
̡), (d) Hangzhou Online Game Town Tourism Investment Co., Ltd. (༷ҳ༟
ʮ̡) and (e) Zheli Digital Interactive Entertainment Base (Hangzhou) Commercial
Operation Management Co., Ltd. (ਿή(ψ)ʮ̡); (ii) the
chairman of Hangzhou Shunwangsheng Investment Co., Ltd. (ʮ̡) and
Jiangsu Guorui Xinan Technology Co., Ltd. (ʮ̡); (iii) the director of
Shanghai Wangyu Information Technology Co., Ltd. (ʮ̡) and
Shanghai Hanwei Xinheng Exhibition Co., Ltd. (ʮ̡); and (iv) the
executive director and general manager of Zhejiang Shunwang Holdings Co., Ltd. ( एϪනၣ
ʮ̡) and Hangzhou Zihui Commercial Management Co., Ltd. (ψ༟ሾਠุ၍ଣϞ
ʮ̡).
(l) Mr. Zhou Lijun
Mr. Zhou Lijun was introduced to us by a mutual acquaintance. Mr. Zhou Lijun has over
four years of experience in administrative management. He is currently the head of
administration of China Overseas Property Management Co., Ltd. (ʮ̡), a
company principally engaged in the provision of property management services.
(m) Ms. Ren
Ms. Ren is our Supervisor. For information on Ms. Ren, see “Directors, Supervisors and
Senior Management”.
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(n) Mr. Fan Shebin
Mr. Fan Shebin was introduced to us by a mutual acquaintance. Mr. Fan is an experienced
investor with over 10 years of experience. Mr. Fan Shebin is currently (i) the supervisor of (a)
Guangzhou Aishun Labour Service Co., Ltd. (ʮ̡), (b) Beihai
Chenshuo Asset Management Co., Ltd. (ʮ̡), (c) Beihai Fujun
Investment Management Co., Ltd. (ʮ̡), (d) Beijing Jiayuqi
Technology Co., Ltd. (ʮ̡), (e) Beijing Yizhiyu Trading Co., Ltd. ( ̏ԯ
ʮ̡) and (f) Beijing Fuan Chenyu Commercial Management Co., Ltd. ( ̏ԯ
ʮ̡); (ii) the manager and executive director of Shenghua Rongxi
(Beijing) Investment Fund Management Co., Ltd. ( ସശፄဢ(̏ԯ)ʮ̡) and
Handan Jinyida Property Service Co., Ltd. (ʮ̡); (iii) the
executive director of Hebei Jinxiang Real Estate Development Co., Ltd. (ήପක೯
ʮ̡); and (iv) the general manager and director of Beijing Shunxiang Home Hotel Co.,
Ltd. (ʮ̡).
(o) Mr. Chu Xiaogang
Mr. Chu Xiaogang is a friend of Mr. Zuo (our chairman, chief executive officer and
executive Director) and he became acquainted with Mr. Zuo on a social occasion. Mr. Chu
Xiaogang has over six years of experience in export and import trading. He is currently the
director of Zhejiang Xibin Import & Export Co., Ltd. (ʮ̡).
To the best knowledge and belief of our Directors, each of our Pre-IPO Investors decided
to invest in our Group in view of the prospects and potential growth of our Group and the
industry which we operate in. To the best knowledge and belief of our Directors after making
reasonable enquiries, other than JD Technology, Tahoe Growth, Tahoe Lande, Tahoe Growth II,
Mr. Qiu, Ms. Ren and Ms. Hua, each of our Pre-IPO Investors, its general partners and limited
partners (as applicable) and its respective ultimate beneficial owners is an Independent Third
Party.
Sole Sponsor’s Confirmation
On the basis that (i) the consideration for the Pre-IPO Investments was settled at least 28
clear days prior to the date of the first submission of our Company’s Listing application form
to the Stock Exchange; and (ii) the termination or cessation of special rights granted to the
Pre-IPO Investors as disclosed in “Special rights granted to our Pre-IPO Investors” above, the
Sole Sponsor is of the view that the Pre-IPO Investments are in compliance with Chapter 4.2
(Pre-IPO Investments) of the Guide.
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OUR SUBSIDIARIES
As of the Latest Practicable Date, our business operations have been carried out by our
Company, our seven subsidiaries in the PRC and one subsidiary in Hong Kong. Set out below
are the major corporate developments including major changes in the shareholding structure
and the registered capital of our subsidiaries during the Track Record Period:
(a) Tianju Renhe
Tianju Renhe (formerly known as Zhuhai Alitaoka Network Technology Co., Ltd. ( मऎ
ʮ̡)) was established in the PRC as a limited liability company on
September 7, 2009 with an initial registered capital of RMB100,000. As of the date of its
establishment, Tianju Renhe was owned as to 50.00% by Mr. Tian Congshi ( ͞੽ͩ) and
50.00% by Ms. Fang Min ( ˙ઽ), both being Independent Third Parties. Subsequent to a series
of equity transfers, Tianju Renhe became wholly owned by Suzhou Jiepai Information
Technology Co., Ltd. (ʮ̡)( “Jiepai IT ”), an Independent Third Party.
Pursuant to the equity transfer agreement dated September 19, 2019 entered into between
Jiepai IT and our Company, our Company acquired the entire equity interest of Tianju Renhe
from Jiepai IT at a consideration of RMB100,000 (the “ Equity Transfer ”), which was
determined based on arm’s length negotiation with reference to the nominal value of the shares
of Tianju Renhe, and was fully settled in September 2019. On September 28, 2019, our
Company, Jiepai IT and its affiliate entered into a subsequent agreement to revisit the
consideration for the Equity Transfer. As Tianju Renhe had entered into a “direct connection
agreement” with one of the largest telecom services providers in the PRC at the time, Jiepai
IT requested to increase the consideration of the Equity Transfer to RMB1,350,000 (taking into
consideration the value of the “direct connection agreement” and determined with reference to
the then consideration paid by Jiepai IT for the acquisition of Tianju Renhe), which was
considered fair and reasonable and was agreed by our Company. As the remaining terms of the
equity transfer agreement remained the same, the industrial and commercial change
registration in respect of the Equity Transfer had not been updated to reflect the revised
consideration. As advised by our PRC Legal Advisers, as there is no clear requirement in the
relevant regulations on industrial and commercial registration that the consideration for equity
transfers should be clearly registered when changing industrial and commercial registrations,
the revised consideration will not affect the validity of the industrial and commercial change
registration of the Equity Transfer because (i) the consideration for equity transfers is not
required to be registered in the industrial and commercial change registration and we
successfully obtained confirmation of the change from the industrial and commerce registration
authorities in October 2019; (ii) as at the Latest Practicable Date, we have not been penalised
by the industrial and commerce registration authorities as a result of the inconsistency and the
industrial and commercial change registration of the Equity Transfer has not been revoked due
to the inconsistency; and (iii) upon acquiring Tianju Renhe, we have completed the submission
of annual corporate information reports in accordance with relevant regulations every year.
Upon completion of such acquisition, Tianju Renhe became our wholly-owned subsidiary.
Tianju Renhe has increased its initial registered capital from RMB100,000 to RMB2.10 million
in March 2016; and subsequently increased its registered capital to RMB10.00 million in April
2017.
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As of the Latest Practicable Date, Tianju Renhe is principally engaged in the provision
of top-up services in the PRC, including calls and data top-ups.
(b) Tianju Xinghe
Tianju Xinghe was established in the PRC on December 3, 2019 with an initial registered
capital of RMB5.00 million. Since its establishment, Tianju Xinghe has been indirectly
wholly-owned by our Company and there has been no change in its registered capital and
ownership structure.
As of the Latest Practicable Date, Tianju Xinghe is principally engaged in the provision
of top-up services in the PRC, including calls and data top-ups.
(c) Juli Wanhe
Juli Wanhe was established in the PRC on April 22, 2015 with an initial registered capital
of RMB50,000. Since its establishment, Juli Wanhe has been directly wholly-owned by our
Company and there has been no change in its registered capital and ownership structure.
As of the Latest Practicable Date, Juli Wanhe had not commenced any substantive
business.
(d) Beijing Sidike
Beijing Sidike was established in the PRC on January 8, 2015 with an initial registered
capital of approximately RMB1.00 million. As of the Latest Practicable Date, Beijing Sidike
was owned as to (i) 85.50% by our Company; (ii) 10.00% by Tahoe Growth; and (iii) 4.50%
by Mr. Ding Y ang ( ɕ౮), who is the director and general manager of Beijing Sidike. As of the
Latest Practicable Date, Tahoe Growth was interested in approximately 1.26% equity interest
in our Company. See “– Background of our principal Pre-IPO Investors” above for the
shareholding structure of Tahoe Growth. Since the establishment of Beijing Sidike, there has
been no change in its registered capital and ownership structure.
As of the Latest Practicable Date, Beijing Sidike had not commenced any substantive
business.
(e) Zhonghui Juhe
Zhonghui Juhe was established in the PRC on November 16, 2016 with an initial
registered capital of RMB5.00 million. Since the establishment of Zhonghui Juhe, Zhonghui
Juhe has undergone several equity transfers and there has been no change in its registered
capital. As of the Latest Practicable Date, Zhonghui Juhe was owned as to (i) 60.00% by our
Company; (ii) 20.00% by Suzhou Y uncai Zhongchuang Enterprise Management Co., Ltd. ( ᘽ
ʮ̡), which was in turn owned as to approximately (a) 98.33% by
Mr. Xu Taiwei (इਃ) and (b) 1.67% by Ms. Li Na (ࢆiii) 10.00% by Jiangsu Boyun
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Technology Co., Ltd. (ʮ̡)( “ Jiangsu Boyun ”), which was in turn
owned as to approximately (a) 19.52% by Mr. Hua Lei (ᆾ), (b) 0.47% by Mr. Zuo (our
chairman, chief executive officer and executive Director) and (c) 80.01% by other
37 shareholders, amongst which no shareholder owned more than 8.00% equity interest in
Jiangsu Boyun; and (iv) 10.00% by Kesheng Wireless (Suzhou) Co., Ltd. (ʺೌᇞ(ᘽψ)ٰ
ʮ̡), which was ultimately owned by Mr. Liu Xiaolei ( ᄎወཤ) and Mr. Li Zhengzhi
(ٜSave for Jiangsu Boyun, each of the minority shareholders of Zhonghui Juhe is an
Independent Third Party.
As of the Latest Practicable Date, Zhonghui Juhe is principally engaged in the provision
of big data services and information technology solutions.
(f) Wuhan Jushunhe
Wuhan Jushunhe was established in the PRC on August 9, 2021 with an initial registered
capital of RMB3.00 million. As of the Latest Practicable Date, Wuhan Jushunhe was owned as
to (i) 51.00% by our Company and (ii) 49.00% by Mr. Wang Jiarong ( ˮԳ࿲), who is a former
employee of our Company. Upon the establishment of Wuhan Jushunhe, Wuhan Jushunhe was
owned as to (i) 51.00% by our Company; (ii) 46.00% by Mr. Chen Wei (۾and (iii) 3.00%
by Mr. Wang Jiarong. In August 2022, Mr. Chen Wei transferred his 46.00% equity interest in
Wuhan Jushunhe to Mr. Wang Jiarong. Since the establishment of Wuhan Jushunhe, there has
been no change in its registered capital.
As of the Latest Practicable Date, Wuhan Jushunhe had not commenced any substantive
business.
(g) JuheData HK
JuheData HK was incorporated in Hong Kong with limited liability on January 7, 2016
with an initial registered capital of USD1.00 million. Since the date of its incorporation,
JuheData HK has been a direct wholly-owned subsidiary of our Company and there has been
no change in its registered capital and ownership structure.
As of the Latest Practicable Date, JuheData HK had not commenced any substantive
business.
(h) Xuzhou Juhe
Xuzhou Juhe was established in the PRC on March 28, 2024 with an initial registered
capital of USD30 million. Since the date of its establishment, Xuzhou Juhe has been a direct
wholly-owned subsidiary of JuheData HK and there has been no change in its registered capital
and ownership structure.
As of the Latest Practicable Date, Xuzhou Juhe had not commenced any substantive
business.
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As advised by our PRC Legal Advisors, according to the Administrative Regulation of the
People’s Republic of China on the Registration of Market Entities and the PRC Company Law,
the acquisition of the equity interests by our Group as described above had been properly and
legally completed and settled, and obtained all applicable regulatory approvals.
MAJOR ACQUISITIONS, DISPOSALS AND MERGERS
During the Track Record Period and as of the Latest Practicable Date, our Group did not
have any major acquisitions, disposals or mergers.
PREVIOUS LISTING ATTEMPT
We had historically explored listing opportunities in the PRC (the “ Previous Listing
Attempts ”).
In November 2018, we made an application with the ChiNext Board of the Shenzhen
Stock Exchange (the “ ChiNext Board ”) to explore a potential listing on the ChiNext Board
(the “ ChiNext Board Application ”) as we believed that a listing on the A-share market would
bring us (i) funds for our future business expansion, (ii) more financing opportunities to
optimize our capital structure, and (iii) enhancement of our brand awareness. However, having
considered the introduction of the registration-based IPO system introduced on the STAR
Market of the Shanghai Stock Exchange (the “ STAR Market ”), we eventually withdrew the
ChiNext Board Application in 2019 and entered into guidance agreements for the proposed
application for listing on the STAR Market (the “ STAR Market Application ”) as our Directors
were of the view that the STAR Market Application may be more beneficial to our Group.
We attempted to submit the STAR Market Application in September 2022, but such
application had not been accepted nor acknowledged by the Shanghai Stock Exchange as it
recommended us to update our audited financials before making the submission since our
audited financial information would expire within one week after the submission.
During the preparation of our updated financial information, we determined that an
application for listing on the Stock Exchange may better suit our needs considering the
timetable uncertainties for an A-share listing onshore and the specific requirements applicable
to listing on the STAR Market that may render additional time for the vetting process. As the
STAR Market had many listing applicants, we were concerned that the numerous applications
may prolong the regulator’s vetting process, thereby resulting in timetable uncertainties and
may affect our chances to capitalize on a window of opportunity. Furthermore, we were also
concerned whether additional requirements or measures would be initiated by regulators during
the vetting process. On the other hand, since the Hong Kong market has a comparatively lower
number of listing applicants, it would enable us to have a better expectation and certainty of
the overall listing timetable. The Hong Kong market also has a proven track record of attracting
innovative technology companies for listing. In light of the above, we considered that an
application for listing on the Stock Exchange may better suit the needs of our Group and the
STAR Market Application was aborted in February 2023.
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Our Directors confirm, and the Sole Sponsor concur based on its due diligence work
conducted and our Directors’ confirmation, that to the best of their respective knowledge: (i)
since the ChiNext Board Application was terminated at an early stage and the STAR Market
Application had not been accepted nor acknowledged by the Shanghai Stock Exchange, our
Company had not received any material queries in respect of the Previous Listing Attempts
from the relevant regulators; (ii) there were no disagreements between our Group and the
relevant professional parties engaged for the Previous Listing Attempts; and (iii) they are not
aware of any other matters in relation to the Previous Listing Attempts of a material nature that
would affect the suitability of our Company to be listed on the Stock Exchange and should be
brought to the attention of the Stock Exchange and potential investors.
PUBLIC FLOAT
Upon Listing, the H Shares directly held by (i) Mr. Zuo; (ii) JD Technology; (iii) Mr. Qiu;
(iv) Yiju Liuhe; (v) Liuju Liuhe; (vi) Ms. Ren; (vii) Tahoe Growth; (viii) Tahoe Lande; (ix)
Tahoe Growth II; and (x) Ms. Hua, being core connected persons of our Company, will not be
counted towards the public float. See “Background of our principal Pre-IPO Investors” in this
section for the background of JD Technology, Tahoe Growth, Tahoe Lande and Tahoe Growth
II. For further information of Yiju Liuhe and Liuju Liuhe, see “Employee Shareholding
Platforms” in this section. Except as stated above, all the H Shares held by other Shareholders
upon Listing will be counted towards the public float for the purpose of Rule 8.08 of the Listing
Rules.
Immediately upon completion of the Global Offering, assuming (i) 4,818,200 H Shares
are issued and sold to public Shareholders in the Global Offering; and (ii) the conversion of
45,300,000 Unlisted Shares into H Shares as applied in the “Full Circulation”, the total number
of H Shares of our Company held by the public represents 25.00% of the total number of issued
Shares of our Company. Therefore, our Company will be able to meet the minimum public float
requirement under Rule 8.08 of the Listing Rules.
Pursuant to the applicable PRC laws, all of the Unlisted Shares in issue prior to the
Listing (including Shares held by our Pre-IPO Investors) are subject to a lock-up period of one
year from the Listing Date. Therefore, immediately following the Listing, none of the existing
Shareholders may dispose of any H Shares held by them.
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CORPORATE STRUCTURE IMMEDIATELY PRIOR TO THE COMPLETION OF THE GLOBAL OFFERING
The chart below illustrates the corporate structure of our Group immediately prior to the completion of the Global Offering:
16.48% 3.11%
100%
2.08% 1.63% 1.15% 1.26%1.39%
Our Company(6) (7)
(PRC)
1.08%
Tahoe Growth(3)
(PRC)
1.19% 8.39%
Mr. Qiu
Mr. Hua Yong
Mr. Zhou Lijun
Suzhou Guofa
No. 8(9)
(PRC)
Ms. Ren
18 other Pre-IPO
Investors(3)(4)
Tahoe Lande(3)
(PRC)
Mr. Fan Shebin Mr. Shao Zhenkai
8.91%7.75%
99.00%
0.15%1.84%43.59%
Mr. Zuo
Yiju Liuhe(2)
(PRC)
Liuju Liuhe(2)
(PRC)
Our Controlling Shareholders(1)
Tianju Renhe
(PRC)
Zhonghui Juhe(5)
(PRC)
Juli Wanhe
(PRC)
Beijing Sidike(5)
(PRC)
Wuhan Jushunhe(5)
(PRC)
JuheData HK
(HK)
100% 100%
100%
85% 60% 51%
100%
Tianju Xinghe
(PRC)
Ms. Hua
JD Technology
(PRC)
69.75%
1.00%
Xuzhou Juhe
(PRC)
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notes:
(1) As (i) Ms. Hua is the spouse of Mr. Zuo; and (ii) Mr. Zuo is the sole general partner of Yiju Liuhe and Liuju Liuhe, Ms. Hua, Mr. Zuo, Yiju Liuhe and Liuju L iuhe are considered
to be a group of Controlling Shareholders, who collectively held approximately 53.33% of our total issued Shares as of the Latest Practicable Date. Th e remaining limited
partners of Liuju Liuhe, being former and current employees of our Group, are not regarded as part of the group of Controlling Shareholders.
(2) Mr. Zuo is the sole general partner of Yiju Liuhe and Liuju Liuhe, both being the employee shareholding platforms of our Company. Mr. Zuo is interest ed in 69.75% partnership
interest in Liuju Liuhe. The remaining partnership interest (i.e. 30.25%) is held by 34 former and current employees of the Group where each of these in dividuals is interested
in no more than 1.88% partnership interest in Liuju Liuhe. Mr. Zuo is also interested in 99.00% partnership interest in Yiju Liuhe. For further details , see “Employee
Shareholding Platforms” in this section above.
(3) Tahoe V enture Capital is the general partner of Tahoe Growth, Tahoe Lande and Tahoe Growth II (all being our Pre-IPO Investors) where Mr. Y u Gang (ou r Supervisor) is
interested in 58.00% partnership interest in Tahoe V enture Capital as its general partner.
(4) The 18 other Pre-IPO Investors include Shanghai Keluopu, China-Singapore V entures, Ms. Mao Sipian, Mr. Chu Xiaogang, Mr. Zhong Weiwei, ABC Inves tment, Mr. Y u
Fangbiao, Mr. Cai Yitao, Tahoe Growth II, Mr. Wang Bin, Datong Qikai, Ms. Lu Fen, Ms. Gong Juhui, Mr. Li Zhicong, Mr. Chen Zhixin, Mr. Gu Guomin, Mr. Y ang X iaoning
and Ms. Wang Liping, each holding approximately 0.82%, 0.81%, 0.81%, 0.81%, 0.81%, 0.66%, 0.65%, 0.49%, 0.46%, 0.41%, 0.38%, 0.27%, 0.27%, 0.22%, 0. 19%, 0.16%,
0.11% and 0.06% of our total issued Shares immediately prior to completion of the Global Offering, respectively. China-Singapore V entures is ultima tely under the supervision
and management of a Suzhou state owned assets authority.
(5) For the identities of the minority shareholders of the non-wholly owned subsidiaries of our Company, see “Our Subsidiaries” in this section above .
(6) During the Track Record Period, we operated Suzhou Tianju Daohe Technology Co., Ltd. (ʮ̡)( “Tianju Daohe” ), which was our indirect wholly-owned
subsidiary. Tianju Daohe was principally engaged in the provision of top-up services in the PRC, including calls and data top-ups. Considering Tianj u Renhe, Tianju Xinghe
and Tianju Daohe are all engaged in the provision of top-up services, we eventually ceased the operation of Tianju Daohe as it is our strategy to focus re sources on Tianju Renhe
and Tianju Xinghe on the provision of such services and to minimize potential competition among similar business. Consequently, Tianju Daohe was dis solved on April 17, 2023.
Our PRC Legal Advisors are not aware that Tianju Daohe had been involved in any material non-compliance incidents during the Track Record Period prior to its dissolution.
(7) Our Company also operates a branch office in Beijing.
(8) Subject to the completion of the relevant filings, all of the Unlisted Shares held by all existing Shareholders will be converted into H Shares unde r the “Full Circulation” upon
Listing. For details, see “Share Capital – Conversion of Unlisted Shares into H Shares”.
(9) Suzhou Guofa No.8 is ultimately under the supervision and management of a Suzhou state owned assets authority.
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CORPORATE STRUCTURE IMMEDIATELY AFTER THE COMPLETION OF THE GLOBAL OFFERING
The chart below illustrates the corporate structure of our Group immediately following the completion of the Global Offering:
14.89% 2.81%
100%
1.88% 1.47% 1.04% 1.14%1.25%
Our Company(6) (7)
(PRC)
0.98%
Tahoe Growth(3)
(PRC)
1.08% 7.58%
Mr. Qiu
Mr. Hua
Yong
Mr. Zhou Lijun
Suzhou Guofa
No. 8(9)
(PRC)
Ms. Ren
18 other Pre-IPO
Investors(3)(4)
Tahoe Lande(3)
(PRC)
Mr. Fan Shebin Mr. Shao
Zhenkai
8.06%7.01%
99.00% 1.00%
69.75%
0.14%1.66%39.40%
Ms. Hua
Yiju Liuhe(2)
(PRC)
Liuju Liuhe(2)
(PRC)
Our Controlling Shareholders(1)
Tianju Renhe
(PRC)
Zhonghui Juhe(5)
(PRC)
Juli Wanhe
(PRC)
Beijing Sidike(5)
(PRC)
Wuhan Jushunhe(5)
(PRC)
JuheData HK
(HK)
100% 100%
100%
85% 60% 51%
100%
Tianju Xinghe
(PRC)
9.61%
Other public
Shareholders(10)
Mr. Zuo
JD Technology
(PRC)
Xuzhou Juhe
(PRC)
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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Notes:
(1) As (i) Ms. Hua is the spouse of Mr. Zuo; and (ii) Mr. Zuo is the sole general partner of Yiju Liuhe and Liuju Liuhe, Ms. Hua, Mr. Zuo, Yiju Liuhe and Liuju L iuhe are considered
to be a group of Controlling Shareholders, who will collectively hold approximately 48.21% of our total issued Shares immediately after the completi on of the Global Offering.
The remaining limited partners of Liuju Liuhe, being former and current employees of our Group, are not regarded as part of the group of Controlling Sha reholders.
(2) Mr. Zuo is the sole general partner of Yiju Liuhe and Liuju Liuhe, both being the employee shareholding platforms of our Company. Mr. Zuo is interest ed in 69.75% partnership
interest in Liuju Liuhe. The remaining partnership interest (i.e. 30.25%) is held by 34 former and current employees of the Group where each of these in dividuals is interested
in no more than 1.88% partnership interest in Liuju Liuhe. Mr. Zuo is also interested in 99.00% partnership interest in Yiju Liuhe. For further details , see “Employee
Shareholding Platforms” in this section above.
(3) Tahoe V enture Capital is the general partner of Tahoe Growth, Tahoe Lande and Tahoe Growth II (all being our Pre-IPO Investors) where Mr. Y u Gang (ou r Supervisor) is
interested in 58.00% partnership interest in Tahoe V enture Capital as its general partner.
(4) The 18 other Pre-IPO Investors include Shanghai Keluopu, China-Singapore V entures, Ms. Mao Sipian, Mr. Chu Xiaogang, Mr. Zhong Weiwei, ABC Inves tment, Mr. Y u
Fangbiao, Mr. Cai Yitao, Tahoe Growth II, Mr. Wang Bin, Datong Qikai, Ms. Lu Fen, Ms. Gong Juhui, Mr. Li Zhicong, Mr. Chen Zhixin, Mr. Gu Guomin, Mr. Y ang X iaoning
and Ms. Wang Liping, each will hold approximately 0.74%, 0.74%, 0.73%, 0.73%, 0.73%, 0.60%, 0.59%, 0.44%, 0.42%, 0.37%, 0.34%, 0.24%, 0.24%, 0.20%, 0 .17%, 0.15%,
0.10% and 0.05% of our total issued Shares immediately after the completion of the Global Offering, respectively. China-Singapore V entures is ultim ately under the supervision
and management of a Suzhou state owned assets authority.
(5) For the identities of the minority shareholders of the non-wholly owned subsidiaries of our Company, see “– Our Subsidiaries” above.
(6) During the Track Record Period, we operated Suzhou Tianju Daohe Technology Co., Ltd. (ʮ̡)( “Tianju Daohe ”), which was our indirect wholly-owned
subsidiary. Tianju Daohe was principally engaged in the provision of top-up services in the PRC, including calls and data top-ups. Considering Tianj u Renhe, Tianju Xinghe
and Tianju Daohe are all engaged in the provision of top-up services, we eventually ceased the operations of Tianju Daohe as it is our strategy to focus r esources on Tianju
Renhe and Tianju Xinghe on the provision of such services and to minimize potential competition among the similar business. Consequently, Tianju Dao he was dissolved on
April 17, 2023. Our PRC Legal Advisors are not aware that Tianju Daohe had been involved in any material non-compliance incidents during the Track Reco rd Period prior
to its dissolution.
(7) Our Company also operates a branch office in Beijing.
(8) Subject to the completion of the relevant filings, all of the Unlisted Shares held by all existing Shareholders will be converted into H Shares unde r the “Full Circulation” upon
Listing. For details, see “Share Capital – Conversion of Unlisted Shares into H Shares”.
(9) Suzhou Guofa No.8 is ultimately under the supervision and management of a Suzhou state owned assets authority.
(10) Upon completion of the Global Offering, Suzhou Harvest and Xuzhou ETDZ (HK) will become our Shareholders. For details, see “Cornerstone Investo rs”. Suzhou Harvest is
ultimately under the supervision and management of a Suzhou state owned assets authority, and Xuzhou ETDZ (HK) is ultimately under the supervision an d management of
a Xuzhou state owned assets authority.
HISTORY, DEVELOPMENT AND CORPORATE STRUCTURE
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OVERVIEW
We are an integrated API-enabled data exchange service provider in China. We provide
standard API services and customized data management solutions. As the PRC digital economy
continues to grow, our platform empowers organizations to securely connect and navigate data
through APIs, unlocking the economic value of data. Additionally, we provide data
management solutions, which are customized softwares comprising one or more of our
products, including APIMaster , DataArts, QuickBot, SmartShield and AnchorChain . Data
management solutions aim to achieve functions designated by customers that relate to data
management, data governance, data application and data security. Our data management
solutions are delivered on-premise. The integrated API-enabled data exchange service market
and the industry-specific API-enabled data exchange service market together comprise the
overall API-enabled data exchange service market, which itself is part of the API-enabled
service market.
We are dedicated to eliminating data silos and offering online API services that span
across multiple service types and scenarios. Our API product, API marketplace, matches
requests and responses and facilitates exchange of data. These services have been widely
applied in various vertical industries, such as internet services, software information services,
and telecommunications. Since the launch of our product, API marketplace, in June 2011, we
have developed over 770 proprietary APIs. In 2023, API marketplace handled over 120 billion
API requests. Our customers include well-known enterprises such as Tencent, Alibaba, Baidu,
NetEase, Meituan, China Mobile, China Unicom, China Telecom, and many other internet
companies, app developers and individuals. As of December 31, 2023, API marketplace made
available over 380 proprietary APIs. In 2021, 2022 and 2023, the retention rate of key
customers of our API marketplace was 78.9%, 85.7% and 59.1%, respectively. The net dollar
expansion rate of revenue from our API marketplace key customers in 2021, 2022 and 2023
was 136.4%, 139.1% and 217.3%, respectively.
We commenced providing data management solutions in June 2020, when our first data
management solution was delivered and accepted by a customer. Leveraging our integrated
API-enabled data exchange capabilities, we offer solutions that integrate API management,
data governance, data application, data security, and privacy-preserving computation through
our products, including APIMaster , DataArts , QuickBot , SmartShield and AnchorChain , which
assist organizations in their digital transformation. Our customized, digitalized, and self-
deployed data management solutions cater to a diverse range of customers, including those
from government agencies, manufacturing, finance, telecommunications, and various other
industries. Our technologies eliminate data silos and cleanse data sets with heterogeneity,
forming data that adheres to unified standards. From 2021 to 2023, the CAGR of the revenue
attributable to our data management solutions was 23.1%.
Benefiting from our advanced technologies and service capabilities, we have gained
recognition from our customers, resulting in rapid growth in revenue. In 2021, 2022 and 2023,
our total revenue was RMB260.0 million, RMB328.9 million and RMB441.1 million,
respectively. We recorded a CAGR in revenue of 30.2% from 2021 to 2023.
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In December 2023, we launched API BayArea , an API testing tool that provides functions
such as API design, mocking, testing, debugging, documentation and management of API
development by multiple developers. The API testing tool is accessible through our website or,
in the future, by downloading a desktop application to the customer’s own computer. API
BayArea was launched as a trial version on a free-of-charge basis.
Our Market Opportunity and Value Proposition
Our service offerings are closely connected to the digital transformation of corporate and
government organizations where seamless, fast and stable data access and management are
critical to their business flows and decision-making. Corporate organizations increasingly
depend on data to strengthen customer relationships, personalize customer experiences,
integrate digital resources, analyze business performance and results, and anticipate market
trends to increase productivity and reduce costs. Government organizations are digitalizing to
better perform their functions and to improve their governance and public administration
efficiency and increase public access to social and government data in a secure and private
manner. API services play a critical role in digital transformation.
Key value propositions of our services and solutions include:
 Eliminating data silos . Our API marketplace and data management solutions are
devoted to eliminating data silos both within and across organizations, unifying data
standards and facilitating data output in a standardized approach. By facilitating
standardized output and seamless data integration, we enable organizations to access
and utilize internal and external data more effectively.
 Handling large volume of data. Our API marketplace can simultaneously support
multiple APIs with large data volumes. Our solutions empower organizations to
efficiently access, manage and process extensive data with high concurrency.
 Lowering total cost of ownership. Our data management solutions relieve customers
from making heavy upfront investments and capital expenditures in self-developing
software, helping organizations reduce the total cost of ownership of customized
software, thus allocating resources more strategically.
 Facilitating integration and deployment. We understand the importance of seamless
integration with existing applications. Our data management solutions are built with
an emphasis on usability and compatibility, allowing IT professionals to integrate
our services smoothly and deploy them rapidly.
 Safeguarding privacy and security. Data privacy and security are paramount
concerns in today’s digital landscape. Our products leverage advanced technologies,
such as privacy-preserving computation and blockchain, to ensure that data remains
secure and private. We prioritize data integrity and security and provide
organizations and their customers with greater peace of mind.
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 Customizing solutions . We recognize that each organization has unique needs.
Hence, we offer a wide spectrum of standard API services for customers to choose
from. Likewise, our data management solutions can be tailored to meet specific
requirements. We adapt to diverse business environments and deliver customized
solutions that address specific challenges. We are dedicated to developing
technologies to support our solutions.
OUR STRENGTHS
One of the First-Movers in the Digital Economy’s Key Industry
We are a provider of integrated API-enabled data exchange services, which is a part of the
API-enabled service market in China. One of the pain points in developing China’s digital
economy is the existence of data silos. API-enabled services can eliminate data silos.
API-enabled data exchange service is a key industry in the digital economy in China. Our
market position is primarily derived from our distinctive industry insights and competitive
advantages in our products and services, including:
 Profound industry insights from our first-mover advantage : We have been
involved in API-enabled data exchange services for more than ten years. As one of
the earliest players in the industry, we gradually expanded our services and
solutions, treating digitalization as our core tenet. In addition, we have accumulated
valuable experience continuously in operation, market cultivation and customer
expansion, achieving our current market position in the field of standard API
services.
 National recognition and participation in the formulation of industry
standards : We have received multiple recognitions from national-level institutions,
demonstrating our industry knowhow and involvement in shaping industry
standards. In 2019, we were awarded with the 9th Wu Wenjun Artificial Intelligence
Science and Technology Progress Award (ҦආӉᆤ), the highest
award for achievements in intelligent science and technology in China, for our
“Enterprise Technological Innovation Project”, which was hosted by CAAI. In 2021,
we collaborated with the National Industrial Information Security Development
Research Center (Ӻʕː) and Ant Group Co., Ltd. ( ፂᖻ
ʮ̡) and co-authored a series of white papers on data factor
research titled the “China Data Factors Market Development Report”. In 2022, we
actively participated in drafting the “Technical Requirements for Trusted Data
Service External Data Management Platforms” (ਕ̮௅ᅰኽ၍ଣ̨̻Ҧ
Ӌ) of the MIIT for the telecommunications industry. This initiative aimed to
establish industry-wide standards and promote the development of external data
management platforms in the telecommunications industry. In addition, the “Juhe
Data Asset Service API Platform” project was recognized in the national “2021 Big
Data Industry Development Pilot Demonstration Project List” by the MIIT. We also
received a series of awards and recognitions in 2023, including being shortlisted for
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the 2023 Outstanding Solution in Information Technology Application Innovation in
Jiangsu Province (2023ɝఖΤఊ), being
recognized as an Emerging Service Industry Leading Enterprise in Suzhou ( ᘽψ̹
Άุ), and receiving the Excellent Artificial Intelligence Solution in
Jiangsu Province (ࣩ.)
Furthermore, in 2022, we were among the first batch of companies selected to be a
member of the digital economy standard working group to join the National
Committee for Informatization and Industrialization Convergence Standardization
of the MIIT (ึ). We contributed to the
research and development of the industry standards in key areas of the digital
economy, including data factors, digital infrastructure, digital industrialization,
industrial digitalization, and digital governance, so as to promote the healthy
development of the digital economy. In addition, we have participated in discussions
in multiple important industry seminars as representatives of big data industry
enterprises, along with the China Academy of Macroeconomic Research ( ʕ਷҃ᝈ
Ӻ৫), the National Information Center (ʕː), Alibaba, and
Tencent. Drawing from our own experiences, we have made suggestions on data
factor circulation. As we actively participated in formulating industry standards, we
always keep abreast of policy changes in time. This allows us to keep up with
industry trends and maintain our market position in the API-enabled data exchange
service market in China.
The PRC government has been placing significant emphasis on the role of data as a key
element in the construction of a digital economy and has launched a series of important policies
with vision and strategic significance to underline its commitment. As stated in the “Industry
Overview” of this prospectus, the market size of China’s digital economy is expected to reach
RMB82.0 trillion in 2027 with a CAGR of 10.3% from 2022 to 2027, representing
approximately 49.6% of China’s total expected GDP in 2027 compared to 41.5% in 2022. We
believe we have a strong brand and are well-positioned to capitalize on the massive market
potential.
An Innovator in the Industry with Strong Research and Development Capabilities and
Accumulated Advantages in Core Technologies
Innovation is the core of our culture. Since our inception, we have accumulated 26 core
technologies, primarily in API full-lifecycle management, data governance, RPA, privacy-
preserving computation and blockchain. As of December 31, 2023, we have been granted 50
trademarks, 64 patents and 98 registered software copyrights. Our R&D team also has
experience in large-scale software engineering projects.
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Our technology has traits such as low latency, stability, security, flexibility, scalability,
accessibility and ease of use. Our products, APIMaster , QuickBot, DataArts, SmartShield and
AnchorChain, focus on data collection, data governance, data sharing, data application, and
data security. These products, working independently or in combination, can form a data
management solution system and provide strong support in expanding our customer base across
different industries. In 2023, we participated in the 2022 World Privacy-Preserving Computing
Competition sponsored by the MIIT, and won the first place in the Zero-Knowledge Proof
Track against nine competitors, including Project 985 universities, SOEs and renowned listed
companies. This competition sought to highlight the demand for protection of data security and
privacy and to promote its development. It aimed at promoting the development of
privacy-preserving computing technology in China’s digital economy and was focused on
developing advanced and cost-effective technologies. Data security has played an important
role in promoting an orderly and healthy data exchange market that crystalizes and unlocks
value of data. As one of the most effective ways to ensure a safe data exchange environment,
privacy-preserving computation has gradually been adopted by different organizations to
promote data exchange among different organizations both internally and externally.
We are dedicated to innovation focused on the domestic market and actively promote the
compatibility of domestic CPUs, operating systems, databases, and middleware. Our products
have passed the compatibility test and received recognition from multiple testing agencies for
their compatibility with the above domestic technologies and products. We continue to
independently develop technologies in data collection, data governance, data sharing and
application, and data security, contributing to the development of information and technology
in China.
Well-Established and Diversified Customer Base, a Stable and Diverse Array of Data
Service Suppliers, and Sustainable Monetization Capabilities
Since the launch of our API marketplace in June 2011, we developed over 770 proprietary
APIs. In 2023, API marketplace handled more than 120 billion API requests. It empowered
customers including Tencent, Alibaba, Baidu, NetEase, Meituan, China Mobile, China Unicom,
China Telecom, and other large and well-known enterprises. The China Internet Association
(ʕ਷ʝᑌၣ՘ึ) released the top 100 PRC internet companies in terms of comprehensive
strength in 2023 at the China Internet Enterprise Comprehensive Strength Index (2023) ( ʕ਷
ᅰ) press conference. In the “China Internet Enterprise Comprehensive
Strength Index Report (2023)”, four out of the top five PRC internet companies were our
customers.
We have established cooperative relationships with customers in government and private
sectors to provide our customized data management solutions, and our market recognition and
reputation have steadily improved. For our API marketplace, we continuously enrich and
optimize data sources, and establish diversified stable data channels that also safeguard
security and privacy. Our APIs are typically linked to several suppliers for customers to choose
from and, through our professional operations and automated management, we can provide
customers with steady, efficient and secure API marketplace services.
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Our products and services can be integrated into customers’ operations, enabling us to
maintain our well-established customer base. As our scale in API services and data
management solutions continues to grow, our customers have correspondingly diversified with
new entrants from different industries. Our interaction with customers enables us to keep up
with industry trends and better understand how to address their data needs. This allows us to
further enhance our brand influence within the digital economy in China, strengthen our brand
recognition in the API services and data management solutions sectors, and expand our
potential customer pool. As of December 31, 2021, 2022 and 2023, the number of key
customers of our API marketplace was 21, 22 and 17, respectively. Meanwhile, the average
income from our key customers of our API marketplace were RMB7.0 million, RMB8.1 million
and RMB18.3 million in 2021, 2022 and 2023, respectively.
A Scalable Business Model
By continuously upgrading product and service offerings and expanding application
scenarios and customer base, our products have been applied in areas such as e-government
services, digital society, data integration within internet companies internally, product
development of software enterprises and financial service digitalization. As customers use our
products and services, our technology also improves as we adapt to their needs, which attracts
customers to increase their purchases of our services. Key customers of API marketplace
contributed a substantial portion of our revenue during the Track Record Period. For each of
the years ended December 31, 2021, 2022 and 2023, key customers contributed over 77.0% of
the revenue derived from API marketplace. During the same years, the net dollar expansion rate
of revenue from our API marketplace key customers were 136.4%, 139.1% and 217.3%,
respectively. The average income from our key customers of our API marketplace increased
from RMB7.0 million in 2021 to RMB18.3 million in 2023. Having been in operations for over
a decade, we have experience in providing API marketplace services to customers in various
industries. As we continue to cooperate with customers, we have developed a deeper
understanding of their data needs and can develop technical services that better meet their
diverse requirements.
An Entrepreneurial and Experienced Management Team
Our founder and management team have industry insights, experience, and knowledge,
which have played a crucial role in our continuous exploration, innovation, and achievements
in the digital economy industry, thus promoting the successful development of our business.
Our founder, chairman of our Board, chief executive officer and executive Director, Mr. Zuo,
has won numerous national awards and honors, and served in positions such as member of the
Suzhou City Political Consultative Conference (՘), Secretary-General of the Suzhou
Internet Network Security Alliance ( ᘽψ̹ʝᑌၣၣഖτΌᑌຑ), and Vice President of the
Jiangsu Province Y outh Entrepreneurs Association (ᑌΥึ). He was
successively named Suzhou Industrial Park Science and Technology Leading Talent ( ᘽψʈุ
ɛʑ), 2018 China Big Data Leader (2018يJiangsu
Province Leading New Generation Entrepreneur (࢕Jiangsu
Province Science and Technology Entrepreneur (࢕and Jiangsu Province
Outstanding Chief Information Officer (֜ࢹڦࢩ࠯Our management team has a
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deep insight into industry trends and is well-positioned to effectively seize new market
opportunities. The team places a strong focus on technological innovation and has created a
culture of innovation for our company, laying a solid foundation for our successful
development. Our directors and senior management team possess experience in big data
industry, telecommunications internet industry, auditing and financial management,
communications industry and software development. As of December 31, 2023, we had 104
research and development personnel, accounting for 55.0% of the total number of our
employees. Our senior R&D engineers have over ten years of related practical experience.
We have a comprehensive talent reserve, recruitment, and training system. We highly
value talent, and have created a corporate culture that respects and rewards knowledge, talent
and creativity. We have established multiple channels to recruit talents and key technical
personnel, paving a way for our employees and new recruitments to develop their management
skill and technical knowledge.
We also focus on employee welfare and the work environment, offering competitive
salaries, benefits, and special reward plans, and providing a collaborative culture, relaxed work
atmosphere and benefits, and a diverse development platform.
OUR STRATEGIES
To further pursue our market leadership, we intend to implement the following strategies:
Seize the Significant Opportunities Arising from Government and Public Data Authorized
Operations to Expand
The 14th Five-Y ear Plan proposed to carry out pilot projects for government data
authorized operation (ᅰኽબᛆ༶ᐄ) which selectively open government data for private
use by authorized entities and declared that government data authorized operation will be a
significant part of its national strategy. As the PRC government placed increasing emphasis on
developing China’s digital economy, state-owned data exchanges saw spike in number. From
2014 to 2023, 57 state-owned data exchanges were established, including the Shanghai Data
Exchange (ה׸the Beijing International Data Exchange (׸
הand the Shenzhen Data Exchange (ה׸Local governments are expected to
follow these examples and actively construct data exchanges. In light of the favorable trend,
we will focus on further exploring opportunities to cooperate with the governments for data
opening. We entered into strategic cooperation framework agreements with Western Data
Trading Co., Ltd. (ʮ̡) on June 7, 2023 and Suzhou Data Assets Operation
Co., Ltd. (ʮ̡) on July 5, 2023. Pursuant to the two framework
agreements, we have agreed to cooperate with our respective counterparty to provide a steady
supply of services and solutions to aid in the construction and development of China’s big data
industry. We also entered into a strategic cooperation framework agreement with Shenzhen
Data Exchange Co., Ltd. (ʮ̡) in October 2023. Pursuant to the
agreement, both parties may work together on potential opportunity referral, promotion, data
privacy and security policy building, conducing joint research and hosting seminars and
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forums. In addition, we entered into a strategic cooperation framework agreement with Inspur
Cloud Information Technology Co., Ltd. (΅ʮ̡) in November
2023.Pursuant to the agreement, both parties have agreed to provide each other with services
and support on projects related to system integration, smart terminals and servers, among
others, to jointly expand market share in these fields. We believe that these framework
agreements will further enhance our business and strengthen our market position. We plan to
use 25% of the net proceeds to comprehensively upgrade the existing suites of APIs in our API
marketplace. See “Future Plans and Use of Proceeds – Use of Proceeds”.
We have insights into industrial trends and adapt our services and solutions accordingly.
We are committed to diversified data circulation, such as industrial big data, medical data, and
educational data, to promote government and public data opening and sharing. Using advanced
technologies such as privacy-preserving computation, blockchain and cloud computing, we are
working to ensure that the exchange of data is trustworthy, safe, and controlled, aiming to
eliminate data silos and enhance the quality and efficiency of digital economy.
We will leverage our advantages in technologies and utilize our market resources to
further our cooperation with local governments. We will continue to upgrade technologies,
develop new products and APIs for more scenarios, to meet the increasingly diverse needs of
our customers. We will undertake research on automated operation systems and further
improve the automated selection and matching of data service suppliers, which we expect to
enhance our overall service efficiency. Furthermore, we seek to develop API testing tools and
platforms to provide professional API testing services for developers. We also aim to expand
our customer base and monetize our subscription services.
Further Explore Service Capabilities for Diverse Industries, Continuously Expanding
Regional Coverage, Service Types and Scenarios
We aim to enhance our data management solutions for government organizations by
effectively integrating external data sources and government’s internal data sources. We strive
to maximize the value of data by breaking down the barriers arising from heterogeneous data
from the government and third parties, thus optimizing decision making and promoting
efficiency in social governance. We expect these measures to attract repeat customers for our
data management solutions. We seek to expand our cooperation with our existing customers,
creating industry precedents and allowing our future customers to benefit from the precedential
solutions.
In addition, we plan to fully utilize the business potential of Suzhou, where our
headquarters is located, and focus on local government big data services in all districts of
Suzhou. Suzhou is a prefecture-level city with a GDP of RMB2.4 trillion in 2022, according
to the Bureau of Statistics of Suzhou. We believe our deep commitment to Suzhou will have
a demonstrative effect, laying a solid foundation for our further expansion into other major
cities nationwide. We intend to maintain our early advantages in the field of data management
solutions and replicate our experiences in Suzhou to other prefecture-level and county-level
administrative regions in China. Since China has over 300 prefecture-level administrative units
and over 2,800 county-level administrative units as of December 31, 2022, we believe there are
extensive market opportunities ahead.
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With respect to corporate entities, we will focus on data collection and analysis, and data
factor circulation to seize the development tailwind of digital economy and fortify our
competitive advantages. Leveraging technologies such as RPA, blockchain, and federated
learning, our customized solutions for industrial customers are based on their circumstance and
need. For example, our digitalization in operating solutions helps customers achieve real-time
analysis and smart decision-making. This process enables corporate enterprises to promote
their digital transformation. The Y angtze River Delta region, to which Suzhou belongs, has a
great number of manufacturers who seek digital transformation, which we believe will bring
us continuous business opportunities. We will also strive to expand our data management
solutions to an increasing number of industries, such as the digital transformation of SOEs and
industrial sector entities, and to expand product scenarios. We plan to launch certain of our
future products on a subscription basis as part of our attempt to create a new revenue model.
We plan to use of 45% of the net proceeds to upgrade our existing products and services of our
data management solutions. See “Future Plans and Use of Proceeds – Use of Proceeds”.
Expansion of Customer Base and Deepening of Industry Ecosystem Stakeholder
Relationships
We focus on expanding our customer base and deepening relationships with stakeholders
in the API-enabled data exchange service market and data management service market. We
attract a large non-paying customer base and create opportunities for them to become paying
customers. We aim to continuously grow our clientele, improve customer stickiness, and
increase the retention rate for our customers by addressing customer needs and upgrading our
product offerings. We are also committed to providing comprehensive, full-lifecycle products
and services, deepening our interactions with key customers, and establishing long-term
strategic relationships. We are dedicated to building a more comprehensive data exchange and
trading platform, attracting more customers, suppliers and other market players who possess
data sources to utilize our services. Our aim is to build a virtuous cycle for the digital economy
industry ecosystem and become an industry leader. Leveraging over ten years of industry
experience and insights, we will continue to contribute to the development of digital economy
in China, participating in the formulation of national and industry standards.
Enhancing R&D Capabilities
We plan to continue our research and development efforts to broaden our technical
advantages, expand application areas, solidify our position within existing customer segments,
and continuously update our technologies to meet the demand of digital transformation. To
enhance product advantages and improve core technologies, we are dedicated to attracting
excellent technical talent from the industry, reinforcing incentive measures, devoting attention
to the control and management of R&D projects, and focusing on the implementation aspects
of R&D projects. This approach will keep our core technical level at the forefront of the
industry. In addition to recruiting talents, we aim to enhance the diversity of technical and
professional staff, thus strengthening our employees’ competitiveness. We also intend to
provide better training opportunities for our employees to improve service efficiency, work
performance, and employee satisfaction. We plan to recruit experienced software development
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engineers, operations engineers, network engineer and architects in the next three years to
support our services and solutions. We aim to enhance the diversity of technical and
professional staff, thus strengthening our employees’ competitiveness. We also intend to
enhance training opportunities for our employees to improve service efficiency, work
performance, and employee satisfaction. To upgrade and expand the technology advantages
and scenario adaptability of our products to meet the digital transformation process of
customers and enhance our technical competitiveness, we will delve into the digital
transformation business in areas such as government affairs, finance, and manufacturing,
providing customers with more convenient and cost-effective project implementation
solutions. We plan to use 25% of the net proceeds to comprehensively upgrade the existing
suites of APIs in our API marketplace and 45% of the net proceeds to upgrade our existing
products and services of our data management solutions. See “Future Plans and Use of
Proceeds – Use of Proceeds”.
We place a high value on data security. We have conducted in-depth research in the field
of privacy-preserving computation and have formed critical technologies such as service
quality management and integrated development environments. Going forward, we plan to
further strengthen research on privacy-preserving computation and blockchain, among other
secure encryption technologies, to upgrade and achieve breakthroughs in data governance
technology services that enjoy the support of government policy. We plan to use 20% of the net
proceeds to conduct research and develop the technologies for data security and privacy
protection, building a comprehensive ecosystem for digital ownership, secure data storage,
trusted data transmission, and collaborative production. See “Future Plans and Use of Proceeds
– Use of Proceeds”. Over the next three years, we plan to recruit industry experts with
backgrounds in data security to form a dedicated technical research and development team. For
our projects under development, see “Business – Research and Development – Ongoing R&D
Projects”.
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A W ARDS AND RECOGNITIONS
The table below sets forth a summary of the major awards and recognitions we received
since January 1, 2021 and as of the Latest Practicable Date:
Y ear Award/Recognition Issuing authority/organization
2023 Jiangsu Province Information
Technology Application Innovation in
2023 Outstanding Solution Shortlist
(2023ҦஔᏐ͜௴อᎴӸ
ɝఖΤఊ)
Jiangsu Provincial Department of
Industry and Information
Technology (ʷ
ᝂ)
2023 Emerging service industry leading
enterprise in Suzhou (ਕ
Άุ)
Suzhou Municipal Development and
Reform Commission (ձ
ึ)
2023 Excellent Artificial Intelligence Solution
in Jiangsu Province (ᎴӸɛʈ
ࣩ)
Jiangsu Artificial Intelligence Society
(ɛʈ౽ঐኪึ)
2023 First batch of emerging service industry
leading enterprises in Suzhou ( ᘽψ̹
Άุ)
Suzhou Service Industry Development
Leading Group Office (ਕ
܃)
2023 List of Jiangsu Province Blockchain
Industry Development Pilot Model
Project ( τΌ͛ପ္಻ཫᙆ̨̻ – Ϫᘽ
༊ᓃͪᇍධͦ)
Jiangsu Provincial Department of
Industry and Information
Technology (ʷ
ᝂ)
2023 Fifth Batch of National Specialized,
Refined, Innovative and Outstanding
“Little Giant” Enterprises (ॴୋʞ
ҭਖ਼ၚतอ“ʃ̶ɛ”)
MIIT
2023 First Prize in the Zero-Knowledge
Proof Track at 2022 World
Privacy-Preserving Computing
Competition (ᗆ
ᒄ༸ɓഃᆤ)
Organizing Committee of
Privacy-Preserving Computation
(ၑɽᒄଡ଼։ึ),
hosted by MIIT
2022 High-Quality Development Outstanding
Case (Է)
Jiangsu Federation of Y oung
Entrepreneurs
(ᑌΥึ)
2022 Outstanding Performance Level in the
Provincial Engineering Technology
Research Center (Corporate Category)
(Ӻʕː(Άุᗳ)ᎴӸᐶ
˥̻)
Jiangsu Provincial Department of
Science and Technology
(ኪҦஔᝂ)
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Y ear Award/Recognition Issuing authority/organization
2022 Selected Member of the National
Informatization and Industrialization
Integration Standard Committee’s
Digital Economy Standards Workgroup
(ึ
ࡰ)
MIIT Informatization and
Industrialization Integration
Standards Committee
(௅ՇʷፄΥᅺ։ึ)
2021 Jiangsu Province Industrial and
Information Industry Transformation
and Upgrading Special Fund Project
(ʺॴਖ਼ධ
ධͦ)
Jiangsu Provincial Department of
Industry and Information
Technology
(ʷᝂ)
2021 2021 Jiangsu Province Artificial
Intelligence Benchmark Demonstration
Enterprise (2021ɛʈ౽ঐ
ᅺ૖ͪᇍΆุ)
Jiangsu Artificial Intelligence
Industry Technology Innovation
Strategic Alliance (ɛʈ౽ঐ
ପุҦஔ௴อ኷ଫᑌຑ)
2021 Big Data Industry Development Pilot
Model Project
(༊ᓃͪᇍධͦ)
MIIT
2021 Jiangsu Provincial Software Enterprise
Technology Center (ॴழ΁Ά
ุҦஔʕː)
Jiangsu Provincial Department of
Industry and Information
Technology (ʷ
ᝂ)
OUR SERVICES AND SOLUTIONS
The table below sets out our total revenue by product categories during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
RMB % RMB % RMB %
(in thousands, except for percentages)
Query .................................... 124,467 47.9 145,279 44.2 271,356 61.6
SMS notice ................................. 57,883 22.2 70,627 21.5 64,543 14.6
Top-up ................................... 12,370 4.8 7,626 2.3 6,170 1.4
Revenue from API marketplace ...................... 194,720 74.9 223,532 68.0 342,069 77.6
Revenue from data management solutions ................ 65,291 25.1 105,404 32.0 99,014 22.4
Total Revenue ............................... 260,011 100.0 328,936 100.0 441,083 100.0
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API Marketplace
Our API marketplace provides standard API services through our web-based integrated
service platform. API marketplace transforms interface service requests based on diverse types
of protocols, methods and parameters to standard data interfaces. Customers can integrate their
software applications quickly with standardized APIs provided by API marketplace, enabling
them to rapidly implement the functionality required for their scenarios. For example, the
query results returned through our API marketplace typically are in a format that is technical
for a lay person. Customers need to connect the APIs we provide with their system by coding,
so that their online interfaces, such as mobile apps, websites or WeChat mini programs can
further output these results. We refer to the connection and working-together process of the
requesting party’s system and our APIs procured by API marketplace as “integrate”. Set forth
below is a screenshot of the query results of a weather condition API:
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Our customers primarily consist of internet companies, software and app developers, and
telecommunications operators, which subscribe to different service types to match their
application scenarios. We have developed more than proprietary APIs since our inception. As
of December 31, 2023, we offered over 380 APIs on API marketplace, including over 300 paid
APIs. The APIs we offer on API marketplace cover a wide array of services, such as
authentication, SMS notice, weather, news, IP address inspections and top-ups.
In addition, we offer a wide spectrum of free query APIs. As of December 31, 2023 and
the Latest Practicable Date, we offered over 80 free APIs. We do not pay for the data supply
source of free APIs as they are generally publicly available information. Other costs incurred
for offering free APIs, such as internet infrastructure and labor cost, were allocated to paid
APIs during the Track Record Period. For example, our weather condition API can connect to
customers’ intelligent audio devices to answer end-user questions about the weather. Another
example of an often used query API is the IP address check, which enables customers to know
the city where their end-user is located.
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Set forth below are the APIs we offer on the website, sorted by scenarios.
Domestic
Services
Verify whether the information of the two elements
of the ID card (name and ID card number)
is consistent.
Fintech
Data
Intelligence
Industry and
Commerce
Transport
Geography
Application
Development
E-Commerce
Top-up &
payment
Entertainment
Free API
For Company Use
First Purchase
Special Offer
1-cent Zone
SMS API
Automotive
Aftermarket
Verification API
Payment For company use Payment For company use
Payment For company use
Payment For company use
Three network mobile phone
real-name authentication (simplified)
Verify whether the information of the three elements of the
mobile phone operator (mobile phone number, name, and ID
card number) is consistent. Only reply whether it is consistent
or inconsistent, and no reason is required.
ID Verification SMS API service
Support three major operators, virtual operator SMS sending,
telecom-level operation and maintenance guarantee, exclusive
dedicated channel, reachable in 3 seconds with 99.99% arrival
rate, support large capacity and high concurrency.
Payment For company use
Payment For company use
Payment Payment
SMS API service (captcha)
This API can only send captchas SMS in fixed template
format. For the list of supported templates, please refer to the
fixed template list API. Template is created via API.
Bank card four-element detection (simplified)
Verify whether the information of four elements of the bank
card (name, mobile phone number, ID card number, bank
card number) is consistent. Only reply whether it is consistent
or inconsistent, and no reason is required.
Bank card three-element detection (Simplified)
Verify whether the information of the three elements of the bank card (name,
ID card number, bank card number) is consistent. Only reply whether it is
consistent or inconsistent, and no reason is required.
Payment For company use
IPv4 address query-district and county level
Support querying detailed information of an IPv4 address,
including information such as country (region), state/province,
city, zip code, longitude and latitude geographical coordinates,
etc., which can be accurate to the district and county level.
IPv6 address query-city level
According to the queried IPv6 address, the region to which
the IPv6 belongs is queried and queried at the city level.
Mobile online time
Check the usage time (non-internet time) of the customer's
mobile phone card since activation.
Free
Free Free
Weather forecast
Check weather conditions: temperature, humidity, AQI,
weather, wind direction, etc.
Three network mobile phone real-name
authentication (details)
Mobile phone number location
Enter the mobile phone number to query the location, number
segment, mobile phone card type, operator and other information
of the mobile phone number.
Payment For company use
News headlines
Latest news headlines, including domestic, international,
sports, entertainment, technology and other information,
updated every 5-30 minutes.
Global Administrative Division Query
Support for enquiry on administrative divisions of more
than 200 countries/regions worldwide.
Free
Free
Verify whether the information of the three elements of
the mobile phone operator (mobile phone number, name,
and ID card number) is consistent. reply with verification
result and error reason.
Horoscope
Daily, monthly and annual horoscopes of the
twelve constellations.
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Service Types
APIs that we offer through API marketplace can be mainly divided into three types, which
we refer to as “service types”:
 Query : Customers utilize our APIs to request the retrieval of data results, such as
identity authentication, mobile online status, online duration, information on
companies, and certain publicly available information such as weather conditions.
We provided approximately 300 paid APIs for query services as of December 31,
2023. One of our most popular query APIs is known as the “three-factor” API. The
“three factors” refer to a person’s name, registered mobile number and PRC identity
card number. Internet platforms in China typically require new customers to provide
these three factors to verify their identity and register a new account. Without
divulging any personal data, our customers will receive a “Y es” or “No” result
confirming whether the three factors match the information previously registered by
the same person. End-users provide their three factors on our customer’s online
interface, such as a mobile app, website or WeChat mini program. The online
interface provides encrypted data to data service suppliers through our APIs. Data
service suppliers will return a “Y es” if the information provided data match their
record. The chart below provides an illustration of how three-factor API works.
End-user(2)
Data flow: input three factors
payment based on the number of requests
Data flow: return “Yes” or “No”
Three-factor API
Data flow: encrypted real name, registered mobile number
and PRC identity card number
Our Company
Data service supplier
Payment(1) Payment
Customer’s online
interface
* the area bordered by dashed lines represents one or more APIs offered by our API marketplace.
(1) The payment between our customers and us may involve Third-Party Payment Arrangements,
which we have ceased since November 27, 2023.
(2) Our Company does not interact directly with end-users.
In addition, we also offer other types of APIs. For instance, our usage duration APIs
enable customers to know the approximate length of time (such as within three months, three
to six months or other responses) for which an end-user has used a mobile phone number. This
may be used to help customers, such as commercial banks, to evaluate the credit risk of their
customers when their customers apply for a loan. For example, a customer of a recently
registered mobile number generally has a higher credit risk than a customer of a mobile number
in use for more than 10 years. The mobile online status API can check whether a mobile
number is functioning normally, temporarily suspended or terminated. This can help customers
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such as logistics companies to decide whether the mobile number owner is reachable and
arrange parcel delivery. Another example is our company information API. It is used when a
customer provides services to its corporate customers. The customer can acquire publicly
available information of a corporate customer by providing the corporate customer’s legal
name or unified social credit code (͜˾ᇁ) and automatically fill in the forms,
sparing corporate customers the trouble of inputting information manually. Customers may also
use company information API to authenticate the information provided by corporate customers.
Our customers of this service type include large internet companies, telecommunications
operators and financial institutions.
 SMS notice : Our customers provide services to enable end-users to subscribe for
SMS alerts, status updates and promotions. Our APIs facilitate SMS for account
registration, login, security notice and password reset. We provided approximately
five paid APIs for SMS notice services as of December 31, 2023. In the case of SMS
notice APIs, an end-user initiates an SMS notice request and provides his or her
mobile number to the customer’s online interface. The customer sends an SMS
notice request to a third-party SMS service provider, who further delivers it to a
telecommunications operator. The telecommunications operator sends the SMS to
end-users. For example, when an end-user logs in to an app, the end-user may
choose to log in by mobile authentication. In that case, the app will send a
verification code request, with the end-user’s mobile number encrypted, to a
third-party SMS service provider through our APIs. The third-party SMS service
provider will work with a telecommunications operator, who will send an SMS login
code to the end-user. The chart below provides an illustration of how SMS
verification API works:
Data flow: send SMS notice
SMS notice API
SMS service
providers
Data flow: send encrypted mobile number
and verification code request
Our Company
End-user(3)
Data flow:
initiate SMS
notice and provide
mobile number
Payment(1) Payment
Telecommunications
operators(2)
Customer’s online
interface
Data flow:
send encrypted
mobile number
and verification
code request
Payment
Another example of SMS notice API is promotional SMS notice. A customer can
initiate a request to send a promotional SMS notice to third-party SMS service
providers or telecommunications operators. We will request the customer to provide
a template for the SMS notice. We will match the customer with service providers
based on the customer’s individual needs. The third-party SMS service providers
will work with the telecommunications operators, who will send an SMS message
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to the designated end-users with promotional SMS notice, and a confirmation (i.e.
as to whether or not the SMS notice was successfully sent) to the customers,
respectively. The chart below provides an illustration of how promotional SMS
notice API works:
Data flow: send SMS notice
Data flow: provide
mobile number
promotional SMS notice APIData flow: confirmation of success or failure
SMS service(2)
providers
Data flow: send encrypted mobile numbers
and promotional SMS notice request
Our Company
End-user(1)
Payment(1) Payment
Telecommunications(2)
operators
Customer’s online
interface
Data flow:
send encrypted
mobile numbers
and promotional
SMS notice
request
Payment
* the area bordered by dashed lines represents one or more APIs offered by our API marketplace.
(1) The payment between our customers and us may involve Third-Party Payment Arrangements,
which we have ceased since November 27, 2023.
(2) SMS service providers receive requests from customer’s mobile apps, websites and WeChat mini
programs and request telecommunications operators to send SMS notices. It is common in China
for SMS notice requests to be first sent to SMS service providers, as opposed to
telecommunications operators directly. SMS service providers cooperate with
telecommunications operators to procure them to send SMS notices. In some cases, SMS notice
requests were sent to telecommunications operators directly. During the Track Record Period,
only a small portion of our SMS notices requests were sent to telecommunications operators
directly which utilized the SP License. As of the Latest Practicable Date, all SMS notice requests
were sent to SMS service providers. Different service providers offer different standards of
services based on different prices. We seek to match the customer’s needs with the varied services
offered by different service providers. SMS notice requests are sent to telecommunications
operators directly when we utilized the SP License, and the telecommunications operators will
send SMS notice to end-users. In this case, we made prepayments to telecommunications
operators. Another case where SMS notice requests are sent to telecommunications operators is
where telecommunications operators act as SMS service providers. Telecommunications
operators, acting as SMS service providers, will find the designated telecommunications
operators which will send the SMS notice to end-users. We have deregistered our SP License
considering the following factors: (i) the current SMS notice business model, which does not
require a SP License, is more commercially viable as compared to sending SMS notice requests
by ourselves. The SMS notice business model that utilized SP Licenses is less commercially
viable for us because (i) we needed to provide a substantial amount of prepayments to
telecommunications operators; and (ii) PRC law and regulations imposed higher regulatory
scrutiny on us when we so operated. In this regard, we have gradually reduced the revenue
contribution from utilizing SP Licenses; as of the Latest Practicable Date, we do not plan to
conduct any business that requires SP Licenses; and (iii) in light of the fact that we did not, and
had no plans to use SP Licenses, deregistration will also maximize our flexibility to adopt “Full
Circulation” of our Company’s shares, based on which they will become “foreign shareholding”
and therefore become subject to regulatory requirements and limitations underlying these
licenses.
(3) Our Company does not interact directly with end-users.
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 Top-up: Almost all of our top-up service in 2023 was mobile top-up. An end-user
initiates a top-up on a customer’s online interface by clicking on a “top-up” button,
inputting its mobile number and top-up amount. The customer’s online interface
sends a top-up request to us through APIs. After receiving the request, we will either
(i) send a request to the telecommunications operators directly, upon which we make
payments to telecommunications operators; or (ii) we send top-up requests to top-up
service providers directly and make payments to them. We generally are not
involved in the interaction between telecommunications operators and service
providers. Revenue derived from mobile top-up service contributed to
approximately 80%, 99%, and 99% of the total top-up service revenue for the years
ended December 31, 2021, 2022 and 2023, respectively. We have been strategically
scaling down our top-up service since 2021. The chart below provides an illustration
of how top-up APIs work.
Mobile top-up service
API
Data flow: send top-up
request and encrypted
mobile number
Top-up service
providers(2)
Data flow:
send top-up
request and
encrypted mobile
number in
the case of (ii)
Our Company
End-user(4)
Payment(1)
Make prepayments with
subsequent settlement(3)
Payment base on face
value of top-up
Telecommunications
operators(2)
Customer’s online
interface
Data flow:
send top-up
request and
encrypted mobile
number in the
case of (i) or Top-up
arrangement/
payment in the
case of (ii)
in the case of (i)
Make
payment
Data flow:
initiate top-up
and provide
mobile number
in the case
of (ii)
* the area bordered by dashed lines represents one or more APIs offered by our API marketplace.
(1) The payment between our customers and us may involve Third-Party Payment Arrangements,
which we have ceased since November 27, 2023. Customers may pay us after we procure top-up
services for them, which led to unbilled trade receivables during the Track Record Period. Less
than RMB230,000 of such unbilled trade receivables as of December 31, 2021, 2022 and 2023
were not settled as of the Latest Practicable Date.
(2) Mobile top-up services can be categorized as either (i) telecommunications operator’s top-ups or
(ii) service provider top-up. In the case of telecommunications operator’s top-up, top-up requests
are sent to telecommunications operators directly and we make payment to telecommunications
operators. In the case of service provider top-up, top-up requests are sent to top-up service
providers directly and we make payment to them. Different service providers offer
different standards of services based on different prices. Service standards include the
response time and probability of success in delivering top-up services. Top-up services that
successfully top up within a shorter period of time generally charge higher prices than top-up
services that do so in a longer period of time. Service providers and telecommunications
operators with high probability of success in delivering top-up services generally charge more
than the ones with lower probability of success. In 2021, 2022 and 2023, there were 19, 17 and
21 top-up service providers. The availability of services offered by top-up providers may
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fluctuate. For instance, provider A might supply a top-up with a face value of RMB50 for mobile
numbers of telecommunication operator A today, but this offering could be unavailable the
following day. Our role is to align customer requirements with the services with suitable standard.
To this end, we maintain regular communication with our top-up service providers to ensure they
consistently deliver timely services with suitable standards of services. Our top-up service
providers may work with telecommunication operators directly, or there may be one or more
layers of top-up service providers between the service provider that directly works with us and
the telecommunications operator that effects the top-up.
(3) For the avoidance of doubt, we make prepayments before we provide mobile top-up services to
customers. However the timing of settling the payment with top-up service providers or
telecommunications operators may come before or after the settlement of payment with our
customers. We make prepayments to both telecommunications operators and top-up service
providers.
(4) Our Company does not interact directly with end-users.
Our top-up service providers rely on the service supply from their suppliers on many
occasions, related to provision of top-up service to us or not, and this may be the case for
mobile top-up as well as other types of top-up services (“ Sub-Providers ”). We are also unable
to ensure whether our direct top-up service providers utilized the prepayments for other means,
which would ultimately impede such supplier’s ability to settle payments with the Sub-
Providers. Thus, we make enquiries with our direct top-up service providers from time to time
to ensure they have sufficient liquidity for the settlement of their fees with the their
Sub-Providers to ensure their provision of top-up service to us would not be disrupted. The
existence of Sub-Providers is commercially justified because (i) it would be more cost-
effective and efficient for us to engage and communicate with one supplier who can further
manage and coordinate the service supply, as opposed to coordinating with various suppliers
by ourselves; and (ii) some top-up service providers can offer competitive prices, as compared
to us engaging telecommunication operators directly. We believe the communication is
important for mitigating the risk of supply chain disruptions to us that could arise from, among
other things, a shortage of payments and disputes between our direct top-up service providers
and Sub-Providers, which might ultimately impact our ability to deliver top-up services to its
customers and to address potential supply shortages that the direct top-up service providers
may experience.
On some occasions, our employees act as a liaison to facilitate the communication among
customers and top-up service providers which we frequently work with. We are not a party to
these transactions and the top-up service involved were not provided to us (the
“Facilitations ”). We engaged in these conversations for the purpose of facilitating queries and
disputes relating to payment issues between the two parties. We make Facilitations to maintain
our relationships with large institutional customers and our suppliers and we do not charge our
customers or suppliers for the Facilitations.
According to F&S, in line with the industry practice, our top-up business requires a
substantial amount of prepayments to be made to service providers to ensure a steady supply
of top-up services. It is common for our top-up service providers to make prepayments to their
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suppliers before supplying services to us. The prepayment amount we made to top-up service
providers rely heavily on, among other things, discussions with top-up customers and service
providers, so as to make reasonable estimations.
The substantial amount of prepayments we make to top-up service providers exposes us
to various risks. See “Risk Factors – Risks Relating to Our Business and Industry – Our top-up
business requires a substantial amount of prepayments. Fraudulent activities by or affecting our
top-up service providers could materially affect our reputation and business.”
Our customers can deposit funds with us to increase the prepayment balance of an account
registered in our website and use the account to purchase one or more types of API service.
These prepayments may not be utilized for any purpose other than purchasing our API service.
As some of our customers, such as internet companies, e-commerce platforms, and app
developers, require multiple API services from us in their business, we allow them to prepay
certain service fees in advance to their account with us, which they can apply to settle our fees
as they continue to use our services. We treat these prepaid service fees as contract liabilities
on our balance sheet. See “Financial Information – Current Assets and Liabilities – Contract
Liabilities”.
In the three service types, API marketplace charges customers for the API requests and
we pay for the services of suppliers. API marketplace directs these requests to the respective
suppliers selected by the customers. During this process, customers may choose suppliers for
the service types of query and SMS notice. In the case of top-up, customers will be assigned
a service provider based on their top-up request details, such as the amount and
telecommunications operator of the mobile phone number. In 2021, 2022 and 2023, the gross
profit margin of our query services was 35.0%, 37.1% and 31.1%, respectively, the gross profit
margin of our SMS notice services was 11.6%, 15.4% and 11.5%, respectively, and the gross
profit margin of our top-up services was 84.6%, 87.3% and 83.2%, respectively. For the
reasons of the decreases in gross profit margin in 2023, See “Financial Information – Results
of Operations – Comparisons between 2023 and 2022 – Gross Profit and Gross Profit Margin”.
Internet infrastructure on which API marketplace’s operation relies are leased from third-party
service providers.
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Key Operating Metrics
The table below sets forth selected key operating metrics of our business:
Y ear ended December 31,
2021 2022 2023
Retention rate of our key customers of
API marketplace (1)(2) .................................. 78.9% 85.7% 59.1%
Net dollar expansion rate of revenue from our
API marketplace key customers (3) .......................... 136.4% 139.1% 217.3%
Number of key customers of API marketplace .................... 2 1 2 2 1 7
Average income from our key customers of our API marketplace ( in millions of
RMB) ........................................... 7 . 0 8 . 1 18.3
Average revenue per paying customer (4)
(in thousands of RMB ) ................................. 8 . 1 13.8 28.8
Number of active registered customers (5)
(in thousands ) ...................................... 77.9 65.8 61.7
Number of active registered paying customers ( in thousands )(6) .......... 14.9 12.1 10.7
Retention rate of paying customers of our API marketplace (7) ........... 38.0% 29.6% 36.6%
Net dollar expansion rate of revenue from paying customers of our
API marketplace (8) ................................... 83.82% 119.84% 123.40%
Conversion rate of non-paying customers into paying customers (9) ......... 0.37% 0.52% 0.45%
Number of API requests for query ( in millions ) .................... 910.8 920.5 1,568.2
Average price per request of API request for query ( in RMB ) ........... 0.137 0.158 0.173
Number of API requests for SMS notice ( in millions ) ................ 2,037.9 2,130.7 2,097.5
Average price per request of API request for SMS notice ( in RMB ) ........ 0.028 0.033 0.031
Aggregate top-up face value ( in millions of RMB ).................. 2,322.6 774.7 494.3
Revenue per RMB100 top-up ( in RMB )(10) ...................... 0.53 0.98 1.25
(1) Key customers refer to customers who contributed revenue of more than RMB1 million in a respective year.
(2) Calculated as the number of key customers of API marketplace in the prior year that remain as our paying
customers in the current year, divided by the number of all key customers of API marketplace in such prior
year.
(3) Calculated as revenue derived from our key customers of API marketplace in any given year divided by the
revenue derived from the same key customers in the previous year, provided that the key customers must be
a paid customer in the previous year. Otherwise the revenue attributable to the key customer will not be
accounted for in the given year.
(4) Calculated as revenue derived from our API marketplace for the respective year divided by the number of
paying customers of API marketplace during the respective year.
(5) Referred to the number of customers who used APIs (whether paid or for free) offered through API marketplace
in the respective year.
(6) Refers to the number of customers who used our APIs (whether paid or for free) offered through API
marketplace in the respective year and historically made payment to us.
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(7) Calculated as the number of paying customers of API marketplace in the prior year who contributed to our
revenue in the current year, divided by the number of all paying customers of API marketplace in such prior
year.
(8) Calculated as revenue derived from our paying customers of API marketplace in any given year divided by the
revenue derived from the same paying customers in the previous year, provided that the paying customers must
be a paid customer in the previous year. Otherwise, the revenue attributable to the paying customer will not
be accounted for in the given year.
(9) Calculated as for a given year, the number of paying customers of API marketplace who made their first
payments to us in the given year, provided that such first payments were made at least 60 days after the
registration of the respective customer, divided by the number of new non-paying customers, who registered
or used any free API marketplace services in the respective year. The use of “60-day period” in this calculation
is based on our internal policy regarding customer lifecycle management, and, according to F&S, it is a
common industry method to calculate the customer conversion rate over a 60-day period between registration
and the first payment.
(10) We recognize the difference between the purchase for the top-up face value paid to data service suppliers and
the amount we received from our customer (i.e. the mobile apps, websites and WeChat mini programs on which
end-users initiate top-up) as revenue during the Track Record Period. We are unable to provide net profit of
each RMB100 top-up primarily because certain expenses cannot be allocated to subsegments of API
marketplace.
We typically charge our customers based on their number of API requests for query and
SMS notice services. Our average price per request for query service increased from
RMB0.137 in 2021 to RMB0.158 in 2022, and further increased to RMB0.173 in 2023,
primarily due to increased purchase costs of identity authentication-related API service supply,
which led to a higher price. This trend was also attributable to the increase in the usage of
mobile number-related three-factor authentication, which had a higher price per request. Our
average price per request for SMS notice service decreased from RMB0.033 in 2022 to
RMB0.031 in 2023, primarily due to a decrease in the usage of promotional SMS notice
service, which had a higher price per request as compared to the average price per request in
2022 and 2023.
The net dollar expansion rate of revenue from our API marketplace key customers
increased significantly from 139.1% in 2022 to 217.3% in 2023, primarily due to a significant
increase in the revenue contributed by three key customers as a result of their increased
purchases of our query services, mainly attributable to their increased trust in the quality and
reliability of our services based on past collaborations as well as our competitive pricing.
Revenue per RMB100 top-up increased from RMB0.53 in 2021 to RMB0.98 in 2022
primarily because we ceased to offer gas card top-up in 2022, which had a much lower revenue
per RMB100 top-up. In addition, certain mobile top-up service providers lowered their price
as part of their promotions. Revenue per RMB100 top-up increased to RMB1.25 in 2023
primarily because we were more selective in working with mobile top-up service suppliers to
lower our purchase costs and we increased our unit price for certain popular top-up values. In
accordance with PRC laws, we did not issue special V A T invoices for top-up service during the
Track Record Period. For certain top-up customers, we offset the revenue to which we are
entitled against the prepayments they made to us. For post-paid customers, revenue derived
from top-up services was recorded as unbilled receivables upon the rendering of services
during the Track Record Period. As of December 31, 2021, 2022 and 2023, such receivables
were approximately RMB1.5 million, RMB3.0 million and RMB5.8 million, respectively. As
of the Latest Practicable Date, more than 90% of such receivables has been settled. Among
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these receivables, RMB0.6 million, RMB2.8 million and RMB5.5 million as of December 31,
2021, 2022 and 2023, respectively, were derived from a corporate customer who settled its
receivables from top-up services daily. We did not experience any delays of such corporate
customer’s payments for top-up services during 2021, 2022 and 2023. Our internal control
procedures for managing unbilled receivables from top-up services are the same as those for
unbilled receivables from query and SMS notice services. Our employees followed up with the
post-paid top-up customers for unbilled receivables since the rendering of the respective top-up
services from time to time to facilitate settlements. Our Directors believe that there is no
material recoverability issue for top-up unbilled receivables given that less than RMB230,000
of the unbilled receivables as of December 31, 2021, 2022 and 2023 derived from top-up
services as of the Latest Practicable Date were not settled.
The retention rate of our key customers of API marketplace decreased from 85.7% in
2022 to 59.1% in 2023, primarily because certain key customers who used SMS notice and
query APIs ceased to use our services in 2023.
The number of key customers of API marketplace declined from 22 in 2022 to 17 in 2023,
primarily because nine key customers ceased to use our API marketplace services, partially
offset by the addition of five new key customers. The nine key customers ceased to use our API
marketplace service because (i) we terminated our business with them due to their prolonged
settlement on amounts payable to us. We have made provision for trade receivables of API
marketplace services to these customers; (ii) customer’s adjustments to their business
operations; and (iii) customer’s refusal to settle amounts overdue, for which we filed a claim;
The average income from our key customers of our API marketplace increased
significantly from RMB8.1 million in 2022 to RMB18.3 million in 2023, primarily due to: (i)
an increase in the total income from our key customers, mainly attributable to (a) a significant
increase in the number of query service requests purchased by three key customers, as
discussed above; and (b) an increase in the proportion of revenue contributed by query services
that commanded relatively higher gross profit margins, mainly due to the increased purchases
from the aforementioned three key customers; and (ii) a decrease in our number of key
customers as we ended our collaboration with nine key customers that, in general, contributed
relatively lower revenue, both as a part of our ordinary course of business and as a result of
our focus on cultivating deeper relationships with key customers that contributed higher
revenue.
Our average revenue per paying customer increased from approximately RMB8,100 in
2021 to approximately RMB13,800 in 2022, and further increased to approximately
RMB28,800 in 2023, primarily due to: (i) an overall decrease in our number of paying
customers, mainly attributable to a decrease in our number of low-spending paying customers;
and (ii) an increase in our revenue from paying customers, mainly attributable to our strategic
focus on attracting and engaging large customers that contributed much higher revenue on
average than our low-spending paying customers.
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The number of active registered customers decreased from approximately 77,900 in 2021
to approximately 65,800 in 2022, and further decreased to approximately 61,700 in 2023,
primarily because we ceased to offer certain APIs. The number of active registered paying
customers decreased from approximately 14,900 in 2021 to 12,100 in 2022, and further
decreased to 10,700 in 2023, which was in line with the decrease in the number of active
registered customers.
Our retention rate of paying customers of our API marketplace decreased from 38.0% in
2021 to 29.6% in 2022, primarily because we ceased to offer paid APIs, such as car ticket
inquiry, car information check and driving license checks. The retention rate of paying
customers of our API marketplace increased to 36.6% in 2023, primarily due to an increase in
usage of multiple paid APIs by our paying customers in 2023, such as invalid mobile number
checks, identity-related authentications, telecommunication operators history-related checks
and IP address checks.
The number of API query requests we handled increased from 910.8 million in 2021 to
920.5 million in 2022, primarily because one large customer increased its usage. It further
increased to 1,568.2 million in 2023, primarily due to the addition of new key customers and
an increase in usage by existing customers, partially offset by a decrease in usage by certain
existing customers.
The API marketplace price per request during the Track Record Period for SMS notice
and query was lower than the price we offer on the website, primarily because we typically
enter into transactions with large corporate customers based on arm’s length negotiations, with
price-setting decisions made according to aggregate usage. On the other hand, service plans
disclosed on our website cater to individual customers, who are typically price-takers with
lower usage.
Case Studies
Tencent
We provide Tencent with APIs to authenticate identity authentication results of its
end-users, as well as other information. For WeChat Work, we provided SMS notice for mobile
number log-in. We also provide three-factor authentication for employees who wish to be
certified as an employee of certain companies. WeChat has millions of end-users. Therefore,
Tencent places great importance on end-users’ data privacy. Tencent also requires our APIs to
be stable, secure and capable of handling high concurrency as it may need to handle large
volumes of API requests. In terms of data security, our API marketplace has obtained the
Information System Security Level 3 Protection Record Certificate (ӻ୕τΌୋ3ᚐ
׼from the Police Department of Suzhou ( ᘽψ̹ʮτ҅).
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Baidu
We provide various types of SMS notice services to Baidu, including various types of
notification and promotional messages. Baidu imposes stringent requirements on personal data
protection. Our GB/T 22080-2016/ISO/IEC 27001:2013 has been certified to be in compliance
with ISO/IEC 27001, an international standard to manage information security.
Revenue Model
In the case of query and SMS notice, we charge customers based on the number of API
requests they make. For certain large customers, we enter into agreements and provide API
services and settle their invoices on a monthly basis. For top-up, we earn revenue between the
unit price of top-up face value offered to our customers and our cost of purchase of the same
face value from telecommunications operators or service providers. Our revenue is calculated
as a percentage of the total top-up face value and recognized on a net basis under IFRS 15. See
“Financial Information – Material Accounting Policy Information – Principal versus Agent
Consideration in Revenue Recognition”.
Revenue in connection with API marketplace is recognized at the point in time when API
services are provided. For large customers with individual agreements, services are charged
based on the number of requests and price for each request for the respective period. For sales
contracts with fixed contract periods and fixed contract amounts, we recognize revenue over
time on a periodic basis during the contract period, based on the total contract amount.
We have established a pricing group which is responsible for determining service pricing
based on a vast array of data. It is also responsible for formulating guidance price for our API
marketplace. We continuously monitor market prices, and adjust prices whenever necessary.
Our revenue model has generated favorable financial results throughout the Track Record
Period. Our revenue derived from query services in 2021, 2022 and 2023 was RMB124.5
million, RMB145.3 million and RMB271.4 million, respectively. The average price per request
for query services for the respective years was RMB0.14, RMB0.16 and RMB0.17,
respectively. Our revenue derived from SMS notice services in 2021, 2022 and 2023, was
RMB57.9 million, RMB70.6 million and RMB64.5 million, respectively. The average price per
request for SMS notice services remained relatively stable at approximately RMB0.03 during
the Track Record Period. The average price per request for query services was significantly
higher than that of SMS notice services for the same year, mainly because we charged
relatively high prices for certain query services, including services that handled more sensitive
queries, such as identity authentication and bank card authentication. In contrast, the prices per
request for SMS notice services did not vary as greatly as those for query services, and the
prices per request for most of our SMS notice services were relatively low. In 2021, 2022 and
2023, the gross profit margin of our query services were 35.0%, 37.1% and 31.1%,
respectively, the gross profit margin of our SMS notice services were 11.6%, 15.4% and 11.5%,
respectively, and the gross profit margin of our top-up services were 84.6%, 87.3% and 83.2%,
respectively. For the analysis of our revenue derived from API marketplace by service type, see
“Financial Information”.
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Data Management Solutions
We provide comprehensive data management solutions to corporate and government
organizations. Our solutions primarily comprise three service types, including external data
management, data stewardship, and data circulation. With our solutions, we enable
organizations to efficiently collect, process, govern, share, and utilize data while preserving
privacy and security, achieving digital transformation. Our data management solutions offer
the following key benefits:
 Promote efficiency through external data management: We empower our
customers to leverage market data and services, enabling them to focus on business
innovation while benefiting from faster and more convenient access to external data
in a safe and compliant manner. With the help of our data management solutions,
corporate organizations can introduce, access and manage external data sources for
multiple departments. By using them with corporate internal data, corporate
organizations can make informed decision and manage daily operation effectively.
Another example is that a textile manufacturing company can generate the correct
ingredient composition for each color used in batches of the textile company’s
textile products, thereby reducing the reliance on human experience and improving
consistency across batches. Governments may use a centralized platform to integrate
and manage data from different government departments. This approach is more
efficient as compared to allowing each department to introduce, manage and use
data source separately and in a non-coordinated manner. See “– Case Studies” for
the specific examples of these business innovations.
 Empower data through optimized data stewardship: We assist our customers in
achieving comprehensive integration and governance of their internal database,
allowing them to build standardized data assets within their organizations. Data can
be collected in different formats. For example, a company that requires each
employee identification number to start with “JH” may encounter an instance where
one employee’s ID was erroneously inputted starting with “RH”. The place of
residence should be marked as a four-digit number, each representing a municipality
in China, whereas a particular employee’s place of residence was erroneously
marked Chinese characters, “ ಳ̏ᑳᅾ”. Such disparities in data formats are
typically referred to as “heterogeneous”. Heterogenous data creates difficulty for
governments and corporate organizations to ascertain. Data stewardship addresses
the difficulty by unifying the standard. Data with unified standard is ready for output
and utilization through APIs.
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Employee
ID
JH2019001 0 39
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35
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39
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1 1 1004 410521198207200512 2019.5.06
2019.05.16
2019.6.05
2019.06.15
2020.05.06
2020.8.13 1.2
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2.4
2.4
2.4
2.5
2.52019.5.06
320521198607200513
320521199007200748
320521198607200537
320521198307200719
410521198607200512
410521198207200512
Y9952119910720192Z 2021/9/21 0.1333333
2003
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2402
1983
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11
JH2019002
JH2019004
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01 1
RH2099985
Name of
Employee
ۨ
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Gender Age Types of
Documents Nationality Place of
Residence
PRC Identification
Number
Employment
Commencement
Date
Length of Service
(years)
8
1
Data type
does not meet
the standard
Numerical
precision does
not meet
the standard
Storage format
does not meet
the standard
Data does not
meet the
numbering rule
Code dictionary
does not comply
with international
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Y99521199107200192Z
 Facilitate full release of data value: We help our customers establish exchange of
data systems that enable seamless data sharing among internal departments or foster
data circulation with upstream and downstream business partners, unleashing the
value of data. Data management solutions make data available for sharing and
utilizing, which we refer to as “empower”. For example, a corporate organization
may wish to share the supply chain data and relevant analytics with its suppliers, so
that suppliers could optimize their warehouse management and manufacturing
process.
Our data management solutions employ five products: APIMaster , DataArts , QuickBot ,
SmartShield and AnchorChain. Based on customer needs, each product can function
independently or in conjunction with others to achieve the specific service type for each
project. Data management solutions are customized in the following aspects: (i) we choose one
or more products (i.e. APIMaster , DataArts, QuickBot, SmartShield and AnchorChain )t o
create a data management solution; and (ii) in addition to products, data management solutions
may, based on customer needs, provide a small amount of additional customized code and
additional components to offer specific functionality. Examples of such additional components
include adaptation and integration with specific types of data warehouse, customized style of
data marketplace portals, and unique encryption algorithms.
APIMaster
APIMaster provides lifecycle management services for APIs, facilitating corporate and
government organizations in API procurement, integration, application, management, and
operation. APIMaster collects data from different sources inside and outside an organization.
APIMaster creates a suite of preset APIs based on the customer’s requirements and uses them
to exchange data that it has collected internally or externally, and/or connect with external data
sources available on our API marketplace. APIMaster ’s monitoring and alert sub-systems offer
supervision and risk control for APIs, including security situation awareness and anomaly
warnings. APIMaster also manages authorization, API access, and, where payment is involved,
metering, billing, and checkout services. Unlike APIs offered on our API marketplace which
are more standardized and typically provide a single purpose or application, APIs created by
APIMaster are tailored to each customer and typically involve multiple purposes and
applications. As such, APIMaster would not reduce the future needs on our API marketplace.
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Set forth below are two illustrative examples:
A company can create a centralized platform using APIMaster , in conjunction with our
other products, to connect data and APIs from power companies, gas companies, broadcasting
and television companies, and banks. Through the integration and unified output of data and
APIs by APIMaster , the centralized platform can provide a variety of APIs, allowing customers
to offer functionalities such as utilities payment, credit card repayments, cable TV channel
purchases, coupon distribution, or identity verification functions on their website or mobile app
for end-users. Without this centralized platform, customers might not be able to directly choose
one or more functionalities they want on a single platform but would need to negotiate
individually with the data and API sources being introduced. APIMaster can also provide
real-time monitoring for this centralized platform, sending alerts to the company about any
misfunction of APIs.
Data management solutions can assist a state-owned securities company in generating
APIs for its databases, which contain data relating to publicly listed companies and securities.
The platform then outputs data. Prior to release, the platform performs administrative functions
such as subscription management, authorization, platform monitoring and alert, channel
management and security control.
DataArts
DataArts is a data integrated stewardship platform which collects, cleanses and processes
data in order to empower data. Data source can be in diverse structures and formats from
multiple sources. By cleansing data and building database based on common features, such as
whether data is related to a particular event or person, and conducting data analytics, DataArts
transforms data to a unified standard that is ready for output and utilization through APIs.
DataArts operates in four phases: collection, cleansing, processing, and empowerment. In the
first phase, DataArts collects data from diverse sources in different structures and formats,
including those with and without API. This data is then stored in a raw database. In the second
phase, data cleansing takes place, which involves removing repetitive data and transferring it
to an intermediate database. DataArts then repaired data in question and, together with the data
in the intermediate database, transforms the data to a unified standard and transfers it to a
standard database. The third phase involves building database based on common features, such
as whether data is related to a particular event or person. In the final phase, DataArts creates
APIs to output the data with monitoring and management through our API gateway.
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The process is illustrated in the chart below:
Source A database A
Source B

Source C


raw
database

remove repetitive
intermediate
database

repair data
transform to a
unified standard


standard
database


by event*
by person



other standard
 database B


 database C


gateway output
via APIs

collect cleanse process empower
*standards are for
illustrative purpose
QuickBot
QuickBot is an RPA software designed to execute basic and repetitive tasks with a certain
pattern. It simulates human operations on computers through pre-set rule-based processes,
helping customers improve efficiency and reduce costs. It has three main application scenarios:
(a) It can process and simplify repetitive tasks. For example, it can assist accountants
in handling financial data and reports or help personnel from forensic appraisal
institutions in generating data reports in batches. For purposes of illustration,
assume that a forensic appraisal institution that, upon initiating forensic
examination, must open case files across three distinct systems: one for sharing with
the local government legal department, another for process management, and a third
for the internal finance system. These systems cannot directly connect with one
another. Y et, it is crucial that any update in information is simultaneously reflected
across all three systems. A traditional solution might involve an employee manually
inputting the same information into each of these systems. However, with QuickBot ,
the institution can establish automated mechanism to seamlessly input data into all
three systems whenever there is an update.
(b) It can facilitate monitoring tasks. For example, it can assist customers in system
inspections every hour or regularly check mailboxes and import attachments into
other systems.
(c) It can eliminate data silos. For instance, it can input the same data in two systems
that are isolated from each other, which ensures consistent and updated data between
the two systems even when they are not connected with each other.
QuickBot comprises a designing component, a commander component and several
executing working components. Workflow rationale can be developed and tested with a graphic
configuration interface or QuickBot can summarize a protocol by observing a screen recording.
Once a workflow rationale is confirmed by the customer, the designer sends workflow rationale
to a commander, which will issue orders to workers to complete the work according to the
workflow rationale.
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The chart below illustrates the structure of QuickBot :
Send orders Worker
Worker
Worker

 Designer Commander Send orders
Send orders
Send workflow
rationale
SmartShield
SmartShield is a privacy computation tool that addresses the issue of privacy protection
in data exchange. SmartShield is equipped with a variety of computation algorithm models,
including federated learning, multi-party secure computing, and zero-knowledge proof.
Customers can perform data privacy-preserving computation and analytical processing via a
visually intuitive low-code development platform, which significantly reduces the research and
development costs for our customers. SmartShield primarily utilizes federated learning
combined with secure multi-party computation to achieve its goals. Multi-party computation is
a cryptography technique that allows multiple parties to compute collaboratively on their data
without revealing their inputs to each other. SmartShield utilizes federated learning in two
phases to ensure privacy and security of data. In the first phase, SmartShield trains component
models on each independent database. Then, in the second phase, component models use a
series of secure operations to form a model that can achieve the desired function on their
private data without any party having access to the other parties’ inputs. This ensures that each
party’s data remains private and secure throughout the process.
As an illustration, consider a scenario where a commercial bank aims to develop an
analytical tool to assess each mortgage application using a credit profile. The bank could
deploy SmartShield to train individual component models across multiple isolated databases:
the tax authority, pension funds, and credit card payment histories. The component models can
be put together to form the desired analytical tool to assess each mortgage application, without
giving away data. This process is called federated learning. When the bank receives a mortgage
application, a comprehensive model, comprising these individually trained component models,
conducts a multifaceted assessment, balancing various factors. This delivers a conclusion
regarding the applicant’s creditworthiness. This process ensures the bank gains valuable
insights without directly accessing sensitive information from each database, preserving
privacy while facilitating informed decision-making.
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AnchorChain
AnchorChain is a consortium blockchain tool to ensure the security of data circulation
distributed ledgers. In a data circulation distribution ledger, the information is not stored in a
centralized database. Instead, copies of the ledger are maintained across a network of
computers, commonly called nodes. When a new transaction or data entry occur, it is broadcast
to all nodes in the network. Each node in the network independently verifies and validates the
transaction. Once a consensus is reached among a majority of nodes that the transaction is
valid, it is added to the ledger as a new block. This process, known as consensus mechanism,
ensures that the data on the ledger is secure, transparent, and tamper-proof. It facilitates
collaboration among multiple parties within a process that is open, transparent, tamper-
resistant, and traceable. The tool is particularly useful in scenarios that require collaboration
among various organizations. For example, with AnchorChain , corporations can securely
receive information from their suppliers and customers, and easily conduct “tracing”. In the
context of blockchain, “tracing” refers to the ability to track and authenticate the entire journey
of a transaction, asset, or data point as it moves through a blockchain network. Due to the
inherent transparency and immutability of blockchains, every transaction that occurs is
recorded in a tamper-proof manner, enabling precise traceability. By leveraging blockchain
technology, AnchorChain ensures the safety of data flow and promotes secure collaboration
among parties.
Service types
Corporate and government organizations use our solutions to empower three main service
types:
External Data Management
Our solution for external data management empowers corporate and government
organizations to systematically manage external data and seamlessly connect external data with
their existing business systems in a secure and effective manner which we refer to as
“integration with other’s system”. Our solutions can also integrate data silos in customers’
systems non-intrusively using RPA technology and low code/no code quick access and
technology. Our data management solutions can connect with data silos in customers’ systems
and further cleanse, process and further output them, which we refer to as “integration with
data silo”. Another approach to integrate customers’ systems would be to cooperate with the
developer of the system and alter a customer’s system. In contrast, our RPA technology enables
integration without changing the existing system. As an illustration, suppose the existing
system A of a manufacturing company needs to request millions of pieces of order related
information. The existing system B, not having developed APIs to release such information to
system A, would require millions of manual requests and manual checks to generate such
information, which is time-consuming and not practicably feasible. Another approach is to
work with the developer of the existing system B to alter the existing system B, so that it
can provide the data required via APIs. However, this approach can be time-consuming and
costly. Using our approach, however, our developers would not need to work with the
developers of the existing system B to generate APIs which could output such information.
This solution facilitates the customer’s utilization of external data sources. Customers can
therefore minimize operational costs and enhance efficiency. Our low code quick access
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technologies, including no-code API access technology, visual integration technology, and API
generation technology, enable our customers to seamlessly integrate our data management
solutions with their existing systems. For details, see “– Our Technologies – Low
Code/No-code Quick Access”.
Data Stewardship
Data stewardship offers effective end-to-end management of data acquisition, processing,
construction, management, and utilization by performing data cleansing and intelligent data
analytics on the raw heterogeneous data. Our data stewardship solution is distinguished by its
user-friendly design. The user-friendly experience is mainly reflected in the following manner:
(1) our data stewardship allows dirty data filtering, data cleansing, standard unification and
data asset storage in one step, which simplifies multi-process handling, monitoring, checking,
and tracing, and enhances the convenience of an otherwise complex operation; and (2) the
automated modules, such as data quality verification rules and data quality assessment reports,
reduce human participation, sparing customers from heavy operations. With a graphical
interface, customers can configure strategies for metadata, data standards, quality checks, data
extraction tasks, and cleansing processes.
Data Circulation
Our solutions enable customers to facilitate data flow and exchange within or across
organizations or provide data products to the public. Our solutions assist customers in quickly
generating APIs for their databases or applications, enabling the establishment of operating
platforms for data circulation. Moreover, we leverage privacy-preserving computation and
blockchain technologies to enable data value circulation while protecting data privacy. These
capabilities allow us to offer comprehensive solutions that assist businesses in fully unlocking
the potential value of data.
Key Operating Metrics
The table below sets forth selected key operating metrics of our data management solution
business:
Y ear ended December 31,
2021 2022 2023
Number of projects delivered to and accepted by the customers ........ 2 0 2 2 6 2
Number of projects delivered to and accepted by government customers . . 2 4 20
Number of projects delivered to and accepted by SOE customers ....... 5 9 2 9
Number of projects delivered to and accepted by other customers ...... 1 3 9 1 3
Number of projects delivered to and accepted in loss .............. – – –
Total revenue ( in millions of RMB ) .......................... 65.3 105.4 99.0
Number of customers ................................... 1 8 2 1 2 9
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* For the avoidance of doubt, the number of customers were calculated by consolidating contracting parties who
controlled each other or were under common control based on the information provided by the contracting
parties.
We did not have any data management solutions projects that incurred losses during the
Track Record Period, primarily because we evaluate the cost for each project before we provide
a quote or make a bidding proposal, as required under our project management operation
manual (ˏ). In addition, a substantial portion of the cost for each project
comes from the labor costs of our programmers, who are paid at a fixed salary on a monthly
basis and therefore we are unlikely to incur substantial unexpected costs. Our project contracts
also include clauses of payment milestones or payment time point, which reduces our credit
risk for each project.
Our number of projects delivered to and accepted by the customers remained steady in
2021 and 2022, and increased to 62 in 2023. The total revenue derived from data management
solutions decreased from RMB105.4 million in 2022 to RMB99.0 million in 2023, primarily
because in 2023 we provided a large number of a new solution, “data police”, which required
little customization and each project contributed to a small amount of revenue as compared to
revenue from more customized solutions.
Case Studies
A textile company
Background: A textile manufacturer in Suzhou, China, sought to transform its operations and
increase its competitiveness through intelligent manufacturing. During this process, it
identified several key challenges:
 Data Integration : it faced the issue of dispersed data across various systems,
hindering effective utilization.
 Process Optimization : The traditional manual-based approach at the textile company
relied heavily on human experience, which posed challenges in knowledge transfer
and efficient onboarding of new employees.
 Warehouse Management: the textile company struggled with warehouse
management issues such as disorganization, limited space, and inefficiencies in
inventory management.
Solution: To address these challenges, we implemented an integrated platform that
leveraged APIMaster and DataArts technologies. This platform cleansed, processed, and
integrated diverse data sources. We installed sensors on production lines and machines to
collect real-time data. By automating data collection and analysis, the platform monitored and
proceeded with production steps automatically under human supervision. In cases where
human action was required, the platform would send reminders to the persons who were
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responsible for the action. Moreover, the platform could generate the correct ingredient
composition for each color used in batches of the textile company’s textile products, thereby
reducing the reliance on human experience and improving consistency across batches.
Additionally, the platform tracked machine utilization and would temporarily stop machines to
reduce energy consumption. Warehouse management was also digitalized, with the platform
automatically managing inventory by tracking labels on materials and products. It also
controlled transportation vehicles to facilitate material delivery to production lines and product
retrieval to the warehouse. The platform also leveraged SmartShield , a federated learning tool
for cross-domain data analytics on suppliers’ data, which helped the textile company to
optimize the supply chain management without compromising specific suppliers’ data.
Key Benefits:
 The platform created a centralized repository of valuable data assets, enabling
efficient data management and utilization.
 By automating various processes, the solution reduced the dependency on individual
expertise, thereby promoting production efficiency.
 Through automation and real-time monitoring, the platform improved the overall
production process, reducing delays and errors.
 The platform enabled efficient and effective management of warehouses, optimizing
space utilization and inventory control.
 By tracking machine utilization and implementing intelligent control, the solution
helped the textile company reduce energy consumption.
A municipal service authority
Background:
A municipal service authority planned to establish a platform to collect data from
governmental departments and use the data to promote social governance. V arious
governmental departments possess data needed by this municipal service authority. However,
data was stored in databases of different governmental departments and databases of each
district or county government were often in different formats and seemingly unrelated.
Furthermore, there was no system to process the data and provide data to the governmental
departments, such as district level coordination working groups, that needed them.
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Solution:
The municipal service authority adopted a system which was customized based on
DataArts and APIMaster . APIMaster efficiently integrated data from multiple heterogeneous
sources into a data warehouse. DataArts removed duplicate data, and performed data quality
checks. For defective data, DataArts traced back to its source and made efforts to repair it.
DataArts then categorized data by subjects and topics, such as crackdown on organized crimes
or certain incidents. APIMaster generated hundreds of APIs to output the cleansed data.
Government departments can acquire data through these APIs. This solution enables the
municipal service authority to provide data analytics and application to the different
departments that demand near real-time responses.
Key Benefits:
 overcomes inefficiencies caused by multi-source heterogeneous data;
 facilitates exchange of data and data-sharing among governmental departments; and
 supports massive simultaneous queries.
An industrial park
Background: An industrial park established data warehouse through its departments,
completing the gathering of data related to individuals, business organizations, and subject-
related data. To support digital economy and provide efficient public services, this industrial
park needed a unified platform that could integrate and leverage these databases, enabling
identity authentication, sharing digital licenses, conducting optical character recognition and
providing secured communication channels.
Solution: By leveraging APIMaster and QuickBot , we developed an Intelligent Central
Hub solution that seamlessly integrates the databases of various bureaus and offices. Our
no-code access technology enables a connection between the existing systems of these entities
and the Intelligent Central Hub, eliminating data silos without making significant system
modifications. Intelligent Central Hub modified existing APIs and created new APIs to provide
standardized output. Through the Intelligent Central Hub, government departments of the
industrial park can access continuous and standardized data services, facilitating the sharing of
public data resources.
Key Benefits:
 enables rapid integration of diverse and heterogeneous data sources;
 significantly reduces the cost of cross-department integration;
 supports reuse of existing APIs and rapid creation of new APIs; and
 establishes an open marketplace for government digital resources, facilitating
cross-department data service sharing and promoting efficiency.
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A local emergency management bureau
Background: A local emergency management bureau is responsible for supervising the
production safety of corporate organizations within a region. It relies on data from four
sources: data collected by sensors installed on the equipment of corporate organizations, video
surveillance from various corporate organizations, data derived from inspections and penalty
record and data from accidents. Possible challenges in such process include how to ensure the
data can be collected and properly recorded, free from tampering.
Solution: We developed a comprehensive safety production warning and monitoring
system for this bureau, leveraging the capabilities of AnchorChain . The system, by utilizing
blockchain technologies, creates a decentralized ledger for corporate organizations and this
bureau to upload data. The data was synchronized to a trusted database, which can be used to
verify whether data has been tampered. These data can be used to train models to identify
unusual circumstances, such as an abrupt increase in dust particles in a chemical production
factory, to identify potential production risks. This bureau can then issue warnings to the
respective corporate organizations.
Key Benefits
 ensures an authentic and tamper-proof data source; and
 provides warning on unusual production circumstances and prevents accidents.
Revenue Model
Our data management solutions primarily follow a project-based pricing model, where
customers are generally billed for the products and platform development according to
payment terms agreed with customers. Platform construction fees are typically charged for the
implementation of the data management platform. Additionally, in certain cases, we may also
charge fees for supporting operational services and consulting services based on specific
customer requirements. Revenue derived from data management solutions is recognized when
the data management solution and related services are delivered to and accepted by the
customers. In 2021, 2022 and 2023, revenue derived from data management solutions were
RMB65.3 million, RMB105.4 million and RMB99.0 million, respectively.
We established a project management committee to evaluate the request for proposed
potential projects. In case that no consensus is reached, our CEO shall have the right to make
final judgment on whether we could accept the project. Our project management committee
comprises the head of the business team which discovered the potential projects, the general
manager of project operation center and our CEO, joined by head of other departments if
necessary. We determine the price based on a combination of factors, such as budget of the bid
inviter, labor costs and required investments in resources, delivery and development costs,
pre-sales consulting, and technical operations.
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When we participate in a government bidding process, we also take the budget of the
tender into consideration. A bidding shall be reviewed by the head of sales team and approved
by the head of department. Any project with a bidding price above RMB2.0 million shall also
be approved by our CEO. In 2021, 2022 and 2023, three, four and 12 of the data management
solution projects went through a bidding process, measured by the signing date of the relevant
project agreements, representing RMB35.8 million, RMB17.1 million and RMB19.3 million of
the total project value, respectively. In 2021, 2022 and 2023, we participated in 14, 15 and 21
bidding process, respectively. Our bidding success rate was 21.4%, 46.7% and 66.7%,
respectively. The bidding process typically requires us to make a deposit of 2% of our bid price,
which is capped at RMB800,000. The deposits we made to participate in the data management
solution project bidding process were RMB925,828, RMB309,100 and RMB678,600 in 2021,
2022 and 2023, respectively. As of the Latest Practicable Date, all deposits we made for the
same years were refunded to us.
OUR TECHNOLOGIES
Technologies are the backbone of our service offerings. Over the years, we have
developed series of proprietary technologies, which enables us to compete effectively. Our
technology has powerful competitive advantages in low latency, stability, security, flexibility,
scalability, accessibility and ease of use. For example, our high-performance API gateway uses
canary deployment, which provides API stability and scalability. This technology also enables
a low-latency API response. Our multi-channel intelligent routing technology enhances the
stability of the API by consolidating multiple APIs into one, improving flexibility while
reducing complexity and making APIs easier to use. Our API safety management technology
provides security for API transmission. Our low-code/no-code quick access technology makes
the API easy to use and accessible. We employ the following key technologies:
 Low Code/No-code Quick Access: Our proprietary low code quick access
technologies, including no-code API access technology, visual integration
technology, and API generation technology, enable our customers to seamlessly
integrate our data management solutions with their existing systems. No-code access
technology enables customers to swiftly integrate data management solutions with
their systems, reducing the need to involve professional technicians for
development. Non-professional software developers can access APIs with different
technical standards without coding, thereby improving the efficiency of API
integration, access, and management. Visual integration technology enables
customers to combine multiple component APIs graphically to create new integrated
APIs or set up workflow protocols. This technology is mainly utilized by APIMaster
and QuickBot. API generation technology supports the conversion of database tables
to standard, transparent and fine-grained APIs with configuration wizard or SQL.
This technology is mainly utilized by APIMaster .
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 High-Performance API Gateway: High-performance API gateway technology
enables high-speed network protocol processing. Utilizing canary deployment and
elastic expansion, our services and solutions require less server resources to achieve
high performance. In addition, elastic expansion reduces resource consumption,
hardware costs, and carbon emissions during low-load periods. Canary deployment
allows for controlled impact of version changes, contributing to improved system
stability and customer satisfaction. High-Performance API Gateway can also limit
and adjust the data flow from time to time to promote the speed of data transmission
and the stability of APIs’ operation. High-Performance API Gateway is mainly
utilized by APIMaster and API marketplace.
 Multi-Channel Intelligent Routing Technology: Multi-channel intelligent routing
technology utilizes a visual routing configuration, allowing customers to easily
configure the routing rules for APIs. It also supports combination strategies that
allow multiple APIs to be combined to form a single API, providing greater
flexibility and customization. It supports APIs to adjust channel weights and remove
abnormal channels, which improves the stability and performance of the APIs. This
function ensures that requests are automatically routed to the most suitable channel,
reducing downtime and improving customer experience. These mechanisms ensure
the stability of APIs and enable customers to select the most appropriate routing
method based on their needs and resource availability. Multi-Channel Intelligent
Routing Technology is mainly utilized by API marketplace and APIMaster .
 API Safety Management Technologies: API Safety Management Technologies
address the concerns of data tampering and data leakage during API transmission, as
well as the risk of network attacks initiated through APIs. APIMaster employs three
types of API safety management technologies: bidirectional encryption, risk
awareness and automated management and data security audit. API bidirectional
encryption enables encrypted transmission of data during the access of APIs, thus
enhancing the security and reliability of API data transmission. It protects data from
replay attacks, data tampering, and leakage. The transaction details shall be
irreversibly redacted for sensitive information and stored for a reasonable retention
period for accounting purpose. Our proprietary API risk awareness and automated
management technology ensures data security and confidentiality. It monitors the
proper functioning of APIs and blocks security risks. API Data Security Audit
functions as a complement to the API risk awareness and automated management
technology. It identifies, audits and analyzes abnormal data circulation.
 Data Cleansing Technologies: Data cleansing technologies aim to improve the
quality of data, such as their accuracy, timeliness, completeness, consistency, and
effectiveness, thereby achieving better data quality and ensuring data security. These
technologies facilitate the exchange of data among different departments by
generating high-quality data, making them readily available for output through
APIs. It also makes data ready for further analysis to support decision-making and
risk management.
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 RPA: We utilize two types of RPA proprietary technologies on our QuickBot :
Non-Intrusive API builder and RPA-based sensitive credential protection
technology. Non-Intrusive API builder enables customers to generate APIs by
operating in a graphic form without redeveloping customer’s existing IT system. It
shortens the development time of APIs and decreases reliance on experienced
programmers. RPA-based sensitive credential protection technology ensures the
security of sensitive data and reduces the risk of data leakage. This technology is
also utilized by our SmartShield .
 Privacy-Preserving Computation Technologies: Service quality management
technology optimizes the efficiency of cross-domain data computation by
scheduling of network and computing resources in privacy-preserving computation
tasks. Our privacy-preserving computation technology optimizes the coordination
between hardware and software. To ensure high-quality service, the technology
employs three key strategies. First, it establishes models to set priorities for tasks
and allocate network and computing resources accordingly, leading to more efficient
and effective task execution. Second, it supports decentralized matching based on
smart contracts, which can automate data collaboration and reduce the need for
human intervention. A smart contract is a program stored on the blockchain that runs
when predetermined conditions are met. This feature can significantly improve the
efficiency of privacy-preserving computation tasks. Finally, the technology offers
privacy security audit capabilities based on knowledge graphs, which provide a
graphical representation of the relationships between data and privacy risks. This
allows customers to identify potential risks in a more easy-to-understand manner.
The knowledge graphs can also enhance the transparency and interpretability of the
privacy protection mechanisms employed in the technology. We utilize privacy-
preserving computation technology on our SmartShield .
 Blockchain: We utilize two types of blockchain-based technologies on our
AnchorChain: (i) data intelligent semantic registration and matching; and (ii) data
trust transfer. Leveraging the tamper-proof features of blockchain technology, our
data intelligent semantic registration and matching technology registers data on the
blockchain, to affix data ownership. This technology utilizes cryptographic
techniques of blockchain to protect the privacy of both data providers and
customers. By generating smart contracts, data intelligent semantic registration and
matching enables automatic matching of data transaction parties, enhancing the
efficiency and accuracy of data circulation. Our trust transfer technology ensures
that the data input by multiple parties is traceable. The technology uses knowledge
graphs to visualize ledger data and supports the elastic expansion of the blockchain
to handle requests with scalability.
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RESEARCH AND DEVELOPMENT
Research is at the core of our business. We invest substantial human and capital resources
in research and development. Our research efforts enhance the existing solution offerings and
incubate new technological initiatives. We incurred RMB16.9 million, RMB26.3 million and
RMB24.3 million of research and development expenses in 2021, 2022 and 2023, respectively,
accounting for 6.5%, 8.0% and 5.5% of our total revenue during the respective years,
respectively.
As a part of our commitment to maintaining a robust, innovative approach to the
application of data technology, we recognize the integral role of novel technologies in the
continued development and enhancement of our API marketplace and data management
solutions. Our focus centers on the protection of data privacy and security. We continually
strive to reduce dependence on third-party software and foreign infrastructure solutions,
thereby enhancing our ability to safeguard vital data.
Our experienced programmers and engineers are the backbone of our research and
development efforts. As of December 31, 2023, we had 103 research and development
employees, representing 54.5% of our total headcount. Our research and development team
includes data scientists, computer scientists and software engineers. Among them, eight hold
a master’s degree and 89 hold a bachelor’s degree. We plan to recruit experienced software
development engineers, operating and maintenance engineers, internet engineers and architects
in the next three years. See “Future Plans and Use of Proceeds” for further details.
Product Planning
To introduce a new standard API to our API marketplace, our business department and the
procurement department discover market demand and conducts in-depth market research to
find APIs that match the demand. The business team reviews such APIs from the perspective
of meeting customer needs and market potential. Our risk management department evaluates
the new API from a compliance perspective. The technical team reviews the API’s
compatibility with our platform integration requirements. Once all these steps have been taken,
we will release the new API.
The steps of our development process for data management solution projects vary case by
case. The order of the steps may also vary in different cases. We identify the potential customer
demands by discussing with their representatives, conducing due diligence to understand their
current IT system, analyzing the advantages and drawbacks of the current IT system and
collecting relevant public information, with a view to understanding the areas that the customer
is interested in promoting digitalization and their goals and strategies. We also conduct an
in-depth demand assessment, which helps us to understand prospects of similar projects in the
future. After these steps, we will formulate a customized data management solution based on
customer requirements. We typically participate in the bidding process or by competitive
negotiation to acquire projects. For the following steps, we proceed differently, depending on
whether the customer is a government entity, an SOE or other customers. In the case of a
government entity or SOE, we prepare and develop the data management solution, which may
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include coding, building the customer interface, and testing product functionalities. Close
communication with government clients is crucial during the product development phase in
order to timely report development progress and issues and make product adjustments and
improvements according to clients’ needs. We conduct trial tests and collect feedback on issues
the data management solutions encountered, which in turn helps us to further optimize and
improve the data management solutions. We regularly conduct marketing and promotional
activities, including communication with government departments to understand their latest
needs, participating in industry conferences, releasing press statements, and conducting social
media marketing. We will apply for necessary certifications and awards as recognitions to the
quality of our data management solutions. In the case of other customers, mainly private
entities, we make efforts to further understand their specific needs, ensuring the solution meets
their unique business requirements. Based on our analysis, we perform data cleansing, data
migration and other works to facilitate smooth data flow integration. Then we proceed to
implement the data management solution, including establishing data management protocols,
formulating policies and standards, and training the customers’ employees. Depending on the
terms of the contract, we provide ongoing after-sales service and support and make adjustments
and improvements based on customer feedback. We further maintain our relationships with the
customers by regularly communicating with them, which also creates opportunities for us to
understand their evolving needs. We may make recommendations for them to upgrade the data
management solutions or purchase other data management solutions based on their needs.
Similar to SOE and government projects, we also conduct marketing and promotional activities
and apply for certifications and compete for awards.
Ongoing R&D Projects
We place strong emphasis in our technology development, which is critical to allowing us
to efficiently and effectively address the technical challenges associated with our business. Our
R&D initiatives include the following:
 combine data and data-driven analytics applications to provide customers with
analytics without revealing sensitive data, together with improving our solutions to
fit vertical industries using authorized data from customers;
 create transaction tokens for diverse data types and specifications, which can also be
exchanged with other data trading systems, together with our efforts to improve the
speed of peer-to-peer data transactions through cryptographic technology;
 build a data value evaluator to rank data based on market supply and demand within
a reasonable range;
 develop a plug-in system and network channel for privacy-preserving exchange of
data and computation, allowing dynamic connectivity of different data service
suppliers; and
 enhance computational speed for privacy-preserving data analysis by designing
tailored hardware for computing and network devices.
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Collaboration
We seek to expand our R&D capabilities by establishing collaboration with top
universities. In June 2023, we entered into a strategic collaboration agreement with College of
Computer Science and Technology, Nanjing University of Aeronautics and Astronautics (ԯ
ኪၾҦஔኪ৫)( “ Nan Hang ”), laying out the general directions for our
future cooperation. Pursuant to the strategic collaboration agreement, both parties will form a
joint laboratory to conduct joint research and cultivate talents. The parties will jointly establish
an academic committee, a joint laboratory and a general office. The academic committee is
responsible for the development plan and daily operation of the joint laboratory. The joint
laboratory will be led by Mr. Zheng Weiming, a Member of the Chinese Academy of
Engineering ( ʕ਷ʈ೻৫). The general office is responsible for logistical, financing,
coordination, marketing and administrative matters. We are committed to providing
RMB300,000 per annum for the operation of the joint laboratory. Furthermore, the intellectual
property rights of any research products arising from this collaboration will be jointly owned
by both parties. The strategic collaboration agreement has a term of five years. The
collaboration will focus on the design and optimization of intelligent algorithms for edge
computing, system safety technology and high-performance database technology with
hardware-software co-optimization, which are the general research topics set forth in the
agreement. We believe this collaboration will strengthen our research capabilities and in turn,
improve our technologies in future. As of the Latest Practicable Date, we have not conducted
any joint research, applied for research on any national projects or commenced to cultivate any
talents for Nan Hang.
INTELLECTUAL PROPERTY
As of December 31, 2023, we had 50 registered trademarks in China, 98 registered
software copyrights in China, 64 registered patents in China and four major domain names in
use in China. For further details of the intellectual property rights that are material to our
business operations, see “Statutory and General Information – B. Further Information about
Our Business – 2. Intellectual Property Rights of Our Group” in Appendix VII to this
prospectus.
We protect our intellectual property rights through a combination of copyrights,
trademarks and patents and other forms of intellectual property rights available, as well as
confidentiality and licence agreements with our employees, suppliers, customers and others.
We generally require our employees to enter into confidentiality agreements acknowledging
that inventions, trade secrets, developments and other processes generated by them on our
behalf are our property and assigning to us any ownership rights that they may claim in those
works. Despite our precautions, however, third parties may obtain and use intellectual property
that we own or licence without our consent. We are not aware of any such breaches of our
intellectual property rights during the Track Record Period. For further details of the risks
relating to our intellectual property rights, see “Risk Factors – Risks Relating to Our Business
and Industry – Unauthorized use or other violation of our intellectual property rights by our
customers, employees and/or third parties may harm our brand and reputation, and the expenses
incurred in protecting our intellectual property rights may materially and adversely affect our
business. We may also be subject to intellectual property infringement claims, which may be
expensive to defend and may disrupt our business and operations.”
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We have not experienced any material disputes or claims for infringement of intellectual
property rights with third parties during the Track Record Period and up to the Latest
Practicable Date.
OUR SUPPLIERS
Our procurement includes purchases of data services, software, hardware and technology
services. For each of the years ended December 31, 2021, 2022 and 2023, our purchases
amounted to RMB160.5 million, RMB208.0 million and RMB298.6 million, respectively,
representing 94.4%, 94.0% and 94.4% of our total cost of sales, respectively.
In addition, for our top-up service of the API marketplace, we arrange mobile phone
top-up services on behalf of our customers primarily from third-party top-up service providers.
Since the Group acts as a facilitator in these transactions, we recognize revenue from this
top-up service on a net basis on our consolidated statements of profit or loss.
Our Major Suppliers
For each of the years ended December 31, 2021, 2022 and 2023, procurement from our
five largest suppliers accounted for 56.2%, 69.9% and 83.2% of our total purchases,
respectively, and purchases from our largest supplier accounted for 36.3%, 42.5% and 46.3%
of our total purchases, respectively. The percentage of purchases from our five largest suppliers
increased substantially in 2023 compared to the percentage of purchases in 2021 and 2022,
primarily due to the commencement of our cooperation with Customer L, who mainly used
mobile number-related three-factor authentication API, the data supply of which was provided
by Supplier A. In addition, the API requests made by Customer C mainly procured the data
service supply of Supplier A. This also in turn led to the increase in the percentage of our
purchase from Supplier A in our total purchase. For risks related to the concentration of
suppliers, see “Risk Factors – Risks Relating to Our Business and Industry – We experienced
customer and supplier concentration during the Track Record Period and may continue to be
exposed to the risk of such concentration in the future.” Our major suppliers, with whom we
have maintained business relationships for a few months to seven years, are located in China.
The payments we make to our major suppliers are primarily in Renminbi by way of bank
transfers. All our suppliers during the Track Record Period and up to the Latest Practicable
Date were based in China.
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The table below sets out certain details of our five largest suppliers for each of the years
ended December 31, 2021, 2022 and 2023:
2023
Rank Supplier Background
Subject matter of the
procurement
Approximate
Transaction
amount
Percentage of
total
purchase
Y ear of
commencement
of business
relationship
with us
Credit
period/term
(RMB’000) (%)
1. *Supplier A Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
155,903 46.3% 2017 15 – 90 days
2. *Supplier F Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
Data management
solutions
54,537 16.2% 2016 5 – 30 days
3. Supplier C Computer information
technology
development,
technical services,
technical consulting,
technology transfer;
software
development.
API marketplace –
Query
API marketplace – SMS
notice
37,866 11.2% 2023 15 days
4. *Supplier J Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
22,267 6.6% 2020 7 – 15 days
5. Supplier L Provision of big data
service
API marketplace –
Query
9,947 3.0% 2016 7 days
* The supplier is a group consolidating the transaction amounts of entities within such group.
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2022
Rank Supplier Background
Subject matter of the
procurement
Approximate
Transaction
amount
Percentage of
total
purchase
Y ear of
commencement
of business
relationship
with us
Credit
period/term
(RMB’000) (%)
1. *Supplier A Provision of
telecommunications
service
API marketplace –
Query
83,057 42.5% 2017 20 to 90 days
2. *Supplier F Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
30,330 15.5% 2016 10 days
3. *Supplier D Provision of
cryptographic
service
API marketplace –
Query
API marketplace – SMS
notice
Data management
solutions
8,802 4.5% 2019 Seven days
4. Supplier H Provision of integrated
industrial internet
solutions and
production of
I-Perception cloud
platform
API marketplace –
Query
API marketplace –
SMS notice
7,779 4.0% 2020 Seven days
5. *Supplier I Provision of services
and products in
connection with
cloud data center,
cloud service and
big data, smart city
and smart enterprise
Data management
solutions
6,604 3.4% 2022 Seven days
* The supplier is a group consolidating the transaction amounts of entities within such group.
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2021
Rank Supplier Background
Subject matter of the
procurement
Approximate
Transaction
amount
Percentage of
total
purchase
Y ear of
commencement
of business
relationship
with us
Credit
period/term
(RMB’000) (%)
1. *Supplier A Provision of
telecommunications
service
API marketplace –
Query
63,642 36.3% 2017 20 to 90 days
2. *Supplier F Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
12,680 7.2% 2016 10 days
3. Supplier C Computer information
technology
development,
technical services,
technical consulting,
technology transfer;
software
development
API marketplace –
Query
API marketplace – SMS
notice
10,079 5.8% 2019 Seven days
4. *Supplier D Provision of
cryptographic
service
API marketplace –
Query
API marketplace – SMS
notice
Data management
solutions
6,757 3.9% 2019 Seven days
5. Supplier G Research,
development, sales
and service of
overall data security
solutions, and its
main business is
video security and
big data security
Data management
solutions
5,236 3.0% 2021 Five days
* The supplier is a group consolidating the transaction amounts of entities within such group.
(1) Supplier A is a mega telecommunications operator in China. It mainly provides integrated information
services such as mobile communications, Internet access and applications, fixed-line telephony, satellite
communications and information and communication technology integration. Supplier A has operations
in 31 provinces (autonomous regions and centrally-administered municipalities) and in the Americas,
Europe, Hong Kong and Macau.
(2) Supplier B mainly engages in the research and development, design and promotion of enterprise level
mobile information services. It continued to deepen the construction and layout of the resource,
especially regional high-quality resources, in deepening the strategic cooperation with Chinese
telecommunication service providers. It focused on promoting content cooperation and business
cooperation with operators in Northeast China, North China, and Northwest China, and strengthened
operations with key provinces and cities.
(3) Supplier C belongs to the industry of software and information technology services. The scope of
business contains computer information technology development, technical services, technical
consulting, technology transfer; software development.
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(4) Supplier D is a leading cryptographic service provider in the industry, it is committed to promote the
application and development of digital certificates, trusted identity and blockchain technology to
provide security and trusted identity services for the new infrastructure in the Internet era.
(5) Supplier F engages in the provision of voice usage, broadband and mobile data services, and data and
internet application services through its subsidiaries. Supplier F has subsidiaries in 31 provinces
(autonomous regions and municipalities) across China and many other countries and regions around the
world. It also offers other value-added services, leased lines and associated services, and sales of
telecommunications products.
(6) Supplier G mainly engages in the research, development and providing service of overall data security
solutions, and its main business is video security and big data security. It has gained insight into
customer needs, plowed into industry applications, and innovative products and solutions have
comprehensively covered many industries such as public security, procuratorate, emergency
management and big data for government.
(7) Supplier H is a software and hardware developer, focusing on providing integrated industrial Internet
solutions such as remote equipment monitoring, big data analysis, intelligent operation and maintenance
for customers of different sizes, laying a good data foundation for the information construction and
intelligent construction of production enterprises. Its product – cloud platform is available for both
cloud and local deployment.
(8) Supplier I’s group includes three listed companies, business covers four industry groups, namely, cloud
data center, cloud service and big data, smart city and smart enterprise, providing IT products and
services around the world, and meeting the needs of government and enterprise informationization in all
aspects.
(9) Supplier J is a large central enterprise in the communications industry in China. It provides full-service
communications services in all 31 provinces, autonomous regions, municipalities directly under the
Central Government of China and the Hong Kong, covering mobile voice and data, wireline broadband,
and other communications and information services.
(10) Supplier L focuses on big data services in the financial industry, providing customers with big data
analysis services, big data mining services, customized data cloud services, and financial control cloud
services.
(11) Supplier M is a data trading center located in China. It serves the entire industrial chain of the digital
economy. It trades data packets, API interfaces, big data application solutions, data trading services,
etc., providing a compliant data trading venue for both buyers and sellers.
Our Directors confirm that, as of the Latest Practicable Date, (i) our five largest suppliers
during the Track Record Period were Independent Third Parties; and (ii) none of our Directors,
their close associates or Shareholders who own more than 5% of the share capital of our
Company had any interest in our five largest suppliers.
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General Terms of Contracts with Suppliers
With respect to our major suppliers for API marketplace services (including major
providers of telecommunications service in the PRC), we usually enter into different master
agreements with such suppliers for a term of one to two years, which specify the unit price for
each type of services to be provided by them. We will typically pay the suppliers for the service
on a monthly basis with the credit period ranging from five to 90 days. The parties will
maintain the confidentiality of any information obtained during the course of their business
relationship, and they will comply with all relevant laws and regulations. Both parties are
responsible for ensuring that they have the necessary qualifications and authorization to enter
into and perform the agreement. If either party breaches the agreement, the other party may
terminate and seek compensation for any direct or indirect losses incurred. The parties are also
obligated to refrain from engaging in bribery or providing improper benefits to each other’s
employees. Our contracts with API marketplace suppliers typically provide that the term of the
agreement is one year and will be automatically renewed for an additional year, unless either
party gives prior notice to object. In most contracts, suppliers commit to providing data in
compliance with legal and regulatory requirements, and with authorization that does not
infringe on any third party’s legal rights. They also commit to protecting all information
obtained through the services with adequate measures, and not providing it to third parties for
unauthorized purposes. Suppliers will also promptly and effectively respond to any data
security incidents and ensure the proper classification and management of all data and record
all data processing activities.
Our suppliers for data management solutions typically have their own template contract
base on which we conduct negotiations. The terms of each supply agreement vary individually.
OUR CUSTOMERS
Our customers include internet companies, telecommunications operators, technology
companies and other business and government organizations seeking digital transformation as
well as individual app developers and technology professionals. For each of the years ended
December 31, 2021, 2022 and 2023, revenue from our five largest customers accounted for
41.1%, 43.7%, and 62.3% of our total revenue, respectively, and revenue from our largest
customer accounted for 11.7%, 12.4% and 20.1% of our total revenue, respectively. The
percentage of our five largest customers’ revenue contribution increased substantially for the
year ended December 31, 2023 as compared to the revenue contribution for the years ended
December 31, 2021 and 2022, primarily due to the commencement of our cooperation with
Customer L, who mainly used mobile number-related three-factor authentication API.
Furthermore, our second largest Customer C expanded its services to help its customers,
including commercial banks and financial institutions, to conduct promotional activities. For
risks related to the concentration of customers, see “Risk Factors – Risks Relating to Our
Business and Industry – We experienced customer and supplier concentration during the Track
Record Period and may continue to be exposed to the risk of such concentration in the future.”
We have maintained business relationships with our major customers for one to eight years.
The payments made to us by our major customers are primarily in Renminbi by way of bank
transfers.
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During the Track Record Period, we mainly provided query APIs that related to identity,
bank card, mobile number, real name authentication and SMS notice, together with other types
of APIs to large internet company customers. For telecommunications operators, our API
service mainly include APIs in connection with mobile numbers and SMS notices with regard
to Supplier A, F and J. We have also provided data management solutions to
telecommunications operators for a total of 10 projects during the Track Record Period. The
purchase amount of each project ranged from less than RMB0.5 million to RMB10.9 million
during the Track Record Period. These projects include, without limitation, data management,
API creation and operation powered by APIMaster ; adding security technical measures and
expanding the current functions of an existing platform; providing identity recognition
function; providing risk monitoring, production management, warehouse management data
analytics and application, and system management, functions safeguarding internet security,
providing public services to certain rural areas; intelligent voice related services; WIFI
establishment and internet system settings; and driver fatigue monitoring platform. We
consider our cooperation with telecommunications operators and large internet company
customers to be well-established because, (i) since June 2011, we have accumulated experience
and technologies, enabling us to provide over 380 APIs as of December 31, 2023; (ii) since the
inception of our cooperation with large internet company customers, such as Baidu and
Tencent, and telecommunications operators, they have continued to use our services; (iii) large
telecommunications operators and their local subsidiaries need a third-party platform to assist
them in requesting other telecommunications operators’ data; and (iv) we implemented policies
establishing strict prior and periodic reviews, evaluated suppliers based on five criteria and
organized semi-annual comprehensive assessments. These policies ensure the quality of our
data supply sources, which granted us competitive advantages. We believe the likelihood of
substantial internet companies and telecommunications operators opting to establish their own
APIs, thereby reducing the utilization of our services via API marketplace, to be minimal.
Establishing a suite of APIs comparable to ours necessitates substantial time and financial
resources. Even with the requisite determination, there is no assurance that undertaking such
initiatives would yield a more financially cost-effective arrangement than procuring services
directly from us.
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The table below sets out certain details of our five largest customers for each of the years
ended December 31, 2021, 2022 and 2023:
2023
Rank Customer Background
Products
provided by us
Approximate
Transaction
amount
Percentage of
total revenue
Y ear of
commencement
of business
relationship
with us
Typical credit
terms
(RMB’000) (%)
1. Customer J A cloud computing
service provider
API marketplace –
Query
88,624 20.1% 2018 45 days
(1)
2. #Customer C A professional one-
stop financial
technology
intelligent solution
provider
API marketplace –
Query
API marketplace – SMS
notice
70,575 16.0% 2016 7 – 10 days
(1)
3. Customer F An internet and AI
company
API marketplace –
Query
API marketplace – SMS
notice
62,276 14.1% 2019 35 days (1)
4. #Customer L Provision of services
and products in
connection with
cloud data center,
cloud service and
big data, smart city
and smart enterprise
Data management
solution
28,438 6.4% 2022 60 days
5. *Customer K Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
Data management
solution
24,990 5.7% 2015 10 – 30
days
(1)
* The customer is a group consolidating the transaction amounts of entities within such group.
# Customers settled their payments through the Third-Party Payment Arrangements during the Track
Record Period. Customer C and Customer L both ceased to settle their payments with us through the
Third-Party Payment Arrangements after November 27, 2023.
(1) We allow this customer to settle payments to us on a monthly basis for its API marketplace purchases.
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2022
Rank Customer Background
Products
provided by us
Approximate
Transaction
amount
Percentage of
total revenue
Y ear of
commencement
of business
relationship
with us
Typical credit
terms
(RMB’000) (%)
1.
#Customer C Provision of
technology
intelligent solutions
API marketplace –
Query
API marketplace – SMS
notice
40,890 12.4% 2016 Seven to 10
days
(1)
2. #*Customer B Provision of
telecommunications
service
API marketplace –
Query
32,734 10.0% 2016 Five to 30
days
3. Customer F An internet and AI
company
API marketplace –
Query
API marketplace – SMS
notice
24,516 7.5% 2019 35 days
(1)
4. Customer I Local government Data management
solutions
23,480 7.1% 2020 No credit
period
stated
5. Customer G An internet technology
company in China,
and in the
development of
Internet applications
and services
API marketplace –
Query
22,101 6.7% 2021 15 days
* The customer is a group consolidating the transaction amounts of entities within such group.
# Customers settled their payments through the Third-Party Payment Arrangements during the Track
Record Period. Customer B and Customer C both ceased to settle their payments with us through the
Third-Party Payment Arrangements after November 27, 2023.
(1) We allow this customer to settle payments to us on a monthly basis for its API marketplace purchases.
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2021
Rank Customer Background
Products
provided by us
Approximate
Transaction
amount
Percentage of
total revenue
Y ear of
commencement
of business
relationship
with us
Typical credit
terms
(RMB’000) (%)
1.
#*Customer B Provision of
telecommunications
service
API marketplace –
Query
Data management
solutions
30,432 11.7% 2016 Five to 30
days
2. Customer F An internet AI
company
API marketplace –
Query
API marketplace – SMS
notice
27,646 10.6% 2019 35 days
(1)
3. Customer G An internet technology
company engaged in
advertising design,
software
development, agency
representation
API marketplace –
Query
26,397 10.2% 2021 15 days
4. Customer C Provision of
technology
intelligent solutions
API marketplace –
Query
API marketplace – SMS
notice
11,667 4.5% 2016 Seven to 10
days
(1)
5. *Customer H Provision of
telecommunications
service
API marketplace –
Query
API marketplace – SMS
notice
10,714 4.1% 2017 20 days* The customer is a group consolidating the transaction amounts of entities within such group.
# Customers settled their payments through the Third-Party Payment Arrangements during the Track
Record Period. Customer B ceased to settle their payments with us through the Third-Party Payment
Arrangements after November 27, 2023.
(1) We allow this customer to settle payments to us on a monthly basis for its API marketplace purchases.
(2) Customer A is a comprehensive e-commerce service provider engaged in digital commodity trading
services, product promotion operations, telecommunications and internet value-added services, and
convenient payments.
(3) Customer B engages in the provision of voice usage, broadband and mobile data services, and data and
internet application services through its subsidiaries. Customer B has subsidiaries in 31 provinces
(autonomous regions and municipalities) across China and many other countries and regions around the
world. It also offers other value-added services, leased lines and associated services, and sales of
telecommunications products.
(4) Customer C is a professional one-stop financial technology intelligent solution provider in China. It has
offices and subsidiaries in major cities such as Beijing, Shanghai, Shenzhen and Ningbo. Customer C’s
products are widely used in the head offices of commercial banks in China, as well as insurance,
transportation, education, electric power and other industries and government departments.
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(5) Customer D is a third-party electronic authentication service provider in Guizhou Province with national
license. It specializes in providing electronic authentication services, software development,
information security equipment sales, information system data services and commercial cryptographic
products production. Customer D provides professional services for many industries such as public
prosecution, law enforcement, commercial, medical insurance, statistics, finance and health care.
(6) Customer E is a service provider of basic communication services and industry application solutions for
Internet applications. Customer E dedicates to providing enterprises with 4G technology-based
communication capabilities, efficient management and personalized service solutions.
(7) Customer F mainly engages in internet operations. It is a leading AI company. It holds the world’s
leading search engine technology, making itself a Chinese high-tech company with the world’s
cutting-edge scientific core technology. Based on the search engine, it has evolved artificial intelligence
technologies such as voice, image, knowledge graph and natural language processing in the last ten
years.
(8) Customer G is professional one-stop financial technology intelligent solution provider in China. It has
offices and subsidiaries in major cities such as Beijing, Shanghai, Shenzhen and Ningbo. Its products
are widely used in the head offices of commercial banks, as well as insurance, transportation, education,
electric power and other industries and government departments.
(9) Customer H is a mega telecommunications operator and an SOE controlled by the PRC government in
China. It mainly provides integrated information services such as mobile communications, Internet
access and applications, fixed-line telephony, satellite communications and information and
communication technology integration. Customer H has operations in 31 provinces (autonomous regions
and centrally-administered municipalities) and in the Americas, Europe, Hong Kong and Macau. The
Board of Directors was established in accordance with the requirements of the State-owned Assets
Supervision and Administration Commission of the State Council.
(10) Customer I is the governmental working department that leads and manages the political and legal work
of a province in China.
(11) Customer J, Tencent Cloud Computing (Beijing) Co., Ltd. (ၑ(̏ԯ)ப΂ʮ̡), is a cloud
computing service provider to provide cloud services to Chinese enterprises going abroad and overseas
local enterprises. It provides basic cloud services such as cloud servers, cloud storage, cloud database
and elastic web engine.
(12) Customer K is a mega telecommunication operator and an SOE controlled by the PRC government. It
provides full-service communications services in all 31 provinces, autonomous regions, centrally-
administered municipalities and Hong Kong, covering mobile voice and data, wireline broadband, and
other communications and information services.
We took a prolonged process to settle the unbilled receivables after they are recognized
as revenue. The typical credit terms disclosed in the certain details of our five largest customers
for each of the years ended December 31, 2021, 2022 and 2023 are determined by the terms
of the contract, typically commencing from the respective dates on which the invoices are
issued. The actual settlement of unbilled receivables took longer than the typical credit periods.
See “– General Terms of Contracts with Customers” for the settlement process and “Financial
Information – Current Assets and Liabilities – Trade Receivables” for the analysis of the
unbilled receivables.
During the Track Record Period, among our major customers, Customer H, Customer B,
Customer K and Customer L were also major suppliers of our Group during the Track Record
Period, namely Supplier A, Supplier F, Supplier J and Supplier I, respectively, as indicated in
the paragraph “– Our Suppliers” above, respectively.
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Customer H (Supplier A), Customer B (Supplier F) and Customer K (Supplier J) are
telecommunications operators in China, which supplied data services to us in our API
marketplace. In the meantime, these suppliers or their affiliates also purchased query, SMS
notice or top-up services, as well as data management solutions, from us. Customer L (Supplier
I)’s business covers four industry groups, namely, cloud data center, cloud service and big data,
smart city and smart enterprise. Customer L (Supplier I) supplied us with software
development services in connection with data management solutions and purchased three data
management solutions from us in 2023.
Revenue derived from these large customers were RMB51.1 million, RMB42.2 million
and RMB65.4 million for each of the years ended December 31, 2021, 2022 and 2023,
respectively, representing 19.6%, 12.8% and 14.8% of the total revenue, respectively. Our cost
of sales attributable to them was RMB35.8 million, RMB26.3 million and RMB47.2 million for
each of the years ended December 31, 2021, 2022 and 2023, respectively, representing 21.1%,
11.9% and 14.9% of the total cost of sales, respectively. For the respective years, the gross
profit margin of the four customers were 29.9%, 37.6% and 27.8%, respectively, as compared
to 35.7%, 32.0% and 28.3% of other customers, respectively.
The table below sets forth a breakdown of our cost of sales attributable to Customer H
(Supplier A), Customer B (Supplier F), Customer K (Supplier J) and Customer L (Supplier I)
for each of the years ended December 31, 2021, 2022 and 2023:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Cost of Sales (1)
Customer H (Supplier A) ............... 7,815 4,252 230
Customer B (Supplier F) ............... 21,515 19,789 8,192
Customer K (Supplier J) ............... 6,483 2,218 16,944
Customer L (Supplier I) ............... 4 5 2 21,860
(1) The cost of sales of major customers and suppliers were calculated on a consolidated basis, including
their respective affiliates.
The table below sets forth a breakdown of our gross profit attributable to Customer H
(Supplier A), Customer B (Supplier F) and Customer K (Supplier J) for each of the years ended
December 31, 2021, 2022 and 2023:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Gross Profit (1)
Customer H (Supplier A) ............... 2,899 904 115
Customer B (Supplier F) ............... 8,921 12,945 3,482
Customer K (Supplier J) ............... 3,446 1,753 8,045
Customer L (Supplier I) ............... 3 2 3 9 6,577
(1) The gross profit of major customers and suppliers were calculated on a consolidated basis, including
their respective affiliates.
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In connection with API marketplace, we procured data supply from Supplier A, Supplier
F and Supplier J, which was mainly related to mobile numbers and SMS notices during the
Track Record Period. Supplier F during the Track Record Period has provided us software
development related services in connection with a data management solution related to an
in-vehicle anti-fatigue cloud system. Customer L is a group with three listed companies. We
provided three data management solutions to them and received software development services
for seven data management solutions during the Track Record Period.
Our Directors confirm that, as of the Latest Practicable Date, (i) our five largest
customers during the Track Record Period were Independent Third Parties; and (ii) none of our
Directors, their close associates or Shareholders who own more than 5% of the share capital
of our Company had any interest in our five largest customers.
General Terms of Contracts with Customers
We typically provide API marketplace services by entering into standard contracts with
our customers. Customers can make prepayments to their accounts. In the contracts, our
customers typically warrant that they will comply with applicable data privacy laws, have
acquired proper data authorization, and will not misuse our services. Our customized service
agreements with API marketplace customers typically provide that the term of the agreement
is one year and is not subject to automatic renewal. Either party may terminate the agreement
in cases of breaches or bankruptcy of the other party.
While we enter into standard contracts with most of our API marketplace customers on
our website, we also enter into customized service agreements with certain major and strategic
customers who contributed more than 50% of our revenue derived from API marketplace for
each of the years ended December 31, 2021, 2022 and 2023. For customers who enter into
standard contracts on our website, they may register an account on our website and may
purchase services with pre-paid balance in the account. However, we settle payments on a
monthly basis with certain major and strategic customers. These customers are given a longer
period to settle payments with us as we seek to build or maintain relationships that we believe
will enhance our business. For each of the years ended December 31, 2021, 2022 and 2023,
customers with whom we settle on a monthly basis constituted approximately 0.8% to 1.1% of
the active registered paying customers in the respective year. The credit period for our API
customers as stipulated in customized service agreements ranges from five to 60 days upon
issuance of invoice.
For customers who settle their payments on a monthly basis, we recognize revenue every
month based on their actual usage and the agreed unit price of the current period. Among our
post-paid API marketplace customers for each of the years ended December 31, 2021, 2022 and
2023, the average number of days between our recognition of revenue and the issuance of
invoices was 109.4 days, 91.2 days and 129.4 days, respectively. The settlement process
consists of three stages:
In the first stage, we recognize revenue and make available to our customers a record of
the number of API requests the customers made in the previous month as well as the amounts
to be charged.
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In the second stage, the customers check our records against their own records. If the
customers believe there are discrepancies, they discuss the matter with us and we work together
to reconcile the record. For each of the years ended December 31, 2021, 2022 and 2023, the
discrepancy ratio, as measured by the differences between our endorsements and our
customers’ endorsements, was 0.36%, 0.03% and 0.05%, respectively. After further review and
discussion, we and the customers will agree on the number of API requests and the amounts
to be charged.
In the third stage, the customers undergo their internal protocols to initiate the payment
process. Once the customers inform us that their internal protocols have been satisfied, they
will request that we issue an invoice.
A small number of customers of API marketplace contributed a large portion of our
revenue derived from API marketplace. For example, in 2023, while we had approximately
10,700 active registered paying customers, the top 1% of our active registered paying
customers accounted for 97.3% of our revenue. These top 1% customers typically have
stronger bargaining power and may request that they settle payment at a later period. We
provided data management solutions to a limited number of customers during the Track Record
Period. In 2021, 2022 and 2023, our number of data management solution customers was 18,
21 and 29, respectively. We believe that many of these customers of API marketplace and data
management solutions offer strategic value to our business: they not only provide us with
revenue, but also enable us to keep abreast of industry trends. They may also introduce us to
future market opportunities. Moreover, we have years of relationships with many of such
customers, including nationally reputable or even world-renowned companies. Even though
their receivables may be prolonged, we have not historically experienced any material effect
on the recoverability of prolonged receivables.
Our trade receivables tend to be higher when there are a larger number of post-paid
customers who pay only after services are rendered, as their payment obligations are recorded
as trade receivables. We have implemented internal policies to set a three-month period from
the issuance of invoice to pursue the billed receivables for customers with an annual revenue
of less than RMB1 million; and a six-month period from the issuance of invoice to pursue the
billed receivables for customers with an annual revenue of over RMB1 million. For billed and
unbilled receivables, see “Financial Information – Current Assets and Liabilities – Trade
Receivables”.
Depending on the types of customer, we adopt different strategies for entering into service
contracts related to our data management solutions. The contracts typically provide the
purchase amount to be paid by customers and the payment schedule, which can be in lump sum
or in installments by milestone. We generally grant a credit period of up to 30 days from
milestone billing or project delivery.
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Set forth below is information in connection with the stages in our settlement process for
our data management solutions business during the Track Record Period:
In the first stage, the customers confirm with us their understanding of the contents of the
contract, the relevant milestones, and a payment plan. Once these milestones have been
realized, we issue our invoice. Among our customers for each of the years ended December 31,
2021, 2022 and 2023, the average number of days between our recognition of revenue to our
issuance of the invoices was 280.0 days, 217.4 days and 120.5 days, respectively.
In the second stage, we collect amounts outstanding (but not including retention money,
which we are entitled to collect after the end of the warranty and maintenance period for each
project. For details, see “Financial Information – Current Assets and Liabilities – Contract
Assets”) in connection with the various projects. Among our customers for each of the years
ended December 31, 2021, 2022 and 2023, the average number of days between our issuance
of the invoices and the final collection of amounts outstanding was 31.7 days, 46.2 days and
29.6 days, respectively.
Most of our data management solution customers are post-paid customers. To maintain
our relationships with customers, we issue invoices after the customers have fulfilled their
internal protocols to make payments, which led to a substantial amount of unbilled receivables
during the Track Record Period. As of December 31, 2021, 2022 and 2023, our unbilled
receivables for data management solutions were RMB39.3 million, RMB34.7 million and
RMB37.1 million, respectively. See “Financial Information – Current Assets and Liabilities –
Trade Receivables”. We entered into service contracts for all our data management solutions.
All service contracts of our data management solutions during the Track Record Period
included the purchase amounts to be paid by the customers. The contract typically sets forth
the quality of the solutions and in some cases, post-delivery customer care quality and provides
that customers have a right of refusal. In many contracts, we also undertake to compensate for
damages for breach of contract.
MARKETING AND SALES
Our sales team is strategically located in Suzhou, Beijing, Wuhan, Hangzhou and Hefei
as of the Latest Practicable Date, each strategically located to be close to our customers, who
are based in these and other cities in China.
We sell our API marketplace services to customers primarily through our direct sales
online and sales representatives. A customer who registers the account on our website may
purchase services with pre-paid balance in the account. To subscribe, prospective customers
will undergo a certification process, in which our staff will review the scenarios in which our
APIs will be used to ensure that customers use the APIs for the same scenarios as the ones they
claim. Upon approval, customers may use the API marketplace services. For certain major and
strategic customers, we enter into customized service agreements and appoint sales
representative to communicate with them regularly to resolve matters such as billing, payment
settlement and agreement renewal.
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Our data management solutions are sold by our sales representatives. The sales and
technical teams work together with customers to discuss solutions and assess their
requirements. We then convene a project team, which consists of our technical professionals
and sales representatives, to design a data management solution. The project team designs and
implements a solution for the customer. There were no governmental regulatory pricing
guidelines for API marketplace services and data management solutions during the Track
Record Period and up to the Latest Practicable Date.
Our marketing programs include a variety of advertising, exhibitions, industry forums and
public relations activities targeted at key executives and decision makers within businesses.
Additionally, we actively participate in industry associations to broaden our social connections
and identify potential marketing opportunities.
COMPETITION
Our operations are subject to the impact of the China’s API enabled service market and
the data management solution market in China. We face competition from different companies
for our different business segments.
As an integrated API-enabled data exchange service provider, we face competition from
our peers who also provide comprehensive API-enabled data exchange service across wide
categories of data. We believe that we are well positioned in terms of our operational track
record and our ability to deliver high-performance standard API service in China and
consistently increase the number of APIs we offer, utilize our technologies to reduce the
response time and reduce error probability. We also face competition from industry-specific
API-enabled data exchange service providers, who focus on providing industry specific
API-enabled data exchange service with specific types of data.
In data management solutions, we also face competition from data management service
providers in China, who provide data management service with specialties in certain industries.
We believe we are able to compete effectively against these data management service
providers, leveraging robust technology capabilities, our scalable business model and
entrepreneurial and technically skilled management team.
For information in connection with API service market and data management service
market, see “Industry Overview” and “Risk Factors – Risks Relating to Our Business and
Industry – If we cannot continue to innovate or effectively respond to the rapidly evolving
technology, market demands, industry dynamics and other risks and uncertainties, our business,
results of operations and prospects would be materially and adversely affected.”
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SEASONALITY
Both our API marketplace and data management solution business lines are subject to
seasonal fluctuations and generally experience higher profitability in the fourth quarter of the
year. Our revenue from API marketplace, in particular revenue derived from our internet
company customers, generally experience spikes in the fourth quarter due to these internet
companies’ increased customer flow from online shopping festivals that occur toward the end
of the year, such as annual sales on November 11, or “Double Eleven” ( ᕐɤɓ) and annual
sales on December 12, or “Double Twelve” ( ᕐɤɚ). We also typically receive a substantial
discount (depending on our whole year total purchase of data services) from our data service
suppliers in the fourth quarter of the year as we increase our purchase of data services
throughout the year, which further increases the profitability of our API marketplace business
in the fourth quarter. For related risks, see “Risk Factors – Risks Relating to Our Business and
Industry – Our business is subject to seasonality.”
In 2021 and 2022, our fourth quarter recorded more than half of the revenue in the
respective year. In 2021 and 2023 our gross profit margin in the fourth quarter was slightly
higher than our annual gross profit margin in the same year. In 2022 and 2023, our gross profit
margin in the fourth quarter was higher than our annual gross profit margin in the same year,
primarily because we received discounts from our data service suppliers in the fourth quarter.
EMPLOYEES
Our human resources department is responsible for recruiting, managing and training our
employees. As of December 31, 2023, we had 189 full-time employees, most of whom were
based in Suzhou, Jiangsu province, China. The table below set forth the number of our
employees by function and geographic locations as of December 31, 2023:
Number of
employees % of Total
Number of
employees who
are based in
Suzhou
Research and Development ..................... 1 0 3 54.5 96
Sales and Marketing ......................... 3 9 20.6 31
Administration ............................ 2 3 12.2 23
Operation ............................... 2 4 12.7 24
Total ................................. 189 100.0 174
We require fairness and transparency in our recruitment processes and place emphasis on
diversity in our recruitment. We welcome talents from different backgrounds to join us in order
to increase our workplace diversity. We adopt a hybrid recruitment process and recruit
candidates through both online and traditional methods.
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We provide various forms of incentives to our employees, including:
(i) Employee Incentive Scheme. We provide a share incentive scheme where employees
can obtain equity interests in our employee shareholding platforms as a reward for
their contributions and achievements. See “History, Development and Corporate
Structure – Employee Shareholding Platforms” and “Appendix VII – Statutory and
General Information – D. Employee Incentive Scheme”; and
(ii) Reward Systems. We have implemented reward systems such as performance
appraisal bonuses, sales bonuses, innovation bonuses, and outstanding contribution
awards, among others, to reward employees for outstanding performance and
innovation at work.
We provide a variety of employee benefits, including medical insurance, holiday gifts and
other benefits to create better work-life balance for our employees. We pay attention to our
employees’ individual career development plans and provide career counselling to our
employees to motivate them to achieve higher career goals. We implement transparent
promotion procedures, including a performance review system under which our employees’
performance and competence are regularly evaluated. We aim to more closely align the
personal career development of our employees with business development. In order to help
employees that have fallen below our standards to improve their performance, we have set up
a performance improvement team to help them through guidance and training. We provide
training for newly hired employees and conduct training sessions from time to time. For sales
personnel, we offer sales training programs. We believe our training culture has contributed to
our ability to recruit and retain qualified employees. We set clear performance standards and
may dismiss employees with low performance and employees who do not conform to our
values. We abide by the relevant labor laws and regulations in our dismissal process.
As required under PRC law and regulations, we participate in various employee social
security plans that are organized by applicable local municipal and provincial governments,
including housing, pension, medical, maternity, work-related injury and unemployment benefit
plans.
During the Track Record Period, we and some of our PRC subsidiaries did not make full
contributions to the social insurance and housing provident funds for some of our employees
primarily in relation to their discretionary bonus as required under PRC laws and regulations.
For the years ended December 31, 2021, 2022 and 2023, we estimate the shortfall in the
aggregate amount of contributions made by the Group to its employees’ social insurance was
approximately RMB1.5 million, and the shortfall in the aggregate amount of unpaid housing
provident fund was approximately RMB0.7 million. We were unable to make full social
insurance and housing provident fund contributions for the relevant employees primarily
because many of our employees were not willing to bear the costs associated with social
insurance and housing provident funds. During the Track Record Period, according to relevant
PRC laws and regulations, due to the shortfall of social insurance and housing provident fund
contributions, the maximum potential late payment fee that we may be subject to would be
approximately RMB0.4 million and the maximum potential penalties that we may be subject
to would be approximately RMB6.7 million.
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During the Track Record Period, we engaged third-party human resources agencies to pay
social insurance and housing provident funds for a small portion of our Company and Tianju
Renhe employees (the “ Employee Third-Party HRA Payment ”). As of December 31, 2023,
the number of employees whose social security and housing provident funds were made
through third-party human resources agencies was 15. During the Track Record Period, we
estimate the aggregate amount of social insurance contributions made through third-party
human resources agencies was approximately RMB1.5 million, and the aggregate amount of
unpaid housing provident fund was approximately RMB0.7 million. The Employee Third-Party
HRA Payment, although not uncommon in China, are not in strict compliance with relevant
PRC laws and regulations. If the Employee Third-Party HRA Payment is challenged by
government authorities, we may be deemed to have failed to have discharged our obligations
in relation to the payment of social insurance and housing provident funds through our own
accounts as an employer. Our Group undertakes that if we are ordered by the competent
government authorities to pay additional contributions in respect of the Employee Third-Party
HRA Payment, we would do so within the prescribed period. We estimate that in the event that
we are ordered to make up for the social insurance and housing provident funds contributions
made by third party agencies on behalf of us during the Track Record Period, the maximum late
payment fee would be approximately RMB0.7 million.
According to the written confirmation by the competent authority, our Company, Tianju
Renhe and Zhonghui Juhe had not been subject any administrative penalties due to any breach
of the applicable laws and regulations in relation to social insurance and housing provident
fund during the Track Record Period. Through an interview with Suzhou Industrial Park Social
Security and Provident Fund Management Center, the competent authorities for matters
relating to social insurance and housing provident fund regarding our Company and
subsidiaries located in Suzhou, our status in relation to the shortfall of social insurance and
housing provident fund contributions and the Employee Third-Party HRA Payment was
disclosed to the authority and it confirmed that: (i) our relevant status would not result in any
material violation of applicable Laws or regulations and it had not imposed any penalty on us
due to the non-compliance as of the Latest Practicable Date; and (ii) we had not been on record
that it required us to supplement social insurance and housing provident fund contributions or
to pay late payment fee or penalties as of the Latest Practicable Date.
Our PRC Legal Advisors are of the view that the likelihood of us being subject to material
penalties due to the insufficiency of contribution to social insurance and housing provident
funds during the Track Record Period is low, on the basis that (i) according to the Urgent
Notice of the General Office of the Ministry of Human Resources and Social Security on
Implementing the Spirit of the Executive Meeting of the State Council in Stabilizing the
Collection of Social Insurance Premiums (஫࿏ໝྼ਷ਕ
) issued on September 21, 2018,
administrative enforcement authorities shall not organize or conduct centralized collection of
enterprises’ historical social insurance arrears. The General Office of the State Council issued
the Circular on Issuing the Comprehensive Plan for Reducing the Social Insurance
Contribution Rates () on April
1, 2019, which promotes the reduction in the amount of social insurance contributions by
companies to avoid overburdening enterprises, and re-emphasizes that local authorities shall
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not conduct self-collection of historical underpaid or unpaid social insurance contributions
from enterprises; (ii) during the Track Record Period, with the confirmations from local
competent authorities as described above; (iii) penalties will only be imposed if we fail to pay
the underpaid amount within the prescribed period, and the Group undertakes that it will rectify
or make outstanding payments within a prescribed period once required by competent
authorities; and (iv) our Group has not received labor arbitration notices from any of
employees in relation to the shortfall of contributions to the social insurance and housing or
the Employee Third-Party HRA Payment during the Track Record Period and up to the Latest
Practicable Date.
In addition, as of the Latest Practicable Date, we have established internal policies and
procedures as rectification plans to ensure that we will make contributions in relation to social
insurance and housing provident funds as required under PRC laws and regulations. These
internal policies and procedures include: (i) regular communication with government agencies
to ensure that our calculation and payment methods are in compliance with the relevant laws
and regulations during the Track Record Period; (ii) regular consultation with legal counsel to
understand whether we are at risk of non-compliance with the relevant laws and regulations;
(iii) preparation of regular reports regarding our contribution amounts for review by our Board
during the Track Record Period; (iv) in the process of communicating with our employees with
a view to seeking their understanding and cooperation in complying with the applicable
payment base, which also requires additional contributions from our employees; and (v)
holding of internal trainings on the relevant laws and regulations for our Directors, senior
management and certain employees during the Track Record Period. Due to our efforts to
rectify the insufficient contribution of social insurance and housing provident funds, we have
completed the adjustment of the base for social insurance and housing provident funds as of
the Latest Practicable Date. This adjustment is expected to reduce the underpayment amount
for 2024 by approximately 10.0% compared to 2023. We will continue to implement the above
internal control policies and communicate with other employees who have not yet adjusted
their social insurance and housing provident funds, in order to further reduce the insufficient
contribution in 2025. For employees who join us after December 31, 2023, we will fully pay
their social insurance and housing provident funds.
We will continue to select third-party human resources agencies which have obtained
human resources service permits granted by appropriate governmental authorities and request
copies of such permits from these agencies for inspection before any transaction to ensure that
they have adequate and proper qualifications. We have also communicated with all employees
involved in the Employee Third-Party HRA Payment to seek their approval to terminate the
Employee Third-Party HRA Payment. For employees who join us after December 31, 2023, we
will only allow them to use the Employee Third-Party HRA Payment in areas where we do not
have branches or subsidiaries; For employees have used the Employee Third-Party
HRAPayment before December 31, 2023, we will continue to communicate with the relevant
authorities and employees, and reduce the number of employees using the Employee
Third-Party HRA Payment as required by the two authorities and based on our discussions with
the employees; When the number of employees using the Employee Third-Party HRA Payment
in the same region reaches a certain level, we will consider establishing branches or
subsidiaries in the corresponding areas.
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During the Track Record Period and up to the Latest Practicable Date, we did not
experience any strikes or major disputes with our employees. We believe that we have
maintained a good working relationship with our employees.
INSURANCE
Our Directors believe our insurance coverage is adequate and in line with industry norms
that we maintain insurance policies for our vehicles and directors’ and officers’ liability
insurance. In line with general market practice, we do not maintain any product liability
insurance, business interruption insurance or key-man life insurance, which are not mandatory
under PRC Laws. See “Risk Factors – Risks Relating to Our Business and Industry – Our
insurance coverage may not be sufficient to cover all the losses associated with our business
operations.” During the Track Record Period, we did not make any material insurance claims
in relation to our business.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE MATTERS
We are committed to promoting corporate social responsibility and sustainable
development and integrating it into all major aspects of our business operations. We view
corporate social responsibility as part of our core philosophy that is pivotal to our ability to
create sustainable value for our shareholders by embracing diversity and public interests.
Accordingly, we have adopted a policy on environmental, social and corporate governance, or
ESG, responsibilities (the “ ESG Policy ”) based on requirements set forth in the Listing Rules,
which sets forth our corporate social responsibility objectives and provides guidance on
practicing corporate social responsibility and sustainable development in our daily operations.
Pursuant to our ESG Policy, our Board of Directors has the overall responsibility of: (i)
setting out our ESG initiatives, strategies, and governance guidelines; (ii) directing our
company in perfecting our ESG framework; and (iii) reviewing our ESG governance, policies
and operational management. Our senior management has the overall responsibility of handling
the daily operations and management of ESG-related work and preparing the annual ESG
information summary and report. Our Board conducts an ESG report meeting annually.
Impact of Climate Change
In recent years, changing weather patterns due to climate change have increased in
frequency. Growing concerns about climate change and greenhouse gas emissions have led to
the adoption of various regulations and policies. Newly enacted legislation and regulations in
response to potential impacts of climate change may impact our operations directly or
indirectly. We may be required to obtain additional permits, licenses or certificates in the
future. Our customers or suppliers may also be affected and may in turn subject us to additional
compliance costs and operational restrictions, which could negatively impact our financial
condition and results of operations.
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Governance on ESG Matters
Environmental Matters
We are committed to reducing the environmental impact of our operational activities. As
we are primarily engaged in providing digital services, we are not subject to significant health,
work safety, social or environmental risks. In addition, we believe that there are no
environmental laws and regulations in respect of air and greenhouse gas emissions, discharge
into water and land, and generation of hazardous and non-hazardous waste that would have a
significant impact on our business and operations. During the Track Record Period and up to
the Latest Practicable Date, we have not been subject to any fines or other penalties due to
non-compliance in relation to health, work safety, social or environmental regulations, nor
have we incurred any material costs in relation to compliance with applicable environmental
protection rules and regulations. Given our business nature, we do not expect that we will incur
significant costs for compliance with applicable environmental protection rules and regulations
in the future.
We are committed to improving our resource efficiency and increasing our employees’
environmental awareness. Owing to the nature of our business, we believe that our operations
are not major sources of environmental pollution as they do not involve any significant direct
air emissions, wastewater emissions, noise emissions and waste generation. Nonetheless, we
have implemented various measures to better conserve resources in our operations, for
example: (i) encouraging the use of environmentally friendly products, such as recycled paper,
paper produced from sustainable forest management and energy efficiency-labelled products;
(ii) encouraging our employees to reduce energy and water consumption, reduce paper usage
and increase recycling; and (iii) ensuring that our employees complete environmental
protection trainings.
Social Matters
We are committed to creating an equal, harmonious workplace that is free from
discrimination and harassment. We do not tolerate any form of discrimination or harassment
from our employees, customers, suppliers and other relevant persons. We have established a
communication channel for our employees to lodge complaints, including emails, letters and
in-person complaints. If an employee is proven to have breached our anti-discrimination and/or
anti-harassment policies, they may be subject to disciplinary action.
To ensure that we comply with all relevant laws and regulations on anti-money laundering
and counter-financing of terrorism, we have implemented a comprehensive internal policy.
Pursuant to this policy, we ensure that: (i) we have designated personnel to oversee our
compliance with laws and regulations on anti-money laundering and counter-financing of
terrorism; (ii) we develop and implement internal controls to investigate suspicious activities
and take appropriate actions in response; (iii) when necessary, we shall introduce an
anti-money laundering and counter-financing of terrorism corporate training course; and (iv)
we implement internal audit and quality control mechanisms in accordance with anti-money
laundering and counter-financing of terrorism policies and procedures.
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Due to our business nature, we are not subject to significant health and occupational
safety risks. During the Track Record Period and up to the Latest Practicable Date, we did not
experience any material accidents, claims for personal or property damage or compensation to
employees and we did not experience any material non-compliance of health and work safety
laws and regulations.
We are committed to protecting the privacy of all our employees and any personal
information shared by our customers. We have implemented internal rules and policies to
govern how we use personal information and protect personal information from loss, abuse,
unauthorized use, leakage, alteration and destruction. We have implemented appropriate means
to ensure that: (i) personal and sensitive information are obtained directly from the original
sources where possible; (ii) disclosure of personal and sensitive information is relevant to the
functions or activities for which they are required, and the scope of disclosure is not more than
necessary; and (iii) while the information is in our storage, the information should be kept up
to date and free from errors, and should not be retained for longer than necessary.
ESG-Related Metrics and Targets
To comply with the Stock Exchange’s reporting requirements on ESG following our
Listing, we have adopted an ESG policy that has been developed in accordance with Appendix
C2 (Environmental, Social and Governance Reporting Guide) to the Listing Rules. Such ESG
policy will be reviewed on an annual basis. Our ESG policy will outline, among others, (a) the
appropriate governance oversight; (b) ESG approach and practices including the process of
materiality; (c) ESG risks, including climate-related risks and identification, management and
monitoring mechanism of such risks; and (d) setting of key performance indicators. We have
also engaged an independent third-party consultant (the “ ESG Consultant ”) to facilitate us in
assessing our ESG-related metrics and targets and reviewing our ESG policy, and to provide
us with professional advice on ESG as and when necessary.
As we are a data technology company and our business does not involve any
manufacturing or other industrial production, our operations do not have a direct negative
impact on the environment. However, we will adjust our operations to reduce indirect negative
impacts on the environment. For example, we continue to rely on internet and cloud
technologies to develop and deploy our API services instead of hosting energy-intensive server
rooms and data rooms in our office.
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We have identified certain KPIs to evaluate our ESG performance and to facilitate us in
taking corresponding measures to enhance our ESG initiatives. Considering the nature of our
business, we consider electricity, water and paper consumption to be our KPIs to evaluate ESG
performance. We have set the following ESG-related targets and plans:
Key KPIs Our targets Our plans
Electricity consumption Keep the level of our electricity consumption
between 80% and 100% of that in 2022 over
the next three years
We aim to reduce our electricity
consumption through: (i) reducing air
conditioning use through installing smart
temperature control system; (ii) relying on
natural light for illumination; (iii) replacing
office equipment with energy-efficient
appliances; and (iv) reducing energy waste
by requesting employees to turn off
computers and office equipment before
getting off work, setting computers and
monitors to a power saving or sleep mode
when not in use, and unplugging idle
appliances.
Water consumption Keep the level of our water consumption
between 80% and 100% of that in 2022 over
the next three years
We encourage our employees to conserve
water in our office bathrooms and pantries.
We intend to install sensor faucets and smart
toilets to further reduce water consumption.
Paper consumption Keep the level of our paper consumption
between 80% and 100% of that in 2022 over
the next three years
We advocate for a digital and paperless
office by reducing the use of paper materials
in our daily operations. We encourage our
employees to use double-sided printing and
recycled papers.
Apart from the environmental KPIs, regarding our greenhouse gas emissions profile, we
have identified the following major sources:
Scope 1 Direct Emissions from Company V ehicle Fuel Use
Scope 2 Electricity Use
Scope 3 Business Travel and Paper Consumption
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The ESG Consultant has assisted us in the collection of ESG data materially relevant to
our business operations during the Track Record Period as set out below, namely our total
electricity, water and paper consumption, and with the aggregate emissions in Scope 1 to 3:
Y ear ended December 31,
Type of energy/resource 2021 2022 2023
Electricity
Total electricity consumption (1) (MWh) ......................... 190.43 552.62 543.75
Electricity consumption (MWh)/Employee (2) ...................... 1.12 3.03 2.91
Electricity consumption (MWh)/Revenue
(RMB in millions) ................................... 0.73 1.68 1.23
Water
Total water consumption
(1) (tonne) ........................... 1 7 6 5,128 7,209
Water consumption (tonne)/Revenue
(RMB in millions) ................................... 0.68 15.59 16.34
Paper
Total paper consumption (kg) .............................. 593.76 820.79 615.59
Paper consumption (kg)/Employee
(2) .......................... 3.49 4.50 3.29
Greenhouse gas emission
Total greenhouse gas emission (tCO
2e ) ......................... 130.44 347.48 354.80
Scope 1 (3) ......................................... 3.43 4.17 4.62
Scope 2 (3) ......................................... 1 16.19 337.16 331.74
Scope 3 (3) ......................................... 10.82 6.15 18.43
– Business air travel .................................. 7.97 2.21 15.48
– Paper disposal .................................... 2.85 3.94 2.95
Greenhouse gas emission (tCO 2e)/Revenue (RMB in millions) ............ 0.50 1.06 0.80
(1) Our consumptions of electricity and water were calculated based on the bills kept by us and the
respective charge in each year. Given that different locations may have different prices and prices may
vary within a year, the above data will vary from the actual use. Scope for the water and electricity
consumption includes our Company and Tianju Renhe for current disclosure since they account for
approximately 90% of the total emissions.
(2) Calculated based on the total consumption amount divided by the average number of employees at the
beginning and the end of each year.
(3) Emission factor is based on “How to Prepare an ESG Report Appendix 2: Reporting Guidance on
Environmental KPIs” published by the Stock Exchange.
Our total consumptions of electricity, water and paper have generally increased during the
Track Record Period, especially in 2022 because we moved to our headquarters building in
January 2022 with more spacious office environment and additional facilities to accommodate
our long-term growth. In the meantime, we gradually expanded our research and development,
sales and management workforce to accommodate our growing business, particularly data
management solutions. During the Track Record Period, our facilities were equipped with
smart energy management system and we believe that our employees have enhanced their ESG
awareness given our increase in advocating this topic generally.
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For business travel, since we are using more virtual meetings to replace in-person visits,
and with our virtual meeting practice continued from the COVID-19 pandemic period, our
business air travel in 2022 was much lower than in 2021, with the use of emission factor by
International Civil Aviation Organization as suggested by the Stock Exchange as per Appendix
2: Reporting Guidance on Environmental KPIs. Our business air travel increased in 2023 as
compared to in 2022, primarily because we restored some in-person visits and meetings after
the COVID-19 pandemic. We will monitor the level of emissions from time to time and explore
feasibilities in further lowering the emissions from business travel. Our employees usually take
economy class for business travel which is the most environmentally friendly among the types
of flights. We also consider using more land transportation as alternative to further reduce
indirect emission.
In addition, we will also deploy a water butt to collect rainwater in our headquarters
building. Rainwater harvesting offers more benefits than just watering plants; it can be utilized
for various purposes such as floor cleaning and toilet flushing. By incorporating harvested
rainwater into our office usage, it will become an integral part of our workplace’s sustainability
initiatives and environmental management system. We consider this could be an effective and
sustainable method for reducing effluence costs in the office.
While specific data from our value chain is unavailable at this time, based on our
discussions with the ESG Consultant, we set forth below a list of potential Scope 3 emissions
sources that we consider to be significant in our upstream and downstream value chain:
Upstream Scope 3 Emissions:
 Purchased Goods and Services : Emissions associated with the production and
transportation of raw materials, components, and services procured by us.
 Upstream Transportation and Distribution : Emissions generated during the
transportation of goods and materials from suppliers to us.
 Waste Generated in Operations : Emissions resulting from the disposal of waste
generated during regular office operation.
Downstream Scope 3 Emissions:
 Use of Products: Emissions generated during the use of our products by end-users
or customers. This includes energy consumption, fuel combustion, or other
emissions resulting from product usage which is the general electricity consumption
on the use of related sold software.
Going forward, we will endeavor to collect further data to provide more comprehensive
information on our Scope 3 emissions where feasible. Based on our discussions with the ESG
Consultant, compared to other comparable data technology companies in China, we believe our
consumption of electricity, water and paper to be within the average industry level generally.
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Our ESG Consultant has assisted us in identifying the following examples for peer
comparison purpose, which aims to facilitate our understanding of the industry trends:
 Greenhouse gas emissions: We benchmarked our targets against a pioneer company
in the digital and technology industry whose greenhouse gas emission absolute
target was set to reduce absolute Scopes 1 and 2 greenhouse gas emissions by
approximately 5% per year in order to reach an aggregate reduction of 50% by
financial year 2029/30 from financial year 2018/19 as its base year. We currently
have a target of reducing 0 to 20% of greenhouse gas emissions over the next three
years which is similar and even considered more ambitious than the target set by
such industry player;
 Water consumption: According to the ESG Consultant and public information, water
consumption of one of China’s leading software and internet services enterprises is
334,391 tonnes in 2022. In comparison, the corresponding water consumption level
by us is lower than such comparable company;
 Paper consumption : Despite the levels of paper consumption of our comparable
peers are not disclosed publicly, we consider this metric to be important for
identifying our future goals and targets and will therefore commit to disclosing such
information in our ESG report after Listing; and
 Electricity consumption: According to the ESG Consultant and public information,
the electricity consumption of one of the leading software and internet services
enterprises in China is 20,960.05 MWh in 2022. In comparison, the corresponding
electricity consumption level by our company is lower than such comparable
company. Another peer company aims to achieve year-over-year improved
electricity consumption at R&D and office sites globally, relative to its previous
financial year. In comparison, our Company’s improvement target o fa0t o2 0 %
reduction of electricity consumption over the next three years is comparatively more
ambitious and we will strive to achieve this target by implementing the
aforementioned initiatives where feasible. We will also monitor the technological
development and industry trend in energy consumption, and will report to our Board
from time to time for their strategic decision in implementing any further means to
enhance our ESG performance.
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Our ESG Consultant has also assisted us in putting together the below summary of
electricity consumption intensity from some peer companies based on publicly available
information:
Company Name
Financial year
Ended
Electricity consumption intensity
performance data according to
public information Unit
Company A March 31, 2023 5.87 MWh per US$
million in revenue
4.72 MWh/employee
Company B December 31, 2022 3.17 MWh/employee
Company C December 31, 2022 56.27 MWh/employee
Based on the above data, the average electricity consumption for Company A and
Company B is around 4 MWh/employee in electricity consumption, while such figure for a
second-tier company like Company C is 56.27 MWh/employee, which is more than 10 times
the aforementioned average. Therefore, we understand from our ESG Consultant that based on
the above, the average electricity consumption intensity performance as a reference of these
three benchmarked companies is approximately 21.39 MWh/employee. The data from peers
and such average energy consumption levels serve as a reference point for us when determining
our future energy consumption targets.
By comparing this average consumption data with our current electricity consumption
intensity performance of 3.03 MWh/employee for the financial year ended December 31, 2022
and having discussed with our ESG Consultant, we consider that while our Company’s
electricity consumption intensity sets a higher standard in terms of energy efficiency, we still
outperform the industry average and the best performing company above, which had a 3.17
MWh/employee electricity consumption intensity.
Corporate Social Responsibilities
We are committed to corporate social responsibility. In particular, we have taken
initiatives in recent years:
(i) We supported Suzhou’s efforts to contain the spread of COVID-19. In 2021, we
donated masks, face shields and protective suits to the Suzhou Y outh Chamber of
Commerce (ϋਠึ). In 2022, we donated masks, face shields and
protective suits to communities in the Suzhou Industrial Park and Suzhou
Municipality; and
(ii) We have actively participated in other charity work. In 2022 and 2020, we donated
RMB100,000 and RMB1,000,000 respectively to Suzhou Industrial Park Charity
Federation ( ᘽψʈุ෤ਜฉഛᐼึ). In 2020, we also made a donation in an amount
of RMB100,000 to Tongji Hospital of Tongji Medical College of HUST (Ҧ
᙮Ν᏶ᔼ৫).
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RISK MANAGEMENT AND INTERNAL CONTROLS
Risk Management Framework
Risk management is critical in our business operations. We face operational risks such as
changes in general market conditions and regulatory environments within the markets we
operate and related markets; our ability to offer quality services and compete effectively; our
ability to manage our anticipated growth and execute our growth strategies; and our
compliance with regulations and industry standards. Our Board is in charge of our overall risk
management. Our risk control department formulates our annual internal control audit plan to
conduct specialized audits of various business operations, generating a self-assessment report
on internal controls for submission to the Audit Committee for approval.
The risk control department implements appropriate review procedures to evaluate the
effectiveness of our internal controls from time to time. If we discover internal control
deficiencies during the review process, the risk control department personnel will urge the
relevant departments to develop corrective measures and timelines, conduct follow-up reviews
of internal controls, and oversee the implementation of the corrective actions.
Financial Reporting Risk Management
We have in place a set of accounting policies in connection with our financial reporting
risk management. We have various procedures in place to implement accounting policies, and
our financial department reviews our management accounts based on such procedures.
Compliance Risk Management
Compliance risk management is the core of our risk management activities, the
foundation for effective internal controls and an important aspect of our corporate culture. Our
Board of Directors is responsible for establishing our internal control system and reviewing its
effectiveness.
Our material decision-making is undertaken by the chief executive officer, the Board of
Directors, and Shareholders’ Meeting, as the case may be. Additionally, we have established a
series of policies and procedures related to information systems management, aiming to
regulate the application for system clearance and the processes involved in information system
management.
Human Resources Risk Management
We provide different training tailored to the needs of our employees in different
departments. Through these trainings, we ensure that our staff’s skill sets remain up-to-date
and enable them to discover and meet customers’ needs. We have in place an employee
handbook, which contains internal rules and guidelines regarding best commercial practice,
work ethics, fraud prevention mechanism, negligence and corruption. We also provide
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employees with resources for explanation on guidelines contained in the employee handbook.
We make our internal reporting channel open and available to our staff for any reporting of
wrongdoing or misconduct. Reported incidents and persons will be investigated and
appropriate measures will be taken in response to the findings.
Data Privacy Risk Management
We offer our services and solutions with privacy as a core tenet. For API marketplace, we
are committed to complying with the legal requirements, and we adhere to them in the
following manner:
Data collection
During the process of providing query and SMS notice services through API marketplace,
we accept customers’ entrustment to collect and transmit data among customers and suppliers,
including personal information, corporate data and other type of information unrelated to
person or corporate data. In connection with our query and SMS notice services through API
marketplace, as we act as an intermediary technical service provider, we do not purchase or
retain ownership of the data we collect or transmit. We set forth the purpose, duration, method,
type of personal information, protective measures, and the rights and obligations of each party
in our agreement with customers and suppliers. We adhere to the agreed purposes and methods
of processing personal information as stipulated in these agreements. Our customers’
authorization is required for personal information collection, sharing and transmission before
our APIs could process data form our customers. For engagement of our data service suppliers,
we review the authorization from the source of personal information. Our supplier agreement
with them includes the authorization between suppliers and us, services to be provided, validity
period, certain restrictive undertakings and data privacy compliance representations. For
top-up service, our customers collect personal information and we only transmit top-up mobile
numbers with encrypted technologies.
To provide services through API marketplace, we may utilize web crawlers to collect
non-personal information from publicly available sources. Our data compliance management
policies specify that we must first review and adhere to the Robots Exclusion Protocol and the
information sources’ website policies and requirements before conducting any searches,
copying, downloading, or quoting data through web crawlers. We use our best endeavours to
ensure that our collection of non-personal information from publicly available sources does not
disrupt the functioning of the information source, infringe on others’ trade secrets or
intellectual property rights.
When our API marketplace customers (typically non-key customers) register an account
at our website to use our APIs, they will provide certain personal information. Our website
includes a standalone privacy policy page, which specifies the type of personal information,
such as mobile number, user name, email address, photos, and logs of computers, and specify
the circumstance under which we collect personal information. The policy also provides the
circumstance under which consent is required, such as the transfer of personal information
outside our Company, and under what circumstance consent is not required, such as when we
are required to provide disclosure pursuant to laws.
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During the provision of data management solutions, we do not collect personal
information. We collect data related to the customers’ current IT systems on their premises to
produce data management solutions that fits their demands. We only use the data within the
customer’s intranet. Furthermore, our solution employs technologies such as privacy-
preserving computation and blockchain service. Privacy-preserving computation may prevent
unauthorized access to sensitive data during the process of realizing data value, while
blockchain service aids in ensuring the immutability and integrity of the data. In addition, we
make SmartShield and AnchorChain available to customers, both of which are technologies
that safeguard data privacy and security.
Data storage and deletion
For the personal information of end-users provided by customers and the personal
information included in query results returned by suppliers, we neither store nor use such
information for any other business purpose.
During the provision of services via API marketplace, we only store limited order
information necessary for reconciliation and error handling, with strict internal clearance
protocols in place. If the order information includes personal information, we make measures
of anonymization or encryption. Data after anonymization or encryption cannot be used to
identify individuals and are irreversible. For SMS and top-up services, the mobile numbers
encrypted during the transmission and the order information are stored for reconciliation and
error handling. In order to ensure limited sharing and local storage of personal data, we employ
techniques such as masking order information that contains personal information and
implementing access restrictions. Data collected from public channels are stored in the cloud
and are strictly managed by our IT system. Unauthorized access is strictly prohibited. We
engage professional third parties from time to time to review the compliance of data storage
of our APIs in connection with personal data, corporate data and the mix of the two types.
We set forth different retention periods depending on the type of data and the applicable
legal requirement. After the data retention period expires, data will be deleted. For personal
information derived from user registration on our website, it is stored separately and protected
by clearance control. For personal information included in order information derived from our
provision of query services, it is stored with anonymization process or irreversibly encrypted.
With regard to SMS notice and top-up services, anonymization process and encryption were set
to occur six months after the order is completed. After encryption, the data cannot be used to
identify end-users. The order information will be deleted after three years. For non-personal
information derived from our provision of query services, it shall be deleted after three years
of storage. For order information of SMS and top-up service, the data shall be deleted three
years after the order is completed.
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Data sharing and transmission
In the API marketplace, we transmit data among customers and suppliers based on the
entrustment of customers. During the transmission we employ encrypted technologies to ensure
personal information is identity masked. For data management solution, we do not transmit or
share personal information, because these solutions are installed on the customer’s IT systems,
and we are not involved in their daily operations.
Our data management solutions can be delivered online via customer’s intranet server, a
network that is isolated from other internet servers. The delivery within the intranet server does
not involve any transmission of data to us or sharing of personal information with us.
Employee training
We provide education and training sessions on data security for our employees. New
employees are required to adhere to confidentiality obligations and to receive training from our
human resources department on the relevant rules and policies regarding confidentiality.
Risk and data security incidents
When an alleged or actual leakage incident occurs, all departments and individuals should
immediately take remedial measures and report the incident to the risk control center and the
CEO. Such report should include the content of the leaked data, classification level, quantity,
and form of carrier; details of the leakage incident; the particulars of the person responsible for
the leakage; the time, place, and details of the leakage incident; potential or actual harm caused
by the leakage incident; work status that has been or is planned to be investigated; and remedial
measures that have been or are planned to be taken. The risk control center and the CEO should
immediately take remedial measures to prevent further leakage. The risk control center should
immediately conduct an investigation on the incident. During the Track Record Period and up
to the Latest Practicable Date, we have not experienced any material data leakage or loss of
data or information.
Policies
Our supplier management policies outline clear criteria and priorities for assessing data
service supplier qualifications and managing supplier relationships. We have also implemented
polices, which assess the quality and technical capabilities of our data sources. We have
guidelines for data identification, classification, and protection. Additionally, our data
compliance management polices cover the lifecycle of data management. We have also
published our privacy policy on our website to ensure transparency and protect our customers’
privacy when they register or use our services.
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Business Model
Data compliance is at the heart of our business. The PRC Personal Information Protection
Law, which came into effect in November 2021, specifies the concept of “entrusted processing”
of personal information. We, as an intermediate technical service provider, is positioned to act
as an entrusted processor of personal information and to fulfil the obligations imposed on an
entrusted processor by the PRC Personal Information Protection Law. See “Regulatory
Overview – Regulations Related to Internet Security and Privacy Protection – Regulations on
Privacy Protection”, for details of the obligations of an entrusted processor. In line with our
business model, our contracts with customers (to which we, leveraging our technical
capabilities, provide query and SMS notice) clarify that we, as an entrusted processor, are
entrusted to assist the entrusting party in handling data packaging, encryption and transmission
activities between data service supplier and customers. On our customer interface, we provided
numerous suppliers for customers to select from (and such interface displays the basic
information and selection criteria of the suppliers), and according to the choice of supplier
made by our customer, we provide the API connection services between them.
Proper consent, scope of consent, authentication and verification process and measures in
connection with data privacy and security
As of the Latest Practicable Date, we have obtained all consents from our direct suppliers
and customers to provide and receive API marketplace service. We did not acquire consent
from certain suppliers and customers during the Track Record Period mainly because (1) when
the existing consent was about to expire, we urge suppliers to renew their consent with us.
However, there were certain scenarios where the renewal occurred shortly after the expiration
of existing consent; and (2) there may be circumstances where we failed to identify expired
consents in time. During the Track Record Period, we did not have any dispute with our
customers or suppliers that was related to personal information protection. During the Track
Record Period and up to the Latest Practicable Date, we were not subject to any administrative
penalty or inspections due to violation of personal information protection related laws or
regulations. Our PRC Legal Advisers are of the view that, in respect of us not obtaining
consents from certain suppliers and customers during the Track Record Period and up to the
Latest Practicable Date, the likelihood of us violating the relevant laws and regulations on
personal information protection and being investigated or administratively penalized as a result
thereof is relatively low.
During the Track Record Period, we acquired consents from our direct suppliers and
customers to provide services through our API marketplace by signing business contracts.
Before the PRC Personal Information Protection Law became effective, we were required to
comply with the PRC Cybersecurity Law, the PRC Data Security Law, and the Regulations on
the Protection of Personal Information of Telecom and Internet Users (ɛ
֛These laws and regulations required, in principle, that any organization or
individual collecting data should do so in a lawful and legitimate manner, and should not steal
or obtain data by illegal means; and that internet operators (٫collecting and using
personal information should follow the principles of lawfulness, legitimacy, and necessity,
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disclose the rules for such collection and use, clarify the purpose, manner, and scope of the
collection and use of information, and obtain the consent of the person from whom the
information is being collected. As we did not have direct contact with end-users, we sought to
ensure that we have complied with the above requirements mainly by having our direct
customers and suppliers obtain valid authorization and undertake to us that the source of data
is legal. Before November 2021, we (i) established policies to regulate our customers’
admission to our API marketplace, which required customers to provide application links,
screenshots of scenarios, and demanded vetting process to avoid illegal activities. We also
reviewed the privacy policies of customers to understand the scope of authorization to process
personal information of customers by their data sources; (ii) asked customers to undertake in
their agreements with us that they (a) had proper consent from their data sources and would use
our services provided through API marketplace properly; and (b) would provide documents for
our inspection when required; and (iii) developed policies establishing strict prior and periodic
reviews and evaluated suppliers based on five criteria including “official authorization, basic
qualifications, business situations, negative public opinions, and industry risks”.
The PRC Personal Information Protection Law, which has now come into effect,
specifically requires contractual entrustment on the entrusted personal information processor
(which does not have the right to determine the purpose and manner of processing personal
information) by the personal information processor. The entrusted party shall process the
personal information in accordance with the agreement with the personal information
processor, and shall not go beyond the agreed purpose and manner of processing; and if the
contract of entrustment is not in effect, the entrusted party shall return the personal information
to the personal information processor or delete it and shall not retain it. The PRC Personal
Information Protection Law explicitly requires that personal information processor (which role
we do not assume in our query and SMS notice service) shall obtain the consent of an
individual to process personal information, unless otherwise provided by law. In contrast, the
PRC Personal Information Protection Law does not explicitly require an entrusted personal
information processor, which does not determine the purpose and manner of personal
information processing (which role we assume in our query and SMS notice service), to obtain
the consent of individuals. Customers entrust us to process personal information and we
provide them with a list of suppliers that can offer the data service they need. Customers may
choose from the list of suppliers we provided based on their preference. Although the PRC
Personal Information Protection Law does not explicitly so require, we nevertheless require the
direct suppliers and customers to confirm the legality and due authorization of their data source
in writing. Furthermore, we also require the suppliers to provide the authorization from the
ultimate data source; and we will not cooperate or we will stop cooperating with the suppliers
who fail to provide such authorization. After November 2021, we acted as an entrusted
processor of personal information. Pursuant to the PRC Personal Information Protection Law,
an entrusted processor is not obliged to acquire consent directly from end-users. Our agreement
with customers specifies that we can only process personal information with entrustment
within the scope of authorization from our customers. Our Supplier Admission Procedures
Manual ( ԶᏐਠ၍ଣ˓̅) establishes a rating system to evaluate the consent obtained by our
suppliers from their data sources as a requisite for admitting a supplier. In certain cases, the
supplier should undertake to reach certain rating level in the future to be admitted. Our PRC
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Legal Advisers are of view that our business model as of the Latest Practicable Date, by
accepting our customer’s entrustment to provide data-related technology services with regard
to our query and SMS notice services, we had acted as an entrusted personal information
processor as defined in the PRC Personal Information Protection Law.
Our Directors are of the view that our internal control measures on data collection during
the Track Record Period were sufficient and effective, on the basis that:
 During the Track Record Period and up to the Latest Practicable Date, we were not
subject to any administrative penalty or inspections due to violation of personal
information protection related laws or regulations;
 During the Track Record Period, we did not have any dispute with our customers or
suppliers that was related to personal information protection; and
 We regularly consult with our PRC legal advisers to comply with the data privacy
related PRC laws.
The Sole Sponsor has reviewed the legal analysis of the PRC Legal Advisors, with the
assistance of its PRC legal advisors, who concur with the analysis of the PRC Legal Advisors.
The Sole Sponsor has also reviewed the Group’s internal control measures on data collection
as discussed above and have obtained and reviewed samples of the contracts between the
Company and its customers and suppliers together with the internal control consultant engaged
by the Company. Based on such due diligence, nothing has come to the attention of the Sole
Sponsor that would lead itself to disagree on the foregoing Directors’ view.
As advised by our PRC Legal Advisors, our business has complied with the PRC
Cybersecurity Law, the PRC Data Security Law, the PRC Personal Information Protection Law
and other relevant laws and regulations in all material aspects during the Track Record Period.
However, given the nature of our business, we are unable to rule out the possibility of
being adversely affected by data compliance risks. For details, see “Unauthorized access to our
customers’, suppliers’, or our own data could harm our reputation and have a negative impact
on our business and financial performance” and “Our failure to comply with existing or future
laws and regulations related to data security, data protection, cybersecurity or personal
information protection could lead to suspension of our business operations, liabilities,
administrative penalties or other regulatory actions, which could negatively affect our results
of operations and business” in “Risk Factors – Risks Relating to Our Business and Industry”.
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To ensure ongoing compliance with relevant data security and personal information
protection laws, we maintain regular communications with our legal and other professional
advisors, including PRC data law specialists, to keep abreast of the latest regulatory
developments and receive prompt advice on any applicable requirements in relation to our data
security and personal information protection practices. With the measures we have in place, we
believe we can continually adjust our internal policies in response to new regulatory
developments, update our practices on network security, data compliance and personal
information protection as appropriate, and take any necessary rectification or improvement
measures in a timely manner, to ensure compliance with updated cybersecurity, data security
and personal information related laws and regulations if and when they come into effect in the
future.
Audit Committee Experience and Qualification and Board Oversight
To monitor the ongoing implementation of our risk management policies, we have
established an Audit Committee to review and supervise our financial reporting process and
internal control system on an ongoing basis to ensure that our internal control system is
effective in identifying, managing and mitigating risks involved in our business operations.
The Audit Committee comprises three members, namely LI Shun Fai, CHEN Xinhe and QIU
Jianqiang. LI Shun Fai is the Chairperson of the Audit Committee and an independent
non-executive Director. See “Directors, Supervisors and Senior Management – Directors”.
CUSTOMER’S SERVICE AND QUALITY CONTROL
During the Track Record Period and up to the Latest Practicable Date, we have not
received any complaints that could, individually or in the aggregate, have a material adverse
effect on our business, financial condition and results of operations.
During the maintenance period after system delivery, we provide customer support. Once
the project is formally accepted, we submit a maintenance handover application to transfer the
maintenance responsibilities to the maintenance personnel. When the project’s maintenance
service period expires and the customer decides not to renew the contract or agrees to terminate
the service, the maintenance personnel should submit a maintenance service termination
process for our internal approval. If the customer raises new requirements during usage, we
will internally discuss whether it can be developed into a new project.
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We have established a quality control system and obtained multiple professional
qualifications, which has laid a foundation for the consistent delivery of high-standard services
and solutions. The table below sets forth our qualifications as of the Latest Practicable Date:
Certificate Name
Compliant Standard
or Evaluation Basis Certification Scope Validity Period Issuing Organization
Information System Security
Level 3 Protection Record
Certificate (ӻ୕τΌୋ
3׼Juhe
Data Platform System)
Relevant Requirement
of Administrative
Measures for Grade
Protection of
Information Security
Level 3 Since April 2023 Suzhou City
Cybersecurity Level
Protection Work
Coordination Group
Office ( ᘽψ̹ၣഖτ
ᚐʈЪ՘ሜʃ
܃)
Information System Security
Level 2 Protection Record
Certificate (ӻ୕τΌୋ
2׼Tianju
Dihe OA System)
Relevant Requirement
of Administrative
Measures for Grade
Protection of
Information Security
Level 2 Since March 2018 Police Department of
Suzhou ( ᘽψ̹ʮτ
҅)
Information System Security
Level 2 Protection Record
Certificate (ӻ୕τΌୋ
2׼Tianju
Dihe Financial Software
System)
Relevant Requirement
of Administrative
Measures for Grade
Protection of
Information Security
Level 2 Since March 2018 Police Department of
Suzhou ( ᘽψ̹ʮτ
҅)
Information Safety Service
Qualification Certificate (ڦ
ࣣ)
CCRC-ISV-C01:2018 Software Security
Development
Qualification
(Level 2)
November 12, 2021
– November 11,
2024
China Cybersecurity
Review, Technology,
and Certification
Center ( ʕ਷ၣഖτΌ
ҦஔၾႩᗇʕː)
DCMM Capability Assessment
Certificate ( ᅰኽ၍ଣঐɢϓ
ࣣ)
GB/T 36073-2018 Managed Level 2 December 30, 2022
– December 29,
2025
China Electronics
Information Industry
Federation ( ʕ਷ཥɿ
БุᑌΥึ)
Information on System
Construction and Service –
Capability Assessment
System Certificate (ӻ
ࣣ)
T/CITIF 001-2019 General Basic Level
(CS2)
December 23, 2021
– December 22,
2025
China Electronics
Information Industry
Federation ( ʕ਷ཥɿ
БุᑌΥึ)
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Certificate Name
Compliant Standard
or Evaluation Basis Certification Scope Validity Period Issuing Organization
Information Technology
Management Systems
Certification (Ҧஔ
ࣣ)
ISO/IEC 20000-1:2018 Provide Information
Technology Service
Management
Activities Related
to Application
Software
Development to
External Customers
September 15, 2023
– September 14,
2026
Beijing Zhongjiao
Y uanhang Certification
Co., Ltd. ( ̏ԯʕʹჃ
ʮ̡)
Information Security
Management Systems
Certification (τΌ၍ଣ
ࣣ)
GB/T 22080-
2016/ISO/IEC27001:
2013
Information Security
Management
Activities Related
to Application
Software
Development;SOA:TJDH-
IM-001
V ersion:V1.1
September 15, 2023
– October 31,
2025
Beijing Zhongjiao
Y uanhang Certification
Co., Ltd. ( ̏ԯʕʹჃ
ʮ̡)
Quality Management System
Certification ( ሯඎ၍ଣ᜗ӻ
ࣣ)
GB/T 19001 2016/ISO
9001:2015
Online Data
Processing and
Computer Software
Development
October 25, 2023 –
October 24, 2026
Beijing Zhongjiao
Y uanhang Certification
Co., Ltd. ( ̏ԯʕʹჃ
ʮ̡)
PROPERTIES
Owned Property
As of the Latest Practicable Date, we had property ownership certificates for three
properties located in Suzhou for self-use, with an aggregate gross floor area of approximately
26,627 sq.m. The table below sets out a summary of certain information regarding our owned
property as of the Latest Practicable Date:
No. Location
Approximate
gross floor area Permitted use Ownership Term Encumbrance
(sq.m.)
1. No. 9 Rongfu Street,
Suzhou Industrial
Park
25,461.89 Industrial Until March 10,
2066
None
2. Building 78, Shuimo
Jiangnan Villa
1,019.21 Residential Until October 17,
2075
None
3. No. 35 Baita West
Road
145.56 Urban
Residential
Until July 14,
2081
None
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As advised by our PRC Legal Advisors, we had obtained all the relevant property
ownership certificates for the property we owned as required under the PRC laws and
regulations as of the Latest Practicable Date.
As of April 30, 2024, our property located at No. 9 Rongfu Street, Suzhou Industrial Park
accounted for 15% or more of our total assets. Therefore, pursuant to Chapter 5 of the Listing
Rules and Article 6(2) of the Companies Ordinance (Exemption of Companies and Prospectus
from Compliance with Provisions) Notice, we have prepared a valuation report with respect to
our property interests. See “Appendix V – Property V aluation”. Except as aforesaid, as of
April 30, 2024, we did not have any single property interest that forms part of its non-property
activities that had a carrying amount of 15% or more of our total assets.
Leased Property
As of the Latest Practicable Date, we leased and occupied nine properties in Suzhou,
Beijing and Wuhan, which were used as offices and business registration addresses. The table
below sets out a summary of information regarding our leased properties as of the Latest
Practicable Date:
No. Address
Approximate
gross floor
area Use of property
Expiry date of
the lease
(sq.m.)
1. Room 1508, No. 9 Rongfu Street,
Suzhou Industrial Park.
15 office June 27, 2028
2. Room 22782, Building 2, No. 12 Jia,
Xidawang Road, Chaoyang District,
Beijing National Advertising
Industrial Park Incubator
Not specified business
registration
April 7, 2025
3. Building A, 4th Floor, No. 0338,
Building 24, No. 68 Beiqing Road,
Haidian District, Beijing
Not specified business
registration
January 2, 2025
4. Room 201-67, C9 Building Group 2,
Wuhan Software New City Phase 2,
No. 8 Huacheng Avenue, East Lake
New Technology Development Zone,
Wuhan
35 business
registration
July 15, 2024
5. Floor 4, Room 405-200, Building 1,
Tower A, No. 2 Y ongcheng North
Road, Haidian District, Beijing
10 business
registration
April 14, 2025
6. Room 1501, 9 Rongfu Street, Suzhou
Industrial Park
60 office July 3, 2028
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No. Address
Approximate
gross floor
area Use of property
Expiry date of
the lease
(sq.m.)
7. Room 1503, 9 Rongfu Street, Suzhou
Industrial Park
Not specified business
registration
July 3, 2028
8. Room 1506, 9 Rongfu Street, Suzhou
Industrial Park
Not specified business
registration
July 3, 2028
9. Room 1505, 9 Rongfu Street, Suzhou
Industrial Park
Not specified business
registration
July 3, 2028
The relevant lease agreements have lease expiration dates ranging from April 2024 to
July 2028.
As of the Latest Practicable Date, we had not completed the filing for the above nine lease
agreements. As advised by our PRC Legal Advisors, the failure to register the lease agreements
for our leased properties will not affect the validity of such lease agreements, but the relevant
competent housing authorities may order us to register the lease agreements within a prescribed
period of time and impose a fine of up to RMB10,000 for each non-registered lease agreement
if we fail to complete the registration within the prescribed timeframe. As of the Latest
Practicable Date, we had not been subject to any administrative penalties by the relevant PRC
government authorities, nor have we experienced any termination or interruption of business
operations or major property loss because of the failure to file the lease agreements as
described above. Our Directors are of the view that the non-registration of the lease agreements
would not materially and adversely affect our business operations. See “Risk Factors – Risks
Relating to Our Business and Industry – We may be subject to risks relating to our failure to
complete lease registration for our leased properties.”
IMPACT OF THE COVID-19 PANDEMIC
As of the Latest Practicable Date, the overall effects of the COVID-19 pandemic on our
business operations and financial performance have been immaterial. The operations and
subsequent financial outcomes of our API marketplace were largely insulated from the adverse
effects of travel restrictions, given the online nature of our service offerings and transactions.
Despite lockdowns and travel restrictions in China, our product utilization by customers
remained consistent and undeterred. From 2021 to 2023, we experienced a growth in revenue
from our API marketplace. There was an increase in the customer base of our API marketplace
during this period, including both paying and non-paying customers.
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We approved employees who tested positive to take sick leave. For employees who have
had close contact with positive cases, we allowed them to work from home. From 2019 to 2022,
Suzhou did not experience citywide lockdowns and we have not experienced any material
interruptions to our operation. A majority of travel restrictions and quarantine mandates were
rescinded as of December 2022. The ongoing and future influence of the pandemic on our
operational results is contingent upon a myriad of evolving and unpredictable factors. These
encompass the occurrence, duration, and magnitude of COVID-19 outbreaks, the emergence of
novel variants with distinct attributes, the efficacy of containment and treatment measures, and
any subsequent responses to these unfolding events.
We did not experience any significant delays in the delivery of our solutions or loss of
customers as a result of the COVID-19 pandemic. In fact, concomitant with the general growth
in our business, there was a rise in the number of projects delivered and subsequently accepted
between 2021 and 2023. Specifically, during the Track Record Period, the development and
delivery of five data management solution projects with a total project value of RMB38.8
million were delayed due to the COVID-19 pandemic, representing approximately 13.4% of the
total project value of projects which should be delivered and accepted during the Track Record
Period. By comparison, 104 projects were delivered and accepted during the same period. We
have acquired consents from all customers for delayed projects to delivery according to a late
schedule. These projects experienced delays primarily ranging from one to three months.
Purchase amounts of less than RMB40,000 were reduced as a result of such projects delays,
and, save for the above reduction, there were no disputes, termination of contracts, or claims
arising from such delays agreeing that we deliver according to a revised schedule. As of the
Latest Practicable Date, nearly 99% of our fees from these delayed projects were recognized
as revenue with the remaining small portion expect to be recognized after the warranty period
expired with one customer, and therefore such delays did not have a material adverse impact
on our business and results of operations.
REGULATORY COMPLIANCE
Legal Proceedings
We may from time to time become a party to various legal proceedings arising in the
ordinary course of business. Our Directors confirm that, during the Track Record Period and
up to the Latest Practicable Date, we had not been and were not a party to any material legal,
arbitral or administrative proceedings, and we were not aware of any pending or threatened
legal, arbitral or administrative proceedings against us or our Directors that could, individually
or in the aggregate, have a material adverse effect on our business, financial condition and
results of operations.
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Third-Party Payment Arrangements (1)
During the Track Record Period, certain of our API marketplace customers settled their
payments to us through third parties, including through (i) their affiliates, including customers’
subsidiaries or entities which are under common control or their shareholders, but such paying
entity is not an obliged anti-money laundering institution (፺່ਕዚ࿴); (ii) customers’
employees, business partners or friends and families. We have obtained authorization letters
from customers under this category (ii), in which customers confirmed the payors’ account
details they have used or instructed to settle payment; and (iii) Alipay mainly, and where we
could determine or reasonably suspect that the customer’s and the payor’s names were
different. We did not obtain authorization letters from customers under this category (iii) due
to dissolution of certain customers, their refusal to cooperate or our failure to reach such
customers. We refer to the aforementioned categories (i), (ii) and (iii) collectively as the
“Third-Party Payment Arrangements”.
Based on our Directors’ understanding, these Relevant Customers used Third-Party
Payment Arrangements during the Track Record Period mainly because (a) the Relevant
Customers settled the transaction amounts with us using Third-Party Payment Arrangements as
the paying agents helped Relevant Customers with their transitory liquidity needs; (b) certain
Relevant Customers that lack financial or technological capabilities need their business
partners to connect to our APIs on their behalf, leading to their business partners paying on the
Relevant Customer’s behalf; (c) certain Relevant Customers registered accounts on Alipay
using a different name from their corporate name which is allowed on Alipay; and (d) the
Relevant Customers settled the transaction amounts by designating a company who was
responsible for all payments of a group of companies under common control due to their
internal financial policies
(2).
Note:
(1) Figures herein relating to the Third-Party Payment Arrangements include the number of customers, transaction
amount, revenue contribution and refund amount during the Track Record Period. These figures are not audited
or reviewed by our Reporting Accountants. Although we have exercised reasonable judgment in determining
such figures, they may not be accurate because (a) there were other types of inconsistencies between the
customers and paying entity/person other than the Third-Party Payment Arrangements. We categorized such
number of customers, transaction amount and refund amount to the Third-Party Payment Arrangements or vice
versa; (b) the number of customers, transaction amount and refund amount may be double counted within the
Third-Party Payment Arrangements; (c) there was insufficient information on the relationship between the
customer and its paying entity/person or outdated public information that made it indeterminable whether
certain transactions should be categorized as Third-Party Payment Arrangements; and (d) we have estimated
the revenue based on transaction amount when we have not, and are unable to match the specific transaction
amounts with revenue contribution. We are unable to match the transaction amount with revenue from the
Third-Party Payment Arrangements because the transaction amounts via the Third-Party Payment
Arrangements can be either used by our customers to pay for API services or remain as prepayments in their
customer accounts with us.
(2) For the avoidance of doubt, the number of Relevant Customers, transaction amount, revenue contribution and
refund of the Third-Party Payment Arrangements out of this reason (d) were allocated in either Category (i)
or (ii).
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In 2021, 2022 and 2023, we estimated to the best of our knowledge that no more than
approximately 3,031, 2,442 and 2,201 customers used Third-Party Payment Arrangements for
settlement, respectively (“ Relevant Customers ”). The estimated revenue contribution
(4)
associated with Third-Party Payment Arrangements amounted to approximately RMB9.7
million, RMB8.2 million and RMB23.6 million, respectively, representing 3.7%, 2.5% and
5.4% of our total revenue in each year, respectively. The revenue contribution was estimated
based on the transaction amount involving Third-Party Payment Arrangements during the
Track Record Period. The transaction amount cannot match the revenue contribution and we
made the following key assumptions for the estimation: (i) the revenue in relation to a certain
payment made in a period was all recognized in the same period; and (ii) on a conservative
basis, if a customer made a Third-Party Payment in a certain period, all revenue generated from
this customer would be assumed to be under Third-Party Payment Arrangements, and capped
at the transaction amount under Third-Party Payment Arrangements in the same period, unless
the revenue contribution arising out of the Third-Party Payment Arrangements is clearly
separable from other revenue contribution.
The following table sets forth the respective number of Relevant Customers by category
for the years indicated:
For the Y ear ended December 31,
2021 2022 2023
Category (i) (3) ......................... 6 2 3 5 3 4
Category (ii) .......................... 2 3 1 1 1 2
Category (iii) ......................... 2,946 2,396 2,155
Total .............................. 3,031 2,442 2,201
(3) For the avoidance of doubt, the revenue contribution and number of customers under category (i) do not
include payment made through a company’s affiliates which is a payment service provider. These payment
service providers are obliged anti-money laundering institutions (፺່ਕዚ࿴), which generally are
subject to stringent anti-money laundering requirements imposed by PRC law. We did not obtain authorization
letters from customers under this category (i).
(4) The revenue contribution was estimated based on the transaction amount involving Third-Party Payment
Arrangements during the Track Record Period. The transaction amount cannot match the revenue contribution
and we made the following key assumptions for the estimation: (i) the revenue in relation to a certain payment
made in a period was all recognized in the same period; and (ii) on a conservative basis, if a customer made
a Third-Party Payment in a certain period, all revenue generated from this customer would be assumed to be
under Third-Party Payment Arrangements, and capped at the transaction amount under Third-Party Payment
Arrangements in the same period, unless the revenue contribution arising out of the Third-Party Payment
Arrangements is clearly separable from other revenue contribution.
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The following table sets forth the respective estimated revenue contribution (4) of Relevant
Customers by category for the years indicated:
For the Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Category (i) (3) ......................... 6 8 4 4 1 3 16,563
Category (ii) .......................... 9 7 6 2 2 0 1,832
Category (iii) ......................... 8,035 7,562 5,250
Total(5) ............................. 9,695 8,195 23,646
PRC Legal Advisors’ Views
Our PRC Legal Advisors are of the view that the Third-Party Payment Arrangements
during the Track Record Period and up to the Latest Practicable Date did not constitute material
non-compliance under the applicable PRC laws on the following basis:
(i) pursuant to the laws and regulations of the PRC, there is no explicit restriction on
the adoption of Third-Party Payment Arrangements. A Third-Party Payment
Arrangements is valid so long as it does not fall within those grounds of invalidation
specified under the Civil Code of the PRC (Պ), including,
among others, where the arrangement is in violation of public order or harms one’s
legal rights through malicious collusion;
(ii) we have not been penalized or determined to owe or evade taxes by the tax
authorities due to the Third-Party Payment Arrangements during the Track Record
Period, which is evidenced by the fact that we have also received certificate from the
tax authority of Suzhou Industrial Park, confirming that we have not been subject to
any administrative penalties due to tax reasons. The risk of us being penalized or
determined to owe or evade taxes by the tax authorities for the Third-Party Payment
Arrangements during the Track Record Period is relatively low;
(iii) We are not a financial institution or a specified non-financial institution subject to
anti-money laundering obligations under the PRC laws and regulations. This means
that we are not subject to the stringent obligations imposed on such institutions and
have no obligation in law to ascertain the origin of funds in third-party payment
arrangements. Commercial banks and payment service providers that provide
payment settlement services, are generally obliged anti-money laundering
institutions. They are required by law to effectively investigate and curb potential
money laundering activities;
(5) We are unable to match the transaction amount with revenue from each customer under the Third-Party
Payment Arrangements because the transaction amounts, depending on whether and when the customer uses
our API services, may or may not be recognized as revenue during the same period. Transaction amounts can
be converted to credit in the customer account for such customer’s future use. In addition, we recognize
revenue of top-up service on a net basis. This resulted in a significant difference between the transaction
amount and revenue recognized.
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(iv) we have not been subjected to any administrative penalties due to money laundering
issues related to the Third-Party Payment Arrangements during the Track Record
Period. Furthermore, we have established a corresponding anti-money laundering
system and have taken measures to prevent our business from being used for money
laundering activities;
(v) having considered the Third-Party Payment Arrangements stated above, our PRC
Legal Advisors are of the view that (1) the Third-Party Payment Arrangements were
not in breach of the mandatory provisions of the PRC civil law and other applicable
laws or regulations in China, and (2) the risk of our Company violating the relevant
laws and regulations and being investigated or administratively penalized as a result
thereof is relatively low; and
(vi) during the payment process, the third-party payment agent must obtain the payment
details that we provided to our customers. There are several verification steps during
the payment process, therefore it is unlikely that such payment is intended for
another account other than our Company’s. During the Track Record Period, to the
best of our knowledge, we are not aware of any dispute between our customers and
third-party payments providers arising out of the Third-Party Payment
Arrangements.
Our Directors’ Views
To the best of their knowledge, our Directors confirm that the Relevant Customers and
third party payment agents of Third-Party Payment Arrangements during the Track Record
Period did not have any business, family, trust, financing or other types of relationships with
our Group, our directors or senior management at the time of making the respective third-party
payment, or which would have prejudiced our transactions with the Relevant Customers.
Our Directors are of the view that relevant transactions underlying the Third-Party
Payment Arrangements during the Track Record Period existed and were genuine, on the basis
that:
 We reconciled our records against the statements issued by the financial institutions
on a monthly basis.
 Each customer’s payment required logging into its account and providing a
randomly generated payment transaction number was generated by the paying
financial institutions when making payment. Our finance department verified the
transaction number in the payment record. Only the payer could acquire the
transaction number while the accounts were password protected. Under this design,
the payer and the account holder must exchange the payment information and the
account details to effect a third-party payment.
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 Customer’s account included information such as balance, detailed records of each
purchase, refund and transaction history. If we received unknown payment that does
not match with any transaction, we promptly worked with the finance department to
inspect it.
 Income from each API request corresponded to a purchase from a supplier. Such a
match was traceable in our system.
 The recognition of revenue from the API Marketplace follows the principle of
revenue recognition upon provision of API services. In cases where customers make
payments to the Group for the purchase of API queries and SMS alerts online, but
have not used the services, the corresponding payment received is not recognized as
revenue. In the case of top-up services, revenue is recognized when the value is
added to the designated mobile number as requested by the customer and not when
the funds are received by us.
Our Directors are of the view that the Third-Party Payment Arrangements during the
Track Record Period arose out of genuine transactions and that the money laundering risks
related to the Third-Party Payment Arrangements is low due to the following reasons:
(i) Approximately RMB1.7 million, RMB0.5 million and RMB0.1 million,
respectively, of the transaction amount received via the Third-Party Payment
Arrangements were refunded in 2021, 2022 and 2023, respectively, thus suggesting
that most customers actually used our services as there was a low level of refunds.
The circumstances that led to refunds during the Track Record Period were (1) the
discontinued operation of certain APIs we offered, (2) the customers no longer
needing to use the APIs services they purchased, (3) our inability to accept the
payment due to inconsistency between the account details in our accounting system
and the payment details, (4) operational errors of the customers, such as topping up
to a wrong mobile number or wrong top-up amount, and (5) the customers not using
the API service for a long period after the purchase;
(ii) During the Track Record Period, there was no payments related dispute between our
customers and our Group;
(iii) Third-Party Payment Arrangements are not uncommon as market practices adopted
by individuals and small businesses in China and also not uncommon for
API-enabled data exchange service market in China;
(iv) As advised by our PRC Legal Advisors stated above, Third-Party Payment
Arrangements are not in breach of the mandatory provisions of the PRC civil law
and other applicable laws or regulations in China.
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Since the implementation of the updated anti-money laundering policies in November
2023, the Group has implemented the following internal control measures on anti-money
laundering:
(i) the Group has established guidelines for identifying suspicious transactions, such as
instances of any sudden unusual increase of transactions amount;
(ii) the Group has implemented control measures in respect of suspicious transactions,
which include: (a) establishing a watch list of entities or people who has potential
risks of money laundering; (b) monitoring the transactions which may involve
entities or people on the watch list and taking further measures such as suspension
of transactions, fund transfer refusal and freezing of assets; (c) screening the
relationship between customers and their third-party paying entity; (d) imposing a
reporting obligation on suspicious transactions to the police or other government
authorities; and (e) established a suspicious transaction reporting list;
(iii) the Group has strengthened its internal controls and ceased to accept Third-Party
Payment Arrangements since 27 November 2023;
(iv) the Group introduced and conducted training related to the anti-money laundering
and counter-financing of terrorism and for raising our staff awareness;
(v) the Group has established and implemented internal controls to investigate
suspicious activities and take appropriate actions;
(vi) the Group has designated personnel to regularly oversee and monitor the internal
control measures on anti-money laundering and counter-financing of terrorism; and
(vii) The Group’s audit committee and the Board regularly reviews the results of the
regular check on anti-money laundering and suspicious activities (if any).
The Group’s anti-money laundering policies has covered Tianju Renhe since April 2024.
More than 99.0% of our Group’s revenue were derived from the operation of the Company and
Tianju Renhe during the Track Record Period. The Group’s anti-money laundering policies
have included measures for addressing prepayment transactions with top-up service providers
since November 2023.
Since the implementation of our anti-money laundering policies in June 2023 and up to
the Latest Practicable Date, nothing has come to our Directors’ attention to make us believe
that such policies are not adequate, sufficient and effective, on the basis that:
(i) We have established a suspicious transaction reporting list. As of the Latest
Practicable Date, no suspicious transaction was reported.
(ii) The designated personnel to regularly oversee and monitor the internal control
measures on anti-money laundering and counter-financing of terrorism did not
report anything that makes us believe that is suspicious.
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(iii) We have established a watch list of entities or people who have potential risks of
money laundering and terrorist financing and checked our current customers and
suppliers against it. The watch list includes (1) terrorist individuals and
organizations released by the Ministry of Public Security; (2) individuals and
organizations sanctioned by the United Nations recognized by the PRC government;
(3) other individuals and organizations on the watch lists of anti-money laundering
and anti-terrorist financing released by other international organizations and
jurisdictions that are recognized by the PRC government; (4) other watch list of
anti-money laundering and anti-terrorist financing that is required to watch by the
People’s Bank of China; and (5) other watch lists that we believe should be included.
Since our initial check and up to the Latest Practicable Date, none of our customers
and suppliers were on the watch list.
(iv) Since June 2023 and up to the Latest Practicable Date, we have not been subject to
any payment-related dispute between us and our customers.
(v) During the Track Record Period and up to the Latest Practicable Date, to our
knowledge we have not received any notice and have not been subject to any
investigation, proceedings or penalties arising out of money-laundering of our
customers.
(vi) The API-enabled service market in China is not commonly associated with money
laundering activities.
(vii) During the Track Record Period, more than 99.0% of our Group’s revenue were
derived from the operation of the Company and Tianju Renhe.
As of November 27, 2023, we have ceased to accept Third-Party Payment Arrangements.
Sole Sponsor’s View
The Sole Sponsor has reviewed the legal analysis of the PRC Legal Advisors, with the
assistance of its PRC legal advisors, who concur with the analysis of the PRC Legal Advisors.
The PRC Legal Advisors have also confirmed that the Company is not an obliged anti-money
laundering institution (፺່ਕዚ࿴) as prescribed under PRC laws and is not subject to the
stringent anti-money laundering obligations imposed on such institutions. The Sole Sponsor
has reviewed the Group’s internal control measures on anti-money laundering as discussed
above, including the Anti-Money Laundering Management Policy (ܓand the
General Policy for Anti-money Laundering (ܓThe Sole Sponsor further
discussed with the internal control consultant, engaged by the Company, who has performed an
independent review of the Group’s existing anti-money laundering policies and procedures and
the implementation thereof. The internal control consultant confirmed that based on the
procedures performed and the evidence obtained by the internal control consultant, there are
no deficiencies in the Group’s anti-money laundering process. Based on the above due
diligence, nothing has come to the attention of the Sole Sponsor that would lead itself to
disagree on the foregoing Directors’ and the PRC Legal Advisors’ views.
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Data Security Compliance
Cybersecurity and internet data security
Based on the consultation with the CCRC and our further analyses as set forth below, as
advised by our PRC Legal Advisors, our Directors are of the view that the Cybersecurity
Review Measures and the Draft Cyber Data Security Regulations, as implemented in its current
form, would not have a material adverse impact on our business operations or the proposed
Listing. However, we cannot guarantee whether we will be subject to cybersecurity review in
the future, or if new rules or regulations promulgated in the future will impose additional
compliance requirements on us. See “Risk Factors – Risks Relating to Our Business and
Industry – Our failure to comply with existing or future laws and regulations related to data
security, data protection, cybersecurity or personal information protection could lead to
suspension of our business operations, liabilities, administrative penalties or other regulatory
actions, which could negatively affect our results of operations and business.” Further, the
Cybersecurity Review Measures grants authorities the discretion to initiate cybersecurity
review against any entity if they believe such entity’s data processing activities may or does
affect national security. However, it is unclear how the regulations in its final form would be
interpreted and enforced in practice. For a detailed explanation of the relevant regulations, see
“Regulatory Overview”.
Under the Cybersecurity Review Measures, a cybersecurity review could be triggered if,
(i) a critical information infrastructure operator, or CIIO, that intends to purchase network
products and services; (ii) a network platform operator that possesses the personal information
of more than one million people intends to be listed abroad ( ਷̮ɪ̹); or (iii) for any member
of the cybersecurity review working mechanism believes that any network product or service
or data processing activity affects or is likely to affect national security. In the third case, the
Office of Cybersecurity Review shall report this circumstance to the Central Cyberspace
Affairs Commission for approval, and conduct a review after approval. According to the
consultation with CCRC that our PRC Legal Advisors conducted on our behalf on June 19,
2023, the CCRC confirmed that (i) since Hong Kong is a special administrative region of the
PRC, a listing in Hong Kong is not considered a listing “abroad” and, therefore we are not
subject to the application for cybersecurity review under Article 7 of the Cybersecurity Review
Measures; (ii) if no notification is received from the competent authorities requesting a
cybersecurity review or classifying our Company as a CIIO, there is no need to declare or
conduct a cybersecurity review at this time; (iii) if no notification is received from the
competent authorities, the Company’s products, services and data-processing activities so far
could not be considered by the competent authorities as “affecting or potentially affecting
national security”; and (iv) since the Draft Cyber Data Security Regulations has not become
effective or been formally implemented, we are currently not required to apply for
cybersecurity review under this regulation. See “Risk Factors – Risks Relating to Our Business
and Industry – Our failure to comply with existing or future laws and regulations related to data
security, data protection, cybersecurity or personal information protection could lead to
suspension of our business operations, liabilities, administrative penalties or other regulatory
actions, which could negatively affect our results of operations and business.”
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The Regulations on Cyber Data Security Management (Draft for comments) ( ၣഖᅰኽ
τΌ၍ଣૢԷ(ᅄӋจԈᇃ))( “ Draft Cyber Data Security Regulations ”) provides, among
other things, that a data processor shall apply for a cybersecurity review in compliance with
relevant national regulations under certain circumstances, primarily over matters affecting
national security. As of the Latest Practicable Date, the Draft Cyber Data Security Regulations
have not been enacted or taken effect, and there had been no clarifications from the authorities
as to the standards for determining the activities that “affects or may affect national security”
and there is no timetable as to when it will be enacted. Therefore, as we believe we have not
undertaken and do not intend to undertake matters affecting national security, we have not
applied for a cybersecurity review. Nevertheless, as advised by our PRC Legal Advisors, the
PRC government authorities may have discretion in the interpretation of what activities “affect
or may affect national security”. We will continue to monitor developments to this regulation.
See “Risk Factors – Risks Relating to Our Business and Industry – Our failure to comply with
existing or future laws and regulations related to data security, data protection, cybersecurity
or personal information protection could lead to suspension of our business operations,
liabilities, administrative penalties or other regulatory actions, which could negatively affect
our results of operations and business.”
As of the Latest Practicable Date, (i) we had not been notified of being classified as a
CIIO, or been involved in any investigations on cybersecurity review made by the CAC and
other relevant authorities, nor had we received any inquiry notice, warning, or sanctions in
such respects; (ii) we had formulated effective cybersecurity and data protection policies,
procedures, and measures to ensure secured storage and transmission of data and prevent
unauthorized access or use of data, and there had been no material data leakage during our
business operations during the Track Record Period and up to the Latest Practicable Date; and
(iii) we had not received any inquiry, notice, warning from any PRC government authorities,
and have not been subject to any investigation, sanctions or penalties made by any PRC
government authorities regarding national security risks caused by our business operations or
the proposed Listing.
In addition, the Security Assessment of Outbound Data, which took effect only on
September 1, 2022, requires that any data processor that processes or exports personal
information exceeding certain volume threshold under such measures shall apply for security
assessment by the CAC before transferring any personal information outbound. As of the Latest
Practicable Date, we had not been involved in any cross-border data transfer during our daily
operations. Based on the advice of our PRC Legal Advisors, our Directors are of the view that
the Security Assessment of Outbound Data, if implemented in the current form, would not have
a material adverse impact on our business operations or the proposed Listing. However, since
the Security Assessment of Outbound Data has been newly promulgated, we cannot assure you
that the relevant regulatory authorities will take the same view as ours. If the regulatory
authorities deem certain of our activities as a cross-border data transfer, we will be subject to
the relevant requirements. See “Risk Factors – Risks Relating to Our Business and Industry –
Our failure to comply with existing or future laws and regulations related to data security, data
protection, cybersecurity or personal information protection could lead to suspension of our
business operations, liabilities, administrative penalties or other regulatory actions, which
could negatively affect our results of operations and business.”
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With the same bases and subject to the observations as set forth above as of the Latest
Practicable Date, no material information had come to the attention of the Sole Sponsor that
would cause the Sole Sponsor to disagree with the PRC Legal Advisors’ aforementioned views
in any material respect.
V ATS Services Compliance
During the Track Record Period and up to the Latest Practicable Date, we have not been
and are not involved in any material non-compliance incidents resulting in fines, enforcement
actions or other penalties that could, individually or in the aggregate, have a material adverse
effect on our business, financial condition and results of operations.
Our PRC Legal Advisors are of the view that the operation of our API marketplace and
data management solutions do not fall in any category of any value-added telecommunications
services under the Telecom Business Classification Catalog (ุਕʱᗳͦ፽) and our
current operation as of the Latest Practicable Date do not require Electronic Data Interchange
License (ุਕ຾ᐄ஢̙ᗇ(ஈଣุਕ))( “ EDI License ”),
Internet Content Provider Licenseุਕ຾ᐄ஢̙ᗇ(ਕุਕ,ࢹڦ
ਕ)))( “ ICP License ”) or Service Provider License (information services, excluding
Internet information services) (ุਕ຾ᐄ஢̙ᗇ(ਕุਕ,؂ࢹڦ
ਕ))( “ SP License ”, together with the EDI License and the ICP License, the “ VAT S
Licenses ”), on the basis that:
According to the Telecom Business Classification Catalog, an “online data processing and
transaction processing business” refers to the business that provides online data processing and
transaction/transaction processing services for customers through various data and
transaction/transaction processing application platforms connected to public communication
networks or the internet and an “information service business” (together with the online data
processing and transaction processing business, the “ V ATS services ”) refers to the business
that “provides information services to customers through information collection, development,
processing, and the construction of information platforms via public communication networks
or the internet.”
Our data management solutions are deployed at customer’s system, and it does not
involve services provided through the internet by us. Our API marketplace does not fall into
the V A TS services because: (i) our API marketplace only includes APIs operated by us and it
is not an “application platform” which provides online data processing and
transaction/transaction processing services for third parties; (ii) our self-operated platforms do
not include any third party merchants or provide any information services for third parties; and
(iii) we do not directly send SMS notice by ourselves when operating our SMS notice APIs.
Instead, we will require the SMS service provider sending the SMS notice request to hold an
SP License.
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Based on an interview with the China Academy of Information and Communications
Technology (Ӻ৫)( “CAICT ” as an affiliated institute directly under the MIIT
(᙮ԫุఊЗ)) on August 3, 2023 by our PRC Legal Advisors, during
which the deputy director of the Industry and Planning Research Institute of CAICT confirmed
that (i) the Institute of Industry and Planning of CAICT and the interviewee provide
clarifications on the law, policies and their implementation of V A TS services related to our
business and provide consultation feedback on the application process and results of the
license; and (ii) it agreed with our aforesaid analysis that our API marketplace does not fall
under the scope of V A TS services and its operation does not require the V A TS Licenses.
We held the SP License, ICP License and EDI License during the Track Record Period,
and we applied for deregistration of these licenses. Effective from September 2023, August
2023 and August 2023, respectively, the SP License, ICP License and EDI License were
deregistered.
Our PRC Legal Advisors have advised that during the Track Record Period and up to the
Latest Practicable Date, we have obtained the requisite licenses, qualifications and permits
from the relevant PRC regulatory authorities for our operations.
Sole Sponsor’s View
The Sole Sponsor and its PRC legal advisors also attended the CAICT interview on
August 3, 2023. The Sole Sponsor has reviewed the legal analysis of the PRC Legal Advisors,
with the assistance of its PRC legal advisors, who concur with the analysis of the PRC Legal
Advisors, and has considered the rationale of the Company as referred to above. Based on such
due diligence, nothing has come to the attention of the Sole Sponsor that would lead itself to
disagree on the foregoing Directors’ and the PRC Legal Advisors’ views.
Incidents related to our top-up services
During the Track Record Period, the majority of our top-up services, as measured by
revenue, was mobile top-up service. However, historically, we have also provided other types
of top-up services, such as stored-value gas cards, train tickets, and media streaming
subscriptions. We make these prepayments to direct top-up service providers to ensure a steady
supply, which we believe is in line with industry norms.
In 2017, we have suffered a total loss in prepayments of approximately RMB74.9 million
because a Sub-Provider of our top-up service providers failed to provide the services or issue
refunds to two of our top-up service providers, Provider A and B, due to fraudulent activities
by its own top-up service provider. In 2019, courts in Shanghai rendered judgments stating that
the Sub-Provider was a victim of fraudulent activities conducted by one individual, who was
sentenced to life imprisonment. In September 2019, Provider A, Provider B, and we entered
into a repayment agreement, pursuant to which they agreed to compensate us for our losses
with a total payment of RMB80 million. Provider A and B gradually repaid a total of
RMB10.95 million to us. We gradually reduced our cooperation with Provider A and B after
the incident and terminated our cooperation with them in June 2020 and July 2021,
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respectively. Provider A and B were investigated and ceased operations in 2021 due to
fraudulent issuance of V A T invoices, rendering them unable to fulfill their obligations under
the repayment agreement. We made provisions of RMB63.9 million, which were written off in
2018 as belated adjustments.
According to the judgments rendered by the People’s Court of Shanghai Jinshan District
(৫) and the First Intermediate People’s Court of Shanghai ( ɪऎ̹ୋɓʕ
৫), from June 2017 to October 2021, Provider A and B fraudulently issued V A T
invoices, leading to the closure of their business and subjected their controlling persons to civil
and criminal liabilities. We ceased to cooperate with Provider A and B in June 2020 and July
2021, respectively. Our Directors are of the view that none of our Directors nor our Company
was involved in the fraudulent issuance of V A T invoices, and nothing material has come to our
attention that would reflect negatively on the Directors’ suitability in acting as a Director under
Rules 3.08 and 3.09 in any material respect. However, the involvement of our top-up service
providers in the fraudulent issuance of V A T invoices has also damaged our reputation and
interrupted our capacity to provide top-up services.
Partly due to these risk incidents, we have been strategically scaling down our top-up
services since 2021, which we believe could reduce our risk exposure related to top-up service
providers which are beyond our control.
Sole Sponsor’s View
On the basis of (1) the judgments rendered by the Shanghai No. 2 Intermediate People’s
Court and Shanghai High People’s Court on the fraud charges against an individual who
defrauded a Sub-Provider of our top-up service providers; (2) the repayment agreement entered
into among Provider A, Provider B and our Company in September 2019; (3) the repayment
records showing Provider A and Provider B’s repayment of a total of RMB10.95 million to our
Company; (4) our Company’s Shareholders’ resolutions in 2018 with respect to the provisions
and write-off for prepayments of RMB63.9 million; (5) our PRC Legal Advisors’ view that the
judgment adjudicated by the First Intermediate People’s Court of Shanghai (the second
instance court) is the final and binding judgment regarding the fraudulent issuance of V A T
invoices against Provider A and Provider B, in which there is no indication of any involvement
or wrongdoing by any member of our Group, any Directors or any of our Group’s current
employees; (6) the confirmation obtained from the Economic Crime Investigation Division of
Industry Park Branch of Suzhou Police Department that pursuant to such confirmation, no
economic criminal records or investigations or evidences of any economic wrongdoing or
criminality were found in relation to our Company; (7) none of our Directors were subject to
any legal or administrative proceedings in relation to the fraudulent issuance of V A T invoices
from the results of the background and litigation searches; and (8) the foregoing confirmation
from our Directors, nothing material has come to the Sole Sponsor’s attention that would lead
itself (i) to cast doubt on the reasonableness of our Directors’ view that none of our Directors
nor our Company was involved in the fraudulent issuance of V A T invoices, or (ii) to reflect
negatively on the Directors’ suitability in acting as a Director under Rules 3.08 and 3.09 in any
material respect.
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OVERVIEW
Immediately prior to the Global Offering, our Company is held as to approximately
43.59%, 7.75%, 1.84% and 0.15% by Mr. Zuo, Yiju Liuhe, Liuju Liuhe and Ms. Hua,
respectively. As (i) Ms. Hua is the spouse of Mr. Zuo; and (ii) Mr. Zuo is the sole general
partner of Yiju Liuhe and Liuju Liuhe and can exercise the voting rights attached to the Shares
held by Yiju Liuhe and Liuju Liuhe in accordance with the respective partnership agreement
entered into among the general partner and limited partners of Yiju Liuhe and Liuju Liuhe, Mr.
Zuo, Ms. Hua, Yiju Liuhe and Liuju Liuhe are considered to be a group of Controlling
Shareholders, who collectively held approximately 53.33% of our total issued Shares as of the
Latest Practicable Date.
Immediately following the completion of the Global Offering, Mr. Zuo, Ms. Hua, Yiju
Liuhe and Liuju Liuhe will collectively hold approximately 48.21% of our total issued Shares.
Accordingly, Mr. Zuo, Ms. Hua, Yiju Liuhe and Liuju Liuhe will remain as our Controlling
Shareholders immediately after Listing.
Among our Controlling Shareholders, Mr. Zuo is also our chairman, chief executive
officer and executive Director. For further information of Mr. Zuo, see the section headed
“Directors, Supervisors and Senior Management”. Ms. Hua has been serving as (i) the
executive director and general manager of Shanghai Haotou Investment Management Co., Ltd.
(ʮ̡) since May 2017; and (ii) the assistant to chief executive officer
of our Company since January 2019. Yiju Liuhe and Liuju Liuhe are our employee
shareholding platforms. For further information of Yiju Liuhe and Liuju Liuhe, see “History,
Development and Corporate Structure – Employee Shareholding Platforms”.
Our Controlling Shareholders confirm that as of the Latest Practicable Date, they did not
have any interest in a business, apart from the business of our Group, which competes or is
likely to compete, directly or indirectly, with our business, and requires disclosure under Rule
8.10 of the Listing Rules.
INDEPENDENCE FROM OUR CONTROLLING SHAREHOLDERS
Having considered the following factors, our Directors are satisfied that we are capable
of carrying on our business independently of our Controlling Shareholders and their close
associates after the Listing.
Operational Independence
Although our Controlling Shareholders will retain a controlling interest in us after the
Listing, for the reasons stated below, we have full rights to make all decisions on, and to carry
out, our own business operation independently. We have independent senior management team
and staff to support the operation and management of our business. We have registered the
relevant intellectual property rights relating to relevant technologies of our business and our
offering. We hold the licenses and qualifications necessary to carry on our current business, and
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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have sufficient capital, facilities, technology and employees to operate the business
independently from our Controlling Shareholders. We have access to suppliers and customers
independently from and not connected to our Controlling Shareholders. As of the Latest
Practicable Date, our Group did not share any operational resources, such as sales and
marketing and general administration resources with our Controlling Shareholders and their
respective close associates.
Based on the above, our Directors are satisfied that we are able to operate independently
from our Controlling Shareholders and their close associates.
Management Independence
Our Board comprises four executive Directors, two non-executive Directors and three
independent non-executive Directors. Mr. Zuo is our chairman, chief executive officer,
executive Director and one of our Controlling Shareholders. Our Board has a balanced
composition with a majority of non-executive Directors including independent non-executive
Directors who are not associated with the Controlling Shareholders.
Each of our Directors is aware of his or her fiduciary duties as a Director which require,
among others, that he or she must act for the benefit of and in the best interest of our Company
and not allow any conflict between his or her duties as a Director and his or her personal
interests. In the event that there is a potential conflict of interest arising out of any transactions
to be entered into between our Group and our Directors or their respective close associates, the
interested Director(s) shall abstain from voting on the relevant board meetings of our Company
in respect of such transactions and shall not be counted in the quorum. Further, we believe our
independent non-executive Directors will bring independent judgment to the decision-making
process of our Board. See “Corporate Governance” in this section for further details.
Our senior management team comprises nine members, namely Mr. Zuo, Ms. Y ang, Mr.
Shao Chuangye, Mr. Shao Lida, Mr. Wei Zheng, Mr. Han Jianfeng, Mr. Dong Chuanzu, Mr.
Wang Lei and Ms. Ji Shilin. Save for Mr. Zuo, who is the sole general partner of our employee
shareholding platforms Yiju Liuhe and Liuju Liuhe, none of our Directors or senior
management of our Company had any roles or responsibilities in managing Yiju Liuhe and
Liuju Liuhe during the Track Record Period and up to the Latest Practicable Date.
Based on the above, our Directors are satisfied that our Board as a whole together with
our senior management team is able to perform the managerial role in our Group
independently.
Financial Independence
We have established our own finance department with a team of financial staff, who are
responsible for the financial control, accounting and reporting functions of our Company. We
can make financial decisions independently and our Controlling Shareholders do not intervene
with our use of funds. As of the Latest Practicable Date, there were no loans, advances and
RELATIONSHIP WITH OUR CONTROLLING SHAREHOLDERS
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balances due to and from our Controlling Shareholders, and no share pledges or guarantees
provided by our Controlling Shareholders and their associates on our borrowings. Our source
of funding is independent from our Controlling Shareholders and neither our Controlling
Shareholders nor their respective associates had financed our operations during the Track
Record Period. Our Directors also believe that we are able to obtain financing independently
from our Controlling Shareholders. During the Track Record Period and up to the Latest
Practicable Date, our finance department and accounting systems operate independently from
our Controlling Shareholders.
Based on the above, our Directors are of the view that they and our senior management
are capable of carrying on our business independently of, and have not placed undue reliance
on our Controlling Shareholders and their close associates. We have also established the Audit
Committee comprising one non-executive Director and two independent non-executive
Directors in compliance with Rule 3.21 of the Listing Rules.
NON-COMPETITION UNDERTAKING
On February 3, 2024, our Controlling Shareholders granted a non-competition
undertaking in favour of our Company (the “ Non-competition Undertaking ”), pursuant to
which each of our Controlling Shareholders has unconditionally and irrevocably undertaken to
us on a joint and several basis that each of them will not, and will procure that his/her/its close
associates and/or companies controlled by him/her/it (other than our Group) will not, either on
his/her/its own account or in conjunction with or on behalf of any person or company, directly
or indirectly be interested in or carry out or acquire or hold any right or interest (in each case
whether as a shareholder, partner, principal or director) in any business which competes or is
likely to compete directly or indirectly with the business engaged by our Group in the PRC as
disclosed in the prospectus, being the provision of standard API services and customized data
management solutions (the “ Restricted Activity ”).
If any of our Controlling Shareholders or his/her/its close associates is offered or becomes
aware of any new business opportunity that relates to the Restricted Activity (the “ New
Business Opportunity ”):
(a) he/she/it shall within 30 business days notify our Company of such New Business
Opportunity in writing and refer the same to our Company for consideration, and
shall provide the relevant information to our Company in order to enable our
Company to make an informed assessment of such opportunity; and
(b) he/she/it shall not, and shall procure that his/her/its close associates not to, invest or
participate in any New Business Opportunity, unless such New Business
Opportunity shall have been rejected by our Company and the principal terms of
which the Controlling Shareholders or his/her/its close associates invest or
participate in are no more favourable than those made available to our Company.
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The Controlling Shareholders or his/her/its close associates may only engage in the New
Business Opportunity if (a) a notice is received by the Controlling Shareholder from our
Company confirming that the New Business Opportunity is not accepted (the “ Non-acceptance
Notice ”); or (b) the Non-acceptance Notice is not received by the Controlling Shareholder
within 30 business days after the proposal of the New Business Opportunity is received by our
Company. In the event that there are any material changes to the nature, terms or conditions
of the New Business Opportunity accepted by the Controlling Shareholders or his/her/its close
associates, the Controlling Shareholders shall and shall procure his/her/its close associates to
refer the revised New Business Opportunity to our Company.
Any Director who has an actual or potential material interest in the New Business
Opportunity shall abstain from attending (unless his/her attendance is specifically requested by
the remaining non-interested Directors) and voting at, and shall not be counted towards the
quorum for, any meeting or part of a meeting convened to consider such New Business
Opportunity. Our Board (including our independent non-executive Directors) will be
responsible for reviewing and considering whether or not to take up a New Business
Opportunity referred by a Controlling Shareholder or his/her/its close associates. The factors
that will be taken into consideration by our Board in making the decision include the financial
implication of the New Business Opportunity, the macroeconomic conditions and whether the
nature of the New Business Opportunity is in line with the strategy and development plans of
our Group.
The above undertakings are subject to the exceptions that:
(i) any of our Controlling Shareholders and his/her/its close associates may engage in
any business which is not identical or similar to the Restricted Activity and not in
direct or indirect competition with the Restricted Activity; and
(ii) each of our Controlling Shareholders may either by himself/herself/itself
individually or through his/her/its close associate(s) hold and/or be interested in any
shares or other securities in any private company and/or listed company which
engages or is involved in any business or activity which directly or indirectly
competes with the Restricted Activity, provided that (a) our Controlling
Shareholders and their respective close associates will not participate in or be
otherwise involved in the management of that private company and/or listed
company; (b) the total shareholding held by our Controlling Shareholders and their
respective close associates in such private company and/or listed company, whether
directly or indirectly, do not, in aggregate exceed 10% of the issued share capital of
such private company and/or listed company; and (c) our Controlling Shareholders
and/or his/her/its close associates are not entitled to appoint a majority of the
directors of that private company and/or listed company.
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The Non-competition Undertaking is conditional on (i) the Stock Exchange granting the
listing of, and permission to deal in, all of our H Shares to be issued under the Global Offering
and the H Shares to be converted from 45,300,000 Unlisted Shares, on the Stock Exchange; and
(ii) the obligations of the Underwriters under the Underwriting Agreements becoming
unconditional (including, if relevant, as a result of the waiver of any condition(s) by the
Underwriters) and that the Underwriting Agreements not being terminated in accordance with
their terms or otherwise.
The Non-competition Undertaking shall cease to be effective on the earlier of the dates
below:
(i) the date on which our Controlling Shareholders and their close associates
(individually or taken as a whole) cease to be the Controlling Shareholders of our
Company for the purpose of the Listing Rules; or
(ii) the date on which our H Shares cease to be listed on the Stock Exchange.
Under the Non-competition Undertaking, each of our Controlling Shareholders has
unconditionally and irrevocably undertaken that he/she/it shall and shall procure his/her/its
close associates to cooperate to provide all information necessary for the annual review by our
independent non-executive Directors, their respective representatives and the auditors of our
Group with regard to compliance with the terms of the Non-competition Undertaking. Each of
our Controlling Shareholders has also unconditionally and irrevocably undertaken to make an
annual declaration as to full compliance with the terms of the Non-competition Undertaking
and a consent to disclose such letter in our annual report.
CORPORATE GOVERNANCE
Our Company will comply with the provisions of the Corporate Governance Code in
Appendix C1 to the Listing Rules (the “ CG Code ”), which sets out principles of good
corporate governance.
Our Directors recognize the importance of good corporate governance in protection of our
Shareholders’ interests. We would adopt the following measures to safeguard good corporate
governance standards and to avoid potential conflict of interests between our Group and our
Controlling Shareholders:
(i) where a Shareholders’ meeting is to be held for considering proposed transactions
in which our Controlling Shareholders or any of their respective associates have a
material interest, our Controlling Shareholders will not vote on the resolutions and
shall not be counted in the quorum in the voting;
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(ii) our Company has established internal control mechanisms to identify connected
transactions. Upon Listing, if our Company enters into connected transactions with
our Controlling Shareholders or any of their close associates, our Company will
comply with the applicable Listing Rules;
(iii) our independent non-executive Directors will review, on an annual basis, whether
there is any conflict of interests between our Group and our Controlling
Shareholders (the “ Annual Review ”) and provide impartial and professional advice
to protect the interests of our minority Shareholders;
(iv) our Controlling Shareholders will undertake to provide all information necessary,
including all relevant financial, operational and market information and any other
necessary information as required by our independent non-executive Directors for
the Annual Review;
(v) our Company will disclose decisions (with basis) on matters reviewed by our
independent non-executive Directors either in its annual report or by way of
announcements;
(vi) where our Directors reasonably request the advice of independent professionals such
as financial advisors, the appointment of such independent professionals will be
made at our Company’s expenses; and
(vii) we have appointed Rainbow Capital (HK) Limited as our Compliance Advisor to
provide advice and guidance to use in respect of compliance with the Listing Rules,
including various requirements relating to corporate governance.
Based on the above, our Directors are satisfied that sufficient corporate governance
measures have been put in place to manage conflicts of interest between our Group and our
Controlling Shareholders, and to protect minority Shareholders’ interests after the Listing.
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OVERVIEW
Our Company has entered into an agreement with Jiangsu Jingdong Xuke Information
Technology Co., Ltd. (ʮ̡)( “ Jingdong Xuke ”) which will, upon
Listing, become our connected person (as defined under Chapter 14A of the Listing Rules).
Upon Listing, such transaction will constitute partially-exempt continuing connected
transaction (the “ Partially-exempt Continuing Connected Transaction ”) of our Group,
which will be subject to the announcement, reporting and annual review requirements but
exempt from the circular and independent Shareholders’ approval requirements under Chapter
14A of the Listing Rules, details of which are set out below.
PARTIALLY-EXEMPT CONTINUING CONNECTED TRANSACTION
API Interface Service Agreement
Principal Terms
On March 14, 2024, our Company entered into an agreement relating to the provision of
API interface service with Jingdong Xuke (the “ API Interface Service Agreement ”), pursuant
to which our Company will provide an interface to the online platforms and mobile
applications operated by JD.com (the holding company of Jingdong Xuke) (the “ JD
Platforms ”) to enable the end-users to top-up their mobile accounts through the JD Platforms
(the “ API Interface Services ”). The API Interface Service Agreement has a term commencing
from April 1, 2024 and ending on March 31, 2025. The provision of the API Interface Services
is in the ordinary and usual course of business of our Company and we may continue the
provision of the API Interface Services to Jingdong Xuke and its associates (as defined in the
Listing Rules) in the future, subject to compliance with the requirements under Chapter 14A
of the Listing Rules and all other applicable laws and regulations.
Reasons for and benefits of entering into the transaction
We are principally engaged in the provision of standard API services and customized data
management solutions and it is in our ordinary and usual course of business to provide API
Interface Services.
Since 2020, we have been providing the API Interface Services to Jingdong Xuke and its
associates and we have established compatible systems with the relevant parties. Having
considered that JD.com (the holding company of Jingdong Xuke) is a well-known e-commerce
platform in the PRC with a relatively large customer base and customer traffic, it is mutually
beneficial for our Group and Jingdong Xuke to cooperate with each other on the provision and
purchase of the API Interface Services as each of our Group and JD.com enjoys competitive
advantages in its respective business segment. Also, the transactions with Jingdong Xuke
enable our Group to expand our customer base and market penetration. Our Directors are of the
view that the price of service fees payable by Jingdong Xuke is in line with market practice
and the transactions contemplated under the API Interface Service Agreement will provide us
with a steady source of income which is in the interest of our Company and our Shareholders
as a whole.
CONNECTED TRANSACTION
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Pricing policies
The price and any corresponding discount in respect of the API Interface Services will be
based on the top-up value purchased and the type of telecommunications operators. The
discount is a percentage discount based on total top-up value purchased in one transaction.
The amounts paid and to be paid by Jingdong Xuke to our Company under the API
Interface Service Agreement are determined based on normal commercial terms after arm’s
length negotiations between the relevant parties with reference to (i) our cost in relation to the
provision of the API Interface Services on a cost-plus basis by adding a reasonable profit which
varies with the volume of the order; (ii) the prevailing market price for similar services in the
PRC; (iii) the prevailing market price in respect of similar services to companies comparable
to Jingdong Xuke; and (iv) the prevailing market price of similar services set by other
companies comparable to us for sales to companies comparable to Jingdong Xuke.
The sales price for our API Interface Services under the API Interface Service Agreement
are fair and reasonable, and on normal commercial terms no less favorable to our Company
than terms offered to Independent Third Parties. The level of profits we received and to be
received from Jingdong Xuke are consistent with our pricing policy for similar transactions we
entered into with our Independent Third Party customers of comparable profile.
Historical transaction amounts
For the three years ended December 31, 2021, 2022, 2023 and the three months ended
March 31, 2024, the transaction amounts (in our capacity as an agent to transactions of this
nature) were approximately RMB5,531,801, RMB4,914,027, RMB5,055,722, and
RMB1,800,000, respectively. The historical amounts were relatively significant in 2021 upon
the establishment of the compatible systems. From 2021 to 2022, the historical transaction
amounts decreased slightly due to budget adjustment of Jingdong Xuke as a result of the
macroeconomic condition in 2022. From 2022 to 2023 and the three months ended March 31,
2024, the historical transaction amounts grew rapidly due to the rising demands for API
Interface Services from Jingdong Xuke in light of their expanded investment in marketing and
promotional activities for major events and festivals in 2023 as a result of the gradual recovery
of the global economy.
Proposed annual caps
Our Directors estimate that the proposed annual caps in respect of the transactions
contemplated under the API Interface Service Agreement will not exceed RMB7,000,000 and
RMB2,800,000 for the financial year ending December 31, 2024 and three months ending
March 31, 2025.
CONNECTED TRANSACTION
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The above proposed annual caps are determined with reference to the following factors:
(i) the historical transaction amounts paid by Jingdong Xuke to our Company in respect
of the API Interface Services;
(ii) the expected amount of API Interface Services required by Jingdong Xuke in light
of the promotions expected to be launched on the JD Platforms from time-to-time;
and
(iii) the sales price of the API Interface Services agreed between our Company and
Jingdong Xuke in the previous agreements.
Implications under the Listing Rules
Jingdong Xuke is an indirect wholly-owned subsidiary of JD.com where JD.com is a
majority-controlled company (as defined in the Listing Rules) of Mr. Richard Liu. As of the
Latest Practicable Date, JD Technology was also a majority-controlled company (as defined in
the Listing Rules) of Mr. Richard Liu where Mr. Richard Liu was entitled to exercise majority
control over JD Technology through his direct and indirect interest in JD Technology.
Accordingly, Mr. Richard Liu is deemed to be our substantial Shareholder by virtue of his
deemed interest in JD Technology. Since JD.com and JD Technology are majority-controlled
entities of Mr. Richard Liu, Jingdong Xuke, being an indirect wholly-owned subsidiary of
JD.com, is an associate of Mr. Richard Liu and thus a connected person of our Company for
the purpose of the Listing Rules. Accordingly, the transactions under the API Interface Service
Agreement will constitute continuing connected transactions for our Company upon Listing.
Since the highest applicable percentage ratio in respect of the API Interface Service
Agreement is expected to be more than 0.1% but less than 5% on an annual basis, the
transactions under the API Interface Service Agreement constitute continuing connected
transactions for our Company which are subject to reporting, annual review and announcement
requirements but exempt from the circular and independent Shareholders’ approval
requirements pursuant to Rule 14A.76(2)(a) of the Listing Rules.
CONFIRMATION BY OUR DIRECTORS
Our Directors (including independent non-executive Directors) are of the view that the
continuing connected transaction described in “Partially-exempt Continuing Connected
Transaction” above has been and will continue to be carried out (i) in the ordinary and usual
course of business of our Company; (ii) on normal commercial terms or better and in
accordance with the respective terms that are fair and reasonable and in the interests of our
Company and our Shareholders as a whole; and (iii) the proposed annual caps in relation
thereto are fair and reasonable and in the interests of our Company and our Shareholders as a
whole.
CONNECTED TRANSACTION
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CONFIRMATION BY THE SOLE SPONSOR
Based on (i) the relevant documents and information provided by our Group, (ii)
participation in the due diligence and discussions with our management; and (iii) the relevant
representations and confirmations from our Company and our Directors, the Sole Sponsor is of
the view that (i) the continuing connected transaction described in “Partially-exempt
Continuing Connected Transaction” above has been and will be entered into in the ordinary and
usual course of our business; (ii) on normal commercial terms or better and in accordance with
the respective terms that are fair and reasonable and in the interests of our Company and our
Shareholders as a whole; and (iii) the proposed annual caps in relation thereto are fair and
reasonable and in the interests of our Company and our Shareholders as a whole.
APPLICATION FOR W AIVER
As the transaction described under “Partially-exempt Continuing Connected Transaction”
constitute continuing connected transaction under the Listing Rules are subject to the reporting,
annual review and announcement requirements but exempt from circular and independent
Shareholders’ approval requirements, our Directors consider that strict compliance with the
announcement requirement under the Listing Rules would be unduly burdensome and would
add unnecessary administrative costs to our Company, which would not be beneficial to our
Shareholders as a whole. Therefore, pursuant to Rule 14A.105 of the Listing Rules, our
Company has applied to the Stock Exchange for and the Stock Exchange has granted a waiver
to our Company from compliance with the announcement requirement under Chapter 14A of
the Listing Rules in respect of the Partially-exempt Continuing Connected Transaction.
We will comply with the other applicable provisions under Chapter 14A of the Listing
Rules in respect of such Partially-exempt Continuing Connected Transaction.
CONNECTED TRANSACTION
– 272 –


--- page 284 ---
BOARD OF DIRECTORS
Our Board currently consists of nine Directors, comprising four executive Directors, two
non-executive Directors and three independent non-executive Directors.
The powers and duties of our Board include convening general meetings and reporting our
Board’s work at general meetings, determining our business and development plans, preparing
our annual financial budgets and financial reports, formulating proposals for dividend
distributions and for the increase or reduction of our authorized share capital as well as
exercising other powers, functions and duties as conferred by our Articles of Association. We
have entered into service contracts with each of our executive Directors and non-executive
Directors. We have also entered into letters of appointment with each of our independent
non-executive Directors.
Members of Our Board
The table below sets out certain information in relation to members of our Board:
Name Age
Existing position(s)
in our Group
Time of joining
our Group
Date of
appointment as
Director
Principal
responsibilities
Relationship with
other Directors,
Supervisors and
senior
management
Executive Directors
Mr. Zuo Lei
(̸ᆾ) .......
38 Chairman of our
Board, chief
executive officer
and executive
Director of our
Company
Chairman and
director of Beijing
Sidike
Chairman and
director of
Zhonghui Juhe
Director, general
manager and head
of finance of
Wuhan Jushunhe
Director and
manager of Juli
Wanhe
Director and general
manager of
Xuzhou Juhe
February 2010 February 24, 2010 Overseeing day-to-
day operations
and overall
business strategy
and planning of
our Group and
overseeing our
Board
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 285 ---
Name Age
Existing position(s)
in our Group
Time of joining
our Group
Date of
appointment as
Director
Principal
responsibilities
Relationship with
other Directors,
Supervisors and
senior
management
Mr. Wang Haojin
(ʦ)......
40 Executive Director
Supervisor of Juli
Wanhe
Supervisor of
Xuzhou Juhe
November 2011 February 14, 2014 Handling client
relationship
management and
maintenance
None
Mr. Lin Shan
(ӄ) .......
39 Executive Director
Supervisor of
Wuhan Jushunhe
October 2014 December 17, 2015 Handling key
customer
relationships
and business
development
None
Ms. Y ang Y anjun
(ё)......
37 Executive Director,
deputy general
manager, secretary
to our Board and
joint company
secretary of our
Company
July 2018 December 18, 2020 Handling day-to-day
affairs of our
Board, assisting
our Board in
legal compliance
matters and
handling public
relations of our
Group
None
Non-executive Directors
Mr. Qiu Jianqiang
(਺੶)......
50 Non-executive
Director
December 2016 December 20, 2016 Providing
management and
strategic advice
to our Group
None
Mr. Gao Y uan
(ࡡ.......)
41 Non-executive
Director
July 2023 July 20, 2023 Providing
management and
strategic advice
to our Group
None
Independent non-executive Directors
Mr. Huang Xuexian
(රኪሬ)......
61 Independent non-
executive Director
August 2017 August 18, 2017 Supervising our
Board and
providing
independent
advice to our
Board
None
Mr. Chen Xinhe
(ئ......)
48 Independent non-
executive Director
August 2017 August 18, 2017 Supervising our
Board and
providing
independent
advice to our
Board
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 286 ---
Name Age
Existing position(s)
in our Group
Time of joining
our Group
Date of
appointment as
Director
Principal
responsibilities
Relationship with
other Directors,
Supervisors and
senior
management
Mr. Li Shun Fai
(ҽ૮ฯ)......
43 Independent non-
executive Director
May 2023 May 18, 2023 Supervising our
Board and
providing
independent
advice to our
Board
None
Executive Directors
Mr. Zuo Lei ( ̸ᆾ), aged 38, founded our Company in February 2010 and is currently the
chairman of our Board, chief executive officer and executive Director of our Company. Mr.
Zuo was re-designated as our executive Director in June 2023. Mr. Zuo is primarily responsible
for overseeing day-to-day operations and overall business strategy and planning of our Group
and overseeing our Board. He also serves in various roles in our subsidiaries, including (i) the
chairman and director of Beijing Sidike and Zhonghui Juhe; (ii) the director and manager of
Juli Wanhe; (iii) the director, general manager and head of finance of Wuhan Jushunhe; and (iv)
the director and general manager of Xuzhou Juhe.
Mr. Zuo has over 14 years of experience in big data industry.
Mr. Zuo is (i) the vice chairman of the Y outh Enterprise Association in Jiangsu Province
(ᑌΥึ); and (ii) the vice chairman of Suzhou Artificial Intelligence
Industry Association ( ᘽψ̹ɛʈ౽ঐБุ՘ึ).
Mr. Zuo obtained his bachelor’s degree in computer science and technology from Nanjing
University of Aeronautics and Astronautics (ঘ˂ɽኪ) in the PRC in June 2006. He
further obtained his executive master of business administration degree from Cheung Kong
Graduate School of Business (Ϫਠኪ৫) in the PRC in September 2021.
Mr. Zuo had various roles in certain dissolved companies, details of which are set out
below:
Name of company Position
Place of
establishment Nature of business
Reason for
dissolution Date of dissolution
Beijing Yingchuang
Wanhe Advertising Co.,
Ltd. ( ̏ԯᙊ௴ຬΥᄿѓ
ʮ̡)
Legal
representative
PRC Provision of leasing
and commercial
services in the PRC
Members’
resolutions
October 24, 2018
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 287 ---
Name of company Position
Place of
establishment Nature of business
Reason for
dissolution Date of dissolution
Suzhou Ape Ecological
Information Technology
Co., Ltd. ( ᘽψ๹͛࿒
ʮ̡)
(“Ape Ecological
Information
Technology ”)
Director PRC R&D, technical
consultation and
information system
integration services
in the PRC
Members’
resolutions
July 15, 2019
Suzhou Tianju Shunhe
Management Consulting
Partnership Enterprise
(Limited Partnership)
(ᘽψ˂ၳනΥ၍ଣፔ
༔ΥྫΆุ(Υྫ))
Executive
partner
PRC Provision of
enterprise
management
consulting and
information
consulting services
in the PRC
Members’
resolutions
October 19, 2021
Mr. Zuo confirmed that (i) there was no judgment or findings of fraud, dishonesty, any
misconduct or wrongful act on his part in connection with these dissolved companies; (ii) there
is no outstanding claim or liability against him in connection with these dissolved companies;
and (iii) these companies were solvent at the time of their respective dissolution.
As of the Latest Practicable Date, Mr. Zuo was interested in an aggregate of
approximately 53.33% equity interest of our Company. See “Appendix VII – Statutory and
General Information – Further Information About Our Directors, Supervisors and Substantial
Shareholders” for details.
Mr. Wang Haojin (ʦ) (formerly known as Wang Haojun (㢵)), aged 40, joined
our Company in November 2011 as our Director and general manager until December 2013.
Subsequently, he has served in various roles in our Company, including the general manager
of our key account unit and Supervisor. He was re-appointed as our Director in February 2014
and re-designated as our executive Director in June 2023. He is primarily responsible for client
relationship management and maintenance. Mr. Wang has over 11 years of experience in client
development and management. He is also the supervisor of Juli Wanhe and Xuzhou Juhe.
Mr. Wang obtained his bachelor’s degree in computer science and technology from
Nanjing University of Aeronautics and Astronautics (ঘ˂ɽኪ) in the PRC in June
2006.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 288 ---
Mr. Wang was a director or supervisor of certain dissolved companies, details of which
are set out below:
Name of company Position
Place of
establishment
Nature of business
pursuant to the
business license
Reason for
dissolution Date of dissolution
Ape Ecological
Information
Technology
Director PRC Provision of R&D,
technical
consultation and
information
system integration
services
Members’
resolutions
July 15, 2019
Changshu Hefang
Education and
Training Center Co.,
Ltd. ( ੬ᆞ̹ஃ˙઺ԃ
ʮ̡)
Director PRC Provision of
subject-based
training for
primary and
middle school
students
Members’
resolutions
February 15, 2023
Changshu Y uanfang
Education Training
Center Co., Ltd. ( ੬ᆞ
̹Ⴣ˙઺ԃ੃৅ʕːϞ
ʮ̡)
Supervisor PRC Provision of
subject-based
training for
primary and
middle school
students
Members’
resolutions
April 26, 2023
Changshu Lushan
Xiaohe Education
Information
Consulting Services
Department ( ੬ᆞ̹໬
ፔ༔
ਕ௅)
Operator PRC Provision of
education
information
consulting
services
Members’
resolutions
August 10, 2018
Changshu Jinghe
Education Information
Consulting Co., Ltd.
(ࢹڦ
ʮ̡)
Executive
Director,
legal
representative
and
general
manager
PRC Provision of
education
information
consulting
services
Members’
resolutions
September 8, 2020
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 289 ---
Name of company Position
Place of
establishment
Nature of business
pursuant to the
business license
Reason for
dissolution Date of dissolution
Changshu Hewen
Education and
Training Center
Co., Ltd. Zhongnan
Jincheng Branch
(੬ᆞ̹ஃ˖઺ԃ੃৅
۬
ʱʮ̡)
Person-in-
charge
PRC Provision of
language training
for primary school
students
Members’
resolutions
November 11, 2022
Mr. Wang confirmed that (i) there was no judgment or findings of fraud, dishonesty, any
misconduct or wrongful act on his part in connection with these dissolved companies; (ii) there
is no outstanding claim or liability against him in connection with these dissolved companies;
and (iii) these companies were solvent at the time of their respective dissolution.
Mr. Lin Shan (ӄ), aged 39, was appointed as our Director in December 2015 and
re-designated as our executive Director in June 2023. Mr. Lin joined our Company in October
2014 as a manager of our key account division. He is primarily responsible for managing our
Company’s key customer relationships and business development. He is also the supervisor of
Wuhan Jushunhe.
Mr. Lin has over 16 years of experience in information technology industry. Prior to
joining our Company, from June 2007 to September 2012, Mr. Lin served in AsiaInfo
Technologies (Nanjing) Inc. (Ҧ(ԯ)ʮ̡), a company principally engaged in the
provision of software products, solutions and services in the PRC. From December 2013 to
May 2014, he served in Nanjing Tongren Information Technology Co., Ltd. (Ҧ
ʮ̡), a company principally engaged in image and video technology research and
provision of video detection technology products and services in the PRC.
Mr. Lin had previously served in Nanjing Xilian Software Technology Co., Ltd. (ԯҎ
ʮ̡)( “ Nanjing Xilian ”) from November 2012 to March 2016, with his last
position as the legal representative of Nanjing Xilian. Nanjing Xilian is a company principally
engaged in the provision of computer software and hardware design services and network
technology services in the PRC. Nanjing Xilian was dissolved on October 28, 2022 as a result
of members’ resolutions. Mr. Lin confirmed that (i) there was no judgment or findings of fraud,
dishonesty, any misconduct or wrongful act on his part in connection with the dissolution of
Nanjing Xilian; (ii) there is no outstanding claim or liability against him in connection with the
dissolution of Nanjing Xilian; and (iii) Nanjing Xilian was solvent at the time of its dissolution.
Mr. Lin obtained his bachelor’s degree in computer science and technology from Nanjing
University of Aeronautics and Astronautics (ঘ˂ɽኪ) in the PRC in June 2006.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 290 ---
Ms. Y ang Y anjun (ё), aged 37, was appointed as our Director in December 2020
and re-designated as our executive Director in June 2023. Ms. Y ang joined our Company in
July 2018 as a deputy general manager and has also been serving as the secretary of our Board
since February 2019. She was appointed as one of our joint company secretaries in August
2023. She is primarily responsible for handling day-to-day affairs of our Board, assisting our
Board in legal compliance matters and handling public relations of our Group.
Ms. Y ang has over five years of experience in big data industry. Prior to joining our
Company, from July 2009 to March 2016, Ms. Y ang served as a professional director of the
business development unit of the financial service center under the external cooperation
department in China Fortune Land Co., Ltd. (ʮ̡), a company
principally engaged in real estate development in the PRC, where she was primarily
responsible for business development. From May 2015 to January 2019, she served as the
chairlady of Beijing Phoenix Interactive Entertainment Investment Management Co., Ltd. ( ̏
ʮ̡) (formerly known as Blue Lotus Capital Co., Ltd. ( ᔝᇳସ˰(̏
ԯ)ʮ̡)), a company principally engaged in the provision of investment and
asset management services in the PRC, where she was primarily responsible for providing
customized strategic advices, financing solutions and management consultancy services to
small and medium enterprises. From October 2017 to March 2018, she served as the president
assistant of Indonesia Lippo Group ( Ι̵ɢᘒණྠ), one of Asia’s largest and most diversified
conglomerates, where she was primarily responsible for assisting the president with
operational and administrative management.
Ms. Y ang obtained her bachelor’s degree in tourism management from Xi’an University
of Finance and Economics ( Гτৌ຾ኪ৫) in the PRC in June 2009. She further obtained her
executive master of business administration degree from Renmin University of China ( ʕ਷ɛ
͏ɽኪ) in the PRC in January 2018. Ms. Y ang was awarded the Doctor of Philosophy in
Business Studies from Cardiff University in the United Kingdom in December 2021.
Non-executive Directors
Mr. Qiu Jianqiang (਺੶), aged 50, was appointed as our Director in December 2016
and re-designated as our non-executive Director in June 2023. Mr. Qiu is primarily responsible
for providing management and strategic advice to our Group.
Mr. Qiu has over 27 years of management experience in garment industry. Prior to joining
our Company, since December 1996, Mr. Qiu has served in various managerial roles (including
vice president and director) in Semir Group Co., Ltd. (ʮ̡) (the “ Semir
Group ”), a company principally engaged in the garment business in the PRC, where he is
primarily responsible for strategic planning and overseeing the management and operation of
Semir Group. Since 2009, Mr. Qiu has served in various roles in Zhejiang Semir Garment Co.,
Ltd. (ʮ̡)( “ Zhejiang Semir ”), a PRC garment company which is
owned as to 12.47% by Semir Group and whose shares are listed on the Shenzhen Stock
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 291 ---
Exchange (stock code: 002563), including president, director and vice chairman. He is
currently the chairman of Zhejiang Semir and primarily responsible for the overall
management, strategic planning and decision making of Zhejiang Semir.
Mr. Qiu is also (i) the representative of the People’s Congress of Minhang District in
Shanghai; and (ii) the vice chairman of the seventh council to the China National Garment
Association (ଣԫึ).
Mr. Qiu obtained his executive master’s degree in business administration from China
Europe International Business School ( ʕᆄ਷ყʈਠኪ৫) in the PRC in October 2014.
As of the Latest Practicable Date, Mr. Qiu was one of our Pre-IPO Investors and
interested in approximately 8.91% equity interest of our Company. See “Appendix VII –
Statutory and General Information – Further Information About Our Directors, Supervisors and
Substantial Shareholders” for details.
Mr. Gao Yuan (ࡡ)aged 41, joined our Company as a non-executive Director in July
2023. He is primarily responsible for providing management and strategic advice to our Group.
Mr. Gao has over seven years of management experience in the technology industry. The
major work experience of Mr. Gao are as follows:
Name of company Service period Position
Primary
responsibilities
Principal activities
of the company
JD Technology From September
2015 to current
Head of strategic
and integrated
support
Overseeing strategic
planning and
business strategy
development
Provision of
technology
products and
solutions
Suqian Zhongyiguan
Business Consulting
Co., Ltd. (ڿ
ʮ̡)
From December
2019 to current
Executive director,
general manager
and legal
representative
Handling the daily
operation and
management
Provision of financial
consulting services
JD Molybdenum Media
Technology Co., Ltd.
(ʮ
̡)
From December
2021 to current
Executive director,
general manager
and legal
representative
Handling the daily
operation and
management
Provision of public
relations, market
research and
advertising services
Tianjin JD Molybdenum
Media Technology
Co., Ltd. (◞
ʮ̡)
From January 2022
to current
Executive director,
manager and legal
representative
Handling the daily
operation and
management
Provision of market
research and
advertising services
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 292 ---
Name of company Service period Position
Primary
responsibilities
Principal activities
of the company
Jingmo (Shanghai)
Technology Co., Ltd.
(ԯ◞(ɪऎ)ࠢ
ʮ̡)
From February 2022
to current
Executive director,
general manager
and legal
representative
Handling the daily
operation and
management
Provision of
telecommunications
top-up, technical
and big data
services
Shanghai Baixun
Investment
Management Co.,
Ltd. ( ɪऎϵԘҳ༟၍
ʮ̡)
From June 2023 to
current
Legal representative Handling the daily
operation and
management
Provision of
investment and
asset management
services
Mr. Gao obtained his bachelor’s degree in information engineering from South China
University of Technology (ଣʈɽኪ) in the PRC in July 2005. He further obtained his
master’s degree in communication and information system from Beijing University of Posts
and Telecommunications ( ̏ԯඉཥɽኪ) in the PRC in March 2009.
Independent Non-executive Directors
Mr. Huang Xuexian ( රኪሬ), aged 61, was appointed as our independent Director in
August 2017 and re-designated as our independent non-executive Director in June 2023. Mr.
Huang is primarily responsible for supervising our Board and providing independent advice to
our Board.
Mr. Huang has over 38 years of experience in legal education industry. From July 1985
to June 2015, Mr. Huang has been serving as a lecturer, associate professor and professor at
Soochow University ( ᘽψɽኪ) in the PRC. From September 2008 to June 2015, he has served
as the vice president of the law faculty at Soochow University, where he was primarily
responsible for teaching management. Since December 2022, Mr. Huang has also served as an
independent director of Canmax Technologies Co., Ltd. (ʮ̡),
a company principally engaged in the provision of electrostatic and micro-pollution prevention
and control solutions in the PRC and whose shares are listed on the Shenzhen Stock Exchange
(stock code: 300390), where he is primarily responsible for supervising and providing
independent advice to the board. To strengthen his skillset as our independent non-executive
Director and his knowledge in relation to corporate governance, he has attended the 75th
Shanghai Stock Exchange Independent Director Qualification Training in April 2021.
Mr. Huang is the member of the eighth council of the Institute of Rule of Law, China
University of Political Science and Law (Ӻ৫).
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 293 ---
Mr. Huang obtained his bachelor’s degree in political science, master’s degree in
administrative law and doctoral degree in constitutional and administrative laws from Soochow
University ( ᘽψɽኪ) in the PRC in July 1985, June 1997 and December 2016, respectively.
From September 19, 2003 to December 28, 2005, Mr. Huang served as a supervisor of
Suzhou Industrial Park Haikun Business Consulting Co., Ltd. ( ᘽψʈุ෤ਜऎ㆕ਠਕፔ༔Ϟ
ʮ̡)( “ Suzhou Haikun ”), a limited liability company established in the PRC. Suzhou
Haikun was revoked on December 28, 2005 as a result of revocation of business license due
to the fact that Suzhou Haikun was not engaging in any business activities for more than six
months prior to the date of the revocation. Mr. Huang confirmed that (i) there was no judgment
or findings of fraud, dishonesty, any misconduct or wrongful act on his part in connection with
the revocation of Suzhou Haikun; (ii) there is no outstanding claim or liability against him in
connection with the revocation of Suzhou Haikun; and (iii) Suzhou Haikun was solvent at the
time of its revocation. Mr. Huang confirmed that since the revocation and as of the Latest
Practicable Date, Suzhou Haikun has not carried out any business activities and, so far as he
was aware, the revocation of the business licenses of Suzhou Haikun has not resulted in any
punishment or fines imposed by any competent authorities, nor has it resulted in any
outstanding or potential claims or liabilities against Suzhou Haikun.
Mr. Chen Xinhe (ئ)aged 48, was appointed as our independent Director in August
2017 and re-designated as our independent non-executive Director in June 2023. Mr. Chen is
primarily responsible for supervising our Board and providing independent advice to our
Board.
Mr. Chen has over 22 years of experience in big data industry. Prior to joining our
Company, from December 2001 to June 2015, Mr. Chen has worked in the China Industrial
Control Systems Cyber Emergency Response Team (CICS-CERT) (޼࢝
Ӻʕː) (formerly known as the Institute of Electronic Science and Technology Information of
the MIIT (הa centralized professional science and
technology intelligence research institution in the PRC, where he was primarily responsible for
R&D and promoting the technological advancement in the PRC. Since June 2015, he has been
serving as the deputy secretary-general of Zhongguancun Big Data Industry Alliance ( ʕᗫӀ
ପุᑌຑ), a non profit-making organization which is committed to promoting the
development of big data industry in the PRC, where he is primarily responsible for assisting
with the operation of the alliance.
Mr. Chen obtained his bachelor’s degree in metal pressure processing from the faculty of
material engineering from Southern Institute of Metal (ኪ৫) in the PRC in July 1997.
He further obtained his master’s degree in business administration from the Beijing Institute
of Technology ( ̏ԯଣʈɽኪ) in the PRC in March 2004.
Mr. Li Shun Fai ( ҽ૮ฯ), aged 43, was appointed as our independent Director in May
2023 and re-designated as our independent non-executive Director in June 2023. Mr. Li is
primarily responsible for supervising our Board and providing independent advice to our
Group.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 294 ---
Mr. Li has over 21 years of experience in auditing and financial management. Prior to
joining our Company, from September 2002 to April 2011, Mr. Li successively served in
various roles in Deloitte China, with his last position as a senior manager, where he was
primarily responsible for providing professional audit services. From April 2011 to June 2013,
Mr. Li served as the head of finance of Shantou International Container Terminals in Hutchison
Port Holdings Limited, a company principally engaged in the operation of ports and terminals,
where he was primary responsible for financial management. Subsequently, he joined
Zhonghui Anda CPA Limited, an auditing firm in Hong Kong, and has been serving as an audit
partner, where he is primarily responsible for the provision of audit services to listed
companies in Hong Kong.
From March 2021 to June 2021, Mr. Li served as an independent non-executive director
of Evershine Group Holdings Limited, a company principally engaged in trading, property
development and investment, money lending, mobile application, and cemetery businesses and
whose shares were previously listed on the GEM of the Stock Exchange (stock code: 8022) and
subsequently delisted in October 2022, where he was primarily responsible for supervising and
providing independent advice to the board.
Mr. Li is an existing Council Member to the Hong Kong Institute of Certified Public
Accountants (ʮึ) and a founding member of the Hong Kong Professional
Investors Association (՘ึ).
Mr. Li obtained his bachelor’s degree in business administration from the City University
of Hong Kong in November 2002. He also obtained a master of science degree in professional
accountancy from the University of London in the United Kingdom in August 2017. He further
obtained a master of law degree from King’s College London in the United Kingdom in April
2020. He has been a member of The Hong Kong Institute of Certified Public Accountants and
The Association of Chartered Certified Accountants since July 2006 and March 2006,
respectively. Mr. Li also obtained professional qualifications in valuation and surveying from
The International Association of Certified V aluation Specialists, Canada since May 2016.
SUPERVISORS
In accordance with the PRC Company Law, all joint stock companies are required to
establish a supervisory committee, which is responsible for supervising the board and senior
management of a company on the fulfilment of their respective duties, as well as the financial
performance, internal control management and risk management of the corporation. Our
Supervisory Committee consists of three members comprising one Supervisor representing
employees and two Supervisors representing Shareholders.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 295 ---
The table below sets out certain information regarding our Supervisors:
Name Age
Existing
position(s) in
our Group
Time of joining
our Group
Date of
appointment
as Supervisor
Principal
responsibilities
Relationship
with Directors,
Supervisors and
other senior
management
Mr. Gao Qi ( ৷
փ)
34 Chairperson of our
Supervisory
Committee
February 2011 April 2023 Presiding over the
work of our
Supervisory
Committee and
supervising the
operating and
financial activities of
our Company
None
Mr. Y u Gang
(Я፻)
51 Supervisor
Director of Beijing
Sidike
August 2017 August 2017 Supervising the
operating and
financial activities of
our Company
None
Ms. Ren Y uan
(΂෤)
50 Supervisor February 2014 February 2014 Supervising the
operating and
financial activities of
our Company
None
Mr. Gao Qi ( ৷փ), aged 34, was appointed as our design manager in February 2011, and
was appointed as our Supervisor representing employees and chairman of our Supervisory
Committee in April 2023. He is primarily responsible for presiding over the work of our
Supervisory Committee and supervising the operating and financial activities of our Company.
Mr. Gao had previously served as a legal representative of Shanghai Qiongjin
Architectural Design Consulting Center (ፔ༔ʕː)( “ Shanghai Qiongjin ”)
from March 2019 to October 2021, a company principally engaged in the provision of
architectural design consulting services and information consulting services in the PRC.
Shanghai Qiongjin was dissolved on October 12, 2021 as a result of cessation of business. Mr.
Gao confirmed that (i) there was no judgment or findings of fraud, dishonesty, any misconduct
or wrongful act on his part in connection with the dissolution of Shanghai Qiongjin; (ii) there
is no outstanding claim or liability against him in connection with the dissolution of Shanghai
Qiongjin; and (iii) Shanghai Qiongjin was solvent at the time of its dissolution.
Mr. Gao obtained his associate degree in entertainment software design from Suzhou Art
& Design Technology Institute (ஔᔖุҦஔኪ৫) in the PRC in June 2011.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Yu Gang ( Я፻), aged 51, was appointed as our Supervisor representing Shareholders
in August 2017 and he is primarily responsible for supervising the operating and financial
activities of our Company. He is also the director of our subsidiary Beijing Sidike.
The major work experience of Mr. Y u are as follows:
Name of company Service period Position
Primary
responsibilities
Principal activities
of the company
Jiangsu Sugaoxin
V enture Capital Co.,
Ltd. (ࠬ
ʮ̡)
From March 2000
to September
2000
Project manager Sourcing, due
diligence and
execution of
projects
Investment with
focus on science
and technology
innovation and
development of
small and medium
enterprises in
Suzhou High-Tech
Development Zone
Shanghai Zhangjiang
V enture Capital Co.,
Ltd. ( ɪऎੵϪ௴ุҳ
ʮ̡)
From September
2000 to June
2003
Senior manager Sourcing, due
diligence and
execution of
projects
Investment with
focus on
information
technology,
biotechnology and
new material
sectors in the PRC
China-Singapore
V entures
From November
2007 to March
2014
Deputy general
manager
Managing the
business
development of
Suzhou Industrial
Park Y uandian
V enture Capital
Investment Co.,
Ltd. ( ᘽψʈุ෤ਜ
ࠢ
ʮ̡)( “ Yuandian
Venture Capital ”)
Investment with
focus on high-tech
enterprises at the
start-up and growth
stages
Y uandian V enture
Capital
From March 2008
to March 2014
Manager Overall business
development
including project
sourcing, due
diligence,
decision-making
and
post-investment
management
V enture capital
investment in the
PRC
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 297 ---
Name of company Service period Position
Primary
responsibilities
Principal activities
of the company
Tahoe V enture Capital From June 2014 to
current
Executive
partner
Fund raising, project
investment and
post-investment
management
Management of
venture capital
companies and
provision of related
consulting services
Suzhou Tahoe Taihe
Investment
Management Co.,
Ltd. ( ᘽψ˄ख˄Υҳ
ʮ̡)
From May 2018 to
current
Executive
director
Overall project
investment and
project
management
Provision of
investment
management
services in the
PRC
Suzhou Digital-Health
Care Co., Ltd. ( ᘽψ
ࠢ
ʮ̡)
From June 2020 to
current
Director Overall management
and business
operation
Provision and
operation of
medical devices
Suzhou Keda
Technology Co., Ltd.
(΅Ϟ
ʮ̡) (Shanghai
Stock Exchange
stock code: 603660)
From September
2021 to current
Independent
director
Supervising and
providing
independent advice
to the board
R&D and provision
of network
communication
equipment and
software
Suzhou Jingyu Medical
Equipment Co., Ltd.
(ᔼᐕኜ૛Ϟ
ʮ̡)
From January 2022
to current
Supervisor Supervising business
operation
R&D and export and
import of medical
devices and other
related electronic
products
Suzhou Mitu
Optoelectronic
Technology Co., Ltd.
(ྡΈཥҦஔϞ
ʮ̡)
From March 2022
to current
Supervisor Supervising business
operation
R&D and sales of
optoelectronic
chips
Mr. Y u obtained his bachelor’s degree in industrial electrical automation and master’s
degree in accounting from the China University of Mining and Technology ( ʕ਷ᘤุɽኪ)i n
the PRC in July 1994 and June 1999, respectively.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Mr. Y u had various roles in certain dissolved or revoked companies, details of which are
set out below:
Name of company Position
Place of
establishment
Nature of business
pursuant to the
business license
Reason for
dissolution or
revocation
Date of
dissolution or
revocation
Shanghai Suding
Biotechnology Co,. Ltd.
(ࠢ
ʮ̡)
Supervisor PRC Research and
development of
biotechnology
Cessation of business June 23, 2005
Shanghai Daozheng
Investment Management
Consulting Co., Ltd. ( ɪ
ऎ༸͍ҳ༟၍ଣፔ༔Ϟ
ʮ̡)( “ Shanghai
Daozheng ”)
Executive director
and legal
representative
PRC Provision of investment
management services
in the PRC
Revocation of business
license due to the
fact that Shanghai
Daozheng was not
engaging in any
business activities
for more than six
months prior to the
date of the
revocation
April 5, 2007
Shanghai Xiangzheng
Investment Management
Consulting Co., Ltd. ( ɪ
ऎୂ͍ҳ༟၍ଣፔ༔Ϟ
ʮ̡)
Executive director
and legal
representative
PRC Provision of investment
consulting, corporate
management
consulting and
enterprise marketing
planning services
Cessation of business August 3, 2012
Shanghai Jiaxiang
Architectural Design
Co., Ltd. (ጘ
ʮ̡)
Executive director
and legal
representative
PRC Provision of
architectural,
landscape and
interior design
services
Cessation of business August 3, 2012
Suzhou Hengyu Tahoe
V enture Capital
Management Co., Ltd.
(ρ˄ख௴ุҳ༟
ʮ̡)
Executive director
and legal
representative
PRC V enture capital
investment in the
PRC
Cessation of business September 14,
2022
Mr. Y u confirmed that (i) there was no judgment or findings of fraud, dishonesty, any
misconduct or wrongful act on his part in connection with the dissolution or revocation of the
above companies; (ii) there is no outstanding claim or liability against him in connection with
the dissolution or revocation of the above companies; and (iii) the above companies were
solvent at the time of their respective dissolution or revocation. Mr. Y u confirmed that since
the revocation of Shanghai Daozheng and as of the Latest Practicable Date, Shanghai
Daozheng has not carried out any business activities and, so far as he was aware, the revocation
of the business licenses of Shanghai Daozheng has not resulted in any punishment or fines
imposed by any competent authorities, nor has it resulted in any outstanding or potential claims
or liabilities against Shanghai Daozheng.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 299 ---
As of the Latest Practicable Date, Mr. Y u was interested in an aggregate of approximately
2.87% equity interest of our Company through his indirect interest in Tahoe Growth, Tahoe
Lande and Tahoe Growth II. See “History, Development and Corporate Structure – Pre-IPO
Investments” and “Appendix VII – Statutory and General Information – Further Information
About Our Directors, Supervisors and Substantial Shareholders” for details.
Ms. Ren Yuan ( ΂෤), aged 50, was appointed as our Supervisor representing
Shareholders in February 2014. She is primarily responsible for supervising our Company’s
operating and financial activities.
Prior to joining our Company, from April 2010 to May 2019, she served as a project
manager of Beijing Innovation Lezhi Information Technology Co., Ltd. (Ҧ
ʮ̡), a company principally engaged in the provision of information technology
services in the PRC, where she was primarily responsible for overall project management
including decision-making, project coordination and implementation, cost management and
post-completion reviews. Since April 2012, Ms. Ren served as a supervisor of Beijing Weiming
Interactive Information Technology Co., Ltd. (ʮ̡), a company
principally engaged in the provision of information technology services, where she was
primarily responsible for the supervisory role. Since June 2019, she has been serving as a
project manager of Beijing Innovation Lezhi Network Technology Co., Ltd. (ၣ
ʮ̡), a company principally engaged in the provision of network technology
services in the PRC, where she is primarily responsible for overall project management
including decision-making, project coordination and implementation, cost management and
post-completion reviews. Since September 2019, Ms. Ren was the supervisor of Beijing Jike
Shejian Technology Service Co., Ltd. (ʮ̡), a company
principally engaged in the provision of technology services in the PRC, where she is primarily
responsible for the supervising role.
Ms. Ren obtained her bachelor’s degree in accounting from Zhongnan University of
Economics and Law (ɽኪ) in the PRC in July 2000.
Ms. Ren had various roles in certain dissolved companies, details of which are set out
below:
Name of company Position
Place of
establishment
Nature of business
pursuant to the
business license
Reason for
dissolution Date of dissolution
Beijing Aiweisheng
Education Technology
Co., Ltd. ( ̏ԯЎਬ௷
ʮ̡)
Supervisor PRC Promotion of internet
activities and
provision of online
retail services
Members’
resolutions
April 2019
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 300 ---
Name of company Position
Place of
establishment
Nature of business
pursuant to the
business license
Reason for
dissolution Date of dissolution
Tianjin Letang Enterprise
Management Consulting
Partnership (Limited
Partnership) (ᆀಆ
Άุ၍ଣፔ༔ΥྫΆุ
(Υྫ))
Managing
partner
PRC Provision of
enterprise
management
consulting and
information
consulting services
in the PRC
Members’
resolutions
November 24, 2022
Ms. Ren confirmed that (i) there was no judgment or findings of fraud, dishonesty, any
misconduct or wrongful act on her part in connection with these dissolved companies; (ii) there
is no outstanding claim or liability against her in connection with these dissolved companies;
and (iii) these companies were solvent at the time of their respective dissolution.
As of the Latest Practicable Date, Ms. Ren was one of our Pre-IPO Investor and interested
in approximately 1.39% equity interest of our Company. See “History, Development and
Corporate Structure – Pre-IPO Investments” and “Appendix VII – Statutory and General
Information – Further Information About Our Directors, Supervisors and Substantial
Shareholders” for details.
OTHER INFORMATION IN RELATION TO OUR DIRECTORS AND SUPERVISORS
Save as disclosed above and in this prospectus, each of our Directors and Supervisors has
confirmed with respect to himself/herself that he/she (i) did not hold other long positions or
short positions in the shares, underlying shares or debentures of our Company or any associated
corporation (within the meaning of Part XV of the SFO) as of the Latest Practicable Date; (ii)
had no other relationship with any Directors, Supervisors, senior management, substantial
Shareholders or Controlling Shareholders of our Company as of the Latest Practicable Date;
(iii) did not hold any other directorships in the three years prior to the Latest Practicable Date
in any public companies of which the securities are listed on any securities market in Hong
Kong and/or overseas; and (iv) there are no other matters concerning our Directors’ and
Supervisors’ appointments that need to be brought to the attention of our Shareholders and the
Stock Exchange or shall be disclosed pursuant to Rules 13.51(2)(h) to (v) of the Listing Rules.
SENIOR MANAGEMENT
Our executive Directors and senior management are responsible for the day-to-day
operation and management of our business.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 301 ---
The table below sets out certain information regarding our senior management. For
information concerning our senior management who also serve as executive Directors, see the
paragraph headed “Board of Directors – Executive Directors” in this section above.
Name Age
Existing
position(s) in
our Group
Time of joining
our Group
Date of
appointment
as senior
management
Principal
responsibilities
Relationship
with Directors,
Supervisors and
other senior
management
Mr. Zuo Lei
(̸ᆾ)
38 Chairman of our
Board, chief
executive officer
and executive
Director of our
Company
Chairman and
director of
Beijing Sidike
Chairman and
director of
Zhonghui Juhe
Director, general
manager and
head of finance
of Wuhan
Jushunhe
Director and
manager of Juli
Wanhe
Director and
general manager
of Xuzhou Juhe
February 2010 February 2010 Overseeing day-to-
day operations
and overall
business strategy
and planning of
our Group and
overseeing our
Board
None
Ms. Y ang Y anjun
(ё)
37 Executive Director,
deputy general
manager,
secretary to the
Board and joint
company
secretary of our
Company
July 2018 July 2018 Handling day-to-
day affairs of
our Board,
assisting our
Board in legal
compliance
matters and
handling public
relations of our
Group
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 302 ---
Name Age
Existing
position(s) in
our Group
Time of joining
our Group
Date of
appointment
as senior
management
Principal
responsibilities
Relationship
with Directors,
Supervisors and
other senior
management
Mr. Shao
Chuangye (ڑ
௴ุ)
40 Chief financial
officer of our
Company
January 2020 January 2020 Overseeing our
Group’s finance
and accounting
matters
None
Mr. Shao Lida
(л༺)
44 Deputy general
manager of our
Company
November 2015 June 2019 Overseeing our
Group’s API
standardization
sales business
and managing
our product
planning
None
Mr. Wei Zheng
(ᕧᅄ)
39 Deputy general
manager of our
Company
Director and
general manager
of Tianju Renhe
Director of Tianju
Xinghe
March 2019 June 2019 Managing our
business
department and
formulating our
market strategy
None
Mr. Han Jianfeng
(ᒵᄏቜ)
42 Deputy general
manager of our
Company
June 2019 June 2019 Formulating the
strategies of our
Group’s products
and technologies
None
Mr. Dong
Chuanzu ( ໨ෂ
ૄ)
35 Deputy general
manager of our
Company
April 2011 January 2020 Managing our
Group’s R&D
teams, cost
control and
product
improvement
None
Mr. Wang Lei ( ˮ
ཤ)
44 Deputy general
manager of our
Company
June 2021 June 2021 Overseeing the
operation of the
government
sector business
team and
business
expansion of our
Group
None
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 303 ---
Name Age
Existing
position(s) in
our Group
Time of joining
our Group
Date of
appointment
as senior
management
Principal
responsibilities
Relationship
with Directors,
Supervisors and
other senior
management
Ms. Ji Shilin ( ኏
ɻ೙)
35 Deputy general
manager of our
Company
July 2017 April 2023 Overseeing the
human resources
management of
our Group
None
Mr. Zuo Lei ( ̸ᆾ), see “Board of Directors – Executive Directors” for details.
Ms. Y ang Y anjun (ё), see “Board of Directors – Executive Directors” for details.
Mr. Shao Chuangye (௴ุ), aged 40, was appointed as our chief financial officer in
January 2020. Mr. Shao is primarily responsible for overseeing our Group’s finance and
accounting matters.
Mr. Shao has over 17 years of experience in finance and taxation. Prior to joining our
Company, from July 2006 to June 2007, he served as an audit assistant in Suzhou Jinding
Certified Public Accountants Co., Ltd. (ʮ̡), a company
principally engaged in the provision of auditing and accounting services in the PRC, where he
was primarily responsible for providing audit services. From July 2007 to August 2009, he
served as a manager in Qisda Corporation (ʮ̡), a company with
principal business in information technology industry, medical business, smart solutions and
network communication business, where he was primarily responsible for providing
accounting service. From September 2009 to October 2019, Mr. Shao successively served in
various roles and last served as a finance director of Suzhou Snail Digital Technology Co., Ltd.
(ʮ̡), an integrated internet company based on virtual digital
technology with principal business in R&D, content development and platform operation in the
PRC, where he was primarily responsible for handling corporate finance works.
Mr. Shao obtained a bachelor’s degree in economics from Soochow University ( ᘽψɽ
ኪ) in the PRC in June 2006.
Mr. Shao Lida (л༺) (formerly known as Shao Lida (ᘆ༺)), aged 44, was
appointed as our pre-sales consultant in November 2015 and subsequently served as our sales
director. In June 2019, he was promoted to our deputy general manager. He is primarily
responsible for overseeing our Group’s API standardization sales business and managing our
product planning.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 304 ---
Mr. Shao has over 17 years of experience in telecommunications and internet data
industry. Prior to joining our Company, from June 2009 to December 2012, Mr. Shao served
as a network optimization engineer of Shanghai Posts & Telecommunications Designing
Consulting Institute Co., Ltd. (ʮ̡), a company principally
engaged in engineering design and information technology development in the PRC, where he
was primarily responsible for network optimization. From June 2015 to November 2015, Mr.
Shao served as a sales representative of Suzhon Yida Feixiang Information Technology Co.,
Ltd. (ʮ̡), a company principally engaged in the provision of
software and information technology services in the PRC, where he was primarily responsible
for sales and account management.
Mr. Shao completed his self-taught higher education examinations (junior college)
qualification in computer application offered by Nanjing University (ԯɽኪ) in the PRC in
June 1999.
Mr. Wei Zheng ( ᕧᅄ), aged 39, was appointed as a deputy director of our fundamental
business unit in March 2019 and was promoted to deputy general manager in June 2019. He
is primarily responsible for managing our business department and formulating our market
strategy. He is also the director and general manager of our subsidiary Tianju Renhe and the
director of our subsidiary Tianju Xinghe.
Mr. Wei has over 13 years of experience in communication industry which includes 10
years of work experience in the internet industry. Prior to joining our Company, from June
2010 to February 2013, Mr. Wei served as a product director of the communication subdivision
of PCI Technology Group Co., Ltd. (ʮ̡), a company principally
engaged in the provision of artificial intelligence services and products in the PRC and whose
shares are listed on the Shanghai Stock Exchange (stock code: 600728), where he was
primarily responsible for handling pre-sales work, providing customized products and
solutions, upgrading the existing products platform and cooperating with major customers to
build the cloud platform. From March 2013 to March 2019, Mr. Wei served as a general
manager of the top-up division of Beijing Gaoyang Jiexun Information Technology Co., Ltd.
(ʮ̡), a company principally engaged in the provision of
information technology products in the PRC, where he was primarily responsible for managing
the top-up division.
Mr. Wei had previously served as a legal representative and executive director of Tianju
Daohe (our subsidiary before its dissolution), a company principally engaged in the provision
of top-up services in the PRC. Tianju Daohe was dissolved on April 17, 2023 as a result of
cessation of business. Mr. Wei confirmed that (i) there was no judgment or findings of fraud,
dishonesty, any misconduct or wrongful act on his part in connection with the dissolution of
Tianju Daohe; (ii) there is no outstanding claim or liability against him in connection with the
dissolution of Tianju Daohe; and (iii) Tianju Daohe was solvent at the time of its dissolution.
Mr. Wei obtained a bachelor’s degree in business administration from Beijing Jiaotong
University ( ̏ԯʹஷɽኪ) through distance learning in July 2010.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 305 ---
Mr. Han Jianfeng ( ᒵᄏቜ), aged 42, has been serving as our deputy general manager and
technical director of our R&D center since June 2019. Mr. Han is primarily responsible for
formulating the strategies of our Group’s products and technologies.
Mr. Han has over ten years of experience in software development focusing on big data,
artificial intelligence and blockchain. Prior to joining our Company, from April 2013 to
February 2014, he served as a R&D director of Suzhou Y ouwen Software Technology Co., Ltd.
(ʮ̡), a company principally engaged in the R&D of intelligent
semantic technology and provision of software products in the PRC, where he was primarily
responsible for R&D. From March 2014 to April 2019, he served as a project director of
mobility security business unit of Jiangsu Tongfudun Technology Co., Ltd. (Ҧ
ʮ̡), a company principally engaged in the provision of blockchain solutions, smart
contract audit and management services and data analysis services in the PRC, where he was
primarily responsible for project management.
Mr. Han obtained a bachelor’s degree in computer science and technology from the
People’s Liberation Army Strategic Support Force Information Engineering University ( ʕ਷
ʈ೻ɽኪ) in the PRC in July 2003.
Mr. Dong Chuanzu ( ໨ෂૄ), aged 35, joined our Company since April 2011 and served
in various roles including development engineer, project manager, technical director of our
R&D center and chairperson of our Supervisory Committee. He was promoted to deputy
general manager in January 2020. Mr. Dong is primarily responsible for managing our Group’s
R&D teams, cost control and product improvement. Mr. Dong has over 12 years of experience
in computer software development.
Mr. Dong obtained an associate’s degree in computer network technology from Zhejiang
University of Water Resources and Electric Power ( एϪ˥л˥ཥኪ৫) (formerly known as
Zhejiang Institute of Water Resources and Electric Power (ኪ৫)) in the PRC
in June 2009.
Mr. Wang Lei ( ˮཤ), aged 44, was appointed as our deputy general manager in June
2021. Mr. Wang is primarily responsible for overseeing the operation of the government sector
business team and business expansion of our Group.
Mr. Wang has over 12 years of experience in R&D of software systems. Prior to joining
our Company, from April 2011 to June 2017, Mr. Wang served as a project manager of Founder
International Co., Ltd. (ʮ̡), a company principally engaged in the
development of application software and provision of IT system integration services, where he
was primarily responsible for overall project management, and subsequently became a
technician for its smart city public affairs department. From July 2017 to June 2021, he served
as a project deputy general manager of GAEA Information Technology Co., Ltd. ( ᘽψᅰοή
ʮ̡), a company principally engaged in the provision of geographic
information technology products and services in the PRC and whose shares are listed on the
NEEQ (stock code: 835256), where he was primarily responsible for overall project
management, internal management team development and key customer maintenance.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
– 294 –


--- page 306 ---
Mr. Wang obtained a bachelor’s degree in applied electronics technology from Anhui
Normal University (ᇍɽኪ) in the PRC in July 2001. He further obtained a master’s
degree in business administration from Xiamen University (ɽኪ) in the PRC in September
2016.
Ms. Ji Shilin ( ኏ɻ೙), aged 35, has previously served in various roles in our Company
since July 2017, including assistant to president, head of marketing and chairlady of our
Supervisory Committee. Since January 2021, Ms. Ji has been serving as the head of human
resources of our Company. In April 2023, she was promoted as the deputy general manager of
our Company and is responsible for overseeing the human resources management of our Group.
Prior to joining our Company, from September 2014 to February 2017, she successively
served as the president assistant deputy director of the management center of Speed and
Technology Co., Ltd. (ʮ̡), a company principally engaged in the
development and sales of software products and data services, where she was primarily
responsible for administrative affairs, business expansion and human resources management.
Ms. Ji obtained a bachelor’s degree in forest study from Huangshan University ( රʆኪ
৫) in July 2011. She further obtained a master’s degree in forest protection from Nanjing
Forestry University (ุɽኪ) in June 2014 and is currently enrolled in the master’s
degree in applied psychology of Renmin University of China ( ʕ਷ɛ͏ɽኪ). She has obtained
the qualification of Human Resource Management Professional (ࢪaccredited
by the Ministry of Human Resources and Social Security of the PRC in November 2022.
JOINT COMPANY SECRETARIES
Ms. Y ang Y anjun (ё) was appointed as our joint company secretary in August 2023.
For further biographic details of Ms. Y ang, see “– Board of Directors – Executive Directors”
in this section.
Ms. Ching Shuk Wah Shirley ( ೻ૺശ), was appointed as our joint company secretary
in August 2023.
Ms. Ching has over 25 years of experience in corporate secretarial services,
administration and management, international trade and trade financing. She joined SWCS
Corporate Services Group (Hong Kong) Limited (“ SWCS ”), a corporate service provider in
Hong Kong established in 2011 and is currently an assistant manager to the company secretary
services department of SWCS, where she is responsible for assisting in the provision of
company secretarial services.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 307 ---
Ms. Ching obtained a bachelor’s degree in business administration from the University of
Western Sydney and further obtained a master’s degree in corporate governance from the Hong
Kong Metropolitan University (formerly known as The Open University of Hong Kong). She
is a Chartered Secretary, a Chartered Governance Professional and an associate of both The
Hong Kong Chartered Governance Institute and The Chartered Governance Institute in the
United Kingdom.
Ms. Ching is not an employee of our Company but will coordinate with Ms. Y ang, our
other joint company secretary, in discharging their duties as the joint company secretaries of
our Company.
BOARD COMMITTEES
Our Board has established the Audit Committee, the Remuneration and Assessment
Committee and the Nomination Committee and delegated various responsibilities to these
committees, which assist our Board in discharging its duties and overseeing particular aspects
of our Company’s activities.
Audit Committee
We have established our Audit Committee with written terms of reference in compliance
with Rule 3.21 of the Listing Rules and the CG Code as set out in Appendix C1 to the Listing
Rules.
The primary duties of our Audit Committee are to review and supervise our financial
reporting process, internal control system, risk management and internal audit of our Company;
provide advice and comments to our Board; and perform other duties and responsibilities as
may be assigned by our Board. Our Audit Committee consists of three members, namely Mr.
Li Shun Fai, Mr. Qiu Jianqiang and Mr. Chen Xinhe. The chairperson of our Audit Committee
is Mr. Li Shun Fai, who is our independent non-executive Director with appropriate
professional qualifications.
Remuneration and Assessment Committee
We have established our Remuneration and Assessment Committee with written terms of
reference in compliance with Rule 3.25 of the Listing Rules and the CG Code as set out in
Appendix C1 of the Listing Rules.
The primary duties of our Remuneration and Assessment Committee are to establish,
review and provide advices to our Board on our policy and structure concerning remuneration
of our Directors and senior management and on the establishment of a formal and transparent
procedure for developing policies concerning such remuneration; make recommendations to
our Board on the terms of the specific remuneration package of each executive Director and
senior management; and review and approve performance-based remuneration by reference to
corporate goals and objectives resolved by our Directors from time-to-time. Our Remuneration
and Assessment Committee consists of three members, namely Mr. Huang Xuexian, Mr. Chen
Xinhe and Ms. Y ang Y anjun. The chairperson of our Remuneration and Assessment Committee
is Mr. Huang Xuexian, who is our independent non-executive Director.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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--- page 308 ---
Nomination Committee
We have established our Nomination Committee with written terms of reference in
compliance with the CG Code as set out in Appendix C1 of the Listing Rules.
The primary duties of our Nomination Committee are to review the structure, size and
composition of our Board on a regular basis and make recommendations to our Board regarding
any proposed changes to the composition of our Board; identify, select or make
recommendations to our Board on the selection of individuals nominated for directorships;
ensure the diversity of our Board members; assess the independence of our independent
non-executive Directors; and make recommendations to our Board on relevant matters relating
to the appointment, re-appointment and removal of our Directors and succession planning for
our Directors. Our Nomination Committee consists of three members, namely Mr. Chen Xinhe,
Mr. Li Shun Fai and Mr. Lin Shan. The chairperson of our Nomination Committee is Mr. Chen
Xinhe, who is our independent non-executive Director.
CORPORATE GOVERNANCE
We aim to achieve high standards of corporate governance which are crucial to our
development and the safeguard of the interests of our Shareholders. Pursuant to provision C.2.1
of the CG Code as set out in Appendix C1 to the Listing Rules, the roles of the chairman and
chief executive officer should be separate and should not be performed by the same individual.
Mr. Zuo is the chairman of the Board and the chief executive officer of our Company. In view
of the fact that Mr. Zuo has been responsible for the overall strategic planning and day-to-day
management of our Group since its establishment, our Board believes that with the support of
Mr. Zuo’s extensive experience and knowledge in the big data industry and our business,
vesting the roles of both chairman and chief executive officer in Mr. Zuo strengthens the
consistent and solid corporate vision of our Group and promotes efficient business planning
and decision. Our Board is also of the view that the current management structure is effective
for our operation and sufficient checks and balances are in place. Our Board currently
comprises four executive Directors, two non-executive Directors and three independent
non-executive Directors, and therefore has a strong independence element in its composition.
Our Board will continue to review the effectiveness of the corporate governance structure of
our Company in order to assess whether separation of the roles of chairman of our Board and
chief executive officer is necessary.
Save as disclosed above, we expect to comply with the CG Code set out in Appendix C1
to the Listing Rules after the Listing.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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Board Diversity Policy
We have adopted a Board Diversity Policy which sets out the approach to achieve and
maintain diversity in our Board which includes the criteria in selecting candidates to our Board
in order to enhance the effectiveness of our Board and to maintain a high standard of corporate
governance. Our Company recognizes and embraces the benefits of having a diverse Board and
sees increasing diversity at the Board level as an essential element in supporting the attainment
of our Company’s strategic objectives and sustainable development. Our Company seeks to
achieve Board diversity through the consideration of a number of factors, including but not
limited to talent, gender, age, cultural and education background, ethnicity, professional
qualifications, skills, knowledge, industry experience and length of service. We will select
potential Board candidates based on merit and his/her potential contribution to our Board while
taking into consideration our own business model and specific needs from time to time. All
Board appointments will be based on meritocracy and candidates will be considered against
objective criteria, having due regard to the benefits of diversity on our Board. Our Board is of
the view that our Board has achieved the board diversity requirement in our Board Diversity
Policy.
Our Board has a balanced mix of knowledge, skills and experience, including but without
limitation to technology, big data, accounting, finance, corporate finance and legal industries.
Our Directors obtained degrees in various majors including accounting, laws, business
administration, computer science and engineering and from universities in Mainland China,
Hong Kong and overseas. We believe they can contribute different knowledge, skills and
industry experience. We have three independent non-executive Directors from different
industry backgrounds, including law, big data and accounting and finance. Furthermore, our
Directors are of a wide range of age, from 37 to 61 years old.
With regards to gender diversity on the Board, we recognize the particular importance of
gender diversity. Our Board currently comprises one female Director and eight male Directors.
We have taken and will continue to take steps to promote and enhance gender diversity at all
levels of our Company, including but without limitation at our Board and senior management
levels. Our Board Diversity Policy provides that our Board should take gender diversity into
consideration when selecting and making recommendations on suitable candidates for Board
appointments. We will also ensure that there is gender diversity when recruiting staff at mid
to senior level so that we will have a pipeline of female senior management and potential
successors to our Board going forward. It is our objective to maintain an appropriate balance
of gender diversity with reference to the expectations of stakeholders and international and
local recommended best practices.
Our Nomination Committee is responsible for ensuring the diversity of our Board
members. After Listing, our Nomination Committee will review our board diversity policy and
its implementation from time to time to monitor its continued effectiveness, assess the
composition of our Board and make recommendations to our Board on appointment of
members of our Board. We will also disclose a summary of our Board Diversity Policy,
including any measurable objectives set for implementation and the progress on achieving
these objectives, in our corporate governance report on an annual basis.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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CONFIRMATION FROM OUR DIRECTORS
Rule 3.09D of the Listing Rules
Each of our Directors confirms that he or she (i) has obtained the legal advice referred
to under Rule 3.09D of the Listing Rules in August 2023, and (ii) understands his/her
obligations as a director of a listed issuer under the Listing Rules.
Rule 3.13 of the Listing Rules
Each of our independent non-executive Directors has confirmed (i) his independence as
regards each of the factors referred to in Rules 3.13(1) to (8) of the Listing Rules, (ii) that he
has no past or present financial or other interest in the business of our Company or its
subsidiaries or any connection with any core connected person of our Company under the
Listing Rules, and (iii) that there are no other factors that may affect his independence at the
time of his appointments.
DIRECTORS’, SUPERVISORS’ AND SENIOR MANAGEMENT’S REMUNERATION
We offer our Directors, Supervisors and senior management, who are also employees of
our Company, emolument in the form of fees, salaries, allowance and other benefits,
discretionary bonus, contribution to retirement scheme and equity-settled share-based
payments (as the case may be). The independent non-executive Directors receive emolument
based on their respective duties and responsibilities (including being members or chairperson
of Board committees).
The aggregate remuneration (including fees, salaries, allowance and other benefits,
discretionary bonus, contribution to retirement scheme and equity-settled share-based
payments (as the case may be)) paid to our Directors and Supervisors for the three years ended
December 31, 2021, 2022 and 2023 was approximately RMB2,306,000, RMB2,472,000 and
RMB2,529,000, respectively. None of our Directors and Supervisors had waived or agreed to
waive any remuneration during the Track Record Period. Saved as disclosed above, no other
payments have been paid or are payable by our Company to our Directors and Supervisors
during the Track Record Period.
The number of our Company’s five highest paid individuals for the three years ended
December 31, 2021, 2022 and 2023 included three, four and five employees who were not
Directors and supervisors, respectively. The aggregate remuneration (including salaries,
allowance and other benefits, discretionary bonus, contribution to retirement scheme and
equity-settled share-based payments) payable to such individuals (excluding any of our
Directors and Supervisors) for the three years ended December 31, 2021, 2022 and 2023 was
approximately RMB2,143,000, RMB3,138,000 and RMB3,735,000, respectively.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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For the three years ended December 31, 2021, 2022 and 2023, no remuneration was paid
by us to our Directors, Supervisors or the five highest paid individuals as an inducement to join
or upon joining our Company, and save as required by relevant laws and regulations, no
compensation was made by us to our Directors for the loss of office for the three years ended
December 31, 2021, 2022 and 2023.
Save as disclosed above, no other payments had been made, or are payable, by any
member of our Company to our Directors and Supervisors during the Track Record Period. For
additional information on our Directors and Supervisors’ remuneration during the Track
Record Period as well as information on the five highest paid individuals, see Note 14 to the
Accountants’ Report in Appendix I.
Pursuant to the existing arrangements that are currently in force as of the date of this
prospectus, the amount of remuneration (including benefits in kind but excluding discretionary
bonuses) payable to our Directors and Supervisors by our Company for the year ending
December 31, 2024 is estimated to be approximately RMB2.7 million in aggregate.
Our Board will review and determine the remuneration and compensation packages of our
Directors, Supervisors and senior management and will, following the Listing, receive
recommendation from our Remuneration and Assessment Committee which will take into
account salaries paid by comparable companies, time commitment and responsibilities of our
Directors, Supervisors and senior management and performance of our Group.
COMPLIANCE ADVISOR
Our Company has appointed Rainbow Capital (HK) Limited as our Compliance Advisor
pursuant to Rule 3A.19 of the Listing Rules. The material terms of the Compliance Advisor’s
agreement entered into between our Company and the Compliance Advisor are as follows:
(i) the Compliance Advisor shall provide our Company with services including
guidance and advice as to compliance with the requirement of the Listing Rules and
other applicable laws, rules, codes and guidelines, and accompany our Company to
any meetings with the Stock Exchange;
(ii) our Company may terminate the appointment of the Compliance Advisor by giving
a prior written notice of no less than 30 days to the Compliance Advisor. Our
Company will exercise such right in compliance with Rule 3A.26 of the Listing
Rules. The Compliance Advisor will have the right to terminate its appointment as
Compliance Advisor under certain specific circumstances; and
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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(iii) during the period of appointment, our Company must consult with, and if necessary,
seek advice from the Compliance Advisor on a timely basis in the following
circumstances:
(a) before the publication of any regulatory announcement, circular or financial
report;
(b) where a transaction, which might be a notifiable or connected transaction under
Chapter 14 or 14A of the Listing Rules, is contemplated, including share issues
and share repurchases;
(c) where our Company proposes to use the proceeds of the Global Offering in a
manner different from that detailed in this prospectus or where our business
activities, developments or results deviate from any forecast, estimate or other
information in this prospectus; and
(d) where the Stock Exchange makes an inquiry of our Company regarding
unusual movements in the price or trading volume of our H Shares under Rule
13.10 of the Listing Rules.
The term of the appointment shall commence on the Listing Date and end on the date on
which we distribute our annual report in respect of our financial results for the first full
financial year commencing after the Listing Date.
COMPETITION
Save as otherwise disclosed in this prospectus, none of our Directors has any interest in
a business which materially competes or is likely to compete, directly or indirectly, with our
business, and requires disclosure under Rule 8.10 of the Listing Rules.
From time to time, our non-executive Directors may serve on the boards of both private
and public companies within the broader information technology industry. However, as these
non-executive Directors are neither our Controlling Shareholders nor members of our
executive management team, we believe that their interests in such companies as directors
would not render us incapable of carrying on our business independently from the other
companies in which they may hold directorships from time to time.
DIRECTORS, SUPERVISORS AND SENIOR MANAGEMENT
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SUBSTANTIAL SHAREHOLDERS
So far as our Directors are aware, immediately following the completion of the Global
Offering, the following persons will have, or be deemed, or taken to have an interest and/or
short position in the H Shares or the underlying Shares which would fall to be disclosed to our
Company and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the
SFO, or will be, directly or indirectly, interested in 10% or more of the nominal value of any
class of share capital carrying rights to vote in all circumstances at general meetings of our
Company:
Name of
Shareholder Nature of interest
Shares held as of the Latest Practicable Date
Shares held immediately following the completion
of the Global Offering
Type of Shares
Number of
Shares (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company Type of Shares
Number of
Shares (1)
Approximate
percentage of
shareholding in
the total issued
share capital of
our Company
Mr. Zuo Beneficial interest Unlisted Shares 19,744,192 43.59% H Shares 19,744,192 39.40%
Interest of spouse (2) Unlisted Shares 69,042 0.15% H Shares 69,042 0.14%
Interest in
controlled
corporation
(3)
Unlisted Shares 4,345,711 9.59% H Shares 4,345,711 8.67%
Ms. Hua Beneficial interest Unlisted Shares 69,042 0.15% H Shares 69,042 0.14%
Interest of spouse (2) Unlisted Shares 24,089,903 53.18% H Shares 24,089,903 48.07%
JD Technology Beneficial interest (4) Unlisted Shares 7,463,958 16.48% H Shares 7,463,958 14.89%
Mr. Richard Liu Interest in
controlled
corporation
(4)
Unlisted Shares 7,463,958 16.48% H Shares 7,463,958 14.89%
Mr. Qiu Beneficial interest Unlisted Shares 4,037,978 8.91% H Shares 4,037,978 8.06%
Notes:
(1) All interests stated are long positions.
(2) Mr. Zuo and Ms. Hua are spouses. Accordingly, they are deemed to be interested in the same number of Shares
that the other person is interested in for the purpose of the SFO.
(3) As of the Latest Practicable Date, Yiju Liuhe was owned as to 99.00% by Mr. Zuo as its sole general partner
where Yiju Liuhe was interested in 3,512,401 Shares. Accordingly, Mr. Zuo is deemed to be interested in the
Shares held by Yiju Liuhe. As of the Latest Practicable Date, Liuju Liuhe was owned as to 69.75% by Mr. Zuo
as its sole general partner where Liuju Liuhe was interested in 833,310 Shares. Accordingly, Mr. Zuo is deemed
to be interested in the Shares held by Liuju Liuhe.
(4) As of the Latest Practicable Date, JD Technology was a majority-controlled company (as defined in the Listing
Rules) of Mr. Richard Liu where Mr. Richard Liu was entitled to exercise majority control over JD Technology
through his direct and indirect interest in JD Technology. Accordingly, Mr. Richard Liu is deemed to be
interested in the Shares held by JD Technology.
SUBSTANTIAL SHAREHOLDERS
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Save as disclosed herein above, our Directors are not aware of any person who will,
immediately following the completion of the Global Offering, have an interest or short position
in the H Shares or underlying Shares which will be required to be disclosed to our Company
and the Stock Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO or
will be, directly or indirectly, interested in 10% or more of the nominal value of any class of
share capital carrying rights to vote in all circumstances at general meetings of our Company.
We are not aware of any arrangement which may result in any change of control in our
Company at any subsequent date.
SUBSTANTIAL SHAREHOLDERS
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THE CORNERSTONE PLACING
We have entered into cornerstone investment agreements (each a “ Cornerstone Investment
Agreement ”, and, collectively the “ Cornerstone Investment Agreements ”) with the
cornerstone investors set out below (the “ Cornerstone Investors ”, and each a “ Cornerstone
Investor ”), pursuant to which, subject to certain conditions precedent, the Cornerstone Investors
have agreed to subscribe, or cause their designated entities to subscribe, for such number of Offer
Shares with an aggregate net amount of approximately HK$319.6 million (exclusive of
brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading fee) at
the Offer Price as set out in the tables below (the “ Cornerstone Placing ”).
Based on the Offer Price of HK$83.33 per Offer Share, the total number of Offer Shares
to be subscribed for by the Cornerstone Investors would be 3,835,950 H Shares, representing
approximately 79.62% of the Offer Shares and approximately 7.66% of the total issued share
capital of our Company immediately upon completion of the Global Offering.
Our Company is of the view that (i) introducing the Cornerstone Investors to the Global
Offering would help to ensure a reasonable size of solid commitment at the commencement of
the marketing period, thus lowering the risk of unsuccessful issuance under volatile market
conditions; and (ii) by leveraging on the Cornerstone Investors’ reputation, the Cornerstone
Placing would contribute to elevating the profile of our Company and providing confidence to
the market in respect of our business and prospects. Our Company became acquainted with
each of the Cornerstone Investors mainly through the introduction by Underwriters and the
business network of our Group and executive Directors.
The Cornerstone Placing forms part of the International Offering, and the Cornerstone
Investors will not acquire any Offer Shares under the Global Offering other than pursuant to
the Cornerstone Investment Agreements. The Offer Shares to be subscribed by the Cornerstone
Investors will rank pari passu in all respects with the fully paid H Shares in issue following
the completion of the Global Offering and will be listed on the Stock Exchange and counted
towards the public float of our Company for the purpose of Rule 8.08 of the Listing Rules.
Immediately upon the completion of the Global Offering, (i) none of the Cornerstone
Investors will become substantial Shareholders; and (ii) the Cornerstone Investors or their
close associates will not, by virtue of their cornerstone investments, have any Board
representation in our Company.
To the best knowledge of our Company and after making reasonable enquiries:
(i) each of the Cornerstone Investors and their beneficial owners is an Independent
Third Party and is not our connected person (as defined under the Listing Rules) or
its respective associate(s);
(ii) is independent of other Cornerstone Investors;
CORNERSTONE INVESTORS
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(iii) none of the Cornerstone Investors are accustomed to taking and have taken any
instructions from our Company, our Directors, Supervisors, chief executive, our
Controlling Shareholders, substantial Shareholders, or any of its subsidiaries or their
respective close associates in relation to the acquisition, disposal, voting or other
disposition of the H Shares registered in their name or otherwise held by them;
(iv) save for the Offer Shares subscribed by SIP Industrial Investment Fund (as defined
below), who is a close associate of China-Singapore V entures (an existing
Shareholder) and are entities ultimately controlled by Suzhou Industrial Park
Administrative Committee and the Jiangsu Provincial Department of Finance, none
of the subscription of the relevant Offer Shares by the Cornerstone Investors is
directly or indirectly, financed, funded or backed by our Company, our subsidiaries,
our Directors, Supervisors, chief executive, our Controlling Shareholders,
substantial Shareholders, existing Shareholder or any of its subsidiaries or their
respective close associates;
(v) each Cornerstone Investor has confirmed that their subscriptions under the
Cornerstone Placing would be financed by its own internal financial resources or the
financial resources of its parent company or the funds under its management.
We have applied to the Stock Exchange, and the Stock Exchange has granted, a waiver
from strict compliance with Rule 10.04 of the Listing Rules in relation to the cornerstone
investment by SIP Industrial Investment Fund through Suzhou Harvest, details of which are set
out in “Waiver from Strict Compliance with the Listing Rules – Placing to a Close Associate
of an Existing Shareholder as Cornerstone Investor”.
There are no side agreements/arrangements between our Company and the Cornerstone
Investors or any benefit, direct or indirect, conferred on the Cornerstone Investors by virtue of
or in relation to the Listing, other than a guaranteed allocation of the relevant Offer Shares at
the Offer Price. Each of the Cornerstone Investors has confirmed that all necessary approvals
have been obtained with respect to the relevant cornerstone investment. None of the
Cornerstone Investors or their holding companies is listed on any stock exchange, and each of
the Cornerstone Investors has confirmed that no specific approval from any stock exchange (if
relevant) or its shareholders is required for the relevant cornerstone investment. There will also
be no delayed delivery of the Offer Shares to be subscribed by the Cornerstone Investors.
The total number of Offer Shares to be subscribed by the Cornerstone Investors pursuant
to the Cornerstone Placing may be affected by reallocation of the Offer Shares between the
International Offering and the Hong Kong Public Offering in the event of over-subscription
under the Hong Kong Public Offering as described in “Structure of the Global Offering – The
Hong Kong Public Offering – Reallocation” in this prospectus. Details of the actual number of
Offer Shares to be allocated to the Cornerstone Investors will be disclosed in the allotment
results announcement to be published by our Company.
CORNERSTONE INVESTORS
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OUR CORNERSTONE INVESTORS
The information about our Cornerstone Investors set forth below has been provided by the
Cornerstone Investors in relation to the Cornerstone Placing.
Reynold Lemkins
Reynold Lemkins Group (Asia) Limited (“ Reynold Lemkins ”) is an investment holding
company incorporated in Hong Kong with limited liability on November 30, 2020. Reynold
Lemkins is wholly-owned by Liu Haoran ( ᄎख್), an Independent Third Party . Reynold
Lemkins is principally engaged in investments across various asset classes, industries and
geographies. In the equity market, Reynold Lemkins invests primarily in emerging growth
companies with a focus on technology and healthcare.
Suzhou Harvest
Suzhou Harvest International Co., Limited (“ Suzhou Harvest ”) is incorporated in Hong
Kong with limited liability on November 27, 2023 and is wholly-owned by Suzhou Industrial
Park Industrial Investment Fund (Limited Partnership) (ږ(Υ
ྫ)) (“ SIP Industrial Investment Fund ”). SIP Industrial Investment Fund, established in the
PRC on November 7, 2017, primarily focuses on venture capital and equity investment, asset
management, investment management, and investment consultancy. The sole general partner as
well as the fund manager of SIP Industrial Investment Fund is Suzhou Y uanfeng Capital
Management Co. (ʮ̡)( “ Suzhou Yuanfeng ”), a limited company
incorporated in the PRC with a focus on private equity fund management service, holding 0.1%
partnership interest in SIP Industrial Investment Fund. The ultimate controller of Suzhou
Y uanfeng is Suzhou Industrial Park Zhaorun Investment Holding Group Co., Ltd ( ᘽψʈุ෤
ʮ̡), which is wholly-owned by Suzhou Industrial Park
Administrative Committee (ึ), a PRC governmental authority.
The remaining partnership interests of SIP Industrial Investment Fund are held as to
59.94% and 39.96% by Suzhou Industrial Park Economic Development Co. ( ᘽψʈุ෤ਜ຾
ʮ̡)( “ SIP Economic Development ”) and Suzhou Industrial Park State-owned
Capital Investment and Operation Holding Co. (ʮ
̡)( “ SIP State-owned Capital Holding ”) as limited partners. Both the SIP Economic
Development and SIP State-owned Capital Holding are held by Suzhou Industrial Park
Administrative Committee and Jiangsu Provincial Department of Finance as to 90% and 10%,
respectively.
As disclosed in “Waiver from Strict Compliance with the Listing Rules – Placing to a
Close Associate of an Existing Shareholder as Cornerstone Investor”, each of Suzhou Harvest
and SIP Industrial Investment Fund is a close associate of China-Singapore V entures, an
existing Shareholder of our Company and one of the Pre-IPO Investors. Therefore, our
Company has applied for, and the Stock Exchange has granted, a waiver from strict compliance
with Rule 10.04 and consent under paragraph 5(2) of Appendix F1 to the Listing Rules so that
SIP Industrial Investment Fund may participate in the Global Offering as a cornerstone investor
through Suzhou Harvest.
CORNERSTONE INVESTORS
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Xuzhou ETDZ (HK)
Xuzhou Economic and Technology Development Zone (HK) Investment Co., Limited (ࢱ
ψ຾᏶Ҧஔක೯ਜ(ಥ)ʮ̡)( “ Xuzhou ETDZ (HK) ”) is a company incorporated
in Hong Kong with limited liability on May 3, 2016. Xuzhou ETDZ (HK) is ultimately wholly
owned by Xuzhou Economic and Technology Development Zone Management Committee (ࢱ
ึ)( “ Xuzhou ETDZ Committee ”). It is an overseas investment
platform of Xuzhou ETDZ Committee. Xuzhou ETDZ (HK) engages in investment, trade,
distribution and advisory work. Xuzhou ETDZ Committee mainly invests in overseas bonds,
as well as the PRC integrated circuit semiconductors, new energy and new materials sectors
companies.
Gold Wings
Gold Wings Holdings Limited (“ Gold Wings ”) is a company incorporated in BVI on
December 10, 2020, and is wholly owned by Wu Yi ( юᆇ), an Independent Third Party. Gold
Wings is principally engaged in investments and invests in both primary and secondary
markets. Investments in primary markets include share acquisitions of private companies,
while investments in secondary markets include stocks and bonds of companies listed on the
Stock Exchange.
Set out below is the aggregate number of the Offer Shares, and the corresponding
percentage to our Company’s total issued share capital under the Cornerstone Placing:
Total investment amount
Number of
Offer Shares
to be
acquired (3)
Based on the Offer Price of HK$83.33 per H Share
Cornerstone Investor
(each as defined below)
Approximate
%o ft h e
International
Offering
Approximate
% of Offer
Shares
Approximate % of
the issued share
capital immediately
following the
completion of the
Global Offering
Approx. (US$) (HK$)
Reynold Lemkins ...... 15,000,000 (1) 117,180,000 (1) 1,406,200 32.43% 29.19% 2.81%
Suzhou Harvest ...... 12,200,000 (2) 95,306,400 (2) 1,132,300 26.11% 23.50% 2.26%
Xuzhou ETDZ (HK) .... 10,000,000 (1) 78,120,000 (1) 937,450 21.62% 19.46% 1.87%
Gold Wings ......... 3,841,000 (1) 30,000,000 (1) 360,000 8.30% 7.47% 0.72%
Total: ............ 41,041,000 320,606,400 3,835,950 88.46% 79.62% 7.66%
Notes:
(1) Exclusive of brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading
fee.
(2) Inclusive of brokerage, SFC transaction levy, AFRC transaction levy and the Stock Exchange trading
fee.
(3) Calculated based on the exchange rate at US$1.0 : HK$7.81 as described in the section headed
“Information about this Prospectus and the Global Offering – Exchange Rate Conversion” and rounded
down to the nearest whole board lot of 50 H Shares.
CORNERSTONE INVESTORS
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CLOSING CONDITIONS
The subscription obligation of each Cornerstone Investor under the respective
Cornerstone Investment Agreement is subject to, among other things, the following closing
conditions:
(a) the Underwriting Agreements being entered into and having become effective and
unconditional (in accordance with their respective original terms or as subsequently
waived or varied by agreement of the parties thereto) by no later than the time and
date as specified in these Underwriting Agreements, and neither of the aforesaid
Underwriting Agreements having been terminated;
(b) the Offer Price having been agreed upon between our Company and the Sole Overall
Coordinator (for itself and on behalf of the Underwriters);
(c) the Stock Exchange having granted the listing of, and permission to deal in, the H
Shares (including the Investor Shares defined in the Cornerstone Investment
Agreements) as well as other applicable waivers and approvals and such approval,
permission or waiver having not been revoked prior to the commencement of
dealings in the H Shares on the Stock Exchange;
(d) no laws shall have been enacted or promulgated by any governmental authority
which prohibits the consummation of the transactions contemplated in the Global
Offering or the Cornerstone Investment Agreements, and there shall be no orders or
injunctions from a court of competent jurisdiction in effect precluding or prohibiting
consummation of such transactions; and
(e) the respective representations, warranties, undertakings, acknowledgements and
confirmations of the Cornerstone Investor under the respective Cornerstone
Investment Agreements are (as of the date of each of the Cornerstone Investment
Agreement) and will be (as of the Listing Date) accurate and true in all respects and
not misleading and that there is no breach of the Cornerstone Investment Agreement
on the part of the Cornerstone Investor.
RESTRICTIONS ON THE CORNERSTONE INVESTORS
Each of the Cornerstone Investors has agreed that without the prior written consent of
each of the Company, the Sole Sponsor and the Sole Overall Coordinator, it will not, whether
directly or indirectly, at any time during the period of six months following the Listing Date
(the “ Lock-up Period ”), dispose of any of the Offer Shares they have subscribed for pursuant
to the relevant Cornerstone Investment Agreements (the “ Relevant Shares ”) or any interest in
any company or entity holding any of the Relevant Shares.
CORNERSTONE INVESTORS
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This section presents certain information regarding our share capital prior to and
following the completion of the Global Offering.
BEFORE THE GLOBAL OFFERING
As of the Latest Practicable Date, our registered share capital was RMB45,300,000,
divided into 45,300,000 Unlisted Shares with a nominal value of RMB1.00 each.
UPON COMPLETION OF THE GLOBAL OFFERING
The share capital of our Company immediately after completion of the Global Offering
and conversion of Unlisted Shares into H Shares will be as follows:
Description of Shares Number of Shares
Approximate
percentage of
total share capital
H Shares to be converted from Unlisted Shares ..... 45,300,000 90.39%
H Shares issued pursuant to the Global Offering .... 4,818,200 9.61%
Total ................................... 50,118,200 100.00%
The above table assumes that the Global Offering has become unconditional and the H
Shares are issued pursuant to the Global Offering.
CONVERSION OF UNLISTED SHARES INTO H SHARES
If any of the Unlisted Shares are to be converted, listed and traded as H Shares on the
Stock Exchange, such conversion, listing and trading will need the approval of the relevant
PRC regulatory authorities, including the CSRC, and the approval of the Stock Exchange.
RANKING
Upon completion of the Global Offering and the Conversion, we would have only one
class of Shares, being the H Shares. Our H Shares and Unlisted Shares are all ordinary Shares
in the share capital of our Company. Our Unlisted Shares and H Shares will rank pari passu
with each other in all respects and, in particular, will rank equally for all dividends or
distributions declared, paid or made after the date of this prospectus. All dividends in respect
of the H Shares are to be paid by us in Hong Kong dollars or in the form of H Shares.
Listing Review and Approval by the CSRC
In accordance with the Overseas Listing Trial Measures and five relevant guidelines
announced by the CSRC, for a domestic company directly offering and listing overseas,
shareholders of its domestic unlisted shares applying to convert such shares into shares listed
and trade on an overseas trading venue shall conform to relevant regulations promulgated by
the CSRC, and authorize the domestic company to file with the CSRC on their behalf.
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Our Company applied for a “Full Circulation” filing when applying for an overseas listing
filing with the CSRC on August 30, 2023, and submitted the filing reports, authorization
documents of the shareholders of Unlisted Shares for which a H-share “Full Circulation” was
applied, explanation about the compliance of share acquisition and other documents in
accordance with the requirements of the CSRC. The CSRC has accepted our Company’s
application for filing on September 5, 2023. Our Company has received the reply from the
CSRC dated November 28, 2023, in relation to the filing notice of the overseas listing and
“Full Circulation”.
Listing Approval by the Stock Exchange
Our Company has applied to the Stock Exchange for the granting of listing of, and
permission to deal in, our H Shares to be issued pursuant to the Global Offering and the H
Shares to be converted from 45,300,000 Unlisted Shares on the Stock Exchange, which is
subject to the approval by the Stock Exchange. We will perform the following procedures for
the conversion of the Unlisted Shares into H Shares after receiving the approval of the Stock
Exchange; (i) giving instructions to our H Share Registrar regarding relevant share certificates
of the converted H Shares; and (ii) enabling the converted H Shares to be accepted as eligible
securities by HKSCC for deposit, clearance and settlement in CCASS.
REGISTRATION OF SHARES NOT LISTED ON AN OVERSEAS STOCK EXCHANGE
According to the Notice of Centralized Registration and Deposit of Non-overseas Listed
Shares of Companies Listed on an Overseas Stock Exchange (ྤ̮ɪ̹
) issued by the CSRC, an overseas listed company is
required to register its shares that are not listed on an overseas stock exchange with the China
Securities Depository and Clearing Corporation Limited within 15 business days upon listing
and provide a written report to the CSRC regarding the centralized registration and deposit of
its non-overseas listed shares as well as the current offering and listing of the H shares.
CIRCUMSTANCES UNDER WHICH GENERAL MEETING IS REQUIRED
For details of circumstances under which the Shareholders’ general meeting is required,
see “Appendix VI – Summary of the Articles of Association”.
SHAREHOLDERS’ APPROV AL FOR THE GLOBAL OFFERING
Approval from holders of the Shares is required for the Company to issue H Shares and
seek the Listing of H Shares on the Stock Exchange. The Company has obtained such approval
at the Shareholders’ general meeting held on August 4, 2023.
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LOCK-UP PERIODS
In accordance with the PRC Company Law, the shares issued prior to any public offering
of shares by a company cannot be transferred within one year from the date on which such
publicly offered shares are listed and traded on the relevant stock exchange. As such, the
Unlisted Shares issued by our Company prior to the issue of H Shares (including shares held
by our Pre-IPO Investors) will be subject to such statutory restriction on transfer within a
period of one year from the Listing Date.
Our Directors, Supervisors and members of the senior management (as defined in our
Articles of Association) of our Company shall declare their shareholdings in our Company and
any changes in their shareholdings. Shares transferred by our Directors, Supervisors and such
members of the senior management each year during their term of office shall not exceed 25%
of their total respective shareholdings in our Company. The Shares that the aforementioned
persons held in our Company cannot be transferred within one year from the date on which the
H Shares are listed and traded, nor within half a year after they leave their positions in our
Company. Our Articles of Association may contain other restrictions or conditions on the
transfer of the Shares held by our Directors, Supervisors, members of senior management of
our Company and other Shareholders. For further details, see “Summary of Articles of
Association” in Appendix VI to this prospectus.
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You should read the following discussion and analysis in conjunction with the
consolidated financial statements, including the notes thereto included in the
Accountants’ Report in Appendix I to this prospectus and the selected historical financial
information presented elsewhere into this prospectus. Our consolidated financial
statements were prepared in accordance with IFRSs.
This discussion of our financial condition and results of operations contains
forward-looking statements which, although based on the assumptions that we consider
reasonable, are subject to risks and uncertainties. Our actual performance and results
are based on the assumptions about our business and may differ materially from those
anticipated in the forward-looking statements as a result of certain factors, including
those set out in the sections entitled “Forward-Looking Statements”, “Risk Factors” and
elsewhere. In addition, certain industry issues also affect our financial condition and
results of operations, as described in “Industry Overview”.
OVERVIEW
We are an integrated API-enabled data exchange service provider in China. We provide
standard API services and customized data management solutions to internet companies,
telecommunications operators, technology companies and other business and government
organizations as well as app developers and technology professionals. The integrated
API-enabled data exchange service market and the industry-specific API-enabled data
exchange service market together comprise the overall API-enabled data exchange service
market, which itself is part of the API-enabled service market.
Application Programming Interface, commonly known as API, is a set of protocols that
allows disconnected applications to communicate with each other. A common example of how
APIs work is when a customer requests weather information on a mobile app, the app sends out
a request via an API to a weather data supply source, which then processes the request,
retrieves the requested information, and sends a response via the API back to the mobile app
for the customer. An alternative to achieving such connectivity would have required the mobile
app developer and the data supply source to work together to build a new system that connects
different applications. However, such an alternative is oftentimes not viable when the
connectivity requires the handling of millions of data requests from various data sources on a
day-to-day basis. APIs are an accessible way to enable applications to exchange data and
functionality within and across organizations. APIs can eliminate data silos and handle the
exchange of large volumes of data.
We are dedicated to eliminating data silos and offering online API services that span
across multiple service types and scenarios. Our API marketplace, a combination of APIs we
offer, matches requests and responses and facilitates exchange of data. These services have
been widely applied in various vertical industries, such as internet services, software
information services, and telecommunications. Since the launch of API marketplace in June
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2011, we have developed over 770 proprietary APIs. In 2023, API marketplace handled over
120 billion API requests. Our customers include well-known enterprises such as Tencent,
Alibaba, Baidu, NetEase, Meituan, China Mobile, China Unicom, China Telecom, and many
other internet companies, app developers and individuals. As of December 31, 2023, API
marketplace made available over 380 proprietary APIs to our customers. In 2021, 2022 and
2023, the retention rate of key customers of our API marketplace was 78.9%, 85.7% and 59.1%,
respectively. The net dollar expansion rate of revenue from our API marketplace key customers
in 2021, 2022 and 2023 was 136.4%, 139.1% and 217.3%, respectively.
Leveraging our integrated API-enabled data exchange capabilities, in 2020, we started to
provide data management solutions, a type of customized data technology solution which
comprises one or more of our products and services, including APIMaster , which provides
lifecycle management services for APIs; DataArts , which is an integrated data stewardship
platform that collects, cleanses and processes data to empower data; QuickBot, which is an
RPA software designed to execute basic and repetitive tasks with a certain pattern;
SmartShield , which is a privacy computation tool that addresses the issue of privacy protection
in data exchange; and AnchorChain , which is a consortium blockchain tool that ensures the
security of data circulation distributed ledgers.
We offer solutions that assist organizations in their digital transformation. Our
customized, digitalized, and self-deployed data management solutions cater to a diverse range
of customers, including those from government agencies, manufacturing, finance,
telecommunications, and various other industries. Our technologies eliminate data silos and
cleanse data sets with heterogeneity, forming data that adheres to unified standards.
Benefiting from our advanced technologies and service capabilities, we have gained
recognition from our customers, resulting in rapid growth in revenue. In 2021, 2022 and 2023,
our total revenue was RMB260.0 million, RMB328.9 million and RMB441.1 million,
respectively. We recorded a CAGR in revenue of 30.2% from 2021 to 2023. From 2021 to 2023,
the CAGR of the revenue attributable to our data management solutions was 23.1%.
Recent Developments
From January to April 2024, we handled 526.8 million query service requests compared
to 558.7 million query service requests for the same period in 2023, while our average price
per request for query service increased significantly from RMB0.15 in January to April 2023
to RMB0.23 for the same period in 2024. The decrease in the number was mainly due to (1)
a decrease in the usage of an identity authentication API frequently utilized by an internet
corporate customer and (2) decreases in two APIs which were mainly used by small individual
and corporate customers, which are priced lower than the average price per query. The increase
in average price of query service requests was mainly driven by an increase in demand from
a large internet company customer for certain three-factor authentication APIs with relatively
high prices, as this customer conducted identity authentication of its existing customers.
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From January to April 2024, we handled 923.7 million SMS notice service requests
compared to 773.4 million SMS notice service requests for the same period in 2023. The
increase in the number of SMS notice service requests was primarily due to an internet
company increasing its usage in a promotional SMS notice service. Our average price per
request for SMS notice service remained relatively stable at RMB0.03 from January to April
2023 and in the same period in 2024.
For data management solutions, ten projects were delivered and accepted in January to
April 2024 compared to nine for the same period in 2023, which remained relatively stable.
We received a letter of intent from the Suzhou Branch of a commercial bank in China in
June 2024. The commercial bank will provide loan facilities of no more than RMB400 million
in aggregate to the Company in the next three years. The loan can be by way of credit and fixed
asset mortgages, with interest rates determined based on the prevailing market rates.
Our Directors have confirmed that there has been no material adverse change in our
financial and trading position or prospects since December 31, 2023, being the date to which
our latest audited consolidated financial statements have been prepared, up to the date of this
prospectus.
BASIS OF PREPARATION
The Historical Financial Information has been prepared based on accounting policies set
out in Note 4 of the Accountants’ Report included in Appendix I which conform with IFRSs,
which includes IFRSs, International Accounting Standard (“IAS”) and the related
interpretations issued by the International Accountings Standards Board (“IASB”). In addition,
the Historical Financial Information includes applicable disclosures required by the Rules
Governing the Listing of Securities on The Stock Exchange of the Hong Kong Limited and by
the Hong Kong Companies Ordinance.
For the purpose of preparing and presenting the Historical Financial Information, all
relevant standards, amendments and interpretations to the IFRSs that are effective during the
Track Record Period have been adopted by us consistently throughout the Track Record Period.
The preparation of the Historical Financial Information in conformity with IFRSs requires
the use of certain critical accounting estimates. It also requires management to exercise its
judgment in the process of applying our accounting policies. The areas involving a higher
degree of judgment or complexity, or areas where assumptions and estimates are significant to
the Historical Financial Information are disclosed in Note 5 of the Accountants’ Report.
The Historical Financial Information has been prepared on the historical cost basis except
for certain financial instruments, which are measured at fair values as explained in the material
accounting policy information set out in Notes of the Accountants’ Report. The Historical
Financial Information is presented in Renminbi, which is the same as our functional currency.
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KEY FACTORS AFFECTING OUR BUSINESS AND RESULTS OF OPERATIONS
Our business and results of operations have been and are expected to be affected by
certain key factors such as:
Government Policy, Industry Trends and Development
As substantially all of our assets and operations are located in China, our business and
results of operations are significantly affected by China’s overall economic conditions and the
development of the data-related service industry in which we operate. The PRC government
has been actively promoting the development of China’s digital economy and introduced a
series of favorable policies including the 14th Five-Y ear Plan for the Development of the
Digital Economy (“ ɤ̬ʞ”஝ྌ) issued by the State Council in January 2022,
which states that the government aims to have the economic value added in core digital
economy industries account for 10% of national GDP by 2025. China’s digital economy
experienced steady growth at a CAGR of 12.5% from 2018 to 2022, far exceeding the average
annual growth rate of 7.4% for China’s overall GDP . We believe that the continued
development of China’s digital economy and data-related service industries will create new
business opportunities for us.
Our Ability to Compete Effectively
We operate in a highly competitive industry, and the success of our business relies
significantly on our ability to compete effectively. We have been focusing on the provision of
API services since our inception and have accumulated significant industry experience and
knowhow. As one of the earliest API-enabled data exchange service providers, we have been
able to get a head start over our competitors in building market share, brand reputation, and
R&D strength. We have accumulated over ten years of valuable operational experience,
established relatively strong brand awareness, and built a high-quality customer base that
includes well-known companies such as Tencent, Alibaba, Baidu and NetEase. We have won
multiple national-level awards and participated in the formulation of industry standards,
further augmenting our market position. Our industry is still in a growing stage which is
beneficial for our future development as we believe a fast-growing market translates into
additional business opportunities for us. However, increased competition can materially affect
our marketing and pricing abilities, in particular for our API marketplace. Our ability to
compete effectively may materially affect our business, results of operations and financial
condition.
Looking forward, we plan to leverage our technological advantages and utilize our market
resources to deepen our cooperation with the local government, expand our customer base, and
monetize our subscription services. We aim to keep abreast of the latest industry trends,
continue enriching the types of data circulation, such as industrial big data, medical data, and
educational data, to promote government and public data opening and sharing. We will also
focus on further exploring opportunities to collaborate with the government on data opening
projects.
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Our Ability to Continue Enriching and Enhancing Our Service Mix
We have a proven record of developing competitive services and solutions to meet
customers’ needs. We believe that our R&D capabilities are a critical competitive advantage for
us and a key factor that affects our business and long-term prospects. During the Track Record
Period, we incurred R&D costs of RMB16.9 million, RMB26.3 million, and RMB24.3 million
in 2021, 2022 and 2023, respectively. We plan to increase the overall efficiency of our service
by researching and developing an automated operation system for data business channels that
can improve the automated selection and matching of data service suppliers. In addition, we
plan to continue optimizing API testing tools and platforms that can provide professional API
testing services for developers. Our R&D investment aims to enrich our API marketplace
ecosystem, improve customer experience, increase usage and enhance customer stickiness. For
our data management solutions, we focus our R&D efforts on tailored aspects for customers of
different industries and sizes. For government organizations, we concentrate our R&D efforts
on effectively integrating internal government data sources and external third-party data
sources, helping public sector customers increase governance efficiency. For corporate
organizations, we focus our research and development on data collection and analysis, and data
circulation to help private sector customers in their digital transformation process, enabling
them to streamline production flow, improve operational efficiency and reduce costs.
Our ability to improve our existing services and solutions and develop new services and
solutions depends on the strength of our research and development team, our abilities to apply
our technologies, resolve issues, and provide services and solutions that satisfy our customers’
needs, and our investment in other relevant aspects of the industry.
Our Service Mix
Our revenue and profitability are affected by the mix in our service offerings. During the
Track Record Period, our revenue from API marketplace accounted for 74.9%, 68.0% and
77.6% of our total revenue in 2021, 2022 and 2023, respectively. Our revenue from data
management solutions accounted for 25.1%, 32.0% and 22.4% of our total revenue in 2021,
2022 and 2023, respectively. Our gross profit margin for API marketplace was 31.2%, 32.0%
and 28.3% for 2021, 2022 and 2023, respectively. Our gross profit margin varies among
different API marketplace services. For example, the gross profit margin of our query service
was 35.0%, 37.1% and 31.1% in 2021, 2022 and 2023, respectively, while the gross profit
margin of our SMS notice was 11.6%, 15.4% and 11.5% for the same years, respectively. Our
gross profit margin for data management solutions was 44.6%, 34.2% and 28.0% for 2021,
2022 and 2023, respectively. For data management solutions, our gross profit margin varies
from project to project. For example, projects with more standardized components generally
have higher gross profit margins than those with more customized components as we generally
incur higher labor costs and other costs to develop customized components tailored to the
customers’ specific needs. For additional information, see “– Principal Components of
Consolidated Statements of Profits or Loss – Gross Profit and Gross Profit Margin”. We believe
our changing service offerings will continue to have an impact on our revenue and profitability.
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Our Ability to Attract and Retain Major Customers
Our ability to attract new customers, retain existing customers, and derive more revenue
from existing customers has played a significant role in our past. For each of the years ended
December 31, 2021, 2022 and 2023, revenue generated from our top five customers amounted
to approximately RMB106.9 million, RMB143.7 million and RMB274.9 million respectively,
accounting for approximately 41.1%, 43.7% and 62.3% of our total revenue for each of the
years ended December 31, 2021, 2022 and 2023, respectively. In 2021, 2022 and 2023, the
retention rate of our key customers of our API marketplace was 78.9%, 85.7% and 59.1%,
respectively, while the net dollar expansion rate of revenue from our API marketplace key
customers was 136.4%, 139.1% and 217.3%, respectively. In the future, we plan to attract more
customers – that we hope will eventually become long-standing customers – by offering
competitive services and solutions in response to market trends, thereby increasing customer
satisfaction and stickiness.
Our ability to maintain our competitiveness and profitability depends substantially upon
our relationships with our customers. We experienced customer concentration during the Track
Record Period. For details on our revenue generated from our top five customers during the
Track Record Period, see “Risk Factors – Risks Relating to Our Business and Industry – We
experienced customer and supplier concentration during the Track Record period and may
continue to be exposed to the risk of such concentration in the future.”
Going forward, we plan to optimize our customer base by reinforcing our relationships
with our customers. We also aim to continue attracting new customers of all sizes by enriching
our services and solutions offerings.
Our Ability to Manage Our Costs and Expenses and Enhance Operational Efficiency
Our ability to manage and control our costs and expenses is important to the success of
our business. We have continued to purchase data services, software and hardware from
suppliers, invest in research and development, and increase our efforts to attract talents. As a
result, we expect our costs and expenses to increase along with our revenue from API
marketplace and data management solutions. Nonetheless, we are committed to improving our
operational efficiency by managing our costs and expenses. While we expect our overall costs
and expenses to increase as our business expands, we also expect our costs and expenses as a
percentage of our total revenue to decrease as we achieve higher operational efficiency and
have greater bargaining power when negotiating prices with suppliers. For example, suppliers
may continue to offer us tiered pricing and related discounts when we purchase in greater
quantities. For API marketplace, we expect our costs to lower as a percentage of revenue due
to the favorable pricing we receive from suppliers. However, for data management solutions,
our costs and expenses as a percentage of revenue may still fluctuate, depending on our
investments in research and development, selling and distribution, and other items.
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Regulatory Environment
Our business and results of operations are subject to evolving regulatory environment
changes. In recent years, the PRC government has promulgated a series of laws and regulations
on data collection, storage, sharing, use, disclosure and protection, including the PRC
Cybersecurity Law (), the PRC Data Security Law ( ʕശɛ
), the PRC Personal Information Protection Law, and Cybersecurity
Review Measures (), among others. For details, see “Regulatory
Overview”. We believe that while new regulations would require us to expend more resources
on compliance, overall, they would benefit the long-term development of our business and
industry. An increasingly well-established regulatory framework would provide clearer legal
guidelines regarding our business development and improving data security and privacy,
thereby creating a safer environment that encourages more data exchanges.
MATERIAL ACCOUNTING POLICY INFORMATION
Revenue Recognition
Revenue from contracts with customers is recognized when control of goods or services
is transferred to the customers at an amount that reflects the consideration to which we expect
to be entitled in exchange for those goods or services, excluding those amounts collected on
behalf of third parties. Revenue excludes value added tax or other sales taxes and is after
deduction of any trade discounts.
Depending on the terms of the contract and the laws that apply to the contract, control of
the goods or service may be transferred over time or at a point in time. Control of the goods
or service is transferred over time if our performance:
 provides all of the benefits received and consumed simultaneously by the customer;
 creates or enhances an asset that the customer controls as we perform; or
 does not create an asset with an alternative use to us and we have an enforceable
right to payment for performance completed to date.
If control of the goods or services transfers over time, revenue is recognized over the
period of the contract by reference to the progress towards complete satisfaction of that
performance obligation. Otherwise, revenue is recognized at a point in time when the customer
obtains control of the goods or service.
Contracts with customers may include multiple performance obligations. For such
arrangements, we allocate revenue to each performance obligation based on its relative
standalone selling price. We generally determine standalone selling prices based on the prices
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charged to customers. If the standalone selling price is not directly observable, it is estimated
using expected cost plus a margin or adjusted market assessment approach, depending on the
availability of observable information.
When the contract contains a financing component which provides the customer a
significant benefit of financing the transfer of goods or services to the customer for more than
one year, revenue is measured at the present value of the amounts receivable, discounted using
the discount rate that would be reflected in a separate financing transaction between us and the
customer at contract inception. Where the contract contains a financing component which
provides a significant financing benefit to us, revenue recognized under that contract includes
the interest expense accreted on the contract liability under the effective interest method. For
contracts where the period between the payment and the transfer of the promised goods or
services is one year or less, the transaction price is not adjusted for the effects of a significant
financing component, using the practical expedient in IFRS 15.
API Marketplace
Revenue from services provided to customers includes query, SMS notice and top-up
services. Revenue is recognized at the point in time when the relevant services are fulfilled. For
contracts that are charged based on usage and unit price, we recognize revenue based on actual
usage and agreed unit price of the current period. For sales contracts with fixed contract
periods, we recognize revenue over time on a periodic basis during the contract period, with
reference to the total contract amount.
Data Management Solutions
We provide an array of data management solutions for government and corporate
organizations to enable them to systematically and securely digitize, manage, share and derive
insights from data within and across organizations. Customers use our data management
solutions to power many service types, such as data sharing among external parties, data
warehouse, data governance, internal data application and data release to external parties.
Revenue is recognized at a point in time when the software platform and related services are
delivered to and accepted by the customer. We also provide related maintenance and upgrade
services for a specific period after sale as stipulated in the same contract. These maintenance
and upgrade services are provided to maintain and improve the effectiveness of the software
and therefore are accounted for as a separate performance obligation. Revenue from provision
of maintenance and upgrade services is recognized over the service period.
Principal versus Agent Consideration in Revenue Recognition
Under IFRS 15, whether revenue should be recognized on a gross or a net basis depends
on whether the entity is acting as a principal or an agent in the transaction. The principal is the
entity that controls the goods or services before they are transferred to the customer, whereas
the agent facilitates the transfer of goods or services between the customer and the principal.
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If the entity has control over the goods or services before they are transferred to the
customer, indicators of which include the discretion to establish the price, bearing inventory
risk, and being primarily responsible for fulfilling the performance obligation to the customer,
then it is acting as a principal and should recognize revenue on a gross basis. The aforesaid
indicators cannot individually conclude whether the entity is acting as a principal or agent in
the transaction, but the assessment will be based on several indicators taken as a whole.
If the entity is an agent, instead of a principal, it should recognize revenue on a net basis,
which means that the amount recognized as revenue is the commission or fee earned by the
entity for facilitating the transfer of goods or services between the customer and the principal.
API Marketplace – Query and SMS Notice
For our query and SMS notice services, we have entered into contractual agreements with
our customers to provide them with relevant query information and SMS services, and
customers view us as the party primarily responsible for fulfilling the performance obligation.
We provide value-added services to our customers through our APIs, going beyond the
role of a mere intermediary to facilitate the transmission of information between suppliers and
customers. The customers obtain from us the requested query information and SMS services in
accordance with their requirements. From the customers’ point of view, it is us who provide
value-added service on these query information and SMS notification services that meet their
needs through suppliers selected by us from a customer-approved supplier list and the
customers do not know which supplier is finally deployed; and the customers consider us to be
primarily responsible for fulfilling the performance obligation. In addition:
 We retain the sole discretion to establish the price for the query information and
SMS services provided to the customers. We are required to pay the suppliers a fixed
price for each service used, which is not affected by the price paid by our customers.
This discretion to establish prices demonstrates our ability to obtain substantially all
of the remaining benefits from the query/SMS notice services, in contrast to an agent
who normally charges a commission or fee as a percentage of the customer’s paid
price.
 We do not bear any inventory risks related to the query/SMS notice services. We
only request the services from the supplier upon receiving a customer’s request for
query and SMS notice services. We do not commit to paying the supplier for the
services until the request from the customer is received, sent to the supplier, and the
result is obtained.
 During the course of providing the services, we may source information requested
or SMS services required by the customers from multiple suppliers via the API
marketplace, and we have the discretion in selecting suppliers from a customer-
approved supplier list that meets the customer’s needs to provide the requested
query information and SMS services.
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Therefore, we are acting as a principal for query and SMS notice services even though we
do not bear inventory risk considering the nature of the query and SMS services, and relevant
revenue should be recognized on gross basis, i.e. the selling prices of the service.
API Marketplace – Top-up
For the top-up service, our performance obligation is to arrange for the provision of the
top-up service requested by the end-user through our customers to the relevant
telecommunications operators. Although the top-up request is made through our API, to fulfill
our performance obligation, we only have to pass the request order to the supplier, and the
primary responsibility for successful top-up rests with the telecommunications operators for
crediting the relevant top-up value to the end users. We only facilitate the transmission of this
top-up request with limited involvement in the top-up request process with the customer’s
designated telecommunications operators. In addition:
 The revenue earned from top-up service is based on agreed fees, which are
calculated as a percentage of the total top-up face value and the amount of the fee
earned is low. The lack of the sole discretion to establish prices and we only earn
a narrow margin instead of obtaining substantially all of the remaining benefits from
the top-up service. This is consistent with the definition of revenue earned by an
agent under IFRS 15, which is a commission or fee earned for facilitating a
transaction between two parties.
 We do not bear any inventory risks related to top-up service being provided to the
customer. As an intermediary facilitating the transmission of this top-up request
between the customer and the supplier, we do not commit to pay the supplier for the
services until we have received a request from the customer and sent the
corresponding request to the supplier. We do not hold any inventory for top-up
services.
 We do not have any discretion on selecting ultimate suppliers for customers. For
example, we can only choose China Mobile for a China Mobile user’s top-up; thus,
we are an agent between China Mobile and the customer.
Therefore, we are acting as an agent for the top-up service, and relevant revenue should
be recognized on net basis, i.e. the selling price of the service less the cost of purchase from
the service provider.
Contract Assets and Contract Liabilities
A contract asset represents our right to consideration in exchange for services that we
have transferred to a customer that is not yet unconditional. In contrast, a receivable represents
our unconditional right to consideration, i.e., only the passage of time is required before
payment of that consideration is due. Contract asset is recognized when the customers retain
retention money to secure the due performance of the contracts. Contract assets are assessed
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for ECLs in accordance with the policy set out in Note 4.10(b) to the Historical Financial
Information in the Accountants’ Report included in Appendix I. ECLs on contract assets are
measured at an amount equal to lifetime ECLs. ECLs on contract assets are estimated using a
provision matrix based on our historical credit loss experience, adjusted for factors that are
specific to the customers and an assessment of both the current and forecast general economic
conditions at the reporting date. Any amount previously recognized as a contract asset is
reclassified to trade receivables at the point at which the milestones are reached. If the
considerations (including advances received from customers) exceed the revenue recognized to
date, then we recognize a contract liability for the difference.
A contract liability represents our obligation to transfer services to a customer for which
we have received consideration (or an amount of consideration is due) from the customer.
A contract asset and a contract liability relating to a contract are accounted for and
presented on a net basis.
Contract Costs
We recognize an asset from the costs incurred to fulfill a contract when those costs meet
all of the following criteria:
 the costs relate directly to a contract or to an anticipated contract that we can
specifically identify;
 the costs generate or enhance our resources that will be used in satisfying (or in
continuing to satisfy) performance obligations in the future; and
 the costs are expected to be recovered.
The asset recognized is subsequently amortized to profit or loss on a systematic basis that
is consistent with the transfer to the customer of the goods or services to which the costs relate.
The asset is subject to impairment review.
Other Income
Interest income is accrued on a time basis on the principal outstanding at the applicable
interest rate.
Property, Plant, and Equipment
Property, plant and equipment, other than construction-in-progress, are stated at cost less
accumulated depreciation and any accumulated impairment losses.
The cost of property, plant and equipment includes its purchase price and the costs
directly attributable to the acquisition of the items.
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Subsequent costs are included in the asset’s carrying amount or recognized as a separate
asset, as appropriate, only when it is probable that future economic benefits associated with the
item will flow to us and the cost of the item can be measured reliably. The carrying amount of
the replaced part is derecognized. All other costs such as repairs and maintenance are
recognized as an expense in profit or loss during the financial period in which they are
incurred.
Property, plant and equipment are depreciated so as to write off their costs net of
estimated residual values over their estimated useful lives on the straight-line method. The
useful lives, residual value and depreciation method are reviewed, and adjusted if appropriate,
at the end of each reporting period. The useful lives are as follows:
Leasehold land Over the lease term
Buildings 20-30 years
Leasehold improvements Over shorter of lease term or 5-10 years
Motor vehicles 4 years
Furniture, fixtures and office equipment 3-10 years
Other properties leased for own use Over the lease term
Construction-in-progress is stated at cost less any impairment losses. Cost comprises
direct costs of construction as well as borrowing costs capitalized during the periods of
construction and installation. Capitalization of these costs ceases and the construction in
progress is transferred to the appropriate classes of property, plant and equipment when
substantially all the activities necessary to prepare the assets for their intended use are
completed. No depreciation is provided for in respect of construction in progress until it is
completed and ready for its intended use.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at
the end of each reporting period.
An asset is written down immediately to its recoverable amount if its carrying amount is
higher than the asset’s estimated recoverable amount.
The gain or loss on disposal of an item of property, plant and equipment is the difference
between the net sale proceeds and its carrying amount, and is recognized in profit or loss on
disposal.
Income Tax
Income taxes for the period comprise current tax and deferred tax.
Current tax is based on the profit or loss from ordinary activities adjusted for items that
are non-assessable or disallowable for income tax purposes and is calculated using tax rates
that have been enacted or substantively enacted at the end of each reporting period. The amount
of current tax payable or receivable is the best estimate of the tax amount expected to be paid
or received that reflects any uncertainty related to income tax.
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Deferred tax is recognized in respect of temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the corresponding
amounts used for tax purposes. Deferred tax liabilities are generally recognized for all taxable
temporary differences. Deferred tax assets are recognized to the extent that it is probable that
taxable profits will be available against which deductible temporary differences can be utilized.
Deferred tax is measured at the tax rates appropriate to the expected manner in which the
carrying amount of the asset or liability is realized or settled and that have been enacted or
substantively enacted at the end of each reporting period, and reflects any uncertainty related
to income taxes.
Deferred tax liabilities are recognized for taxable temporary differences arising on
investments in subsidiaries, except where we are able to control the reversal of the temporary
difference and it is probable that the temporary difference will not reverse in the foreseeable
future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to
set off current tax assets against current tax liabilities and when they relate to income tax levied
by the same taxation authority and we intend to settle its current tax assets and liabilities on
a net basis.
The carrying amount of deferred tax assets is reviewed at reporting date and reduced to
the extent that it is no longer probable that sufficient taxable profits will be available to allow
all or part of the assets to be recovered.
Income taxes are recognized in profit or loss, except when they relate to items recognized
in other comprehensive income or directly in equity, in which case the taxes are also
recognized in other comprehensive income, or when they relate to items recognized directly in
equity, in which case the taxes are also recognized directly in equity.
Fair Value Measurement of Financial Instruments
Our unlisted equity instruments and unlisted debt security are measured at fair values
based on the valuation performed by an independent professional valuer with fair values being
determined based on significant unobservable inputs using valuation techniques. Judgment and
estimation are required in establishing the relevant valuation techniques and the relevant inputs
thereof. Changes in assumptions relating to these factors could result in material adjustments
to the fair values of these instruments. Further disclosures are set out in Note 20 and Note 25
to the Historical Financial Information of the Accountants’ Report included in Appendix I.
Impairment of Financial and Contract Assets
The measurement of the ECLs allowance for financial assets measured at amortized cost
and contract assets is an area that requires the use of significant assumptions about future
economic conditions and credit behavior (e.g. the likelihood of customers defaulting and the
resulting losses). A number of significant judgments, including determining the criteria for
FINANCIAL INFORMATION
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significant increase in credit risk, are also required in applying the accounting requirements for
measuring ECLs. Details about the judgments and assumptions used in measuring ECLs is set
out in Note 4.10(b) and Note 39(b) to the Historical Financial Information of the Accountants’
Report included in Appendix I. Changes to these estimates and assumptions can result in
significant changes to the timing and amount of ECLs to be recognized.
Policy of Provision/Write-off for Trade Receivables
We make provision for inventories based on an assessment of the net realizable value.
Cost is determined on weighted average basis. Net realizable value is the estimated selling
price in the ordinary course of business, less the estimated costs of completion and costs
necessary to make the sale. Allowances are applied to inventories where events or changes in
circumstances indicate that the net realisable value is lower than the cost of inventories.
PRINCIPAL COMPONENTS OF CONSOLIDATED STATEMENTS OF PROFIT OR
LOSS
The table below sets forth the principal components of our consolidated statements of
profit or loss for 2021, 2022 and 2023:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Revenue ............................................. 260,011 328,936 441,083
Cost of sales .......................................... (170,099) (221,382) (316,431)
Gross profit .......................................... 89,912 107,554 124,652
Other income and other gains, net ............................. 16,903 11,019 10,704
Selling and distribution expenses .............................. (15,449) (14,378) (12,530)
Research and development costs .............................. (16,875) (26,345) (24,250)
Administrative and other expenses ............................. (20,490) (32,025) (27,518)
Impairment loss on financial and contract assets, net ................. (418) (1,068) (9,915)
Finance costs .......................................... (154) (1) (1,014)
Listing expenses ........................................ – – (22,354)
Profit before tax ....................................... 53,429 44,756 37,775
Income tax expense ...................................... (7,463) (3,472) (2,714)
Profit for the year ...................................... 45,966 41,284 35,061
Profit for the year attributable to :
Owners of the Company .................................. 46,011 41,249 34,751
Non-controlling interests ................................. (45) 35 310
45,966 41,284 35,061
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Revenue
Revenue by Service Type
During the Track Record Period, we generated revenue primarily from API marketplace,
comprising query, SMS notice and top-up services, and data management solutions. The table
below sets forth a breakdown of our revenue by service type for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
API marketplace
Query ......................... 124,467 47.9% 145,279 44.2% 271,356 61.6%
SMS notice ...................... 57,883 22.2% 70,627 21.5% 64,543 14.6%
Top-up (1) ....................... 12,370 4.8% 7,626 2.3% 6,170 1.4%
194,720 74.9% 223,532 68.0% 342,069 77.6%
Data management solutions ........... 65,291 25.1% 105,404 32.0% 99,014 22.4%
Total .......................... 260,011 100.0% 328,936 100.0% 441,083 100.0%
(1) For top-up, we recognize revenue on a net basis pursuant to IFRS 15. See “Financial Information – Material
Accounting Policy Information – Principal versus Agent Consideration in Revenue Recognition”.
For API marketplace, our revenue derives from sales of query, SMS notice and top-up
services. In our contracts with customers, we charge fees based on usage and unit price, or sales
contract amounts over fixed contract periods. Revenue from API marketplace accounted for
74.9%, 68.0% and 77.6% of our total revenue in 2021, 2022 and 2023, respectively.
The table below sets forth a breakdown of our revenue from API marketplace by key
customers and non-key customers, in absolute amounts and as a percentage of total revenue
from API marketplace, for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
Revenue from API marketplace
Key customers (1) ................... 151,625 77.9% 182,966 81.9% 316,695 92.6%
Non-key customers (1) ................ 43,095 22.1% 40,566 18.1% 25,374 7.4%
Total .......................... 194,720 100.0% 223,532 100.0% 342,069 100.0%
(1) For the avoidance of doubt, customers were categorized based on the number of our contracting parties and
were not calculated on a consolidated basis, and did not account for whether any of them controlled each other
or were under common control.
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Our revenue from API marketplace derived from key customers increased by 20.7% from
RMB151.6 million in 2021 to RMB183.0 million in 2022, and further increased by 73.1% to
RMB316.7 million in 2023. The foregoing increases were primarily due to increased purchases
from both existing and new key customers, mainly as a result of increased customer trust and
reliance on our services as we continued to improve the quality of our services and deepen our
collaboration with our key customers.
Our revenue derived from non-key customers of API marketplace decreased by 5.9% from
RMB43.1 million in 2021 to RMB40.6 million in 2022, and further decreased by 37.5% to
RMB25.4 million in 2023. The foregoing decreases were primarily due to our strategic focus
on attracting and deepening our collaboration with key customers and a decrease in our number
of non-key customers.
For data management solutions, our revenue derives from sales of solutions to
government and corporate organizations. When charging our customers, we generally bill for
the products and platform development according to payment terms agreed with customers.
Platform construction fees are typically charged for the implementation of the data
management platform. In certain cases, we may also charge fees for supporting operational
services and consulting services based on specific customer requirements. Revenue derived
from data management solutions is recognized when the data management solution and related
services are delivered to and accepted by the customers. Revenue from data management
solutions accounted for 25.1%, 32.0% and 22.4% of our total revenue in 2021, 2022 and 2023,
respectively.
The table below sets forth a breakdown of our revenue from data management solutions
by customer type, in absolute amounts and as a percentage of total revenue from data
management solutions, for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
Revenue from data management solutions
Government customers (1) .............. 1,087 1.7% 25,344 24.0% 7,858 7.9%
SOE customers (2) .................. 23,466 35.9% 40,474 38.4% 81,671 82.5%
Other customers (3) .................. 40,738 62.4% 39,586 37.6% 9,485 9.6%
Total .......................... 65,291 100.0% 105,404 100.0% 99,014 100.0%
(1) Government customers include central and local governments and government departments in the PRC.
(2) SOE customers include, based on the public search made by our Company from September to October 2023,
customers which the largest shareholder was at least 51% directly or indirectly owned by central and local
governments in the PRC.
(3) Other customers include private companies, listed companies, foreign companies, public institutions or other
types of entities that are not SOEs or local governments.
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* We exercise reasonable judgment to generate the breakdown based on the above definitions. However, given
the limitations on public search, the complexity of certain customer’s shareholding structure, and that we are
unable to ascertain the shareholding structure of all customers and their shareholders, such breakdown may not
be accurate.
Our revenue from data management solutions derived from government customers
increased significantly from RMB1.1 million in 2021 to RMB25.3 million in 2022, primarily
due to the substantial revenue contribution from one large project in 2022. Our revenue from
data management solutions derived from government customers decreased by 69.0% to
RMB7.9 million in 2023, primarily due to a decrease in the average revenue of our projects as
(i) we had no particularly large projects in 2023, and (ii) most of our projects delivered and
accepted had more standardized components, and such projects generally generated lower
revenue.
Our revenue from data management solutions derived from SOE customers increased by
72.5% from RMB23.5 million in 2021 to RMB40.5 million in 2022, and further increased
significantly to RMB81.7 million in 2023. The foregoing increases were primarily due to an
overall increase in the number of projects and revenue per project delivered to and accepted
by SOE customers during the Track Record Period, primarily because we attracted new SOE
customers and strengthened our business relationship with existing SOE customers as we
continued enhancing our service quality and reputation.
Our revenue from data management solutions derived from other customers remained
relatively stable at RMB40.7 million and RMB39.6 million in 2021 and 2022, respectively, and
decreased by 76.0% to RMB9.5 million in 2023, primarily due to a decrease in the average
revenue of our projects, mainly attributable to: (i) a decrease in our number of integrated
system projects from five in 2022 to nil in 2023, as integrated system projects generally
generated higher revenue but had lower gross profit margins; and (ii) an increase in our
proportion of projects with more standardize components, as such projects generally generated
lower revenue.
Revenue by Settlement Method
Our revenue from API marketplace were settled by two methods, prepayment and
post-payment. Revenue settled by prepayment refers to revenue derived from sales where
customers pay us before services are rendered (that is, sales to pre-paid customers). Revenue
settled by post-payment refers to revenue derived from sales where customers pay us after
services are rendered (that is, sales to post-paid customers).
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The table below sets forth a breakdown of our revenue from API marketplace by
settlement method, in absolute amounts and as a percentage of total revenue generated from the
indicated service type, for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
Post-payment
Query ......................... 109,494 88.0% 133,207 91.7% 263,040 96.9%
SMS notice ...................... 47,313 81.7% 54,353 77.0% 54,974 85.2%
Top-up ......................... 6,172 49.9% 5,472 71.8% 5,055 81.9%
Total revenue from
post-payment .................... 162,979 83.7% 193,032 86.4% 323,069 94.4%
Prepayment
Query ......................... 14,973 12.0% 12,072 8.3% 8,316 3.1%
SMS notice ...................... 10,570 18.3% 16,274 23.0% 9,569 14.8%
Top-up ......................... 6,198 50.1% 2,154 28.2% 1,115 18.1%
Total revenue from prepayment .......... 31,741 16.3% 30,500 13.6% 19,000 5.6%
Total .......................... 194,720 100.0% 223,532 100.0% 342,069 100.0%
Our revenue from API marketplace settled by post-payment increased by 18.6% from
RMB163.0 million in 2021 to RMB193.0 million in 2022, and further increased by 67.4% to
RMB323.1 million in 2023. The foregoing increases were primarily due to increases in the
number of large customers, who generally settled by post-payment.
Our revenue from API marketplace settled by prepayment decreased by 3.9% from
RMB31.7 million in 2021 to RMB30.5 million in 2022, and further decreased by 37.7% to
RMB19.0 million in 2023. The foregoing decreases were primarily due to a decrease in our
number of smaller-sized customers, who generally settled by prepayment.
Cost of Sales
The table below sets forth a breakdown of our cost of sales by nature for the years
indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Labor costs ........................................... 7,805 11,674 16,250
Purchase costs – API marketplace ............................. 130,309 148,964 241,696
Purchase costs – data management solutions ...................... 30,222 59,046 56,887
Others (1) ............................................. 1,763 1,698 1,598
Total ............................................... 170,099 221,382 316,431
(1) Others primarily comprise cloud server, leasing and traveling costs.
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Our cost of sales mainly comprises the following: (i) labor costs, which primarily include
our costs incurred in hiring employees; and (ii) purchase costs, which primarily include: (a)
costs of procuring data services for API marketplace; and (b) costs of purchasing software and
hardware such as specialized software and servers for data management solutions.
The table below sets forth our cost of sales by service type during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
API marketplace
Query ......................... 80,863 47.5% 91,332 41.3% 187,030 59.1%
SMS notice ...................... 51,175 30.1% 59,752 27.0% 57,104 18.1%
Top-up ......................... 1,904 1.1% 965 0.4% 1,037 0.3%
133,942 78.7% 152,049 68.7% 245,171 77.5%
Data management solutions ........... 36,157 21.3% 69,333 31.3% 71,260 22.5%
Total .......................... 170,099 100.0% 221,382 100.0% 316,431 100.0%
Gross Profit and Gross Profit Margin
The table below sets forth our gross profit and overall gross profit margin during the
Track Record Period:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Revenue ............................................. 260,011 328,936 441,083
Cost of sales .......................................... (170,099) (221,382) (316,431)
Gross profit .......................................... 89,912 107,554 124,652
Gross profit margin ..................................... 34.6% 32.7% 28.3%
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The table below sets forth our gross profit by service type during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
API marketplace
Query ............................................. 43,604 53,947 84,326
SMS notice .......................................... 6,708 10,875 7,439
Top-up ............................................ 10,466 6,661 5,133
60,778 71,483 96,898
Data management solutions ................................ 29,134 36,071 27,754
Total ............................................... 89,912 107,554 124,652
The table below sets forth our gross profit margin by service type during the Track Record
Period:
Y ear ended December 31,
2021 2022 2023
API marketplace ....................................... 31.2% 32.0% 28.3%
Query ............................................. 35.0% 37.1% 31.1%
SMS notice .......................................... 1 1.6% 15.4% 11.5%
Top-up ............................................ 84.6% 87.3% 83.2%
Data management solutions ................................ 44.6% 34.2% 28.0%
The table below sets forth a breakdown of our gross profit for API marketplace by key
customers and non-key customers, in absolute amounts and as a percentage of total gross profit
for API marketplace, for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
Gross profit
Key customers ............... 35,779 58.9% 52,058 72.8% 84,586 87.3%
Non-key customers ............ 24,999 41.1% 19,425 27.2% 12,312 12.7%
Total ..................... 60,778 100.0% 71,483 100.0% 96,898 100.0%
Our gross profit derived from key customers of API marketplace increased by 45.5% from
RMB35.8 million in 2021 to RMB52.1 million in 2022, and further increased by 62.5% to
RMB84.6 million in 2023. The foregoing increases were primarily because the increases in our
revenue derived from key customers of API marketplace outpaced the increases in the
corresponding cost of sales, mainly because: (i) our number of key customers for API
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marketplace increased primarily as a result of our strategic focus on attracting and retaining
large API marketplace customers; and (ii) we were able to negotiate for better prices and
received more discounts from suppliers as our purchases increased.
Our gross profit derived from non-key customers of API marketplace decreased by 22.3%
from RMB25.0 million in 2021 to RMB19.4 million in 2022, and further decreased by 36.6%
to RMB12.3 million in 2023. The foregoing decreases were primarily because the decreases in
our revenue derived from non-key customers of API marketplace outpaced the decreases in our
corresponding cost of sales, mainly because we lowered our prices offered to certain non-key
customers in response to heightened market competition.
The table below sets forth our gross profit margin for API marketplace by key customers
and non-key customers for the years indicated:
Y ear ended December 31,
2021 2022 2023
Gross Profit Margin
Key customers ................................. 23.6% 28.5% 26.7%
Non-key customers ............................... 58.0% 47.9% 48.5%
Our gross profit margin derived from key customers of API marketplace increased from
23.6% in 2021 to 28.5% in 2022, primarily due to our effective control of cost as we received
additional discounts from suppliers due to our increased purchases. Our gross profit margin
derived from key customers of API marketplace remained relatively stable at 26.7% in 2023.
Our gross profit margins derived from key customers of API marketplace were lower than our
gross profit margin derived from non-key customers of API marketplace, primarily because we
offered additional discounts to key customers due to their high volume of purchases.
Our gross profit margin derived from non-key customers of API marketplace decreased
from 58.0% in 2021 to 47.9% in 2022, primarily due to our reduction of prices offered to
certain customers in response to heightened market competition. Our gross profit margin
derived from non-key customers of API marketplace remained relatively stable at 48.5% in
2023.
The gross profit margin for our data management solutions could vary significantly from
project to project depending on the nature of each project. For solutions with more customized
components or types of solutions that were unprecedented to us, we would typically incur
higher research and development costs, labor costs and other costs, as we had to tailor to the
specific needs of the customers or develop certain components from scratch. Due primarily to
market competition, we could not always fully pass on such costs to our customers. As a result,
our gross profit margin for such solutions were generally lower. For solutions with more
standardized components, we could typically use previous components as templates, thereby
significantly reducing our costs for such projects. As a result, our gross profit margin for such
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solutions were generally higher. Hence, the gross profit margin of our data management
solutions could fluctuate significantly from period to period, depending on the nature of the
projects we handled during the specific period.
We evaluate the projected cost of each data management solution project before providing
a quote or making a bidding proposal. However, for projects with strategic significance or
higher contract value, we may accept lower gross profit margins after considering competitors’
pricing, the customer’s budget, and whether the project could lead to additional business
opportunities in the future. For instance, we have completed projects for certain government
customers with gross profit margins in the low teens in the hope that such projects could foster
long-lasting business relationships.
The table below sets forth a breakdown of our gross profit for data management solutions
by customer type, in absolute amounts and as percentages of gross profit for data management
solutions, for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands, except for percentages)
Gross Profit
Government customers ................ 1 0 8 0.4% 5,650 15.7% 2,516 9.1%
SOE customers .................... 9,205 31.6% 17,636 48.9% 19,918 71.8%
Other customers .................... 19,821 68.0% 12,785 35.4% 5,320 19.1%
Our gross profit derived from government customers for data management solutions
increased significantly from RMB0.1 million in 2021 to RMB5.7 million in 2022, primarily
due to the substantial gross profit contribution from one large project. Our gross profit derived
from government customers for data management solutions decreased by 55.5% to RMB2.5
million in 2023, primarily because we had no particularly large projects in 2023, which tends
to have higher gross profit, thus our average gross profit per project decreased.
Our gross profit derived from SOE customers for data management solutions increased
by 91.6% from RMB9.2 million in 2021 to RMB17.6 million in 2022, and further increased by
12.9% to RMB19.9 million in 2023. The foregoing increases were primarily because the
increases in our revenue derived from SOE customers outpaced the increases in the
corresponding cost of sales, mainly due to: (i) an increase in our number of projects as we
expanded our business, which led to an increase in revenue; and (ii) our effective control of the
corresponding cost of sales.
Our gross profit derived from other customers for data management solutions decreased
by 35.5% from RMB19.8 million in 2021 to RMB12.8 million in 2022, primarily because a
relatively higher portion of revenue was contributed by two projects that had relatively higher
cost of sales. Our gross profit derived from other customers for data management solutions
FINANCIAL INFORMATION
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further decreased by 58.4% to RMB5.3 million in 2023, primarily because the decrease in our
revenue derived from other customers outpaced the decrease in our corresponding cost of sales,
mainly due to a decrease in the average revenue of our projects delivered and accepted.
The table below sets forth a breakdown of our gross profit margin for data management
solutions by customer type for the years indicated:
Y ear ended December 31,
2021 2022 2023
Gross Profit Margin
Government customers ............................... 9.9% 22.3% 32.0%
SOE customers .................................... 39.2% 43.6% 24.4%
Other customers ................................... 48.7% 32.3% 56.1%
Our gross profit margin derived from government customers for data management
solutions increased significantly from 9.9% in 2021 to 22.3% in 2022, primarily because most
of our gross profit for the year was contributed by one large project that had a gross profit
margin of approximately 22.2%. Our gross profit margin derived from government customers
for data management solutions further increased to 32.0% in 2023, primarily because projects
with more standardized components contributed a higher portion of revenue. Such projects
generally yield higher gross profit margins as they generally had relatively lower cost of sales
due to having more standardized components.
Our gross profit margin derived from SOE customers for data management solutions
increased from 39.2% in 2021 to 43.6% in 2022, primarily because projects with standardized
components contributed a higher portion of revenue in 2022. Our gross profit margin derived
from SOE customers for data management solutions decreased to 24.4% in 2023, primarily
because a higher portion of revenue was contributed by integrated system projects, which
generally involved relatively larger purchases of data services and thus had relatively higher
cost of sales.
Our gross profit margin derived from other customers for data management solutions
decreased from 48.7% in 2021 to 32.3% in 2022, primarily because integrated system projects
contributed a higher proportion of revenue. Our gross profit margin derived from other
customers for data management solutions increased to 56.1% in 2023, primarily because a
higher portion of our projects delivered and accepted had more standardized components.
Other Income and Other Gains, Net
Our other income and other gains, net, primarily consist of fair value gain or loss on
financial assets at fair value through profit or loss, government grants and bank interest
income. Fair value gain or loss on financial assets at FVTPL comprises the fair value gain or
loss on our RMB-denominated structured deposits and unlisted debt security. The government
grants we received were mainly from the local government where we are headquartered, the
FINANCIAL INFORMATION
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purposes of which are primarily to support our research and development activities,
innovations, IP development, talent recruitments and other aspects of our operations conducted
in the ordinary course of business. Our bank interest income primarily consists of interest
income from both current and fixed deposits.
The table below sets forth a segment of our other income and other gains, net, for the
years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Fair value gain/(loss) on financial assets at FVTPL ................ 7,316 3,384 (460)
Government grants ...................................... 7,419 5,557 8,437
Bank interest income .................................... 1,922 1,356 2,469
Dividend income ....................................... 1 5 2 3 4 –
(Loss)/gain on disposal/written off of property, plant and equipment ..... (51) 10 (8)
Others .............................................. 2 8 2 4 7 8 2 6 6
Total ............................................... 16,903 11,019 10,704
Selling and Distribution Expenses
Our selling and distribution expenses primarily consist of labor costs, business
development expenses and promotion expenses. Labor costs comprise primarily the salaries of
our selling and distribution personnel. Promotion expenses comprise primarily our expenses
incurred in relation to brand promotion activities, for example e-sports sponsorship and online
and offline advertisements. Business development expenses comprise primarily expenses
incurred in maintaining and developing customer relationships by our selling and distribution
personnel.
The table below sets forth a breakdown of the key components of our selling and
distribution expenses for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Labor costs ........................................... 9,364 10,170 9,071
Business development expenses ............................. 1,310 1,004 882
Promotion expenses ..................................... 2,728 1,369 482
Depreciation and amortization .............................. 3 4 8 5 8 6 4 1 7
Travel expenses ........................................ 3 2 0 2 6 0 3 7 9
Leasing expenses ....................................... 1 5 7 1 1 6 3 9
Service expenses ....................................... 1,029 511 843
Others (1) ............................................ 1 9 3 3 6 2 4 1 7
Total ............................................... 15,449 14,378 12,530
(1) Others primarily comprise miscellaneous expenses such as telecommunications expenses and utilities costs.
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Research and Development Costs
Our research and development costs comprise primarily labor costs, outsourced research
and development expenses, and cloud server costs. Labor costs comprise primarily the salaries
of our research and development personnel. Outsourced research and development expenses
comprise primarily expenses incurred from outsourcing certain research and development work
to external service providers for our data management solutions. Cloud server costs comprise
primarily costs of procuring cloud server services for use in our daily operations.
The table below sets forth a breakdown of the key components of our research and
development costs for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Labor costs ........................................... 13,418 18,384 16,128
Outsourced research and development expenses ................... 9 7 1 4,340 4,938
Depreciation and amortization .............................. 3 4 5 6 6 7 1,038
Cloud server costs ...................................... 1,490 1,575 863
Office expenses ........................................ 3 5 8 6 9 7 4 8 5
Others (1) ............................................ 2 9 3 6 8 2 7 9 8
Total ............................................... 16,875 26,345 24,250
(1) Others comprise primarily miscellaneous expenses such as telecommunications expenses, patent fees and
utilities costs.
We consider research and development key to our ability to improve our services and
solutions offering and maintain our competitive strengths. Our outsourced research and
development work was mainly in relation to the development of data management platforms
and operating systems. During the Track Record Period, we outsourced research and
development work to five local companies, which are all Independent Third Parties. Of the five
service providers:
 one is a data service company incorporated in Wuxi, Jiangsu Province that primarily
focuses on developing national industrial internet platforms and providing industrial
data intelligence system-related services;
 one is a data technology company incorporated in Suzhou, Jiangsu Province that
primarily focuses on providing general data technology services, including technical
services, technology development, technical consultation, internet data services, big
data services, data processing and storage support services, and others;
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 one is an information technology company incorporated in Suzhou, Jiangsu
Province that primarily focuses on providing smart urban services relating to the
development of smart cities and smart transportation, including professional
consultation on informatization of government administration, database
construction, development of platform software, spatiotemporal data modelling and
mining, big data processing and analysis, and others;
 one is a data technology company incorporated in Wuxi, Jiangsu Province that
primarily focuses on providing services related to technology research and
development, technical consultation, technical services, computer software and
hardware, data processing and storage technology, information system integration,
digital multimedia projects, and others; and
 one is an information technology company incorporated in Suzhou, Jiangsu
Province that primarily focuses on the development of geographic information
systems and providing data services related to geographic information systems.
Our Directors confirm that except for the research and development outsourcing
arrangements, there are no other present or past relationships between our Company and any
of the five service providers, their respective substantial shareholders, directors or senior
management, or any of their respective associates. We decide whether to outsource based
primarily on cost efficiency. If the cost of outsourcing the research and development work was
lower than the cost of performing the work in-house, we would typically outsource the research
and development work to an external service provider. During the Track Record Period, the
fluctuations in our outsourced research and development expenses were mainly attributable to
the varying nature of the research work involved in the data management solution projects
undertaken during the specific year. We incurred higher outsourced research and development
expenses when a higher proportion of the research work was more cost-efficient to complete
via outsourcing than in-house.
Administrative and Other Expenses
Our administrative and other expenses comprise primarily labor costs, depreciation and
amortization and professional fees. Labor costs comprise primarily the salaries of our
administrative personnel. Professional fees comprise: (i) professional fees paid to professionals
including legal advisors, auditors, and other professionals in our ordinary course of business,
which totaled RMB1.1 million, RMB0.9 million and RMB1.5 million in 2021, 2022 and 2023,
respectively; and (ii) non-recurring professional fees paid to professional parties involved in
our previous listing preparation, which totaled RMB5.2 million, RMB8.4 million and
RMB95,000 in 2021, 2022 and 2023, respectively. Depreciation and amortization comprise
primarily the depreciation and amortization of our headquarters building and other properties.
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The table below sets forth a breakdown of the key components of our administrative and
other expenses for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Labor costs ............................................ 8,368 8,996 8,747
Depreciation and amortization ................................ 2,953 9,305 10,029
Professional fees ......................................... 6,349 9,302 1,591
Donations ............................................. 1 0 6 1 9 9 –
Office expenses ......................................... 4 6 6 9 3 2 1,096
Travel expenses ......................................... 5 1 5 1 7 7 8 7 8
Hospitality expenses (1) ..................................... 2 6 3 1,746 2,599
Bank charge ............................................ 2 4 9 5 6 6 9
Equity-settled share-based payments ............................ 4 0 0 4 3 5 4 4 2
Others (2) ............................................. 8 2 1 8 7 7 2,067
Total ................................................ 20,490 32,025 27,518
(1) Hospitality expenses primarily comprise dining and catering for business development with our potential and
existing customers and professional parties, as well as purchases of administrative consumables and gifts given
away as a part of business etiquette.
(2) Others primarily comprise miscellaneous expenses such as telecommunications expenses, vehicle expenses,
utilities costs, and property management expenses.
Impairment Loss on Financial and Contract Assets, Net
Our impairment loss on financial and contract assets comprise impairment on trade
receivables, contract assets, and deposits and other receivables. The table below sets forth a
breakdown of the key components of our impairment loss on financial and contract assets for
the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Trade receivables ........................................ 4 3 7 1,775 10,032
Contract assets .......................................... 6 2 0 (19)
Deposits and other receivables ................................ (25) (727) (98)
Total ................................................ 418 1,068 9,915
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Finance Costs
Our finance costs primarily consist of interests on our lease liabilities, bank borrowings,
and repurchase liabilities. During the Track Record Period, our bank borrowings primarily
comprised a RMB20.0 million loan obtained and repaid in 2021. The table below sets forth a
breakdown of our finance costs for the years indicated:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Interest on lease liabilities .................................. 9 1 1
Interest on bank borrowings ................................. 1 4 5 – –
Interest on repurchase liabilities .............................. – – 1,013
Total ................................................ 154 1 1,014
Income Tax
We are subject to income tax on an entity basis on assessable profits arising in or derived
from the tax jurisdictions in which we are domiciled and operate. Pursuant to the PRC income
tax rules and regulations, our provision for PRC income is calculated based on the statutory tax
rate of 25% during the Track Record Period, except for (i) our Company which is registered
as a High and New-Tech enterprise pursuant to the PRC tax regulations and entitled to a
preferential tax rate of 15% for 2021, 2022 and 2023; (ii) Suzhou Tianju Renhe Technology
Co., Ltd, which is registered as a High and New-Tech enterprise pursuant to the PRC tax
regulations and entitled to a preferential tax rate of 15% for 2021, 2022 and 2023; and (iii)
Suzhou Tianju Xinghe Technology Co., Ltd. and Suzhou Zhonghui Juhe Information
Technology Co., Ltd., which qualified as small and micro-enterprises pursuant to applicable
PRC tax regulations and entitled to a preferential tax rate of 2.5%, 2.5% and 5% for 2021, 2022
and 2023.
The table below sets forth the information relating to our income tax during the Track
Record Period:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Current year – PRC Enterprise Income Tax ....................... 7 , 1 1 6 3,704 4,363
Deferred tax ........................................... 3 4 7 (232) (1,649)
Total ................................................ 7,463 3,472 2,714
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RESULTS OF OPERATIONS
The following discussion and analysis compare the major components of our results of
operations in 2021, 2022 and 2023.
Comparisons between 2023 and 2022
Revenue
Our revenue increased by 34.1% from RMB328.9 million in 2022 to RMB441.1 million
in 2023 due to an increase in our revenue from API marketplace.
Our revenue from API marketplace increased by 53.0% from RMB223.5 million in 2022
to RMB342.1 million in 2023 due to an increase in our revenue from query service:
(a) Our revenue from query service increased by 86.8% from RMB145.3 million in
2022 to RMB271.4 million in 2023, primarily because: (i) our query service requests
increased from 920.5 million in 2022 to 1,568.2 million in 2023; and (ii) the average
price per request increased slightly from RMB0.16 in 2022 to RMB0.17 in 2023.
The large increase in the volume of requests was primarily due to: (i) our acquisition
of new large customers with high demand and an increase in demand from certain
of our existing large customers as we continued to expand our business and enhance
our services; (ii) an increase in demand for query service due to the increasingly
common requirement for real-name registration in China, which resulted in an
increase in demand for API-enabled identity authentication services.
(b) Our revenue from SMS notice service decreased by 8.6% from RMB70.6 million in
2022 to RMB64.5 million in 2023 primarily because our SMS notice service
requests decreased from 2,130.7 million in 2022 to 2,097.5 million in 2023, mainly
attributable to (i) our reduction of collaboration with certain customers who were
slow at settling receivables; and (ii) a decrease in customer demand for finance and
marketing-related SMS notices as a result of regulatory changes. The average price
per request remained relatively stable at approximately RMB0.03 in 2022 and 2023.
(c) Our revenue from top-up service decreased by 19.1% from RMB7.6 million in 2022
to RMB6.2 million in 2023, primarily because our top-up service orders decreased
from 15.5 million in 2022 to 9.0 million in 2023 due to our strategic scale-down of
this service. We have been strategically scaling down our top-up service since 2021
primarily because: (i) although top-up service had a high gross profit margin as we
act as an agent for the service and therefore the associated fees are recognized on
a net basis, and we recognized little cost of sales in the form of labor costs and
equipment and server costs, we nevertheless paid top-up service providers and
telecommunication operators approximately RMB99.0 for every RMB100.0 in
top-up value. The end-users did not pay more than the top-up value. We consider the
profitability to be low as only approximately RMB1.0 in profit can be earned for
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each RMB99.0 payment we made to top-up service providers and
telecommunication operators; (ii) we expect that market competition will continue
to intensify in the future and, as a result, adversely impact our top-up service
business in the long-term future; and (iii) top-up service requires making large
prepayments to suppliers, thereby negatively impacting our cash flow and liquidity.
In view of the aforementioned reasons, we decided to shift our resources and efforts
from top-up service to developing our other business lines, namely query service,
SMS notice service, and data management solutions, which we believe have higher
long-term growth potential.
Our revenue from data management solutions decreased by 6.1% from RMB105.4 million
in 2022 to RMB99.0 million in 2023 primarily due to a decrease in our average revenue per
project as a larger portion of our projects comprised projects with more standardized
components, which generally generated lower revenue than projects with more customized
components. In particular, a large number of our projects were “data police” solutions, which
required relatively little customization and generated relatively lower revenue per project. In
2023, 62 of our data management solution projects were delivered to and accepted by our
customers in comparison to 22 projects in 2022.
Cost of Sales
Our cost of sales increased by 42.9% from RMB221.4 million in 2022 to RMB316.4
million in 2023, primarily due to an increase in our purchase costs for API marketplace, which
primarily comprised costs of data services, from RMB149.0 million in 2022 to RMB241.7
million in 2023 as we increased our purchases to meet the demand of our expanding query
service.
Gross Profit and Gross Profit Margin
Our gross profit increased by 15.9% from RMB107.6 million in 2022 to RMB124.7
million in 2023. Our gross profit margin decreased from 32.7% in 2022 to 28.3% in 2023.
Our gross profit margin for API marketplace decreased from 32.0% in 2022 to 28.3% in
2023, primarily due to the following reasons:
(a) Our gross profit margin for query service decreased from 37.1% in 2022 to 31.1%
in 2023, primarily because: (i) we offered lower prices to certain new large
customers to maintain our competitiveness; and (ii) we lost certain large customers
who yielded higher gross profit margins to competitors who offered prices that were
more favorable than ours.
(b) Our gross profit margin for SMS notice service decreased from 15.4% in 2022 to
11.5% in 2023, primarily because: (i) the increase in our revenue from SMS notice
service was outpaced by the increase in our corresponding cost of sales, mainly
because our suppliers raised their prices in response to new policies that imposed
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more stringent regulatory requirements on them, and we were not able to fully pass
on the increased costs to our customers through price increases as we wanted to stay
competitive; and (ii) we reduced our collaboration with certain customers who
yielded higher gross profit margins due to their delay in settling receivables.
(c) Our gross profit margin for top-up service decreased from 87.3% in 2022 to 83.2%
in 2023, primarily because: (i) our revenue decreased as a result of our strategic
downscaling of our top-up business; and (ii) our corresponding labor costs remained
relatively stable as the number of personnel engaged in top-up service remained
relatively stable, while the revenue from our top-up service decreased due to our
strategic scale-down of this business segment.
Our gross profit margin for data management solutions decreased from 34.2% in 2022 to
28.0% in 2023, primarily because our revenue from data management solutions decreased
while our corresponding cost of sales increased, mainly due to an increase in the corresponding
labor costs as we assigned additional personnel to our data management solution business as
a result of a significant increase in our number of projects from 22 in 2022 to 62 in 2023.
Other Income and Other Gains, Net
Our other income and other gains, net, remained relatively stable at RMB11.0 million and
RMB10.7 million in 2022 and 2023, respectively.
Selling and Distribution Expenses
Our selling and distribution expenses decreased by 12.9% from RMB14.4 million in 2022
to RMB12.5 million in 2023, primarily due to: (i) a decrease in our labor costs from RMB10.2
million in 2022 to RMB9.1 million in 2023, mainly attributable to a shift in our marketing
personnel; and (ii) a decrease in our promotion expenses from RMB1.4 million in 2022 to
RMB0.5 million in 2023, mainly attributable to our reduction of online and offline advertising
activities that were relatively ineffective.
Research and Development Costs
Our research and development costs decreased by 8.0% from RMB26.3 million in 2022
to RMB24.3 million in 2023, primarily due to a 12.3% decrease in labor costs from RMB18.4
million in 2022 to RMB16.1 million in 2023. The foregoing decrease in labor costs was
primarily because certain personnel from research and development were assigned to work on
data management solution projects as we had a relatively high number of data management
projects in 2023. The decrease in labor costs was partially offset by an increase in outsourced
research and development expenses from RMB4.3 million in 2022 to RMB4.9 million in 2023
as certain data management solutions we worked on in 2023 involved research and
development work that was more cost-efficient to complete through outsourcing.
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Administrative and Other Expenses
Our administrative and other expenses decreased by 14.1% from RMB32.0 million in
2022 to RMB27.5 million in 2023, primarily due to a 82.9% decrease in professional fees from
RMB9.3 million in 2022 to RMB1.6 million in 2023, which included a significant decrease in
non-recurring professional fees from RMB8.4 million in 2022 to RMB0.1 million in 2023 as
we ended our previous listing preparations. Our administrative and other expenses, after
deducting the professional fees, increased by 14.1% from RMB22.7 million in 2022 to
RMB25.9 million in 2023, primarily due to (i) an increase in our hospitality expenses from
RMB1.7 million in 2022 to RMB2.6 million in 2023, mainly attributable to our increased
business development events at which we hosted existing and potential customers; and (ii) an
increase in our depreciation and amortization expenses from RMB9.3 million in 2022 to
RMB10.0 million in 2023, mainly attributable to the depreciation of our headquarters building.
Impairment Loss on Financial and Contract Assets, Net
Our impairment loss on financial and contract assets increased significantly from
RMB1.1 million in 2022 to RMB9.9 million in 2023, primarily due to a significant increase in
impairment loss on trade receivables from RMB1.8 million in 2022 to RMB10.0 million in
2023, which was primarily attributable to (i) the increase in provisions for billed receivables
due to the slow settlement of receivables from certain large customers; and (ii) an increase in
our trade receivables as we gained additional post-paid large customers for our API
marketplace.
Finance Costs
Our finance costs increased significantly from RMB1,000 in 2022 to RMB1.0 million in
2023 due to our incurrence of interest expenses of RMB1.0 million on our repurchase liabilities
arising from our share repurchase obligation under the share transfer agreement signed with
China-Singapore V entures. For details, see “– Current Assets and Liabilities – Repurchase
Liabilities” and “– Indebtedness”.
Income Tax Expense
Our income tax expense decreased from RMB3.5 million in 2022 to RMB2.7 million in
2023, primarily due to a decrease in our net profit for the year.
Net Profit and Net Profit Margin
Our net profit decreased by 15.1% from RMB41.3 million in 2022 to RMB35.1 million
in 2023, while our net profit margin decreased from 12.6% in 2022 to 7.9% in 2023, primarily
due to a decrease in our gross profit margin and an increase in our total expenses, mainly
attributable to our non-recurring listing expenses and an increase in our net impairment loss on
financial and contract assets.
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Comparisons Between 2022 and 2021
Revenue
Our revenue increased by 26.5% from RMB260.0 million in 2021 to RMB328.9 million
in 2022 as both of our business lines continued to grow.
Our revenue from API marketplace increased by 14.8% from RMB194.7 million in 2021
to RMB223.5 million in 2022, driven by the increase in our revenue from query and SMS
notice services and partially offset by the decrease in revenue from top-up service, in
particular:
(a) Our revenue from query service increased by 16.7% from RMB124.5 million in
2021 to RMB145.3 million in 2022 because our query service requests increased
from 910.8 million in 2021 to 920.5 million in 2022, primarily due to an increase
in customer demand for our query service as we continued to build customer trust
and our customers increased their purchases of our services, and the average price
per request increased from RMB0.14 in 2021 to RMB0.16 in 2022.
(b) Our revenue from SMS notice service increased by 22.0% from RMB57.9 million in
2021 to RMB70.6 million in 2022 because our SMS notice service requests
increased from 2,037.9 million in 2021 to 2,130.7 million in 2022, primarily due to
increased customer demand mainly as a result of the business expansion of our large
customers, and the average price per request remained relatively stable at
approximately RMB0.03 in both 2021 and 2022.
(c) Our revenue from top-up service decreased by 38.4% from RMB12.4 million in
2021 to RMB7.6 million in 2022, primarily because our top-up service orders
decreased from 35.0 million in 2021 to 15.5 million in 2022 as a result of our
strategic scale-down of our top-up service since 2021.
Our revenue from data management solutions increased by 61.4% from RMB65.3 million
in 2021 to RMB105.4 million in 2022, primarily because: (i) our number of projects delivered
to and accepted by customers increased from 20 in 2021 to 22 in 2022; and (ii) our average
revenue derived from each project increased by 45.5% from RMB3.3 million in 2021 to
RMB4.8 million in 2022. As we continued to enhance our brand awareness and enrich our
solution offerings, we attracted more sizeable customers including government organizations
and state-owned enterprises whose projects were more complex and commanded a higher fee
level.
Cost of Sales
Our cost of sales increased by 30.1% from RMB170.1 million in 2021 to RMB221.4
million in 2022, primarily due to: (i) an increase in the aggregate purchase costs for both of
our business lines from RMB160.5 million in 2021 to RMB208.0 million in 2022 due to our
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business growth; and (ii) an increase in labor costs from RMB7.8 million in 2021 to RMB11.7
million in 2022 as we increased our operational personnel. Our purchase costs for API
marketplace increased by 14.3% from RMB130.3 million in 2021 to RMB149.0 million in 2022
as we continued expanding our API marketplace business and purchased additional data
services to fulfill the increased volume of service requests from customers. Our purchase costs
for data management solutions increased by 95.4% from RMB30.2 million in 2021 to RMB59.0
million in 2022 as our data management solution business continued to expand rapidly,
resulting in additional purchases of software and hardware.
Gross Profit and Gross Profit Margin
Our gross profit increased by 19.6% from RMB89.9 million in 2021 to RMB107.6 million
in 2022. Our gross profit margin decreased slightly from 34.6% in 2021 to 32.7% in 2022,
primarily due to a decrease in the gross profit margin of data management solutions.
Our gross profit margin for API marketplace remained relatively stable at 31.2% and
32.0% in 2021 and 2022, respectively. Below is an analysis of our gross profit margin for API
marketplace by service type:
(a) Our gross profit margin for query service remained relatively stable at 35.0% and
37.1% in 2021 and 2022, respectively.
(b) Our gross profit margin for SMS notice service increased from 11.6% in 2021 to
15.4% in 2022, primarily because a higher proportion of revenue was contributed by
certain types of SMS notice services that had higher gross profit margins, mainly as
a result of an increase in our number of customers who had demand for such types
of SMS notice services.
(c) Our gross profit margin for top-up service increased from 84.6% in 2021 to 87.3%
in 2022, primarily because the decrease in cost of sales for top-up service outpaced
the decrease in revenue derived from top-up service.
Our gross profit margin for data management solutions decreased from 44.6% in 2021 to
34.2% in 2022, primarily because the increase in our revenue from data management solutions
was outpaced by the increase in our corresponding cost of sales, mainly because a higher
proportion of revenue was contributed by integrated system projects, which generally involve
higher purchase costs.
Other Income and Other Gains, Net
Our other income and other gains, net, decreased by 34.8% from RMB16.9 million in
2021 to RMB11.0 million in 2022, primarily due to: (i) a decrease in our fair value gain on
financial assets at FVTPL by 53.7% from RMB7.3 million in 2021 to RMB3.4 million in 2022
due to our disposal of certain financial assets as part of our investment decisions; (ii) a
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decrease in our bank interest income by 29.4% from RMB1.9 million in 2021 to RMB1.4
million in 2022 primarily due to a decrease in market interest rates; and (iii) a decrease in
government grants by 25.1% from RMB7.4 million in 2021 to RMB5.6 million in 2022.
Selling and Distribution Expenses
Our selling and distribution expenses decreased by 6.9% from RMB15.4 million in 2021
to RMB14.4 million in 2022, primarily due to: (i) a decrease of our promotion expenses from
RMB2.7 million in 2021 to RMB1.4 million in 2022 as we pivoted from elevator
advertisements to other cost-efficient and effective promotional methods; and (ii) our service
expenses decreased from RMB1.0 million in 2021 to RMB0.5 million in 2022 primarily due
to our reduced use of bidding and business development agents. These decreases were partially
offset by the increase in our labor costs from RMB9.4 million in 2021 to RMB10.2 million in
2022 as we increased the average salary of our selling and distribution personnel to remain
competitive in the hiring market.
Research and Development Costs
Our research and development costs increased by 56.1% from RMB16.9 million in 2021
to RMB26.3 million in 2022, primarily due to: (i) our labor costs increased from RMB13.4
million in 2021 to RMB18.4 million in 2022; and (ii) our outsourced research and development
expenses increased from RMB1.0 million in 2021 to RMB4.3 million in 2022 as the data
management solutions we delivered in 2022 involved more research and development work
that was more cost-efficient to complete through outsourcing than in-house. As a part of our
continuous effort to maintain our technological strengths, industry position, and ability to offer
competitive services and solutions, we increased our research and development personnel and
raised the average salary to attract talents.
Administrative and Other Expenses
Our administrative and other expenses increased by 56.3% from RMB20.5 million in
2021 to RMB32.0 million in 2022, primarily due to: (i) the increase in depreciation and
amortization from RMB3.0 million in 2021 to RMB9.3 million in 2022 as a result of
recognition of the depreciation of our newly completed headquarters building, which we
relocated to in January 2022; (ii) an increase in professional fees, including an increase in
non-recurring professional fees from RMB5.2 million in 2021 to RMB8.4 million in 2022
relating to our previous listing preparations; and (iii) the increase in hospitality expenses from
RMB0.3 million in 2021 to RMB1.7 million in 2022 as our administrative personnel engaged
in additional and more targeted customer relationship management initiatives since we gained
larger customers who required additional time and efforts from our senior management and
administrative personnel in terms of customer relationship management. For instance, we
hosted additional business development events with a view to pursuing more business
opportunities and cementing existing client relationships.
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Impairment Loss on Financial and Contract Assets, Net
Our impairment of financial and contract assets increased from RMB0.4 million in 2021
to RMB1.1 million in 2022, primarily due to an increase in our trade receivables and a slower
receivable turnover, especially from large customers.
Finance Costs
Our finance costs decreased from RMB0.2 million in 2021 to RMB1,000 in 2022 as we
did not incur interest on bank borrowings in 2022.
Income Tax Expense
Our income tax expense decreased by 53.5% from RMB7.5 million in 2021 to RMB3.5
million in 2022, primarily due to an increase in tax incentives for research and development
costs from RMB1.8 million in 2021 to RMB3.0 million in 2022; and a decrease in our profit
before tax from RMB53.4 million in 2021 to RMB44.8 million in 2022. For details, see Note
11 to the Accountants’ Report in Appendix I to this prospectus.
Net Profit and Net Profit Margin
Our net profit decreased by 10.2% from RMB46.0 million in 2021 to RMB41.3 million
in 2022, while our net profit margin decreased from 17.7% in 2021 to 12.6% in 2022, primarily
due to a decrease in our gross profit margin and the increases in our expenses, in particular
research and development costs and administrative and other expenses.
LIQUIDITY AND CAPITAL RESOURCES
Overview
Historically, we funded working capital and other capital requirements primarily from our
internal cash resources. Our ability to generate cash flow from operations depends on our
operating performance, which is in turn dependent on general economic, financial, competitive,
market and other factors, many of which are beyond our control.
We intend to finance our future capital requirements through the same sources of funds
as discussed above, together with the net proceeds from this Global Offering. In order to cover
future obligations and cash outflows, we need to have sufficient liquidity reserves at all times.
We intend to monitor our liquidity risk through rolling forecasts of our liquidity requirements
to ensure that we have sufficient cash to meet operational needs.
Taking into account the financial resources available to us, including our cash and cash
equivalents, time deposits, and estimated net proceeds from the Global Offering, our Directors
are of the view that we have sufficient working capital required for our operations at present
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and for at least the next 12 months from the date of this prospectus. Going forward, we believe
our liquidity requirements will be satisfied by using funds from a combination of our cash and
cash equivalents, time deposits and estimated net proceeds from the Global Offering. Our
Directors confirm that we had no material defaults in payment of trade and non-trade payables
during the Track Record Period.
With the same bases as set forth above, the Sole Sponsor concurs with our Directors’ view
that our Company has sufficient working capital required for its operations at present and for
at least the next 12 months from the date of this prospectus.
Cash Flow
The table below sets forth a summary of our cash flow for the years indicated.
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Cash flows from operating activities
Profit before tax ......................................... 53,429 44,756 37,775
Operating profit before working capital changes .................... 49,270 52,259 58,832
Changes in working capital .................................. (80,396) (84,435) (51,989)
Net cash generated from/(used in) operating activities ................ (33,796) (36,819) 4,445
Net cash generated from/(used in) investing activities ................ (166,628) 22,335 (44,780)
Net cash used in financing activities ............................ (20,941) (22) (3,884)
Net decrease in cash and cash equivalents ........................ (221,365) (14,506) (44,219)
Cash and cash equivalents at the beginning of the year ............... 403,836 182,287 168,470
Exchange differences on translating cash flows of foreign operations ...... (184) 689 166
Cash and cash equivalents at the end of the year .................. 182,287 168,470 124,417
Cash Flows from Operating Activities
Our cash flows from operating activities consist primarily of cash generated from/used in
our operations (such as sale of API marketplace and data management solutions), and changes
in our inventories, trade receivables and payables, prepayments, deposits and other receivables,
contract assets, other payables and accruals, and contract liabilities. Cash flows from operating
activities reflect: (i) profit before tax, adjusted for non-cash and non-operating items such as
depreciation of property, plant and equipment, interest income and fair value gain on financial
assets at FVTPL; (ii) the effects of movements in working capital; and (iii) other cash items
such as income tax paid and refund.
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In 2023, our net cash generated from operating activities was RMB4.4 million, which was
primarily attributable to profit before tax of RMB37.8 million, adjusted to reflect: (i) an
increase in trade receivables of RMB61.1 million, driven by our revenue growth and an
increase in our number of post-paid customers for API marketplace; (ii) an increase in trade
payables of RMB24.8 million, primarily because of (a) an increase in the prices charged by our
suppliers; and (b) our increased purchase of data services for our query service business; and
(iii) an increase in prepayments, deposits and other receivables of RMB15.4 million, primarily
due to an increase in prepayments made to suppliers, mainly attributable to the growth of our
query service business.
In 2022, our net cash used in operating activities was RMB36.8 million, which was
primarily attributable to profit before tax of RMB44.8 million, adjusted to reflect: (i) an
increase in prepayments, deposits and other receivables of RMB38.4 million, primarily because
we made additional prepayments to suppliers to ensure that we received steady supply of data
services and we increased our bidding deposits as we participated in more bidding activities;
(ii) an increase in trade receivables of RMB34.5 million, driven by our business expansion and
continued increase in our number of post-paid customers; and (iii) a decrease in contract
liabilities of RMB21.7 million as we fulfilled our obligation to render services to customers
who had paid us in advance.
In 2021, our net cash used in operating activities was RMB33.8 million, which was
primarily attributable to profit before tax of RMB53.4 million, adjusted to reflect: (i) an
increase in trade receivables of RMB28.6 million, driven by the continued growth of our
business and an increase in our post-paid customers; (ii) an increase in inventories of RMB17.2
million, primarily because we had yet to deliver certain data management solutions to our
customers at the end of 2021, and the cost of sales related to these projects were accounted for
as inventories; (iii) a decrease in trade payables of RMB13.5 million as we made payments to
our suppliers; and (iv) an increase in prepayments, deposits and other receivables of RMB10.1
million primarily due to our increased prepayments to suppliers to secure steady supply of data
services and augment our relationship with them.
In 2021 and 2022, we had net operating cash outflows as a result of: (i) increases in trade
receivables primarily due to a significant increase in our number of post-paid customers, which
was mainly attributable to the continued increase in the numbers of large API marketplace
customers and data management solution customers; and (ii) decreases in trade payables,
primarily because (a) we accelerated payments to our software and hardware suppliers in order
to strengthen our collaboration with them, and (b) our payment obligations to certain suppliers
did not yet arise as we had yet to collect payments from certain data management solution
customers at the end of the year. The foregoing increases in trade receivables and decreases in
trade payables were reflective of our business growth.
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Cash Flows from Investing Activities
Our cash flows from investing activities consist primarily of our purchase of and proceeds
from disposal of financial assets at FVTPL and our purchase of property, plant and equipment.
In 2023, our net cash used in investing activities was RMB44.8 million, which was
primarily attributable to: (i) placement of time deposits of RMB130.0 million, partially offset
by withdrawal of time deposits of RMB80.0 million; and (ii) purchase of property, plant and
equipment of RMB26.7 million, which were partially offset by proceeds from disposal of
financial assets at FVTPL of RMB181.1 million, partially offset by purchase of financial assets
at FVTPL of RMB151.7 million.
In 2022, our net cash generated from investing activities was RMB22.3 million, which
was primarily attributable to: (i) proceeds from disposal of financial assets at FVTPL of
RMB461.3 million, which was partially offset by: (i) purchase of financial assets at FVTPL of
RMB390.0 million; (ii) purchase of property, plant and equipment of RMB20.6 million; and
(iii) placement of time deposits of RMB30.0 million.
In 2021, our net cash used in investing activities was RMB166.6 million, which was
primarily attributable to: (i) purchase of financial assets at FVTPL of RMB298.5 million; and
(ii) purchase of property, plant and equipment of RMB72.8 million, partially offset by proceeds
from disposal of financial assets at FVTPL of RMB202.8 million.
Cash Flow from Financing Activities
Financing activities primarily include bank borrowings, distribution of dividends, issue of
shares and settlement of interest expenses.
In 2023, net cash used in financing activities primarily comprised payments for listing
expenses of RMB3.9 million relating to our proposed Listing and Global Offering.
In 2022, net cash used in financing activities was RMB22,000 relating to repayments of
principal and interest on our lease liabilities.
In 2021, net cash used in financing activities was RMB20.9 million, which was primarily
attributable to: (i) dividends paid of RMB20.0 million; (ii) repayments of principal of lease
liabilities of RMB0.8 million; and (iii) interests paid of RMB0.1 million.
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CURRENT ASSETS AND LIABILITIES
The table below sets forth our current assets and liabilities as of the dates indicated:
As of December 31,
As of
April 30,
2021 2022 2023 2024
(RMB in thousands)
(Unaudited)
Current assets
Inventories ..................................... 21,533 12,454 20,850 28,813
Financial assets at fair value through profit or loss ........... 103,066 35,155 – 50,136
Trade receivables ................................. 91,203 123,973 175,077 208,631
Prepayments, deposits and other receivables ................ 20,321 59,466 78,743 85,224
Contract assets .................................. 1 , 1 1 7 3,994 1,865 1,992
Cash and cash equivalents ........................... 182,287 168,470 124,417 99,552
Time deposits .................................... – 30,000 80,000 10,000
Tax recoverable .................................. – – 1 1 –
Total current assets ............................... 419,527 433,512 480,963 484,348
Current liabilities
Trade payables ................................... 37,450 36,672 61,491 66,549
Other payables and accruals .......................... 23,113 39,474 19,816 15,749
Contract liabilities ................................. 51,440 29,692 29,802 29,837
Lease liabilities .................................. – 4 3 – –
Repurchase liabilities ............................... – – 23,013 23,796
Income tax payable ................................ 2,947 2,008 3,984 1,273
Total current liabilities ............................. 1 14,950 107,889 138,106 137,204
Net current assets ................................ 304,577 325,623 342,857 347,144
We had net current assets of RMB304.6 million, RMB325.6 million, RMB342.9 million
and RMB347.1 million as of December 31, 2021, 2022 and 2023 and April 30, 2024,
respectively. Our net current assets as of each of these dates were primarily attributable to our
growing balance of trade receivables and prepayments, deposits and other receivables, partially
offset by an overall decrease in our cash and cash equivalents.
Our net current assets remained relatively stable at RMB342.9 million and RMB347.1
million as of December 31, 2023 and April 30, 2024, respectively.
Our net current assets increased by 5.3% from RMB325.6 million as of December 31,
2022 to RMB342.9 million as of December 31, 2023, primarily due to increases in our trade
receivables, time deposits, prepayments, deposits and other receivables, and inventories.
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Our net current assets increased by 6.9% from RMB304.6 million as of December 31,
2021 to RMB325.6 million as of December 31, 2022, primarily due to increases in our time
deposits, prepayments, deposits and other receivables, and trade receivables.
Liquidity Management Measures
Our trade receivables turnover days for 2021, 2022 and 2023 were 114 days, 125 days and
133 days, respectively. Our trade payable turnover days for 2021, 2022 and 2023 were 95 days,
61 days and 57 days, respectively. Such gap between the accounts receivables turnover days
and the accounts payable turnover days may result in liquidity mismatch.
In view of the cash flow mismatch, to improve and refine our liquidity management, we
plan to implement the following measures:
 For API marketplace, we plan to continue developing relationships with more customers
of sound credit profile and expanding our business. We expect our bargaining power to
increase in the future as our business grows, and that we would be able to negotiate for
more favorable terms with our customers and shorten the collection period of our trade
receivables, as well as negotiate for more favorable terms with our suppliers and extend
the settlement period of our trade payables. In addition to gaining large customers, we
also expect to attract more smaller-sized customers, who are generally pre-paid, as our
business continues to expand and our brand recognition continues to improve.
 For data management solutions, we plan to increase our provision of solutions with more
standardized components, which generally have a shorter collection period than solutions
with more customized components. As a result, we expect that the liquidity of our data
management solution business would improve with the increase in our sales of solutions
with more standardized components.
We expect that our cash flow and liquidity will improve as a result of the aforementioned
measures.
In addition, we plan to use 10% of our net proceeds from this Global Offering for working
capital and general corporate purposes. For details, see “Future Plans and Use of Proceeds –
Use of Proceeds”.
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Inventories
Our inventories consist of contract fulfillment costs, which are labor costs allocated to the
relevant data management solution projects before delivery, and purchases of software,
hardware and components such as servers and specialized software in our data management
solutions. Given the nature of our API marketplace, such business does not carry any inventory.
Inventories are stated at the lower of cost and net realizable value. The table below sets forth
our inventories as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Purchases of software, hardware and components ................... 16,288 4,982 10,774
Contract fulfilment cost ................................... 5,245 7,472 10,076
Total ................................................ 21,533 12,454 20,850
Our inventories accounted for an insignificant portion of our total assets as of December
31, 2021, 2022 and 2023, respectively. Our inventories decreased by 42.2% from RMB21.5
million as of December 31, 2021 to RMB12.5 million as of December 31, 2022, primarily
because a substantial amount of inventories was recognized as cost of sales after our existing
and newly-mandated data management solution projects were delivered and accepted
throughout 2022. Our inventories increased by 67.4% from RMB12.5 million as of December
31, 2022 to RMB20.9 million as of December 31, 2023 primarily due to an increase in the
number of data management solution projects that we have not yet delivered to our customers
as of December 31, 2023.
The table below sets forth an aging analysis of our inventories:
As of December 31,
2021 2022 2023
(RMB in thousands)
Within one year ......................................... 20,503 10,667 20,167
One to two years ........................................ 1,030 1,787 659
Over two years .......................................... – – 2 4
Total ................................................ 21,533 12,454 20,850
Our inventories aged within one year decreased by 48.0% from RMB20.5 million as of
December 31, 2021 to RMB10.7 million as of December 31, 2022, primarily due to the delivery
and acceptance of our existing data management solution projects. Our inventories aged within
one year increased by 89.1% from RMB10.7 million as of December 31, 2022 to RMB20.2
million as of December 31, 2023, primarily due to a substantial increase in the number of
projects we secured during the year as we continued expanding our data management solution
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business and acquiring new customers. Our inventories aged one to two years increased by
73.5% from RMB1.0 million as of December 31, 2021 to RMB1.8 million as of December 31,
2022, primarily because we began working on one relatively large project for a government
customer that remained undelivered at the end of the year. Our inventories aged one to two
years decreased by 63.1% from RMB1.8 million as of December 31, 2022 to RMB0.7 million
as of December 31, 2023, primarily due to the delivery and acceptance of the aforementioned
project.
Our Directors believe that there is no material recoverability issue for inventories based
on the following reasons: (i) all our data management solution projects delivered and accepted
during the Track Record Period were profitable; (ii) during the Track Record Period, none of
our customers refused to accept our data management solutions or breached their contracts with
us; (iii) considering our ongoing communications and business relationships with our
customers, we do not expect any customer to refuse our delivery of data management solutions
or materially breach their contracts with us in the foreseeable future; and (iv) we form
well-planned budgets for all our data management solution projects and do not expect to incur
losses on any of the ongoing projects.
The table below sets forth the average inventory turnover days as of the dates indicated:
Y ear ended December 31,
2021 2022 2023
Average inventory turnover days (overall) (1) ...................... 2 8 2 8 1 9
Average inventory turnover days (data management solutions) (2) ......... 1 3 0 8 9 8 5
(1) Average inventory turnover days equal the average of the opening and closing inventory balances of the
indicated year divided by the cost of sales for the same year and multiplied by 365 days.
(2) Average inventory turnover days equal the average of the opening and closing inventory balances of the
indicated year divided by the cost of sales of data management solutions for the same year and multiplied by
365 days.
Our average inventory turnover days for data management solutions decreased from 130
days in 2021 to 89 days in 2022 after we delivered a number of data management solution
projects that were undelivered at the end of 2021. Such turnover days remained relatively
stable at 85 days in 2023.
Inventories are utilized as our data management solutions are delivered to and accepted
by customers. Our Directors expect the majority of our inventories as of December 31, 2023
to be utilized in the second and third quarters of 2024 as the data management solution projects
that incurred a substantial portion of inventories as of December 31, 2023 are expected to be
delivered and accepted by customers during such periods. Our Directors believe no provision
for inventories is required as all of our data management solution projects on hand as of
December 31, 2023 are expected to generate profit. Our Directors are of the view that there are
no material net realizable value issues and do not foresee any material recoverability issues for
our inventories. As of the Latest Practicable Date, RMB5.8 million, or 27.7% of our
inventories as of December 31, 2023, had been utilized.
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Financial Assets at FVTPL
Our current financial assets at FVTPL represent Renminbi-denominated structured
deposits. The expected annual interest rate for the structured deposits to be received is
uncertain until redemption. Our non-current financial assets at FVTPL represents our unlisted
debt investments. The table below sets forth the financial assets at FVTPL as of the dates
indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Structured deposits ....................................... 103,066 35,155 –
Unlisted debt security ..................................... – – 5,245
103,066 35,155 5,245
Our current financial assets at FVTPL consisted of: (i) RMB103.1 million of structured
deposits offered by Bank of Jiangsu as of December 31, 2021; and (ii) RMB35.2 million
structured deposits at Agricultural Bank of China as of December 31, 2022. The
aforementioned structured deposits carried expected annual interest rates of 1.2% to 4.0%
during the Track Record Period. Our non-current financial assets at FVTPL consisted of
RMB5.2 million of unlisted debt security as of December 31, 2023, representing our
investment in an unlisted investment fund principally engaged in the trading of securities. For
details, see Note 25 to the Accountants’ Report in Appendix I to this prospectus.
The movements during the Track Record Period of the unlisted debt security at level 3 fair
value measurement are set out below:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
At the beginning of the year ................................. – – –
Addition .............................................. – – 6,667
Fair value changes ....................................... – – (1,422)
At the end of the year .................................... – – 5,245
We have implemented internal control policies and rules regarding investment in
structured products to ensure that the purpose of such investment is to preserve capital and
liquidity until the free cash is used in our primary business and operation. Prior to purchasing
a structured product, we ensure that there remains sufficient working capital for our business
needs, operating activities, research and development and capital expenditures even after
purchasing such products. We adopt a prudent approach in selecting financial products. Our
investment decisions are made on a case-by-case basis, subject to the approval of our chief
financial officer, and after due and careful consideration of a number of factors, such as
FINANCIAL INFORMATION
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duration of the investment, reputation of the bank, and the expected returns. To control our risk
exposure, we have in the past sought, and may continue in the future to seek other low-risk
financial products. Additionally, we mainly invest in financial products offered by reputable
commercial banks in China. We will comply with requirements under Chapter 14 of the Listing
Rules and disclose the details of our investments and other notifiable transactions to the extent
necessary and as appropriate after the Global Offering.
Trade Receivables
Our trade receivables represent amounts receivable for services and solutions sold to our
customers. We measure loss allowances for trade receivables at an amount equal to lifetime
ECLs, which is calculated using a provision matrix. The table below sets forth our trade
receivables and impairment loss allowance as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Trade receivables
API marketplace ....................................... 55,753 82,039 146,484
Data management solutions ................................ 39,520 47,779 44,470
Total trade receivables .................................. 95,273 129,818 190,954
Less: impairment loss allowance ............................. (4,070) (5,845) (15,877)
Trade receivables, net ................................... 91,203 123,973 175,077
Our customers can be divided into customers that pay us either before (“pre-paid”) or
after (“post-paid”) services are rendered. Trade receivables tend to be higher when there are a
larger number of customers who pay only after services are rendered, as their payment
obligations are recorded as trade receivables. Most of our data management solution customers
and large API marketplace customers, comprising government organizations and large internet
companies, are post-paid customers. Our trade receivables net of impairment loss allowance
increased by 35.9% from RMB91.2 million as of December 31, 2021 to RMB124.0 million as
of December 31, 2022, and further increased by 41.2% to RMB175.1 million as of December
31, 2023. The foregoing increases were primarily due to: (i) the general growth of our data
management solution business, the customers of which were mostly post-paid; and (ii) an
increase in the number of post-paid customers for our API marketplace as we continued
attracting large customers for this business segment.
We performed an impairment analysis with regard to the balance of our trade receivables
at the end of each year or period within the Track Record Period. As of December 31, 2021,
2022 and 2023, we had loss allowance for impairment of trade receivables of RMB4.1 million,
RMB5.8 million and RMB15.9 million, respectively. For details, see Note 39(b) to the
Accountants’ Report in Appendix I to this prospectus. Our Directors consider the impairment
loss allowance for our trade receivables to be adequate based on the aforementioned reasons.
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The table below sets forth an aging analysis of trade receivables, net of impairment
losses, based on the invoice dates, as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
API marketplace
Unbilled receivables .................................... 43,923 60,184 89,975
Billed receivables
Within 30 days ....................................... 7,273 8,497 16,853
31-60 days ......................................... 5 1 2 4 9 3 1 1,949
61-90 days ......................................... 5 7 4,100 3,451
91-180 days ......................................... 1 0 3 1,045 3,486
Over 180 days ....................................... 6 4 2,004 5,218
Subtotal ............................................ 8,009 16,139 40,957
Subtotal for API marketplace ............................... 51,932 76,323 130,932
Data management solutions
Unbilled receivables .................................... 39,271 34,707 37,131
Billed receivables
Within 30 days ....................................... – 1 1,159 1,627
31-60 days ......................................... – 7 3 3 3,991
61-90 days ......................................... – – 6 1 6
91-180 days ......................................... – – 5 9 9
Over 180 days ....................................... – 1,051 181
Subtotal ............................................ – 12,943 7,014
Subtotal for data management solutions ........................ 39,271 47,650 44,145
Total ............................................... 91,203 123,973 175,077
For API marketplace, our unbilled receivables and billed receivables aged zero to 90 days,
net of impairment loss allowance, amounted to RMB51.8 million, RMB73.3 million and
RMB122.2 million as of December 31, 2021, 2022 and 2023, respectively. In particular, for
API marketplace, our unbilled receivables and billed receivables aged within 30 days increased
by 55.5% from RMB68.7 million as of December 31, 2022 to RMB106.8 million as of
December 31, 2023, while our trade receivables aged 31 to 60 days increased significantly
from RMB0.5 million as of December 31, 2022 to RMB11.9 million as of December 31, 2023.
The increases were reflective of the growth of our revenue from API marketplace during the
Track Record Period. For data management solutions, our unbilled receivables and billed
receivables aged zero to 90 days, net of impairment loss allowance, amounted to RMB39.3
million, RMB46.6 million and RMB43.4 million as of December 31, 2021, 2022 and 2023,
respectively. The overall increases in our trade receivables aged zero to 90 days for both
business lines during the Track Record Period were in line with our revenue growth.
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For API marketplace, our trade receivables aged over 90 days, net of impairment loss
allowance, amounted to RMB0.2 million, RMB3.0 million and RMB8.7 million as of
December 31, 2021, 2022 and 2023, respectively. The overall increase during the Track Record
Period was primarily due to an increase in our number of large customers for API marketplace,
as large customers had stronger bargaining power in negotiating payment terms and were
generally post-paid customers who underwent relatively long internal reconciliation
procedures before making payments. For data management solutions, our trade receivables
aged over 90 days, net of impairment loss allowance, amounted to nil, RMB1.1 million and
RMB0.8 million as of December 31, 2021, 2022 and 2023, respectively. The increase to
RMB1.1 million as of December 31, 2022 was primarily because we had yet to receive payment
for one data management solution delivered in 2021 at the time. This outstanding receivable
had since been collected in full.
As of December 31, 2023, we had RMB20.9 million of gross trade receivables aged over
90 days. These were due from 20 customers, including five SOE customers, one government
customer and 14 other customers, primarily comprising technology and data service
companies. As of the Latest Practicable Date, we had subsequently recovered RMB4.1 million
of these trade receivables. However, our Directors believe that there is no material risk that the
remaining trade receivables aged over 90 days could not be recovered based on the following
factors:
 94.1% of the RMB20.9 million was due from five customers, including three other
customers and two SOE customers (accounting for approximately 32.0% of the
RMB20.9 million). For the two SOE customers, we have obtained a favorable court
judgment in our litigation against one of them (accounting for approximately 7.6%
of the RMB20.9 million) over its outstanding balance in November 2023, so we
expect that we can collect the outstanding receivables due from this customer, also
taking into account this customer’s financial conditions and capability to make such
payments. For the other SOE customer (accounting for approximately 24.4% of the
RMB20.9 million), we expect this customer to fully settle its outstanding
receivables by July 31, 2024 based on the continuous discussions between our sales
personnel and this customer.
 For the three other customers (accounting for approximately 62.1% of the RMB20.9
million), based on our regular communications with them, their delays in settlement
were not due to their experiencing any interruptions in business activities,
encountering any financial difficulties or having disputes with us. Instead, they
encountered settlement issues with their own clients as stated below. We have been
actively following up and discussed settlement plans with each of these customers
and believe that they are able and willing to settle outstanding receivables in due
course as agreed with them.
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 For the three other customers, the first one (accounting for 25.6% of the RMB20.9
million) delayed settlement due to a settlement dispute with its own client, but this
customer has since resolved its dispute with its client, who has agreed to pay our
customer in monthly installments starting from December 2023. We expect this
customer to settle its outstanding receivables by July 31, 2024. The second customer
(accounting for 17.4% of the RMB20.9 million) and the third customer (accounting
for 19.1% of the RMB20.9 million) delayed settlement as they needed additional
time to reconcile their records of their own clients’ usage of API services with their
own records. We expect to collect the outstanding receivables due from these two
customers by July 31, 2024, and have already settled in full from the third customer
as of the Latest Practicable Date.
 For the remaining 5.9% of the RMB20.9 million, we expect the outstanding amounts
to be fully settled by July 31, 2024 based on the continuous discussions between our
sales personnel and the relevant customers.
During the Track Record Period, our trade receivables comprised both unbilled and billed
portions. Our unbilled receivables were mainly attributable to services rendered for API
marketplace and data management solutions for which we have recognized revenue but not yet
billed to our customers. Once we issue invoices to customers, such unbilled receivables would
become billed receivables, until payments are settled. Our billed receivables primarily
represented services rendered and billed to our customers. Also see “– Material Accounting
Policy Information – Revenue Recognition”.
For API marketplace, as our customers may incur substantial number of API requests
during a period, and hence need more time to reconcile their internal records with our records
in order to ascertain that they have been charged for the correct number of API requests. For
both API marketplace and data management solutions, before we issue invoices to our
customers, we have to wait for the long internal approval process by our customers’ business
and/or finance departments, which can take weeks or even months. According to F&S, after
conducting independent research, such prolonged billing and payment process is in line with
the market practice in China, and it is a market practice that invoices issued to customers,
especially ones that have more bargaining power such as government entities, SOEs and large
corporate entities, are generally dated after the conclusion of their internal approval process
although our services under relevant contracts have been duly rendered. For a detailed
discussion of the stages in our settlement process, see “Business – Our Customers – General
Terms of Contracts with Customers”.
As of December 31, 2021, 2022 and 2023, our trade receivables included unbilled
receivables of RMB83.2 million, RMB94.9 million and RMB127.1 million, respectively, and
billed receivables of RMB8.0 million, RMB29.1 million and RMB48.0 million, respectively.
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The table below sets forth a breakdown of our unbilled receivables by business segment
as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Unbilled receivables
API marketplace ....................................... 43,923 60,184 89,975
Data management solutions ................................ 39,271 34,707 37,131
Total ............................................... 83,194 94,891 127,106
The table below sets forth a breakdown of our unbilled receivables by customer type as
of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Unbilled receivables
Government .......................................... – – 2,240
SOEs ............................................... 41,572 35,606 28,318
Large corporate entities (1) ................................. 18,776 42,046 88,122
SMEs (2) ............................................. 22,846 17,239 8,426
Total ............................................... 83,194 94,891 127,106
(1) Represents corporate entities classified as “L” or large (ۨon Qichacha (ݟݟand corporate entities
classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small (ۨon Qichacha that are
listed on the Beijing, Shanghai, Shenzhen and/or Stock Exchanges.
(2) Represents corporate entities classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small
(ۨon Qichacha (ݟݟexcluding companies listed on the Beijing, Shanghai, Shenzhen and/or Stock
Exchanges.
Our Directors believe that there are no material recoverability issues with the trade
receivables due from our major and strategic customers on the following basis:
 Our major and strategic customers are primarily government entities, SOEs, and
large corporate entities with solid credit profiles and a history of settling receivables
with us. We have generally maintained strong and stable business relationships with
these customers;
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 The delay in settlement by certain of our major and strategic customers was not
caused by financial difficulties or interruptions in their business activities, but due
to their effort at better managing their liquidity and cash flow as they were still
recovering from the negative impact of the COVID-19 pandemic or had yet to settle
receivables due from their own customers; and
 Our sales personnel maintain communications with these customers to monitor their
business performance and financial position and to discuss settlement plans. Based
on such communications, these customers have generally agreed to settle their
receivables in full within the first nine months of 2024.
In addition, we would take appropriate follow-up actions with our major and strategic
customers when receivables become due.
As of the Latest Practicable Date, our API marketplace customers settled a substantial
portion of unbilled and billed receivables as of December 31, 2021 and 2022. It suggested that
our API marketplace customers overall had a good record of payment settlement. In very rare
cases, we filed a claim against customers to recover the amount of receivables. For the data
management solutions delivered and accepted in 2022, we received payments after the delivery
and acceptance of 17 projects from 2022 up to the Latest Practicable Date. Such payment
represented 78.8% of the receivables of the projects as of their respective delivery and
acceptance months. For the data management solutions delivered and accepted in 2021, we
received payments after the delivery and acceptance of 16 projects from 2022 up to the Latest
Practicable Date. Such payment represented 94.9% of the receivables of the projects as of their
respective delivery and acceptance months. These results suggest that our data management
solution customers do, over time, continuously seek to settle their payments with us after the
delivery and acceptance of respective solutions.
On the basis of (1) reviewing the breakdown of the Group’s unbilled receivables as of
December 31, 2021, 2022 and 2023; (2) reviewing the breakdown of the subsequent settlement
to the unbilled receivables as of the Latest Practicable Date; (3) with the assistance of the
Sponsor’s PRC Legal Counsel, conducting desktop search on the top five customers with
unbilled receivables as of December 31, 2021, 2022 and 2023; (4) discussing with F&S and
obtaining their view that it is a market practice in China that invoices issued to customers,
especially ones that have more bargaining power such as government entities, SOEs and large
corporate entities, are generally dated after the conclusion of their internal approval process;
and (5) discussing with the Reporting Accountants and obtaining their confirmation that
appropriate provisions were made in the Group’s audited financial statements, no material
information has come to the Sole Sponsor’s attention that would lead it to disagree with the
Directors’ views on the recoverability of unbilled receivables and whether sufficient provision
has been made.
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The table below sets forth an aging analysis of trade receivables, net of impairment
losses, based on the revenue recognition dates, as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
API marketplace
Unbilled receivables
Within 30 days ....................................... 27,824 20,919 29,431
31-60 days ......................................... 1,308 19,047 23,312
61-90 days ......................................... 4 4 3 7,173 8,287
91-180 days ......................................... 5 3 2 1 1,688 5,305
Over 180 days ....................................... 13,816 1,357 23,640
Subtotal ............................................. 43,923 60,184 89,975
Billed receivables
Within 30 days ....................................... – 5 3 1 1
31-60 days ......................................... 7,120 8,286 451
61-90 days ......................................... 5 0 4 5 4 1 12,949
91-180 days ......................................... 2 7 9 4,352 7,373
Over 180 days ....................................... 1 0 6 2,429 20,183
Subtotal ............................................. 8,009 16,139 40,957
Subtotal for API marketplace ............................... 51,932 76,323 130,932
Data management solutions
Unbilled receivables
Within 30 days ....................................... 25,539 19,729 12,364
31-60 days ......................................... 13,361 2,535 –
61-90 days ......................................... – 6 0 –
91-180 days ......................................... – 1,317 2,438
Over 180 days ....................................... 3 7 1 1 1,066 22,329
Subtotal ............................................. 39,271 34,707 37,131
Billed receivables
Within 30 days ....................................... – 1 1,892 5,361
31-60 days ......................................... – – 2 8 7
61-90 days ......................................... – – –
91-180 days ......................................... – – –
Over 180 days ....................................... – 1,051 1,366
Subtotal ............................................. – 12,943 7,014
Subtotal for data management solutions ........................ 39,271 47,650 44,145
Total ............................................... 91,203 123,973 175,077
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The table below sets forth the turnover days for our trade receivables and billed
receivables for the years indicated:
Y ear ended December 31,
2021 2022 2023
Trade receivables turnover days (1) ............................ 1 1 4 1 2 5 1 3 3
Billed receivables turnover days (2)............................ 1 1 2 2 3 8
(1) Trade receivables turnover days equal the average of the opening and closing trade receivables balances of the
indicated year divided by the revenue for the same year and multiplied by 365 days.
(2) Billed receivables turnover days equal the average of the opening and closing gross billed receivables balances
of the indicated year divided by the revenue for the same year and multiplied by 365 days.
Our trade receivable turnover days increased from 114 days in 2021 to 125 days in 2022,
and further increased to 133 days in 2023, primarily due to an increase in our number of large
customers, including large internet companies and government organizations, who are
generally post-paid customers that settle payments after using our API marketplace services or
after the delivery and acceptance of our data management solution projects. Before we issue
invoices to our customers, we have to wait for the long internal approval process by our
customers’ business and/or finance departments, which can take weeks or even months. For our
monthly settled API marketplace customers, they take time to reconcile their internal records
with our records in order to ascertain that they have been charged for the correct number of API
requests. The customers also undergo their internal protocols to initiate the payment process.
All these reasons contribute to our increased turnover days of trade receivables. Our billed
receivables turnover days were 11 days in 2021, 22 days in 2022 and 38 days in 2023. Our
billed receivables turnover days were generally within our credit period of five to 60 days.
We closely monitor and control the recoverability of our outstanding receivables,
especially unbilled receivables, by adopting the following measures:
 keeping records of outstanding receivables;
 requiring our sales personnel to communicate with customers regarding payment
plans;
 if a customer’s payment to us is dependent on the customer’s receivables, we will
take reasonable efforts to understand the recoverability of the relevant receivables
from the perspective of our customer;
 implementing various measures to collect outstanding payments, including: (i)
negotiating with customers to formulate payment plans and monitoring the
implementation of such plans; (ii) prompting customers to complete internal
approval and invoice issuance processes as soon as possible; and (iii) sending
overdue payment notices to customers; and
 maintaining and regularly updating a list of customers with payments that are
overdue and designating personnel to collect overdue payments.
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Our Director consider our Group’s internal controls on monitoring and controlling our
unbilled receivables sufficient and effective, on the basis that:
 As of the Latest Practicable Date, 90.2% and 97.3% of the unbilled receivables as
of December 31, 2022 and 2021, respectively, were billed; and 86.8% and 97.0% of
the unbilled receivables as of December 31, 2022 and 2021, respectively, were
settled. This indicated that our customers were willing to pay their unbilled
receivables;
 The amount of the billed receivables was one of the assessment criteria of sales
personnels’ payroll. They have personal interests to follow up with customers and
facilitate the billing of unbilled receivables; and
 Our revenue derived from the contributions from large customers. For example, for
each of the years ended December 31, 2021, 2022 and 2023, revenue from our five
largest customers accounted for approximately 41.1% to 62.3% of our total revenue.
Our data management solutions have less than 30 customers in each of the years
ended December 31, 2021, 2022 and 2023, respectively. To maintain and expand our
business operation, we are also prudent on maintaining our relationship with our
large customers. Sufficient and effective internal control measures should also strike
the balance between reduction on the unbilled receivables and maintenance of
customer relationships.
Furthermore, in order to minimize our credit risks, we have implemented a collection
policy which includes measures to perform on-going credit evaluation of the financial
conditions of our customers. For both our new and existing customers, we assess the potential
customer’s credit quality at the early stage of entering contracts and our sales department is
responsible for assessing the risks and credits of our customers.
For a new customer, as part of the customer onboarding process, our sales staff would
collect basic information and build customer profiles to include the new customer’s business
operation conditions, financial conditions and credit conditions and assess their credit risk
based on the information collected. Before we enter into a new contract with our new or
existing customers, we internally review and confirm the contract with our staff in various key
departments such as finance, sales and legal. Approvals from the relevant departments are
required to enter into contracts. For our existing customers, we also consider the customers’
payment history and any unsettled amount with them before entering into new contracts with
them. We regularly update our assessments based on our customers’ business operations and
financial performance. We obtain information on our customer’s operation and financial
performance via the public domain and through regular communications with them.
When receivables become due, we take further appropriate follow-up actions based on our
previous assessments, including continuous communications with our customers, demanding
due payments through written communications and taking legal actions when necessary. Our
sales team is responsible for following up periodically with our customers regarding unbilled
receivables, and closely monitors the progress and outcome of such follow-ups.
FINANCIAL INFORMATION
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Our finance staff reviews settlement amounts every month and the aging of unbilled
receivables and prepares a list of customers for sales staff to take further actions from time to
time. If the outstanding receivables cannot be recovered after exhausting all proper measures,
the sales staff would notify the finance department. The finance staff would review and obtain
approvals from relevant personnel to make loss allowances for unrecoverable receivables
whenever necessary.
Based on the foregoing, sample testing and the internal control consultant’s review of the
Company’s policies and procedures, the internal control consultant engaged by the Company
is of the view that there are no internal control deficiencies on unbilled receivables.
As a result of the foregoing, our Directors believe that our internal controls over unbilled
receivables are sufficient and that there is no material recoverability issue with our receivables
from our major and strategic customers.
Through discussions with the internal control consultant engaged by our Company (the
“Internal Control Consultant ”), the Sole Sponsor understood that the Internal Control
Consultant has interviewed and discussed with the responsible persons to understand the
abovementioned internal control procedures. The Internal Control Consultant noted that the
Company has established written policies and procedures to manage and monitor the sales
activities including pricing, customer’s identity verification, contract management, customer’s
credit, and account receivables confirmation procedures.
Based on the foregoing, no material information has come to the Sole Sponsor’s attention
that would lead it to disagree with the Directors’ and the Internal Control Consultant’s views
on the effectiveness and sufficiency of the Group’s internal control measures on unbilled
receivables as discussed.
As of the Latest Practicable Date, 48.7% of our trade receivables as of December 31,
2023, 79.8% of our trade receivables as of December 31, 2022 and 93.5% of our trade
receivables as of December 31, 2021 had been settled. With the exception of trade receivables
totalling RMB3.5 million, which have been accounted for in the impairment loss allowance,
our Directors are not aware of any material recoverability issue.
As of the Latest Practicable Date, 57.2% of our unbilled receivables as of December 31,
2023, 90.2% of our unbilled receivables as of December 31, 2022, and 97.3% of our unbilled
receivables as of December 31, 2021, had been billed.
FINANCIAL INFORMATION
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The table below sets forth the subsequent billing status as of the Latest Practicable Date
of our unbilled receivables as of December 31, 2021, 2022 and 2023 by business segment:
As of December 31,
2021 2022 2023
Subsequently billed receivables as of the
Latest Practicable Date
API marketplace ....................... 97.7% 98.9% 59.0%
Data management solutions ............... 96.8% 75.1% 53.0%
Total ............................... 97.3% 90.2% 57.2%
The table below sets forth the subsequent billing status as of the Latest Practicable Date
of our unbilled receivables as of December 31, 2021, 2022 and 2023 by customer type:
As of December 31,
2021 2022 2023
Subsequently billed receivables as of the
Latest Practicable Date
Government .......................... – – 74.0%
SOEs ............................... 97.0% 82.2% 54.7%
Large corporate entities (1) ................ 99.7% 99.9% 58.1%
SMEs (2) ............................. 96.0% 82.8% 52.6%
Total ............................... 97.3% 90.2% 57.2%
(1) Represents corporate entities classified as “L” or large (ۨon Qichacha (ݟݟand corporate entities
classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small (ۨon Qichacha that are
listed on the Beijing, Shanghai, Shenzhen and/or Stock Exchanges.
(2) Represents corporate entities classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small
(ۨon Qichacha (ݟݟexcluding companies listed on the Beijing, Shanghai, Shenzhen and/or Stock
Exchanges.
FINANCIAL INFORMATION
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The table below sets forth the subsequent settlement status as of the Latest Practicable
Date of our unbilled receivables as of December 31, 2021, 2022 and 2023 by business segment:
As of December 31,
2021 2022 2023
Subsequently settled unbilled receivables as
of the Latest Practicable Date
API marketplace ....................... 97.2% 96.6% 58.0%
Data management solutions ............... 96.8% 69.7% 44.3%
Total ............................... 97.0% 86.8% 54.0%
The subsequent settlement rate as of the Latest Practicable Date of our unbilled
receivables for data management solutions as of December 31, 2022 was relatively low at
69.7%, primarily because the following four customers had yet to settle payments with us:
 Two SOE customers that had to go through lengthy internal processes before issuing
payments to us. As per communications with our sales personnel, one of them
(accounting for 65.5% of the unbilled receivables for data management solutions as
of December 31, 2022 that remained unsettled as of the Latest Practicable Date) has
agreed to settle its outstanding unbilled receivables with us before July 31, 2024,
and the other one (accounting for 11.9% of the outstanding unbilled receivables)
before September 30, 2024;
 A publicly-funded university (accounting for 22.5% of the outstanding unbilled
receivables) that delayed its settlement due to a decrease in the government grants
it received in 2022 and 2023 as the COVID-19 pandemic negatively impacted the
local government’s financial position. As per communications with our sales
personnel, this customer has agreed to settle its outstanding unbilled receivables
with us before July 31, 2024; and
 An SOE customer (accounting for 0.1% of the outstanding unbilled receivables)
delayed its settlement as it had not yet received payments due from its own
customer, a local government platform in Suzhou. As per communications with our
sales personnel, this customer has agreed to settle the outstanding unbilled
receivables with us before December 31, 2024.
FINANCIAL INFORMATION
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The table below sets forth the subsequent settlement status as of the Latest Practicable
Date of our unbilled receivables as of December 31, 2021, 2022 and 2023 by customer type:
As of December 31,
2021 2022 2023
Subsequently settled unbilled receivables as
of the Latest Practicable Date
Government .......................... – – 3.2%
SOEs ............................... 96.9% 75.7% 48.6%
Large corporate entities (1) ................ 99.7% 99.5% 58.0%
SMEs (2) ............................. 95.0% 78.4% 43.9%
Total ............................... 97.0% 86.8% 54.0%
(1) Represents corporate entities classified as “L” or large (ۨon Qichacha (ݟݟand corporate entities
classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small (ۨon Qichacha that are
listed on the Beijing, Shanghai, Shenzhen and/or Stock Exchanges.
(2) Represents corporate entities classified as “M” or medium (ۨS” or small (ۨor “XS” or extra small
(ۨon Qichacha (ݟݟexcluding companies listed on the Beijing, Shanghai, Shenzhen and/or Stock
Exchanges.
We believe the prolonged settlement of receivables to be in line with market practice in
China. As more fully set forth under “Business – Our Customers – General Terms of Contracts
with Customers”, a small number of customers contribute a large percentage of our revenues.
For example, in 2023, the top 1% of our active registered paying customers accounted for
97.3% of our revenue. These customers typically have stronger bargaining power and may
request that they settle payment at a later period. It is also often to our strategic interests to
accommodate requests for extended period of settlement, as these customers enhance our
ability to keep abreast of industry trends and business opportunities.
For the reasons set forth below, our Directors are of the view, and the Sponsor concurs,
that there is minimal risk of non-recoverability of our unbilled receivables, and that sufficient
provision has been made:
We measure loss allowances for trade receivables and contract assets using IFRS 9
simplified approach and calculate ECLs based on lifetime ECLs individually or collectively
using a provision matrix with appropriate groupings. Our provision matrix is based on our
historical credit loss experience, adjusted for forward-looking factors specific to the debtors
and the economic environment and an assessment of both the current as well as the forecast
direction of conditions at the reporting date, including time value of money where appropriate.
With respect to our unsettled receivables as of the Latest Practicable Date, based on the
ECL allowance principles set forth herein, we have made impairment loss allowances
depending on the circumstances surrounding the counterparty and the nature of the receivables.
FINANCIAL INFORMATION
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For example, we made an impairment loss allowance of the full amount of the receivables for
a counterparty that had gone bankrupt. We made partial impairment loss allowances for various
SOE customers that will settle with us once their customers have settled with them, which they
expect to occur within the year.
Prepayments, Deposits and Other Receivables
The table below sets forth an analysis of our current portion of prepayments, deposits and
other receivables as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Deposits and other receivables .............................. 3,048 4,612 2,201
Prepayments .......................................... 18,302 55,146 70,339
Prepaid listing expenses and deferred issue costs .................. – – 6,397
21,350 59,758 78,937
Less: impairment loss allowance ............................. (1,029) (292) (194)
Total ............................................... 20,321 59,466 78,743
Our current deposits and other receivables primarily consisted of our prepaid input V A T,
bidding deposits, and advancements to employees in daily operations. Our current deposits and
other receivables increased by 51.3% from RMB3.0 million as of December 31, 2021 to
RMB4.6 million as of December 31, 2022, primarily because we made additional deposits in
relation to our bidding activities. Our current deposits and other receivables decreased by
52.3% to RMB2.2 million as of December 31, 2023 primarily due to an increase in our prepaid
taxes.
Our current prepayments primarily consisted of prepayments to suppliers. Our current
prepayments increased significantly from RMB18.3 million as of December 31, 2021 to
RMB55.1 million as of December 31, 2022, and further increased by 27.6% to RMB70.3
million as of December 31, 2023. The increase in our current prepayments was primarily
because as we continued to grow our API marketplace business and gain customers with
demand for high-quality services, we made more prepayments to suppliers in order to
accelerate the settlement of payables to ensure that we receive a steady supply of data services
and strengthen our relationships with suppliers. We had prepaid listing expenses and deferred
issue costs of RMB6.4 million in relation to our Listing and Global Offering as of December
31, 2023.
As of the Latest Practicable Date, RMB70.4 million, or 89.4% of our prepayments,
deposits and other receivables as of December 31, 2023, had been settled or utilized.
FINANCIAL INFORMATION
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Contract Assets
Our contract assets arising from data management solutions relate to our rights to
consideration for work completed during the project warranty and maintenance period of
usually one year after delivery. Our contract assets increased significantly from RMB1.1
million as of December 31, 2021 to RMB4.0 million as of December 31, 2022, primarily due
to an increase in the total amount of retention money we were entitled to collect as our revenue
from data management solutions grew. Our contract assets decreased by 53.3% to RMB1.9
million as of December 31, 2023, primarily because for certain of our data management
solution projects, the amount of consideration originally recognized as contract assets was
reclassified as trade receivables when these projects reached the end of their warranty and
maintenance period. The table below sets forth our contract assets as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Contract assets arising from data management solutions ............. 1,124 4,021 1,873
Less: impairment loss allowance ............................. ( 7 ) (27) (8)
Total ............................................... 1,117 3,994 1,865
As of the Latest Practicable Date, 20.9% of our contract assets as of December 31, 2023,
had been recognized as trade receivables.
Trade Payables
Our trade payables primarily consist of payables to our suppliers. Our trade suppliers
generally grant us a credit period of up to three months from the date of billing. The table
below sets forth our trade payables and other as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
API marketplace ....................................... 9,506 9,195 35,712
Data management solutions ................................ 27,944 27,477 25,779
Total ............................................... 37,450 36,672 61,491
As of December 31, 2021, 2022 and 2023, our trade payables to suppliers for API
marketplace accounted for 25.4%, 25.1% and 58.1% of our total trade payables, while our trade
payables to our suppliers for data management solutions accounted for 74.6%, 74.9% and
41.9%.
FINANCIAL INFORMATION
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Our trade payables to suppliers for API marketplace as of December 31, 2023 was
significantly higher than as of December 31, 2021 and 2022, primarily due to: (i) the more
relaxed payment schedule with our suppliers, mainly attributable to our increased purchases
and stronger relationship with suppliers, as well as our good settlement history of payables; (ii)
our slower settlement of payables to improve our liquidity and operating cash flow; and (iii)
an overall increase in our purchases of data services due to the growth of our query service
business.
The table below sets forth an aging analysis of our trade payables:
As of December 31,
2021 2022 2023
(RMB in thousands)
Within one year ........................................ 36,389 30,179 50,130
One to two years ....................................... 7 7 5 6,086 7,959
Over two years ........................................ 2 8 6 4 0 7 3,402
Total ............................................... 37,450 36,672 61,491
Our trade payables aged within one year increased by 66.1% from RMB30.2 million in
2022 to RMB50.1 million in 2023, primarily due to an increase in our trade payables to
suppliers for API marketplace. Our trade payables aged over two years increased significantly
from RMB0.4 million in 2022 to RMB3.4 million in 2023, primarily due to our delay in
settlement of payables to our suppliers on certain data management solution projects as we had
not yet received payments from our customers on these projects; per the back-to-back payment
arrangements in our agreements with such suppliers, our obligation to make payment does not
arise until we have received payment from our respective customers. Our trade receivables
aged one to two years increased significantly from RMB0.8 million in 2021 to RMB6.1
million, primarily due to our delay in settlement of payables to certain suppliers for data
management solutions for the same foregoing reason.
The table below sets forth the number of turnover days for our trade payables for the years
indicated:
Y ear ended December 31,
2021 2022 2023
Trade payables turnover days (1) ............................. 9 5 6 1 5 7
(1) Trade payables turnover days equal the average of the opening and closing trade payables balances of the
indicated year divided by the cost of sales for the same year and multiplied by 365 days.
FINANCIAL INFORMATION
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Our trade payables turnover days decreased from 95 days in 2021 to 61 days in 2022, and
further decreased to 57 days in 2023, primarily due to our efforts to accelerate the settlement
of payables to secure a steady supply of data services, software and hardware from our
suppliers.
As of the Latest Practicable Date, RMB44.3 million, or 72.0% of our trade payables as
of December 31, 2023, had been settled.
Other Payables and Accruals
The table below sets forth our other payables and accruals as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Deposits received ....................................... 1 3 0 1 3 0 8 2
Other payables ........................................ 3 9 3 7 2 2
Other tax payables ...................................... 2,457 3,785 1,453
Construction costs payable ................................. 15,566 27,205 2,054
Accruals ............................................ 4,921 8,317 5,934
Accrued listing expenses ................................. – – 10,271
Total ............................................... 23,113 39,474 19,816
Our construction costs payable were the largest component of our other payables and
accruals as of December 31, 2021 and 2022. Fluctuations in our construction costs payable
during the Track Record related to our payment schedule based on the construction of our
headquarters building and our purchase of furniture, fixtures and office equipment for such
building. Our accruals increased significantly from RMB4.9 million as of December 31, 2021
to RMB8.3 million as of December 31, 2022, primarily due to increase in our salaries payable
and professional fees payable. Our accruals decreased by 28.7% from RMB8.3 million as of
December 31, 2022 to RMB5.9 million as of December 31, 2023, primarily due to our
settlement of professional fees payable in relation to our previous listing preparations. We had
accrued listing expenses of RMB10.3 million as of December 31, 2023 in relation to our
proposed Listing and Global Offering.
As of the Latest Practicable Date, RMB17.9 million, or 90.1% of our other payables and
accruals as of December 31, 2023, had been settled.
FINANCIAL INFORMATION
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Contract Liabilities
Our contract liabilities represent our obligation to transfer services to a customer for
which we have received advance consideration from the customer. We receive payments from
customers based on billing schedule as established in contracts. The table below sets forth our
contract liabilities as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
API marketplace ....................................... 31,891 26,902 20,491
Data management solutions ................................ 19,549 2,790 9,311
Total .............................................. 51,440 29,692 29,802
Our contract liabilities arising from API marketplace decreased by 15.6% from RMB31.9
million as of December 31, 2021 to RMB26.9 million as of December 31, 2022, and further
decreased by 23.8% to RMB20.5 million as of December 31, 2023. The overall decreasing
trend in our contract liabilities arising from API marketplace was primarily a reflection of the
fact that our pre-paid customers have been utilizing our API services from prepaid
consideration while we continued to gain more large post-paid customers.
Our contract liabilities arising from data management solutions decreased by 85.7% from
RMB19.5 million as of December 31, 2021 to RMB2.8 million as of December 31, 2022,
primarily due to the delivery and acceptance of certain large data management solutions that
were yet undelivered as of the end of 2021. Our contract liabilities increased significantly to
RMB9.3 million as of December 31, 2023 primarily due to (i) an increase in our number of data
management solutions yet to be delivered and accepted at the end of the year; and (ii) certain
of our new data management solution projects were short-term in nature, and we received
prepayments from these customers.
As of the Latest Practicable Date, RMB5.8 million, or 19.5% of our contract liabilities as
of December 31, 2023, had been recognized as revenue.
Lease Liabilities
We lease properties to operate our business. These leases are typically made for a fixed
term of two years. Lease terms are negotiated on an individual basis and contain different
payments and conditions. These lease agreements do not impose any covenants, but leased
assets may not be used as security for borrowing purpose.
To a lesser extent, we also lease properties with a term of less than one year. These leases
are short-term and we have elected not to recognize right-of-use assets and lease liabilities for
these leases. For details of our lease liabilities during the Track Record Period, see
“– Indebtedness”.
FINANCIAL INFORMATION
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Repurchase Liabilities
Our repurchase liabilities were in relation to our share repurchase obligation under the
share transfer agreement signed with China-Singapore V entures. For details, see
“– Indebtedness”. As of December 31, 2021, 2022 and 2023 and April 30, 2024, we had
repurchase liabilities of nil, nil, RMB23.0 million and RMB23.8 million, respectively.
NON-CURRENT ASSETS AND LIABILITIES
The table below sets forth our non-current assets and liabilities as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Non-current assets
Property, plant and equipment .............................. 212,781 233,972 223,466
Intangible assets ....................................... 1 1 8 1 0 9 1 0 0
Financial assets at FVOCI ................................. 88,189 75,954 61,700
Financial assets at FVTPL ................................. – – 5,245
Prepayments .......................................... 3 6 5 4 0
Deferred tax assets ...................................... 5 5 6 6 2 0 5 4 5
Total non-current assets ................................. 301,680 310,660 291,096
Non-current liabilities
Lease liabilities ........................................ – 2 2 –
Deferred tax liabilities ................................... 1 1,134 9,306 5,536
Total non-current liabilities ............................... 11,134 9,328 5,536
Property, Plant and Equipment
During the Track Record Period, our property, plant and equipment consisted mainly of
buildings, construction-in-progress, leasehold land, and furniture, fixtures and office
equipment. Our property, plant and equipment increased by 10.0% from RMB212.8 million as
of December 31, 2021 to RMB234.0 million as of December 31, 2022, primarily due to: (i) an
addition of RMB15.9 million in construction-in-progress, which was transferred to buildings
upon completion, as the construction of our headquarters building came to completion; (ii) an
addition of RMB10.8 million in leasehold improvements; and (iii) an addition of RMB5.6
million in furnitures, fixtures, and office equipment, primarily incurred as we prepared our
headquarters building for daily use. Our property, plant and equipment decreased by 4.5% to
RMB223.5 million as of December 31, 2023 primarily due to the depreciation and amortization
of our headquarters building.
FINANCIAL INFORMATION
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Financial Assets at FVOCI
Our financial assets at FVOCI represented unlisted equity investments irrevocably
designated at fair value through other comprehensive income due to their long-term strategic
nature. The table below sets for the financial assets at FVOCI as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Unlisted equity investments, at fair value ....................... 88,189 75,954 61,700
The table below sets forth the movements of the unlisted equity investments at level 3 fair
value measurement during the Track Record Period:
As of December 31,
2021 2022 2023
(RMB in thousands)
At the beginning of the year ............................... 50,114 88,189 75,954
Fair value changes ...................................... 38,142 (12,400) (14,266)
Exchange difference ..................................... (67) 165 12
At the end of the year ................................... 88,189 75,954 61,700
Our financial assets at FVOCI represented unlisted equity investments irrevocably
designated at fair value through other comprehensive income due to their nature as long-term
strategic instruments. As of December 31, 2021, 2022 and 2023, our financial assets at FVOCI
amounted to RMB88.2 million, RMB76.0 million and RMB61.7 million, respectively, as
measured at fair values based on the valuation performed by independent professional valuers
with fair values being determined based on significant unobservable inputs using valuation
techniques. There was no transfer between different levels of the fair value hierarchy or change
in valuation technique used during the Track Record Period. The changes in our financial assets
at FVOCI during the Track Record Period were caused by fluctuations in the fair value of our
unlisted equity investments in Shanghai Fairyland Software Co., Ltd. (΅Ϟ
ʮ̡), Beijing Tiantian Y uedong Network Technology Co., Ltd. (ࠢ
ʮ̡), and Stratifyd, Inc. For details, see Note 20 to the Accountants’ Report as set out in
Appendix I to this prospectus.
The Reporting Accountant has carried out necessary audit works in accordance with Hong
Kong Standard on Investment Circular Reporting Engagements 200 “Accountants’ Reports on
Historical Financial Information in Investment Circulars” issued by the Hong Kong Institute of
Certified Public Accountants for the purpose of expressing an opinion on the Group’s historical
financial information for the Track Record Period as a whole in Appendix I to this prospectus.
The Reporting Accountant’s opinion on the historical financial information of the Group for the
Track Record Period is set out on page I-2 of Appendix I to this prospectus.
FINANCIAL INFORMATION
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We perform the valuation of level 3 financial instruments for financial reporting purposes,
taking into account significant unobservable inputs and applicable valuation technique, and
manage the valuation exercise of the investments on a case-by-case basis. We carry out
independent due diligence procedures on our unlisted equity investments, including taking
reasonable steps to verify the accuracy and reasonableness of material company information
that is likely to affect the valuation of the assets, such as financial performance and forecasts,
total addressable market, competitive advantages, business plans and assumptions; and engage
an independent qualified professional valuer to aid our management and directors as to the
determination of the fair value of our level 3 instruments. Our Directors are satisfied with the
valuation work for financial assets categorized within level 3 of fair value measurement in the
historical financial information for the purpose of the preparation of the Accountant’s Report
as referred to in Appendix I to this prospectus.
INDEBTEDNESS
The following table sets forth the balance and breakdown of our indebtedness as of the
dates indicated:
As of December 31,
As of
April 30,
2021 2022 2023 2024
(RMB in thousands)
(Unaudited)
Lease liabilities ................................. – 6 5 – –
Repurchase liabilities ............................. – – 23,013 23,796
Total ........................................ – 65 23,013 23,796
During the Track Record Period, our borrowings comprised a RMB20.0 million loan
obtained and repaid in 2021. As of December 31, 2021, 2022 and 2023 and April 30, 2024, we
recognized lease liabilities of nil, RMB65,000, nil and nil, respectively, and repurchase
liabilities of nil, nil, RMB23.0 million and RMB23.8 million, respectively. For details on our
repurchase liabilities, see Note 41 to the Accountants’ Report in Appendix I to this prospectus.
As of April 30, 2024, being the latest practicable date for determining our indebtedness,
we have no unutilized banking facilities.
Except as disclosed above, as of the Latest Practicable Date, we did not have any material
mortgages, charges, debentures, loan capital, debt securities, loans, bank overdrafts or other
indebtedness, finance lease or hire purchase commitments, liabilities under acceptances (other
than normal trade bills), acceptance credits, which are either guaranteed, unguaranteed, secured
or unsecured, or guarantees.
FINANCIAL INFORMATION
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Our Directors confirm that as of the Latest Practicable Date, there was no material
covenant on any of our outstanding debt and there was no breach of any covenant during the
Track Record Period and up to the Latest Practicable Date. Our Directors further confirm that
we did not experience any difficulty in obtaining bank loans and other borrowings, default in
payment of bank loans and other borrowings or breach of covenants during the Track Record
Period and up to the Latest Practicable Date. Our Directors also confirm that there has not been
any material change in our indebtedness since the Latest Practicable Date and up to the date
of this prospectus.
CAPITAL EXPENDITURES
Our historical capital expenditures during the Track Record Period were primarily used
for the construction of our headquarters building. We funded our capital expenditures during
the Track Record Period mainly from our internal cash resources. Our capital expenditures
amounted to RMB65.3 million, RMB32.2 million and RMB1.6 million for 2021, 2022 and
2023, respectively. In 2021, while our headquarters building was still under construction, our
capital expenditures were relatively high. Our capital expenditures decreased after the
construction of our headquarters building was completed in early 2022. As of the Latest
Practicable Date, we did not have any material capital expenditures planned for 2024.
CAPITAL COMMITMENTS
The table below sets forth our capital commitments as of the dates indicated:
As of December 31,
2021 2022 2023
(RMB in thousands)
Contracted, but not provided for
– Construction-in-progress ............................... 15,851 – –
– Office equipment .................................... 3,851 – –
– Leasehold improvements ............................... 9,908 – –
– Financial assets at FVTPL ............................. – – 13,333
Total ............................................... 29,610 – 13,333
Our capital commitments in 2021, and 2022 were all related to the construction and
preparation of our headquarters building. Hence, after the relocation was completed in January
2022, we did not have any material capital commitments as of December 31, 2022. As of
December 31, 2023, our capital commitments comprised financial assets at FVTPL of
RMB13.3 million relating to our unlisted debt security.
FINANCIAL INFORMATION
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RELATED PARTY TRANSACTIONS
Parties are considered to be related if one party has the ability, directly or indirectly, to
control the other party, or exercise significant influence over the other party in making
financial and operating decisions. Parties are also considered to be related if they are subject
to common control or common significant influence.
We entered into the following related party transactions with related companies during the
Track Record Period, on terms mutually agreed upon between us and the related companies:
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
Shareholder
Provision of API marketplace services ......................... 2 6 – –
Related companies
Purchase of API marketplace services ......................... 1 – –
Provision of API marketplace services ......................... 5,537 4,922 5,056
We are of the view that our transactions with related parties during the Track Record
Period were trade in nature and were conducted on an arm’s length basis and with normal
commercial terms between the relevant parties. For details, see Note 35 to the Accountants’
Report in Appendix I to this prospectus. We are also of the view that our related party
transactions during the Track Record Period will not distort our historical results or make our
historical results unreflective of our future performance.
PROPERTY INTERESTS AND V ALUATION OF PROPERTIES
Ravia Global Appraisal Advisory Limited, an independent qualified property valuer,
valued our property interests as of April 30, 2024 at RMB165.0 million. Details of the
valuation are summarised in Appendix V to this prospectus. The following table sets out the
reconciliation between the net book value of the property as of December 31, 2023 as extracted
from the Accountants’ Report in Appendix I to this document and the property valuation report
as set out in Appendix V to this document as of April 30, 2024:
RMB’000
Net book value of the subject property as of December 31, 2023 ........... 166,890
Less: Depreciation on the subject property for the four months ended
April 30, 2024 .......................................... (1,876)
Subtract: V aluation deficit .................................... (14)
V aluation of the subject property as of April 30, 2024 as set out in Appendix V. 165,000
FINANCIAL INFORMATION
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OFF-BALANCE SHEET ARRANGEMENTS
As of the Latest Practicable Date, we did not have any off-balance sheet commitments or
arrangements.
CONTINGENT LIABILITIES
As of December 31, 2021, 2022 and 2023 and the Latest Practicable Date, we did not have
any material contingent liabilities, guarantees or any litigation or claims of material
importance, pending or threatened against us.
KEY FINANCIAL RATIOS
The table below sets forth our key financial ratios as of the dates or for the years
indicated:
Y ear ended/As of December 31,
2021 2022 2023
Revenue growth ........................................ 45.8% 26.5% 34.1%
Gross profit margin (1) .................................... 34.6% 32.7% 28.3%
Net profit margin (2) ..................................... 17.7% 12.6% 7.9%
(1) Gross profit margin equals gross profit divided by revenue for the year and multiplied by 100%.
(2) Net profit margin equals profit divided by revenue for the year and multiplied by 100%.
For a discussion of the factors affecting our revenue growth, gross profit margin and net
profit margin, see “– Results of Operations”.
DIVIDENDS
We paid RMB20.0 million of dividends to our shareholders in 2021. No dividend has been
declared and paid in 2022 and 2023.
We do not have a formal dividend policy or a fixed dividend payout ratio. We may
distribute dividends in the future by way of cash or by other means that we consider
appropriate. Pursuant to our Articles of Association, our Board may declare dividends in the
future after taking into account our results of operations, financial condition, cash requirements
and availability and other factors as it may deem relevant at such time. Any declaration and
payment as well as the amount of dividends will be subject to our constitutional documents,
applicable PRC laws and approval by our Shareholders. PRC laws require that dividends
should be paid only out of the profit for the year calculated according to PRC accounting
principles.
FINANCIAL INFORMATION
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QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Interest Rate Risk
Our interest-bearing financial instruments at variable rates as of December 31, 2021, 2022
and 2023 are the cash at bank and time deposits except for fixed deposits, and the cash flow
interest risk arising from the change of market interest rate on these balances of relatively short
maturity is not considered significant. Our interest-bearing financial instruments at fixed
interest rates as of December 31, 2021, 2022 and 2023 are fixed deposits and the change of
market interest rate does not expose us to fair value interest risk. Our Directors consider that
our exposure to interest rate risk is not significant and no sensitivity analysis of interest rate
risk is presented. For details, see Note 39(a) to the Accountants’ Report in Appendix I to this
prospectus.
Credit Risk
Our credit risk is primarily attributable to our trade receivables, deposits and other
receivables and contract assets. Our management has a credit policy in place and the exposures
to these credit risks are monitored on an ongoing basis.
In respect of trade receivables, deposits and other receivables and contract assets, credit
evaluations are performed on all debtors. These evaluations focus on the customer’s past
history of making payments when due and current ability to pay, and take into account
information specific to the customers as well as pertaining to the economic environment in
which the customers operate. Ongoing credit evaluation is performed on the financial condition
of trade customers and, where appropriate, credit guarantee insurance cover is purchased.
Trade receivables are due from the date of billing. Normally, we do not obtain collateral from
customers.
Our exposure to credit risk is influenced mainly by the individual characteristics of each
customer. The default risk of the industry and country in which customers operate also has an
influence on credit risk but to a lesser extent. 15.9%, 19.3%, 24.3% of our trade receivables,
deposits and other receivables and 38.2%, 40.5%, 58.1% of our contract assets was due from
our largest customer and the five largest customers, respectively, as of December 31, 2021,
2022 and 2023, respectively. For details, see Note 39(b) to the Accountants’ Report in
Appendix I to this prospectus.
Liquidity Risk
Ultimate responsibility for liquidity risk management rests with our directors, who have
built an appropriate liquidity risk management framework for the management of our short,
medium and long-term funding and liquidity management requirements. We manage liquidity
risk by maintaining adequate reserves. For details, see Note 39(c) to the Accountants’ Report
in Appendix I to this prospectus.
FINANCIAL INFORMATION
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Equity Price Risk
The table below sets out the sensitivity of the carrying amount of financial assets at
FVOCI and FVTPL during the Track Record Period to a change in the significant unobservable
inputs while all other variable held constant. A positive number below indicates an increase in
total comprehensive income for the year. For a decrease in total comprehensive income for the
year, the balance below would be negative. For details, see Note 39(d) to the Accountants’
Report in Appendix I to this prospectus.
Y ear ended December 31,
2021 2022 2023
(RMB in thousands)
10% higher in the fair value of the investment .................... 7,531 6,473 5,252
10% lower in the fair value of the investment .................... (7,531) (6,473) (5,252)
Foreign Currency Risk
Currency risk refers to the risk that the fair values or future cash flows of a financial
instrument will fluctuate because of changes in foreign exchange rates. Our currency risk is
minimal as most of our transactions are carried out in functional currency of the respective
entities.
DISTRIBUTABLE RESERVES
As of December 31, 2023, our Company had a distributable reserve of RMB90.5 million.
DISCLOSURE REQUIRED UNDER THE LISTING RULES
We confirm that, as of the Latest Practicable Date, we are not aware of any circumstances
that would give rise to disclosures required under Rules 13.13 to 13.19 of Chapter 13 of the
Listing Rules.
LISTING EXPENSES
Listing expenses represent professional fees, underwriting commissions and other fees
incurred in connection with the Global Offering. We estimate that our listing expenses will be
approximately RMB52.4 million (assuming the Offer Price of HK$83.33 per Offer Share)
accounting for approximately 14.3% of our gross proceeds, of which approximately RMB23.5
million is directly attributable to the issue of our Offer Shares and will be deducted from
equity, approximately RMB22.4 million has been expensed in our consolidated statements of
profit or loss during the Track Record Period and approximately RMB6.5 million is expected
to be expensed after the Track Record Period. Our estimated listing expenses include: (i)
underwriting-related expenses, representing underwriting commission and fees of
approximately RMB14.6 million; (ii) Sponsor fee of approximately RMB4.3 million; and (iii)
FINANCIAL INFORMATION
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non-underwriting-related expenses, comprising professional fees to the legal advisors,
Reporting Accountant and other professionals of approximately RMB30.1 million for their
services rendered in relation to the Global Offering and the Listing, and other fees and
expenses of approximately RMB3.4 million. The listing expenses above are the best estimate
as of the Latest Practicable Date and for reference only and the actual amount may differ from
this estimate.
FINANCIAL INFORMATION
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FUTURE PLANS
See “Business – Our Strategies” for a detailed description of our future plans.
USE OF PROCEEDS
We estimate that the net proceeds from the Global Offering will be approximately
HK$344.0 million after deducting underwriting fees and commissions and estimated expenses
payable by us in connection with the Global Offering, based on the Offer Price of HK$83.33
per H Share:
We intend to use the net proceeds we will receive from the Global Offering for the
following purposes.
 Approximately HK$86.0 million, representing 25% of the net proceeds, will be used
to comprehensively upgrade the existing suite of APIs in our API marketplace, in
order to seize the significant opportunities arising from the opening and authorized
operations of government and public data, which may create opportunities for future
growth. In particular,
(i) Approximately HK$31.0 million, representing 9% of the net proceeds, will be
used to enhance the carrying capacity of high-performance API gateway and
further improve the infrastructure for API marketplace, preparing to seize
significant opportunities arising from the increased government and public
data opening, as well as the growing industrial trend of data factor circulation.
This will enhance data privacy and security and meet the high-concurrency and
short response time requirements of massive data transmission. Our efforts to
enhance the carrying capacity of high-performance API gateways and
infrastructure are expected to improve the data privacy and security of data
transmission from the following perspectives: to avoid reliance on a single
geographic node or cloud platform, reducing the risk of service interruption; it
will ensure data consistency across nodes; to enhance the security system of
the high-performance API gateways; to promote the even distribution of traffic
across API gateways; to add security audit tools that provide real-time
monitoring, log recording, and alert features. In addition, we will use the net
proceeds to recruit and train professionals to maintain, operate, configure,
monitor and develop high-performance API gateways, systems and hardware
which we plan to possess. The net proceeds used to enhance the carrying
capacity of high-performance API gateways and further improve the
infrastructure for API marketplace will be used to invest in construction and
upgrading of equipment and facilities, such as site renovation in the next two
years, procurement of hardware and software in the next three years, and
upgrade of server room equipment in the next three years, as well as
continuous development of API testing platforms and API docking platforms,
providing professional API testing services for developers. We believe this will
FUTURE PLANS AND USE OF PROCEEDS
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enrich our API marketplace ecosystem, form a complete API industry chain,
improve customer experience, increase the frequency of their usage and
enhance customer stickiness and loyalty. We also aim to expand our customer
base and monetize our subscription services.
(ii) Approximately HK$24.1 million, representing 7% of the net proceeds, will
be used to attract, cultivate, and retain experienced core technical talents
within the industry through competitive compensation to enhance our
R&D capabilities. See “Business – Our Strategies – Enhancing R&D
Capabilities”. In the next three years, we intend to recruit no more than 100
R&D employees including mid-level managerial personnel and engineers.
(iii) Approximately HK$31.0 million, representing 9% of the net proceeds, will be
used to enhance our sales and marketing capability, including the recruitment
of sales staff and the creation of related workplace for the sales team. The
current structure of our sales and marketing team is relatively lean, and in view
of the rapid growth of our business, we will need more personnel to support our
sales and marketing efforts for API marketplace. For the next three years, we
plan to hire approximately 50 market planning specialists, business
development professionals, market research specialists, and sales
representatives. The sales staff will mainly be responsible for product
promotion, maintaining customer relationships and sales channels, as well as
enhancing our brand awareness through strengthened marketing efforts. We
also plan to use the proceeds for marketing expenses online and offline in the
next three years.
 Approximately HK$154.8 million, representing 45% of the net proceeds, will be
used to upgrade our existing products and services of our data management
solutions. This aims to develop and expand industry-specific applications,
strengthening our technical capabilities and market competitiveness in data
management solutions. We plan to recruit no more than 100 sales employees and
market planning specialists in the next three years. We plan to use the proceeds for
marketing expenses online and offline in the next three years. We will recruit a total
of approximately 300 employees including project managers, engineers, designers,
research employees and other delivery personnel in the next three years.
Specifically, we plan to allocate:
(i) Approximately HK$68.8 million, representing 20% of the net proceeds, will be
used to enhance our sales capabilities, expanding and diversifying our sales
channel nationwide:
(a) 7% will be used to partner with big data operating platforms, establish
local subsidiaries and branch offices, and build relationships with local
customers and business partners. We plan to further intensify our
FUTURE PLANS AND USE OF PROCEEDS
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penetration of the sales teams in large cities. We believe there is a
significant unmet demand for data management solutions and digital
transformation in these cities.
(b) 7% will be used to provide competitive compensation and regular job
training for our sales staff, as well as to create workplaces for the sales
team for our data management solutions. This includes renting local
office spaces, purchasing equipment, software, and tools for our sales
team.
(c) 6% will be used for online and offline brand building, actively organizing
and participating in various industry activities, such as industry forums,
seminars, and solution exhibitions, to strengthen relationships with
customers and to expand our influence. We also expect to invest in online
sales and marketing channels, including strategically placing
advertisements on professional and social networking platforms.
(ii) Approximately HK$43.0 million, representing 12.5% of the net proceeds, will
be used to upgrade and expand our technology advantages and scalability of
our products to meet the digital transformation process of customers and
enhance our technical competitiveness. See “Business – Our Strategies –
Enhancing R&D Capabilities”. We plan to make investments in site renovation
in the next two years. We plan to purchase software and hardware including
computers and their accessories in the next three years.
(iii) Approximately HK$43.0 million, representing 12.5% of the net proceeds, will
be used for product delivery, further enhancing the products’ reusability,
continuously expanding the service types of our services and solutions for
government, enterprise and industrial customers. We plan to expand the size of
our product delivery and customer service team, including hiring project
delivery directors, intermediate and senior project managers, operation and
maintenance engineers, DevOps engineers, RPA implementation engineers,
and customer service managers.
 Approximately HK$68.8 million, representing 20% of the net proceeds, will be used
to research and develop the technologies for data security and privacy protection,
building a comprehensive ecosystem for digital ownership, secure data storage,
trusted data transmission, and collaborative production. This aims to enhance our
operational capabilities and provide secure, trusted, and traceable technical support
for data circulation. Specifically:
(i) Approximately HK$55.0 million, representing 16% of the net proceeds will be
used for developing privacy-preserving computation and blockchain
technologies, aiming to overcome technological barriers and meet the data
security and privacy protection requirements of API marketplace and data
FUTURE PLANS AND USE OF PROCEEDS
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management solutions. We plan to recruit R&D personnel for AnchorChain in
connection with blockchain technologies and SmartShield in connection with
privacy-preserving computation. Specifically, for the research related to
AnchorChain , the hiring will include positions such as managers and
engineers, etc., and will be no more than 50 employees. For the research
related to SmartShield, the hiring will include positions such as product
managers, engineers and designers, and will be approximately 50 employees.
(ii) Approximately HK$13.8 million, representing 4% will be used for project site
renovation and server room upgrades at our headquarters building, including
renovation of office space and procurement of software and hardware. We will
make investments in site renovation in the next two years and purchase
software and hardware including computers and their accessories in the next
three years.
FUTURE PLANS AND USE OF PROCEEDS
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 Approximately HK$34.4 million, representing 10% of the net proceeds will be used
for working capital and general corporate purposes.
To the extent that our net proceeds are not sufficient to fund the purposes set out above,
we intend to fund the balance through a variety of means, including cash generated from
operations and bank loans and other borrowings, when necessary. We received a letter of intent
from the Suzhou Branch of a commercial bank in China in June 2024. The commercial bank
will provide loan facilities of no more than RMB400 million in aggregate to the Company in
the next three years. The loan can be by way of credit and fixed asset mortgages, with interest
rates determined based on the prevailing market rates.
If the net proceeds from the Global Offering are not needed for the above purposes
immediately, or if we are unable to implement any part of our development plan as planned,
we may deposit such net proceeds into short-term deposits at licensed commercial banks and/or
other authorised financial institutions (in Hong Kong as defined under the Securities and
Futures Ordinance/the applicable laws in the relevant jurisdiction for non-Hong Kong based
deposits) when we deem it in the best interests of us. In such event, we will comply with the
applicable disclosure requirements under the Listing Rules.
FUTURE PLANS AND USE OF PROCEEDS
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HONG KONG UNDERWRITERS
CLSA Limited
CMB International Capital Limited
ABCI Securities Company Limited
Soochow Securities International Brokerage Limited
ICBC International Securities Limited
CCB International Capital Limited
SPDB International Capital Limited
Livermore Holdings Limited
Futu Securities International (Hong Kong) Limited
Tiger Brokers (HK) Global Limited
UNDERWRITING
This prospectus is published solely in connection with the Hong Kong Public Offering.
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters on a
conditional basis. The International Offering is expected to be fully underwritten by the
International Underwriters.
The Global Offering comprises the Hong Kong Public Offering of initially 481,850 Hong
Kong Offer Shares and the International Offering of initially 4,336,350 International Offer
Shares, subject, in each case, to reallocation on the basis as described in the section headed
“Structure of the Global Offering” in this prospectus.
UNDERWRITING ARRANGEMENTS AND EXPENSES
Hong Kong Public Offering
Hong Kong Underwriting Agreement
Pursuant to the Hong Kong Underwriting Agreement, our Company is offering the Hong
Kong Offer Shares for subscription on the terms and conditions set out in this prospectus and
the Hong Kong Underwriting Agreement at the Offer Price.
UNDERWRITING
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Subject to (a) the Stock Exchange granting approval for the listing of, and permission to
deal in, the H Shares to be offered pursuant to the Global Offering and the 45,300,000 H Shares
to be converted from Unlisted Shares on the Main Board of the Stock Exchange and such
approval not subsequently having been revoked prior to the commencement of trading of the
H Shares on the Stock Exchange; and (b) certain other conditions set out in the Hong Kong
Underwriting Agreement, the Hong Kong Underwriters have agreed severally but not jointly to
procure subscribers for, or themselves to subscribe for, their respective applicable proportions
of the Hong Kong Offer Shares being offered which are not taken up under the Hong Kong
Public Offering on the terms and conditions set out in this prospectus and the Hong Kong
Underwriting Agreement.
The Hong Kong Underwriting Agreement is conditional on, among other things, the
International Underwriting Agreement having been executed and becoming unconditional and
not having been terminated in accordance with its terms.
Grounds for Termination
If any of the events set out below occur at any time prior to 8:00 a.m. on the Listing Date,
the Sole Overall Coordinator (for itself and on behalf of the Hong Kong Underwriters) shall
be entitled to terminate the Hong Kong Underwriting Agreement with immediate effect:
(a) there shall have developed, occurred, existed or comes into force:
(i) any new law or regulation or any change or development involving a
prospective change in existing law or regulation, or any change or development
involving a prospective change in the interpretation or application thereof by
any court or other competent authority in or affecting Hong Kong, the PRC,
Singapore, the United States, the United Kingdom, the European Union (or any
member thereof), Japan or any other jurisdiction relevant to our Group or the
Global Offering (each a “ Relevant Jurisdiction ”); or
(ii) any change or development involving a prospective change or development, or
any event or series of events likely to result in or representing a change or
development, or prospective change or development, in local, national,
regional or international financial, political, military, industrial, economic,
currency market, fiscal or regulatory or market conditions or any monetary or
trading settlement system (including, without limitation, conditions in stock
and bond markets, money and foreign exchange markets and inter-bank
markets, a change in the system under which the value of the Hong Kong
currency is linked to that of the currency of the United States or a change of
the Hong Kong dollars or of the RMB against any foreign currencies) in or
affecting any Relevant Jurisdiction; or
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(iii) any event or series of events, whether in continuation, or circumstances in the
nature of force majeure (including, without limitation, acts of government,
labor disputes, strikes, lock-outs, fire, explosion, earthquake, flooding,
tsunami, volcanic eruption, civil commotion, riots, rebellion, public disorder,
acts of war (whether declared or undeclared), acts of terrorism (whether or not
responsibility has been claimed), acts of God, accident or interruption in
transportation, destruction of power plant, outbreak, escalation, mutation or
aggravation of diseases, epidemics or pandemics including, without limitation,
SARS, swine or avian flu, H5N1, H1N1, H1N7, H7N9, Ebola virus, Middle
East respiratory syndrome (MERS), COVID-19 and such related/mutated
forms, economic sanction, any local, national, regional or international
outbreak or escalation of hostilities (whether or not war is or has been
declared) or other state of emergency or calamity or crisis in whatever form)
political change, paralysis of government operations in, or directly or
indirectly affecting any Relevant Jurisdiction; or
(iv) any moratorium, suspension or restriction (including, without limitation, any
imposition of or requirement for any minimum or maximum price limit or price
range) in or on trading in securities generally on the Stock Exchange, the New
Y ork Stock Exchange, the NASDAQ Global Market, the London Stock
Exchange, the Tokyo Stock Exchange, the Singapore Stock Exchange, the
Beijing Stock Exchange, the Shanghai Stock Exchange or the Shenzhen Stock
Exchange; or
(v) any general moratorium on commercial banking activities in Hong Kong
(imposed by the Financial Secretary or the Hong Kong Monetary Authority or
other competent Governmental Authority), New Y ork (imposed at Federal or
New Y ork State level or other competent Governmental Authority), London,
Singapore, the PRC, the European Union (or any member thereof), Japan or
any Relevant Jurisdiction or any disruption in commercial banking or foreign
exchange trading or securities settlement or clearance services, procedures or
matters in any Relevant Jurisdiction; or
(vi) any (A) change or prospective change in exchange controls, currency exchange
rates or foreign investment regulations (including, without limitation, a change
of the Hong Kong dollars or RMB against any foreign currencies, a change in
the system under which the value of the Hong Kong dollars is linked to that of
the United States dollars or RMB is linked to any foreign currency or
currencies), or (B) any change or prospective change in taxation in any
Relevant Jurisdiction adversely affecting an investment in the H Shares; or
(vii) the issue or requirement to issue by our Company of a supplemental or
amendment to this prospectus, Preliminary Offering Circular (as defined in the
Hong Kong Underwriting Agreement) or Offering Circular (as defined in the
Hong Kong Underwriting Agreement) or other documents in connection with
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the offer and sale of the H Shares pursuant to the Companies Ordinance, the
Companies (Winding Up and Miscellaneous Provisions) Ordinance, the Listing
Rules, or the relevant CSRC rules or upon any requirement or request of the
Stock Exchange, the SFC or the CSRC; or
(viii) any change or development involving a prospective change which has the
effect of materialization of any of the risks set out in the section headed “Risk
Factors” in this prospectus; or
(ix) any litigation or claim being threatened or instigated against any members of
our Group, any Director, any Supervisor or any member of our Controlling
Shareholders, including being charged with an indictable offence or prohibited
by operation of law or otherwise disqualified from taking part in the
management of a company; or
(x) any contravention by any of the members of our Group, any Director or any
Supervisor of the Companies Ordinance, the PRC Company Law, the Listing
Rules or any other applicable laws; or
(xi) our chairman, any executive Directors, our chief executive officer or our chief
financial officer vacating his or her office; or
(xii) any litigation or claim being threatened or instigated against, or a
governmental authority or a regulatory body or organization in any Relevant
Jurisdiction commencing any investigation or action or other proceedings, or
announcing an intention to investigate or take other action or proceedings
against any members of our Group or any of the chairman, the chief executive
officer, the Directors, the Supervisors and our Controlling Shareholders, or any
of them being charged with an indictable offence or prohibited by operation of
laws or otherwise disqualified from taking part in the management of a
company or the commencement by any governmental, political, regulatory
body of any action against any of them or any announcement by any
governmental, political, regulatory body that it intends to take any such action;
or
(xiii) any material adverse change or prospective material adverse change in the
assets, business, prospects, general affairs, management, shareholder’s equity,
earnings, profits, losses, properties, results of operations, in the position or
condition (financial or otherwise) or prospects of any members of our Group
(including any litigation or claim of any third party being threatened or
instigated against any members of our Group); or
(xiv) any order or petition for, or any demand by creditors for repayment of
indebtedness or a petition being presented for the winding-up or liquidation of
any members of our Group, or any members of our Group making any
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composition or arrangement with its creditors or entering into a scheme of
arrangement or any resolution being passed for the winding-up of any members
of our Group or a provisional liquidator, receiver or manager being appointed
over all or part of the assets or undertaking of any members of our Group or
anything analogous thereto occurs in respect of any members of our Group; or
(xv) a prohibition on our Company, the Underwriters and/or their respective
affiliates for whatever reason from allotting, issuing or selling the Offer Shares
pursuant to the terms of the Global Offering; or
(xvi) the imposition of sanctions, in whatever form, directly or indirectly, by, or for,
any Relevant Jurisdiction on or relevant to our Company or any members of
our Group; or
which, in any such case individually or in the aggregate, in the sole and absolute
opinion of the Sole Sponsor and the Sole Overall Coordinator (for itself and on
behalf of the Hong Kong Underwriters): (A) is or will be or may be materially
adverse to, or materially and prejudicially affects, the assets, liabilities, business,
general affairs, management, shareholder’s equity, profit, losses, results of
operations, position or condition (financial or otherwise), or prospects of our
Company or our Group as a whole or to any present or prospective shareholder of
our Company in its capacity as such; or (B) has or will have or may have a material
adverse effect on the success of the Global Offering or the level of Offer Shares
being applied for or accepted or subscribed for or purchased or the distribution of
Offer Shares and/or has made or is likely to make or may make it impracticable or
inadvisable or incapable for any material part of the Hong Kong Underwriting
Agreement, the Hong Kong Public Offering or the Global Offering to be performed
or implemented as envisaged; or (C) makes or will make it or may make it
impracticable or inadvisable or incapable to proceed with the Hong Kong Public
Offering and/or the Global Offering or the delivery of the Offer Shares on the terms
and in the manner contemplated by this prospectus, the Formal Notice (as defined
in the Hong Kong Underwriting Agreement), the Preliminary Offering Circular (as
defined in the Hong Kong Underwriting Agreement) or the Offering Circular (as
defined in the Hong Kong Underwriting Agreement); or (D) would have or may have
the effect of making a part of the Hong Kong Underwriting Agreement (including
underwriting) incapable of performance in accordance with its terms or which
prevents the processing of applications and/or payments pursuant to the Global
Offering or pursuant to the underwriting thereof; or
(b) there has come to the notice of the Sole Sponsor and the Sole Overall Coordinator
(for itself and on behalf of the Hong Kong Underwriters):
(i) that any statement contained in, among other things, this prospectus and/or any
notices, announcements, advertisements, communications issued or used by or
on behalf of our Company in connection with the Global Offering (including
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any supplement or amendment thereto) was or has become untrue, incomplete,
incorrect in any material respect or misleading or any forecasts, estimate,
expressions of opinion, intention or expectation expressed in, among other
things, this prospectus and/or any notices, announcements, advertisements,
communications so issued or used are not fair and honest and made on
reasonable grounds or, where appropriate, based on reasonable assumptions,
when taken as a whole; or
(ii) any contravention by any Group member, or any of our chairman, our chief
executive officer, our Directors and our Supervisors, of any applicable laws; or
(iii) any non-compliance of this prospectus, the relevant CSRC filings or any other
documents used in connection with the contemplated subscription and sale of
the Offer Shares or any aspect of the Global Offering with any applicable laws
(including, without limitation, the Companies Ordinance, the Companies
(Winding Up and Miscellaneous Provisions) Ordinance, the SFO, the Listing
Rules and the relevant CSRC rules); or
(iv) any matter has arisen or has been discovered which would, had it arisen or been
discovered immediately before the date of this prospectus and/or any notices,
announcements, advertisements, communications or other documents issued or
used by or on behalf of our Company in connection with the Global Offering
(including any supplement or amendment thereto), not having been disclosed
in, among other things, this prospectus, constitutes an material omission
therefrom; or
(v) either (i) there has been a material breach of any of the representations,
warranties, undertakings or provisions of either the Hong Kong Underwriting
Agreement or the International Underwriting Agreement by any of our
Company and our Controlling Shareholders or (ii) any of the representations,
warranties and undertakings given by our Company and our Controlling
Shareholders in the Hong Kong Underwriting Agreement or the International
Underwriting Agreement, as applicable, is (or would when repeated be) untrue,
incorrect, incomplete in any material respect or misleading; or
(vi) any event, act or omission which gives or is likely to give rise to any liability
of our Company and our Controlling Shareholders pursuant to the indemnities
given by our Company under the Hong Kong Underwriting Agreement; or
(vii) any litigation or dispute or potential litigation or dispute, which would affect
the operation, financial condition, reputation or composition of the board of
our Group; or
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(viii) any breach of any of the obligations of our Company and our Controlling
Shareholders under the Hong Kong Underwriting Agreement or the
International Underwriting Agreement; or
(ix) any breach of, or any event rendering any of the warranties given by our
Company and our Controlling Shareholders untrue or incorrect or misleading
in any material respect; or
(x) a significant portion of the orders in the bookbuilding process at the time of the
International Underwriting Agreement is entered into, or the investment
commitments by any cornerstone investors after signing of agreements with
such cornerstone investors, have been withdrawn, terminated or cancelled; or
(xi) any cornerstone investor is unlikely to fulfil its obligation under the respective
agreement; or
(xii) any expert, whose consent is required for the issue of this prospectus with the
inclusion of its reports, letters or opinions and references to its name included
in the form and context in which it respectively appears, has withdrawn its
consent (other than the Sole Sponsor) prior to the issue of this prospectus; or
(xiii) any adverse change or prospective adverse change or development involving a
prospective adverse change in the assets, business, prospects, general affairs,
management, shareholder’s equity, earnings, profits, losses, properties, results
of operations, in the position or condition (financial or otherwise) or prospects
of our Group, as a whole; or
(xiv) the grant or agreement to grant by the Stock Exchange of the listing on the
Main Board of, and permission to deal in, our H Shares on the Main Board is
refused or not granted, other than subject to customary conditions, on or before
the Listing Date, or if granted, such grant is subsequently withdrawn,
cancelled, qualified (other than by customary conditions), revoked or withheld;
or
(xv) our Company has withdrawn, among other things, this prospectus (and/or any
other documents issued or used in connection with the Global Offering) or the
Global Offering,
then the Sole Sponsor and the Sole Overall Coordinator may (for itself and on behalf of the
Hong Kong Underwriters), in their sole and absolute discretion and upon giving notice in
writing to our Company, terminate the Hong Kong Underwriting Agreement with immediate
effect.
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Undertakings to the Stock Exchange pursuant to the Listing Rules
Undertakings by our Company
Pursuant to Rule 10.08 of the Listing Rules, our Company has undertaken to the Stock
Exchange that it will not issue any further Shares or securities convertible into equity securities
of our Company (whether or not of a class already listed) or form the subject of any agreement
to such an issue within six months from the Listing Date (whether or not such issue of Shares
or securities will be completed within six months from the Listing Date), except for (a)
pursuant to the Global Offering; or (b) under any of the circumstances provided under Rule
10.08 of the Listing Rules.
Undertakings by our Controlling Shareholders
Pursuant to Rule 10.07 of the Listing Rules, each of our Controlling Shareholders has
undertaken to us and to the Stock Exchange that except pursuant to the Global Offering,
he/she/it will not, and will procure that the relevant registered holder(s) will not, without the
prior written consent of the Stock Exchange or unless otherwise in compliance with the
applicable requirements of the Listing Rules:
(a) in the period commencing on the date by reference to which disclosure of its
shareholdings in our Company is made in this prospectus and ending on the date
which is six months from the Listing Date, either directly or indirectly, dispose of,
nor enter into any agreement to dispose of or otherwise create any options, rights,
interests or encumbrances in respect of, any of our securities that he/she/it is shown
to beneficially own in this prospectus (the “ Relevant Shares ”); or
(b) in the period of a further six months commencing on the date on which the period
referred to in paragraph (a) above expires, either directly or indirectly, dispose of,
nor enter into any agreement to dispose of or otherwise create any options, rights,
interests or encumbrances in respect of, any of the Relevant Shares if, immediately
following such disposal or upon the exercise or enforcement of such options, rights,
interests or encumbrances, he/she/it will cease to be a controlling shareholder (as
defined in the Listing Rules) of our Company or a member of a group of our
Controlling Shareholders or would together with our other Controlling Shareholders
cease to be “Controlling Shareholders” (as defined in the Listing Rules) of our
Company.
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Each of our Controlling Shareholders has further undertaken to us and the Stock
Exchange that, within the period commencing on the date by reference to which disclosure of
his/her/its shareholdings in our Company is made in this prospectus and ending on the date
which is 12 months from the Listing Date, he/she/it will and will procure that the relevant
registered holder(s) will:
(a) when he/she/it pledges or charges any securities in our Company beneficially owned
by him/her/it in favor of an authorized institution pursuant to Note (2) to Rule
10.07(2) of the Listing Rules, immediately inform us in writing of such pledge or
charge together with the number of our securities so pledged or charged; and
(b) when he/she/it receives indications, either verbal or written, from the pledgee or
chargee that any of our pledged or charged securities beneficially owned by it/him
will be disposed of, immediately inform us in writing of such indications.
Our Company will inform the Stock Exchange as soon as we have been informed of the
matters referred to in paragraphs (a) and (b) above (if any) by any of our Controlling
Shareholders and subject to the then requirements of the Listing Rules disclose such matters
by way of an announcement which is published in accordance with Rule 2.07C of the Listing
Rules as soon as possible.
Undertakings pursuant to the Hong Kong Underwriting Agreement
Undertakings by our Company in respect of itself
Pursuant to the Hong Kong Underwriting Agreement, our Company has undertaken to
each of the Sole Sponsor, the Sole Sponsor-Overall Coordinator, the Sole Overall Coordinator,
the Joint Global Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Hong Kong
Underwriters and the Capital Market Intermediaries that except pursuant to the Global
Offering, at any time from the date of the Hong Kong Underwriting Agreement up to and
including the date falling six months after the Listing Date (the “ First Six Month Period ”),
it will not, and will procure that other members of our Group will not without the prior written
consent of the Sole Sponsor and the Sole Overall Coordinator (for itself and on behalf of the
Hong Kong Underwriters) and unless in compliance with the requirements of the Listing Rules:
(a) allot, issue, sell, accept subscription for, offer to allot, issue or sell, contract or agree
to allot, issue or sell, assign, mortgage, charge, pledge, assign, hypothecate, lend,
grant or sell any option, warrant, contract or right to subscribe for or purchase, grant
or purchase any option, warrant, contract or right to allot, issue or sell, or otherwise
transfer or dispose of or create an Encumbrance (as defined in the Hong Kong
Underwriting Agreement) over, or agree to transfer or dispose of or create an
Encumbrance (as defined in the Hong Kong Underwriting Agreement) over, either
directly or indirectly, conditionally or unconditionally, or repurchase, any legal or
beneficial interest in the share capital or any other equity securities of our Company
or any shares or other equity securities of members of our Group, as applicable, or
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any interest in any of the foregoing (including, without limitation, any securities
convertible into or exchangeable or exercisable for or that represents the right to
receive, or any warrants or other rights to purchase any Shares or any other share
capital or other equity securities of our Company or members of our Group, as
applicable), or deposit any share capital or other equity securities of our Company
or any member of our Group, as applicable, with a depositary in connection with the
issue of depositary receipts; or
(b) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership (legal or beneficial) of our H
Shares or any other equity securities of our Company or any shares or other equity
securities of any members of our Group, as applicable, or any interest in any of the
foregoing (including, without limitation, any securities convertible into or
exchangeable or exercisable for or that represent the right to receive, or any warrants
or other rights to purchase, any Shares or any other equity securities of our Company
or any shares or any other equity securities of any members of our Group, as
applicable); or
(c) enter into any transaction with the same economic effect as any transaction
described in paragraph (a) or (b) above; or
(d) offer to or agree to do any of the foregoing or announce any intention to do so,
in each case, whether any of the foregoing transactions is to be settled by delivery of share
capital or such other equity securities, in cash or otherwise (whether or not the issue of such
share capital or other equity securities will be completed within the First Six Month Period).
Our Company further agrees that, in the event our Company is allowed to enter into any of the
transactions described in paragraph (a), (b) or (c) above or offers to or agrees to or announces
any intention to effect any such transaction during the period of six months commencing on the
date on which the First Six Month Period expires (the “ Second Six Month Period ”), it will
take all reasonable steps to ensure that such an issue or disposal will not, and no other act of
our Company will, create a disorderly or false market for any Shares or other securities of our
Company.
Each Controlling Shareholder has undertaken to each of the Sole Sponsor, the Sole
Sponsor-Overall Coordinator, the Sole Overall Coordinator, the Joint Global Coordinators, the
Joint Bookrunners, the Joint Lead Managers, the Hong Kong Underwriters and the Capital
Market Intermediaries to procure our Company and members of our Group to comply with the
aforesaid undertakings.
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Undertakings by our Controlling Shareholders in respect of themselves
Each of our Controlling Shareholders has undertaken to each of our Company, the Sole
Sponsor, the Sole Sponsor-Overall Coordinator, the Sole Overall Coordinator, the Joint Global
Coordinators, the Joint Bookrunners, the Joint Lead Managers, the Hong Kong Underwriters
and the Capital Market Intermediaries that, without the prior written consent of the Sole
Sponsor, the Sole Sponsor-Overall Coordinator and the Sole Overall Coordinator (for itself and
on behalf of the Hong Kong Underwriters) or otherwise unless in compliance with the
requirements of the Listing Rules:
(a) he/she/it will not, and will procure that none of his/her/its associates will, at any
time during the First Six Month Period, (i) offer, accept subscription for, pledge,
charge, allot, issue, sell, lend, mortgage, assign, contract to allot, issue or sell, sell
any option or contract to purchase, purchase any option or contract to sell, grant or
agree to grant any option, right or warrant to purchase or subscribe for, lend or
otherwise transfer, dispose of or create an Encumbrance (as defined in the Hong
Kong Underwriting Agreement) over, either directly or indirectly, conditionally or
unconditionally, or repurchase any of its share capital or other securities of our
Company or any interest therein (including, without limitation, any securities
convertible into or exercisable or exchangeable for or that represent the right to
receive any shares or any other share capital or other equity securities of our
Company); or (ii) enter into any swap or other arrangement that transfers to another,
in whole or in part, any of the economic consequences of ownership (legal or
beneficial) of such share capital or securities or any interest therein, as applicable,
or any interest in any of the foregoing (including, without limitation, any securities
convertible into or exchangeable or exercisable for or that represent the right to
receive, or any warrants or other rights to purchase, any shares or any other share
capital or other equity securities of our Company); or (iii) enter into any transaction
with the same economic effect as any transaction specified in paragraph (i) or (ii)
above; or (iv) offer to or agree to do any of the foregoing or announce any intention
to effect any transactions specified in (i), (ii) or (iii) above, in each case, whether
any of the foregoing transactions is to be settled by delivery of share capital or such
other securities, in cash or otherwise (whether or not the foregoing transactions will
be completed within the First Six-Month Period);
(b) he/she/it will not, and will procure that none of his/her/its associates will, at any
time during the Second Six Month Period, enter into any of the transactions
specified in (i), (ii) or (iii) of paragraph (a) above or offer to or agree to or announce
any intention to effect any such transaction if, immediately following any sale,
transfer or disposal or upon the exercise or enforcement of any option, right, interest
or Encumbrance (as defined in the Hong Kong Underwriting Agreement) pursuant
to such transaction, he/she/it will cease to be a controlling shareholder (as defined
in the Listing Rules) of our Company; and
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(c) until the expiry of the Second Six Month period, in the event that he/she/it enters
into any of the transactions specified in (i), (ii) or (iii) of paragraph (a) above or
offers to or agrees to or announces any intention to effect any such transaction,
he/she/it will take all reasonable steps to ensure that he/she/it will not create a
disorderly or false market in the securities of our Company.
Hong Kong Underwriters’ Interests in our Company
Save for their obligations under the Hong Kong Underwriting Agreement, as of the Latest
Practicable Date, none of the Hong Kong Underwriters had any shareholding interests in our
Company or the right or option (whether legally enforceable or not) to subscribe for or to
nominate persons to subscribe for securities in our Company.
Following the completion of the Global Offering, the Hong Kong Underwriters and their
affiliated companies may hold a certain portion of our H Shares as a result of fulfilling their
respective obligations under the Hong Kong Underwriting Agreement.
International Offering
International Underwriting Agreement
In connection with the International Offering, our Company and our Controlling
Shareholders expect to enter into the International Underwriting Agreement with the Sole
Overall Coordinator on behalf of the International Underwriters on or around Wednesday, June
26, 2024. Under the International Underwriting Agreement, the International Underwriters
would, subject to certain conditions set out therein, agree severally but not jointly to procure
subscribers for, or themselves to subscribe for, their respective applicable proportions of the
International Offer Shares initially being offered pursuant to the International Offering. It is
expected that the International Underwriting Agreement may be terminated on similar
grounds as the Hong Kong Underwriting Agreement. Potential investors should note that in the
event that the International Underwriting Agreement is not entered into or is terminated, the
Global Offering will not proceed. See “Structure of the Global Offering – The International
Offering”.
Commissions and Expenses
The Underwriters and the Capital Market Intermediaries will receive an underwriting
commission of 2.5% of the aggregate Offer Price of all the Offer Shares (the “ Fixed Fee ”), out
of which they will pay any sub-underwriting commissions and other fees.
The Underwriters and the Capital Market Intermediaries may receive a discretionary
incentive fee of up to 1.5% of the aggregate Offer Price of all the Offer Shares (the
“Discretionary Fee ”). The ratio of the Fixed Fee and the Discretionary Fee (if fully paid)
payable to all Underwriters is therefore 63:38. The incentive fee is discretionary in nature and
the payment of such is subject to the sole discretion of our Company.
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For any unsubscribed Hong Kong Offer Shares reallocated to the International Offering,
the underwriting commission will not be paid to the Hong Kong Underwriters but will instead
be paid, at the rate applicable to the International Offering, to the relevant International
Underwriters.
The aggregate underwriting commissions payable to the Underwriters in relation to the
Global Offering (based on the Offer Price of HK$83.33 per Offer Share and assuming the full
payment of the Discretionary Fee) will be approximately HK$16.1 million.
The aggregate underwriting commissions and fees together with the Stock Exchange
listing fees, the AFRC transaction levy, the SFC transaction levy and the Stock Exchange
trading fee, legal and other professional fees and printing and all other expenses relating to the
Global Offering are estimated to be approximately HK$57.5 million (based on the Offer Price
of HK$83.33 per Offer Share and assuming the full payment of the Discretionary Fee), which
will be made by our Company.
Sole Sponsor’s Fee
An amount of US$600,000 is payable by our Company as sponsor fee to the Sole Sponsor.
Indemnity
Each of our Company and our Controlling Shareholders has agreed to indemnify the Hong
Kong Underwriters for certain losses which they may suffer or incur, including losses arising
from the performance of their obligations under the Hong Kong Underwriting Agreement and
any breach by any of our Company and our Controlling Shareholders of the Hong Kong
Underwriting Agreement.
ACTIVITIES BY SYNDICATE MEMBERS
The underwriters of the Hong Kong Public Offering and the International Offering
(together, the “ Syndicate Members ”) and their affiliates may each individually undertake a
variety of activities (as further described below) which do not form part of the underwriting
process.
The Syndicate Members and their affiliates are diversified financial institutions with
relationships in countries around the world. These entities engage in a wide range of
commercial and investment banking, brokerage, funds management, trading, hedging,
investing and other activities for their own account and for the account of others. In relation
to our H Shares, those activities could include acting as agent for buyers and sellers of our H
Shares, entering into transactions with those buyers and sellers in a principal capacity,
proprietary trading in our H Shares and entering into over the counter or listed derivative
transactions or listed or unlisted securities transactions (including issuing securities such as
derivative warrants listed on a stock exchange) which have our H Shares as their underlying
assets or part of their underlying assets. Those activities may require hedging activity by those
UNDERWRITING
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entities involving, directly or indirectly, the buying and selling of our H Shares. All such
activities could occur in Hong Kong and elsewhere in the world and may result in the Syndicate
Members and their affiliates holding long and/or short positions in our H Shares, in baskets of
securities or indices including our H Shares, in units of funds that may purchase our H Shares,
or in derivatives related to any of the foregoing.
In relation to issues by Syndicate Members or their affiliates of any listed securities
having our H Shares as their or part of their underlying securities, whether on the Stock
Exchange or on any other stock exchange, the rules of the stock exchange may require the
issuer of those securities (or one of its affiliates or agents) to act as a market maker or liquidity
provider in the security, and this will also result in hedging activity in our H Shares in most
cases.
Such activities may affect the market price or value of our H Shares, the liquidity or
trading volume in our H Shares and the volatility of the price of our H Shares, and the extent
to which this occurs from day to day cannot be estimated.
It should be noted that when engaging in any of these activities, the Syndicate Members
will be subject to certain restrictions, including the following:
(a) the Syndicate Members must not, in connection with the distribution of the Offer
Shares, effect any transactions (including issuing or entering into any option or other
derivative transactions relating to the Offer Shares), whether in the open market or
otherwise, with a view to stabilizing or maintaining the market price of any of the
Offer Shares at levels other than those which might otherwise prevail in the open
market; and
(b) the Syndicate Members must comply with all applicable laws and regulations,
including the market misconduct provisions of the SFO, including the provisions
prohibiting insider dealing, false trading, price rigging and stock market
manipulation.
No stabilizing manager will be appointed, and it is anticipated that no stabilization
activities will be carried out in relation to the Global Offering.
INDEPENDENCE AND INTERESTS OF THE SOLE SPONSOR
As of the Latest Practicable Date, the Sole Sponsor satisfied the independence criteria
applicable to sponsors set out in Rule 3A.07 of the Listing Rules. As of the Latest Practicable
Date, the Sole Sponsor and its affiliates had no interest in our Group.
UNDERWRITING
– 401 –


--- page 413 ---
THE GLOBAL OFFERING
This prospectus is published in connection with the Hong Kong Public Offering as part
of the Global Offering. CITIC Securities (Hong Kong) Limited is the Sole Sponsor and CLSA
Limited is the Sole Sponsor-Overall Coordinator of the Global Offering.
The Listing of our H Shares on the Stock Exchange is sponsored by the Sole Sponsor. The
Sole Sponsor has made an application on behalf of our Company to the Stock Exchange for the
listing of, and permission to deal in, our H Shares in issue and to be issued as mentioned in
this prospectus.
4,818,200 Offer Shares will initially be made available under the Global Offering
comprising:
(a) the Hong Kong Public Offering of initially 481,850 H Shares (subject to
reallocation) in Hong Kong as described in the sub-section “– The Hong Kong
Public Offering” in this section below; and
(b) the International Offering of initially 4,336,350 H Shares (subject to reallocation)
outside the United States (including to professional and institutional investors
within Hong Kong) in offshore transactions in reliance on Regulation S, as described
in the sub-section headed “– The International Offering” this section below.
Investors may either:
(i) apply for Hong Kong Offer Shares under the Hong Kong Public Offering; or
(ii) apply for or indicate an interest for International Offer Shares under the
International Offering,
but may not do both.
The Offer Shares will represent approximately 9.61% of the enlarged issued share capital
of our Company immediately following the completion of the Global Offering.
References in this prospectus to applications, application monies or the procedure for
applications relate solely to the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 402 –


--- page 414 ---
THE HONG KONG PUBLIC OFFERING
Number of Offer Shares initially offered
Our Company is initially offering 481,850 H Shares (subject to reallocation) for
subscription by the public in Hong Kong at the Offer Price, representing approximately 10%
of the total number of Offer Shares initially available under the Global Offering. The number
of Offer Shares initially offered under the Hong Kong Public Offering, subject to any
reallocation of Offer Shares between the International Offering and the Hong Kong Public
Offering, will represent approximately 0.96% of the enlarged issued share capital of our
Company immediately following the completion of the Global Offering.
The Hong Kong Public Offering is open to members of the public in Hong Kong as well
as to institutional and professional investors. Professional investors generally include brokers,
dealers, companies (including fund managers) whose ordinary business involves dealing in
shares and other securities and corporate entities that regularly invest in shares and other
securities.
Completion of the Hong Kong Public Offering is subject to the conditions set out in the
sub-section headed “– Conditions of the Global Offering” in this section.
Allocation
Allocation of Offer Shares to investors under the Hong Kong Public Offering will be
based solely on the level of valid applications received under the Hong Kong Public Offering.
The basis of allocation may vary, depending on the number of Hong Kong Offer Shares validly
applied for by applicants. Such allocation could, where appropriate, consist of balloting, which
could mean that some applicants may receive a higher allocation than others who have applied
for the same number of Hong Kong Offer Shares, and those applicants who are not successful
in the ballot may not receive any Hong Kong Offer Shares.
For allocation purposes only, the total number of Hong Kong Offer Shares available under
the Hong Kong Public Offering (after taking into account any reallocation referred to below)
will be divided equally into two pools (with any odd lots being allocated to pool A): pool A
and pool B. The Hong Kong Offer Shares in pool A will be allocated on an equitable basis to
applicants who have applied for Hong Kong Offer Shares with an aggregate price of HK$5
million (excluding the brokerage, the AFRC transaction levy, the SFC transaction levy and the
Stock Exchange trading fee payable) or less. The Hong Kong Offer Shares in pool B will be
allocated on an equitable basis to applicants who have applied for Hong Kong Offer Shares
with an aggregate price of more than HK$5 million (excluding the brokerage, the AFRC
transaction levy, the SFC transaction levy and the Stock Exchange trading fee payable) and up
to the total value in pool B.
STRUCTURE OF THE GLOBAL OFFERING
– 403 –


--- page 415 ---
Investors should be aware that applications in pool A and applications in pool B may
receive different allocation ratios. If any Hong Kong Offer Shares in one (but not both) of the
pools are unsubscribed, such unsubscribed Hong Kong Offer Shares will be transferred to the
other pool to satisfy demand in that other pool and be allocated accordingly. For the purpose
of the immediately preceding paragraph only, the “price” for Hong Kong Offer Shares means
the price payable on application therefor, which is HK$83.33 per Offer Share. Applicants can
only receive an allocation of Hong Kong Offer Shares from either pool A or pool B and not
from both pools. Multiple or suspected multiple applications under the Hong Kong Public
Offering and any application for more than 240,900 Hong Kong Offer Shares is liable to be
rejected.
Reallocation
The allocation of Offer Shares between the Hong Kong Public Offering and the
International Offering is at the discretion of the Sole Overall Coordinator, subject to
reallocation. According to Chapter 4.14 (Offering-related Mechanisms) of the Guide and
paragraph 4.2 of Practice Note 18 of the Listing Rules, a clawback mechanism shall be put in
place which would have the effect of increasing the number of Offer Shares under the Hong
Kong Public Offering to a certain percentage of the total number of Offer Shares offered under
the Global Offering if the International Offering is fully or over-subscribed and certain
prescribed total demand levels are reached as further described below:
(a) where the International Offering are fully subscribed or oversubscribed:
(i) if the Hong Kong Offer Shares are undersubscribed, the Sole Overall
Coordinator has the authority to reallocate all or any unsubscribed Hong Kong
Offer Shares to the International Offering, in such proportions as the Sole
Overall Coordinator deems appropriate;
(ii) if the number of Offer Shares validly applied for under the Hong Kong Public
Offering represents less than 15 times the number of the Offer Shares initially
available for subscription under the Hong Kong Public Offering, then up to
481,800 Offer Shares may be reallocated to the Hong Kong Public Offering
from the International Offering, so that the total number of the Offer Shares
available under the Hong Kong Public Offering will be increased to 963,650
Offer Shares, representing approximately 20% of the total number of Offer
Shares initially available under the Global Offering;
(iii) if the number of Offer Shares validly applied for under the Hong Kong Public
Offering represents 15 times or more but less than 50 times the number of Offer
Shares initially available for subscription under the Hong Kong Public
Offering, then an additional 963,650 Offer Shares will be reallocated to the
Hong Kong Public Offering from the International Offering so that the total
number of Offer Shares available under the Hong Kong Public Offering will be
1,445,500 Offer Shares, representing 30% of the Offer Shares initially
available under the Global Offering;
STRUCTURE OF THE GLOBAL OFFERING
– 404 –


--- page 416 ---
(iv) if the number of Offer Shares validly applied for under the Hong Kong Public
Offering represents 50 times or more but less than 100 times the number of
Offer Shares initially available for subscription under the Hong Kong Public
Offering, then an additional 1,445,450 Offer Shares will be reallocated to the
Hong Kong Public Offering from the International Offering so that the total
number of Offer Shares available under the Hong Kong Public Offering will be
1,927,300 Offer Shares, representing 40% of the Offer Shares initially
available under the Global Offering; and
(v) if the number of Offer Shares validly applied for under the Hong Kong Public
Offering represents 100 times or more the number of Offer Shares initially
available for subscription under the Hong Kong Public Offering, then an
additional 1,927,250 Offer Shares will be reallocated to the Hong Kong Public
Offering from the International Offering so that the total number of Offer
Shares available under the Hong Kong Public Offering will be 2,409,100 Offer
Shares, representing 50% of the Offer Shares initially available under the
Global Offering;
(b) where the International Offering are undersubscribed:
(i) if the Hong Kong Offer Shares are also undersubscribed, the Global Offering
will not proceed unless the Underwriters would subscribe for or procure
subscribers for their respective applicable proportions of the Offer Shares
being offered which are not taken up under the Global Offering on the terms
and conditions of this prospectus and the Underwriting Agreements; and
(ii) if the Hong Kong Offer Shares are fully subscribed or oversubscribed
(irrespective of the extent of over-subscription), then up to 481,800 Offer
Shares may be reallocated to the Hong Kong Public Offering from the
International Offering, so that the total number of the Offer Shares available
under the Hong Kong Public Offering will be increased to 963,650 Offer
Shares, representing approximately 20% of the total number of Offer Shares
initially available under the Global Offering.
In the event of reallocation of Offer Shares between the Hong Kong Public Offering and
the International Offering is in the circumstances where the International Offer Shares are fully
subscribed or oversubscribed and the Hong Kong Offer Shares are oversubscribed by less than
15 times under paragraph (a)(ii) above or the International Offer Shares are undersubscribed
and the Hong Kong Offer Shares are oversubscribed under paragraph (b)(ii) above, then the
Sole Overall Coordinator may reallocate Offer Shares from the International Offering to the
Hong Kong Public Offering other than pursuant to Practice Note 18 of the Listing Rules on the
following conditions in such number as they deem appropriate provided that in accordance
with Chapter 4.14 of the Guide, the maximum total number of Offer Shares available under the
Hong Kong Public Offering should not exceed 963,650 Offer Shares, representing double the
number of the Hong Kong Offer Shares initially available under the Global Offering and
approximately 20% of the total number of Offer Shares available under the Global Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 405 –


--- page 417 ---
In addition, the Sole Overall Coordinator may in their sole and absolute discretion
reallocate Offer Shares from the International Offering to the Hong Kong Public Offering to
satisfy valid applications under the Hong Kong Public Offering. In accordance with Chapter
4.14 (Offering-related Mechanisms) of the Guide, if such reallocation is done other than
pursuant to Practice Note 18 of the Listing Rules, the maximum total number of Offer Shares
that may be reallocated to the Hong Kong Public Offering following such reallocation shall be
not more than double the initial allocation to the Hong Kong Public Offering (i.e. 963,650
Offer Shares), representing approximately 20% of the total number of Offer Shares initially
available under the Global Offering.
In each case, the additional Offer Shares reallocated to the Hong Kong Public Offering
will be allocated between Pool A and Pool B and the number of Offer Shares allocated to the
International Offering will be correspondingly reduced in such manner as the Sole Overall
Coordinator deems appropriate. In addition, the Sole Overall Coordinator may in their sole
discretion reallocate Offer Shares from the International Offering to the Hong Kong Public
Offering to satisfy valid applications under the Hong Kong Public Offering.
Pursuant to paragraph 4.2 of Practice Note 18 to the Listing Rules and Chapter 4.14
(Offering-related Mechanism) of the Guide, in the event of over-subscription under the Hong
Kong Public Offering, the number of Offer Shares to be subscribed for by the Cornerstone
Investors under the Cornerstone Investment Agreement might be affected by the reallocation
of Shares between the International Offering and the Hong Kong Public Offering. If the total
demand for Shares in the Hong Kong Public Offering falls within the circumstance as set out
above, the number of Shares to be subscribed by the Cornerstone Investors may be deducted
on a pro rata basis to satisfy the public demands under the Hong Kong Public Offering.
If the Hong Kong Public Offering is not fully subscribed, the Sole Overall Coordinator
has the authority to reallocate all or any unsubscribed Hong Kong Offer Shares to the
International Offering in such proportions as the Sole Overall Coordinator deems appropriate.
Applications
Each applicant under the Hong Kong Public Offering will be required to give an
undertaking and confirmation in the application submitted by him/her/it that he/she/it and any
person(s) for whose benefit he/her/it is making the application has not applied for or taken up,
or indicated an interest for, and will not apply for or take up, or indicate an interest for, any
International Offer Shares under the International Offering. Such applicant’s application is
liable to be rejected if such undertaking and/or confirmation is/are breached and/or untrue (as
the case may be) or if he/she/it has been or will be placed or allocated International Offer
Shares under the International Offering.
Applicants under the Hong Kong Public Offering are required to pay, on application, the
Offer Price of HK$83.33 per Offer Share in addition to the brokerage, the AFRC transaction
levy, the SFC transaction levy and the Stock Exchange trading fee payable on each Offer Share,
amounting to a total of HK$4,208.53 for one board lot of 50 H Shares. Further details are set
out in the section headed “How to Apply for Hong Kong Offer Shares” in this prospectus.
STRUCTURE OF THE GLOBAL OFFERING
– 406 –


--- page 418 ---
THE INTERNATIONAL OFFERING
Number of Offer Shares initially offered
The International Offering will consist of an offering of initially 4,336,350 H Shares,
representing approximately 90% of the total number of Offer Shares initially available under
the Global Offering (subject to reallocation). The number of Offer Shares initially offered
under the International Offering, subject to any reallocation of Offer Shares between the
International Offering and the Hong Kong Public Offering, will represent approximately 8.65%
of the enlarged share capital of our Company immediately following the completion of the
Global Offering.
Allocation
The International Offering will include selective marketing of Offer Shares to
institutional and professional investors and other investors anticipated to have a sizeable
demand for such Offer Shares in Hong Kong and other jurisdictions outside the United States
in reliance on Regulation S. Professional investors generally include brokers, dealers,
companies (including fund managers) whose ordinary business involves dealing in shares and
other securities and corporate entities that regularly invest in shares and other securities.
Allocation of Offer Shares pursuant to the International Offering will be effected in accordance
with the “book-building” process described in sub-section headed “Pricing and Allocation” in
this section and based on a number of factors, including the level and timing of demand, the
total size of the relevant investor’s invested assets or equity assets in the relevant sector and
whether or not it is expected that the relevant investor is likely to buy further Offer Shares
and/or hold or sell its Offer Shares after the Listing. Such allocation is intended to result in a
distribution of the Offer Shares on a basis which would lead to the establishment of a solid
professional and institutional shareholder base to the benefit of our Group and the Shareholders
as a whole.
The Sole Overall Coordinator (for itself and on behalf of the Underwriters) may require
any investor who has been offered Offer Shares under the International Offering and who has
made an application under the Hong Kong Public Offering to provide sufficient information to
the Sole Overall Coordinator so as to allow it to identify the relevant applications under the
Hong Kong Public Offering and to ensure that it is excluded from any allocation of Offer
Shares under the Hong Kong Public Offering.
Reallocation
The total number of Offer Shares to be issued or sold pursuant to the International
Offering may change as a result of the clawback arrangement described in the subsection “–
The Hong Kong Public Offering – Reallocation” in this section above and/or any reallocation
of unsubscribed Offer Shares originally included in the Hong Kong Public Offering.
STRUCTURE OF THE GLOBAL OFFERING
– 407 –


--- page 419 ---
PRICING AND ALLOCATION
The Offer Price will be HK$83.33 per Offer Share, unless otherwise announced.
Applicants under the Hong Kong Public Offering must pay, on application, the Offer Price of
HK$83.33 per Offer Share plus brokerage of 1.0%, the AFRC transaction levy of 0.00015%,
SFC transaction levy of 0.0027% and Stock Exchange trading fee of 0.00565%, amounting to
a total of HK$4,208.53 for one board lot of 50 H Shares.
The International Underwriters will be soliciting from prospective investors indications
of interest in acquiring Offer Shares in the International Offering. Prospective professional and
institutional investors will be required to specify the number of Offer Shares under the
International Offering they would be prepared to acquire either at different prices or at a
particular price. This process, known as “book-building,” is expected to continue up to, and to
cease on or about, the last day for lodging applications under the Hong Kong Public Offering.
The level of indications of interest in the International Offering, the level of applications
in the Hong Kong Public Offering, the basis of allocations of the Hong Kong Offer Shares and
the results of allocations in the Hong Kong Public Offering are expected to be made available
through a variety of channels in the manner described in the section headed “How to Apply for
Hong Kong Offer Shares – (D) Publication of Results” in this prospectus.
Announcement of Offer Price and/or Number of Offer Shares Reduction
The Sole Overall Coordinator (for itself and on behalf of the Underwriters) may, where
considered appropriate, based on the level of interest expressed by prospective investors during
the book-building process, and with the consent of our Company, reduce the Offer Price and/or
the number of Offer Shares offered in the Global Offering below that stated in this prospectus
at any time on or prior to the morning of the last day for lodging applications under the Hong
Kong Public Offering. In such a case, our Company will, as soon as practicable following the
decision to make such reduction, and in any event not later than the morning of the day which
is the last day for lodging applications under the Hong Kong Public Offering, cause there to
be published on the websites of our Company at www.juhe.cn and the Stock Exchange at
www.hkexnews.hk notices of the reduction, and the cancellation of the Global Offering and
relaunch of the offer at the revised number of offer shares and/or the revised offer price. In the
absence of any such notices, the Offer Price will be fixed as stated in this prospectus and the
number of Offer Shares as stated in this prospectus will be final and conclusive.
If there is any change to the offer size due to change in the number of Offer Shares offered
in the Global Offering (other than pursuant to the reallocation mechanism as disclosed in this
prospectus), or change to the Offer Price which leads to the resulting price being different from
the Offer Price as stated in this prospectus, or if our Company becomes aware that there has
been a significant change affecting any matter contained in this prospectus or a significant new
matter has arisen, the inclusion of information in respect of which would have been required
to be in this prospectus if it had arisen before this prospectus was issued, after the issue of this
STRUCTURE OF THE GLOBAL OFFERING
– 408 –


--- page 420 ---
prospectus and before the commencement of dealings in our H Shares as prescribed under Rule
11.13 of the Listing Rules, we are required to cancel the Global Offering and relaunch the offer
and issue a supplemental prospectus or a new prospectus. The Global Offering must first be
canceled and subsequently relaunched on FINI pursuant to the supplemental prospectus.
The Offer Shares to be offered in the International Offering and the Offer Shares to be
offered in the Hong Kong Public Offering may, in certain circumstances, be reallocated as
between these offerings at the discretion of the Sole Overall Coordinator.
UNDERWRITING
The Hong Kong Public Offering is fully underwritten by the Hong Kong Underwriters
under the terms and conditions of the Hong Kong Underwriting Agreement and is subject to,
among other things, the International Underwriting Agreement being signed and becoming
unconditional.
Our Company expects to enter into the International Underwriting Agreement relating to
the International Offering on or around Wednesday, June 26, 2024.
These underwriting arrangements, including the Underwriting Agreements, are
summarized in the section headed “Underwriting” in this prospectus.
CONDITIONS OF THE GLOBAL OFFERING
Acceptance of all applications for Offer Shares will be conditional on:
(a) the Stock Exchange granting approval for the listing of, and permission to deal in,
the H Shares to be issued pursuant to the Global Offering and the 45,300,000 H
Shares to be converted from unlisted Shares on the Main Board of the Stock
Exchange and such approval and permission not subsequently having been
withdrawn or revoked prior to the Listing Date;
(b) the execution and delivery of the International Underwriting Agreement on or about
Wednesday, June 26, 2024; and
(c) the obligations of the Hong Kong Underwriters under the Hong Kong Underwriting
Agreement and the obligations of the International Underwriters under the
International Underwriting Agreement becoming and remaining unconditional and
not having been terminated in accordance with the terms of the respective
agreements,
in each case on or before the dates and times specified in the respective Underwriting
Agreements (unless and to the extent such conditions are validly waived on or before such
dates and times) and, in any event, not later than the date which is 30 days after the date of
this prospectus.
STRUCTURE OF THE GLOBAL OFFERING
– 409 –


--- page 421 ---
The consummation of each of the Hong Kong Public Offering and the International
Offering is conditional upon, among other things, the other offering becoming unconditional
and not having been terminated in accordance with its terms.
If the above conditions are not fulfilled or waived prior to the dates and times specified,
the Global Offering will lapse and the Stock Exchange will be notified immediately. Notice of
the lapse of the Hong Kong Public Offering will be published by our Company on the websites
of our Company and the Stock Exchange at www.juhe.cn and www.hkexnews.hk ,
respectively, on the next day following such lapse. In such a situation, all application monies
will be returned, without interest, on the terms set out in the section headed “How to Apply for
Hong Kong Offer Shares – (F) Refund of Application Monies” in this prospectus. In the
meantime, all application monies will be held in separate bank account(s) with the receiving
banks or other bank(s) in Hong Kong licensed under the Banking Ordinance (Chapter 155 of
the Laws of Hong Kong).
H Share certificates for the Offer Shares will only become valid evidence of title at 8:00
a.m. on Friday, June 28, 2024, provided that the Global Offering has become unconditional in
all respects at or before that time.
DEALINGS IN THE H SHARES
Assuming that the Hong Kong Public Offering becomes unconditional at or before 8:00
a.m. in Hong Kong on Friday, June 28, 2024, it is expected that dealings in the H Shares on
the Stock Exchange will commence at 9:00 a.m. on Friday, June 28, 2024.
The H Shares will be traded in board lots of 50 H Shares each and the stock code of the
H Shares will be 2479.
STRUCTURE OF THE GLOBAL OFFERING
– 410 –


--- page 422 ---
IMPORTANT NOTICE TO INVESTORS OF
HONG KONG OFFER SHARES
FULLY ELECTRONIC APPLICATION PROCESS
We have adopted a fully electronic application process for the Hong Kong
Public Offering and below are the procedures for application.
This prospectus is available at the website of the Stock Exchange at
www.hkexnews.hk under the “HKEXnews > New Listings > New Listing
Information” section, and our website at www.juhe.cn.
The contents of this prospectus are identical to the prospectus as registered with the
Registrar of Companies in Hong Kong pursuant to Section 342C of the Companies
(Winding Up and Miscellaneous Provisions) Ordinance.
A. APPLICATION FOR HONG KONG OFFER SHARES
1. Who Can Apply
Y ou can apply for Hong Kong Offer Shares if you or the person(s) for whose benefit you
are applying for:
 are 18 years of age or older; and
 have a Hong Kong address ( for the White Form eIPO service only ).
Unless permitted by the Listing Rules or a waiver and/or consent has been granted by the
Stock Exchange to us, you cannot apply for any Hong Kong Offer Shares if you or the
person(s) for whose benefit you are applying for:
 are an existing Shareholder or close associates; or
 are a Director or a Supervisor or any of his/her close associates.
2. Application Channels
The Hong Kong Public Offering period will begin at 9:00 am on Thursday, June 20,
2024 and end at 12:00 noon on Tuesday, June 25, 2024 (Hong Kong time).
HOW TO APPLY FOR HONG KONG OFFER SHARES
–4 1 1–


--- page 423 ---
To apply for Hong Kong Offer Shares, you may use one of the following application
channels:
Application Channel Platform Target Investors Application Time
White Form eIPO
service
www.eipo.com.hk Investors who would like to
receive a physical H Share
certificate. Hong Kong Offer
Shares successfully applied for
will be allotted and issued in
your own name.
From 9:00 a.m. on
Thursday, June 20,
2024 to 11:30 a.m.
on Tuesday,
June 25, 2024, Hong
Kong time.
The latest time for
completing full
payment of
application monies
will be 12:00 noon
on Tuesday, June 25,
2024, Hong Kong
time.
HKSCC EIPO
channel
Y our broker or
custodian who is a
HKSCC Participant
will submit an EIPO
application on your
behalf through
HKSCC’s FINI
system in
accordance with
your instruction
Investors who would not like to
receive a physical H Share
certificate. Hong Kong Offer
Shares successfully applied for
will be allotted and issued in
the name of HKSCC Nominees,
deposited directly into CCASS
and credited to your designated
HKSCC Participant’s stock
account.
Contact your broker or
custodian for the
earliest and latest
time for giving such
instructions, as this
may vary by broker
or custodian.
The White Form eIPO service and the HKSCC EIPO channel are facilities subject to
capacity limitations and potential service interruptions and you are advised not to wait until the
last day of the application period to apply for Hong Kong Offer Shares.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 412 –


--- page 424 ---
For those applying through the White Form eIPO service, once you complete payment
in respect of any application instructions given by you or for your benefit through the White
Form eIPO service to make an application for Hong Kong Offer Shares, an actual application
shall be deemed to have been made. If you are a person for whose benefit the electronic
application instructions are given, you shall be deemed to have declared that only one set of
electronic application instructions has been given for your benefit. If you are an agent for
another person, you shall be deemed to have declared that you have only given one set of
electronic application instructions for the benefit of the person for whom you are an agent
and that you are duly authorized to give those instructions as an agent.
For the avoidance of doubt, giving an application instruction under the White Form eIPO
service more than once and obtaining different payment reference numbers without effecting
full payment in respect of a particular reference number will not constitute an actual
application.
If you apply through the White Form eIPO service, you are deemed to have authorized
the White Form eIPO service provider to apply on the terms and conditions in this prospectus,
as supplemented and amended by the terms and conditions of the White Form eIPO service.
By instructing your broker or custodian to apply for the Hong Kong Offer Shares on your
behalf through the HKSCC EIPO Channel, you (and, if you are joint applicants, each of you
jointly and severally) are deemed to have instructed and authorized HKSCC to cause HKSCC
Nominees (acting as nominee for the relevant HKSCC Participants) to apply for Hong Kong
Offer Shares on your behalf and to do on your behalf all the things stated in this prospectus
and any supplement to it.
For those applying through HKSCC EIPO channel, an actual application will be deemed
to have been made for any application instructions given by you or for your benefit to HKSCC
(in which case an application will be made by HKSCC Nominees on your behalf) provided such
application instruction has not been withdrawn or otherwise invalidated before the closing time
of the Hong Kong Public Offering.
HKSCC Nominees will only be acting as a nominee for you and neither HKSCC nor
HKSCC Nominees shall be liable to you or any other person in respect of any actions taken by
HKSCC or HKSCC Nominees on your behalf to apply for Hong Kong Offer Shares or for any
breach of the terms and conditions of this prospectus.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 413 –


--- page 425 ---
3. Information Required to Apply
Y ou must provide the following information with your application:
For Individual or Joint Applicants For Corporate Applicants
 Full name(s) 2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. HKID card; or
ii. National identification document;
or
iii. Passport; and
 Identity document number
 Full name(s)
2 as shown on your
identity document
 Identity document’s issuing country or
jurisdiction
 Identity document type, with order of
priority:
i. LEI registration document; or
ii. Certificate of incorporation; or
iii. Business registration certificate; or
iv. Other equivalent document; and
 Identity document number
Notes:
1. If you are applying through the White Form eIPO service, you are required to provide a valid e-mail
address, a contact telephone number and a Hong Kong address. Y ou are also required to declare that the
identity information provided by you follows the requirements as described in Note 2 below. In
particular, where you cannot provide a HKID number, you must confirm that you do not hold a HKID
card.
2. The applicant’s full name as shown on their identity document must be used. If an applicant’s identity
document contains both an English and Chinese name, both English and Chinese names must be used.
Otherwise, either English or Chinese names will be accepted. The order of priority of the applicant’s
identity document type must be strictly followed and where an individual applicant has a valid HKID
card, the HKID number must be used when making an application to subscribe for Hong Kong Offer
Shares. Similarly for corporate applicants, a LEI number must be used if an entity has a LEI certificate.
3. If the applicant is a trustee, the client identification data (“ CID”) of the trustee, as set out above, will
be required. If the applicant is an investment fund (i.e. a collective investment scheme, or CIS), the CID
of the asset management company or the individual fund, as appropriate, which has opened a trading
account with the broker will be required, as above.
4. The maximum number of joint applicants on FINI is capped at 4
1 in accordance with market practice.
5. If you are applying as a nominee, you must provide: (i) the full name (as shown on the identity
document), the identity document’s issuing country or jurisdiction, the identity document type; and (ii),
the identity document number, for each of the beneficial owners or, in the case(s) of joint beneficial
owners, for each joint beneficial owner. If you do not include this information, the application will be
treated as being made for your benefit.
1 Subject to change, if the Company’s Articles of Incorporation and applicable company law prescribe a lower
cap.
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6. If you are applying as an unlisted company and (i) the principal business of that company is dealing in
securities; and (ii) you exercise statutory control over that company, then the application will be treated
as being for your benefit and you should provide the required information in your application as stated
above.
“Unlisted company” means a company with no equity securities listed on the Stock Exchange or any
other stock exchange.
“Statutory control” means you:
 control the composition of the board of directors of the company;
 control more than half of the voting power of the company; or
 hold more than half of the issued share capital of the company (not counting any part of it which
carries no right to participate beyond a specified amount in a distribution of either profits or
capital).
For those applying through HKSCC EIPO channel, and making an application under a
power of attorney, we and the Sole Overall Coordinator, as our agent, have discretion to
consider whether to accept it on any conditions we think fit, including evidence of the
attorney’s authority.
Failing to provide any required information may result in your application being rejected.
4. Permitted Number of Hong Kong Offer Shares for Application
Board lot size : 50 H Shares
Permitted number of
Hong Kong Offer
Shares for
application and
amount payable on
application/successful
allotment
: Hong Kong Offer Shares are available for
application in specified board lot sizes only. Please
refer to the amount payable associated with each
specified board lot size in the table below.
The Offer Price is HK$83.33 per H Share.
If you are applying through the HKSCC EIPO
channel, you are required to pre-fund your
application based on the amount specified by your
broker or custodian, as determined based on the
applicable laws and regulations in Hong Kong.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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By instructing your broker or custodian to apply
for the Hong Kong Offer Shares on your behalf
through the HKSCC EIPO channel, you (and, if
you are joint applicants, each of you jointly and
severally) are deemed to have instructed and
authorized HKSCC to cause HKSCC Nominees
(acting as nominee for the relevant HKSCC
Participants) to arrange payment of the Offer Price,
brokerage, SFC transaction levy, the Stock
Exchange trading fee and the AFRC transaction
levy by debiting the relevant nominee bank account
at the Designated Bank for your broker or
custodian.
If you are applying through the White Form eIPO
service, you may refer to the table below for the
amount payable for the number of H Shares you
have selected. Y ou must pay the respective
maximum amount payable on application in full
upon application for Hong Kong Offer Shares.
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
No. of
Hong Kong
Offer Shares
applied for
Amount
payable (2) on
application
HK$ HK$ HK$ HK$
50 4,208.53 600 50,502.22 4,000 336,681.53 40,000 3,366,815.33
100 8,417.03 700 58,919.27 4,500 378,766.72 50,000 4,208,519.16
150 12,625.57 800 67,336.31 5,000 420,851.91 60,000 5,050,222.98
200 16,834.07 900 75,753.34 6,000 505,022.30 70,000 5,891,926.81
250 21,042.60 1,000 84,170.38 7,000 589,192.68 80,000 6,733,630.64
300 25,251.11 1,500 126,255.57 8,000 673,363.07 90,000 7,575,334.47
350 29,459.64 2,000 168,340.77 9,000 757,533.44 100,000 8,417,038.30
400 33,668.15 2,500 210,425.95 10,000 841,703.83 150,000 12,625,557.46
450 37,876.68 3,000 252,511.14 20,000 1,683,407.66 200,000 16,834,076.61
500 42,085.18 3,500 294,596.34 30,000 2,525,111.49 240,900
(1) 20,276,645.27
(1) Maximum number of Hong Kong Offer Share you may apply for.
(2) The amount payable is inclusive of brokerage, SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy. If your application is successful, brokerage will be paid to the Exchange Participants (as
defined in the Listing Rules) and the SFC transaction levy, the Stock Exchange trading fee and AFRC
transaction levy are paid to the Stock Exchange (in the case of the SFC transaction levy, collected by the Stock
Exchange on behalf of the SFC; and in the case of the AFRC transaction levy, collected by the Stock Exchange
on behalf of the AFRC).
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5. Multiple Applications Prohibited
Y ou or your joint applicant(s) shall not make more than one application for your own
benefit, except where you are a nominee and provide the information of the underlying investor
in your application as required under the paragraph headed “– A. Applications for Hong Kong
Offer Shares – 3. Information Required to Apply” in this section. If you are suspected of
submitting or cause to submit more than one application, all of your applications will be
rejected.
Multiple applications made either through (i) the White Form eIPO service, (ii) HKSCC
EIPO channel, or (iii) both channels concurrently are prohibited and will be rejected. If you
have made an application through the White Form eIPO service or HKSCC EIPO channel,
you or the person(s) for whose benefit you have made the application shall not apply for any
International Offer Shares.
6. Terms and Conditions of An Application
By applying for Hong Kong Offer Shares through the White Form eIPO service or
HKSCC EIPO channel, you (or as the case may be, HKSCC Nominees will do the following
things on your behalf):
(i) undertake to execute all relevant documents and instruct and authorise us and/or the
Sole Overall Coordinator, as our agents, to execute any documents for you and to do
on your behalf all things necessary to register any Hong Kong Offer Shares allocated
to you in your name or in the name of HKSCC Nominees as required by the Articles
of Association, and (if you are applying through the HKSCC EIPO channel) to
deposit the allotted Hong Kong Offer Shares directly into CCASS for the credit of
your designated HKSCC Participant’s stock account on your behalf;
(ii) confirm that you have read and understand the terms and conditions and application
procedures set out in this prospectus and the designated website of the White Form
eIPO service (or as the case may be, the agreement you entered into with your
broker or custodian), and agree to be bound by them;
(iii) (if you are applying through the HKSCC EIPO channel) agree to the arrangements,
undertakings and warranties under the participant agreement between your broker or
custodian and HKSCC and observe the General Rules of HKSCC and the HKSCC
Operational Procedures for giving application instructions to apply for Hong Kong
Offer Shares;
(iv) confirm that you are aware of the restrictions on offers and sales of shares set out
in this prospectus and they do not apply to you, or the person(s) for whose benefit
you have made the application;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 429 ---
(v) confirm that you have read this prospectus and any supplement to it and have relied
only on the information and representations contained therein in making your
application (or as the case may be, causing your application to be made) and will not
rely on any other information or representations;
(vi) agree that the Relevant Persons, the H Share Registrar and HKSCC will not be liable
for any information and representations not in this prospectus and any supplement
to it;
(vii) agree to disclose the details of your application and your personal data and any other
personal data which may be required about you and the person(s) for whose benefit
you have made the application to us, the Relevant Persons, the H Share Registrar,
HKSCC, HKSCC Nominees, the Stock Exchange, the SFC and any other statutory
regulatory or governmental bodies or otherwise as required by laws, rules or
regulations, for the purposes under the paragraph headed “– G. Personal Data – 3.
Purposes and 4. Transfer of personal data” in this section;
(viii) agree (without prejudice to any other rights which you may have once your
application (or as the case may be, HKSCC Nominees’ application) has been
accepted) that you will not rescind it because of an innocent misrepresentation;
(ix) agree that subject to Section 44A(6) of the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, any application made by you or HKSCC
Nominees on your behalf cannot be revoked once it is accepted, which will be
evidenced by the notification of the result of the ballot by the H Share Registrar by
way of publication of the results at the time and in the manner as specified in the
paragraph headed “– B. Publication of Results” in this section;
(x) confirm that you are aware of the situations specified in the paragraph headed “– C.
Circumstances In Which Y ou Will Not Be Allocated Hong Kong Offer Shares” in
this section;
(xi) agree that your application or HKSCC Nominees’ application, any acceptance of it
and the resulting contract will be governed by and construed in accordance with the
laws of Hong Kong;
(xii) agree to comply with the Companies Ordinance, the Companies (Winding Up and
Miscellaneous Provisions) Ordinance, the Articles of Association and laws of any
place outside Hong Kong that apply to your application and that neither we nor the
Relevant Persons will breach any law inside and/or outside Hong Kong as a result
of the acceptance of your offer to purchase, or any action arising from your rights
and obligations under the terms and conditions contained in this prospectus;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 430 ---
(xiii) confirm that (a) your application or HKSCC Nominees’ application on your behalf
is not financed directly or indirectly by the Company, any of the directors, chief
executives, substantial shareholder(s) or existing Shareholder(s) of the Company or
any of its subsidiaries or any of their respective close associates; and (b) you are not
accustomed or will not be accustomed to taking instructions from the Company, any
of the Directors, chief executives, substantial shareholder(s) or existing
Shareholder(s) of our Company or any of its subsidiaries or any of their respective
close associates in relation to the acquisition, disposal, voting or other disposition
of the H Shares registered in your name or otherwise held by you;
(xiv) warrant that the information you have provided is true and accurate;
(xv) confirm that you understand that we and the Sole Overall Coordinator will rely on
your declarations and representations in deciding whether or not to allocate any
Hong Kong Offer Shares to you and that you may be prosecuted for making a false
declaration;
(xvi) agree to accept Hong Kong Offer Shares applied for or any lesser number allocated
to you under the application;
(xvii) declare and represent that this is the only application made and the only application
intended by you to be made to benefit you or the person for whose benefit you are
applying;
(xviii) (if the application is made for your own benefit) warrant that no other application
has been or will be made for your benefit by giving electronic application
instructions to HKSCC directly or indirectly or through the White Form eIPO
service or by any one as your agent or by any other person; and
(xix) (if you are making the application as an agent for the benefit of another person)
warrant that (1) no other application has been or will be made by you as agent for
or for the benefit of that person or by that person or by any other person as agent
for that person by giving electronic application instructions to HKSCC and (2)
you have due authority to give electronic application instructions on behalf of that
other person as its agent.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 431 ---
B. PUBLICATION OF RESULTS
Results of Allocation
Y ou can check whether you are successfully allocated any Hong Kong Offer Shares
through:
Platform Date/Time
Applying through White Form eIPO service or HKSCC EIPO channel :
Website The designated results of allocation at
www.iporesults.com.hk
(alternatively:
www.eipo.com.hk/eIPOAllotment )
with a “search by ID Number”
function.
24 hours, from 11:00 p.m. on
Thursday, June 27, 2024 to
12:00 midnight on Wednesday,
July 3, 2024.
The full list of (i) wholly or partially successful applicants using the White
Form eIPO service and HKSCC EIPO channel, and (ii) the number of Hong
Kong Offer Shares conditionally allotted to them, among other things, will
be displayed on the “Allotment Results” page of the White Form eIPO
service at www.iporesults.com.hk (alternatively:
www.eipo.com.hk/eIPOAllotment ).
The Stock Exchange’s website at
www.hkexnews.hk and our website
at www.juhe.cn which will provide
links to the above mentioned
websites of the H Share Registrar.
No later than 11:00 p.m. on Thursday,
June 27, 2024 (Hong Kong time).
Telephone +852 2862 8555 – the allocation
results telephone enquiry line
provided by the H Share Registrar.
between 9:00 a.m. and 6:00 p.m.,
from Friday, June 28, 2024 to
Thursday, July 4, 2024 (Hong Kong
time) on a business day.
For those applying through HKSCC EIPO channel, you may also check with your broker or
custodian from 6:00 p.m. on Wednesday, June 26, 2024 (Hong Kong time).
HKSCC Participants can log into FINI and review the allotment result from 6:00 p.m. on
Wednesday, June 26, 2024 (Hong Kong time) on a 24-hour basis and should report any
discrepancies on allotments to HKSCC as soon as practicable.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 432 ---
Allocation Announcement
We expect to announce the level of indications of interest in the International Offering,
the level of applications in the Hong Kong Public Offering and the basis of allocations of Hong
Kong Offer Shares on the Stock Exchange’s website at www.hkexnews.hk and our website at
www.juhe.cn by no later than 11:00 p.m. on Thursday, June 27, 2024 (Hong Kong time).
C. CIRCUMSTANCES IN WHICH YOU WILL NOT BE ALLOCATED HONG KONG
OFFER SHARES
Y ou should note the following situations in which Hong Kong Offer Shares will not be
allocated to you or the person(s) for whose benefit you are applying for:
1. If your application is revoked:
Y our application or the application made by HKSCC Nominees on your behalf may be
revoked pursuant to Section 44A(6) of the Companies (Winding Up and Miscellaneous
Provisions) Ordinance.
2. If we or our agents exercise our discretion to reject your application:
We, the Sole Overall Coordinator, the H Share Registrar and their respective agents and
nominees have full discretion to reject or accept any application, or to accept only part of any
application, without giving any reasons.
3. If the allocation of Hong Kong Offer Shares is void:
The allocation of Hong Kong Offer Shares will be void if the Stock Exchange does not
grant permission to list our H Shares either:
 within three weeks from the closing date of the application lists; or
 within a longer period of up to six weeks if the Stock Exchange notifies us of that
longer period within three weeks of the closing date of the application lists.
4. If:
 you make multiple applications or suspected multiple applications. Y ou may refer to
the paragraph headed “– A. Applications for Hong Kong Offer Shares – 5. Multiple
Applications Prohibited” in this section on what constitutes multiple applications;
 your application instruction is incomplete;
 your payment (or confirmation of funds, as the case may be) is not made correctly;
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 433 ---
 the Underwriting Agreements do not become unconditional or are terminated;
 we or the Sole Overall Coordinator believe that by accepting your application, it or
we would violate applicable securities or other laws, rules or regulations.
5. If there is money settlement failure for allotted H Shares:
Based on the arrangements between HKSCC Participants and HKSCC, HKSCC
Participants will be required to hold sufficient application funds on deposit with their
Designated Bank before balloting. After balloting of Hong Kong Offer Shares, the Receiving
Bank will collect the portion of these funds required to settle each HKSCC Participant’s actual
Hong Kong Offer Share allotment from their Designated Bank.
There is a risk of money settlement failure. In the extreme event of money settlement
failure by a HKSCC Participant (or its Designated Bank), who is acting on your behalf in
settling payment for your allotted shares, HKSCC will contact the defaulting HKSCC
Participant and its Designated Bank to determine the cause of failure and request such
defaulting HKSCC Participant to rectify or procure to rectify the failure.
However, if it is determined that such settlement obligation cannot be met, the affected
Hong Kong Offer Shares will be reallocated to the International Offering. Hong Kong Offer
Shares applied for by you through the broker or custodian may be affected to the extent of the
settlement failure. In the extreme case, you will not be allocated any Hong Kong Offer Shares
due to the money settlement failure by such HKSCC Participant. None of us, the Relevant
Persons, the H Share Registrar and HKSCC is or will be liable if Hong Kong Offer Shares are
not allocated to you due to the money settlement failure.
D. DESPATCH/COLLECTION OF H SHARE CERTIFICATES AND REFUND OF
APPLICATION MONIES
Y ou will receive one H Share certificate for all Hong Kong Offer Shares allotted to you
under the Hong Kong Public Offering (except pursuant to applications made through the
HKSCC EIPO channel where the H Share certificates will be deposited into CCASS as
described below).
No temporary document of title will be issued in respect of the H Shares. No receipt will
be issued for sums paid on application.
H Share certificates will only become valid evidence of title at 8:00 a.m. on Friday, June
28, 2024 (Hong Kong time), provided that the Global Offer has become unconditional and the
right of termination described in the section headed “Underwriting” has not been exercised.
Investors who trade H Shares prior to the receipt of H Share certificates or the H Share
certificates becoming valid do so entirely at their own risk.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 434 ---
The right is reserved to retain any H Share certificate(s) and (if applicable) any surplus
application monies pending clearance of application monies.
The following sets out the relevant procedures and time:
White Form eIPO service HKSCC EIPO channel
Despatch/collection of H Share certificate (3)
For physical share certificates
of 100,000 or more Hong
Kong Offer Shares issued
under your own name
Collection in person at Shops
1712-1716, 17th Floor
Hopewell Centre, 183
Queen’s Road East, Wan
Chai, Hong Kong.
Time: from 9:00 a.m. to 1:00
p.m. on Friday, June 28,
2024.
H Share certificate(s) will be
issued in the name of
HKSCC Nominees, deposited
into CCASS and credited to
your designated HKSCC
Participant’s stock account.
No action by you is required.
If you are an individual, you
must not authorise any other
person to collect for you. If
you are a corporate applicant,
your authorised
representative must bear a
letter of authorization from
your corporation stamped
with your corporation’s chop.
Both individuals and authorised
representatives must produce,
at the time of collection,
evidence of identity
acceptable to the H Share
Registrar.
3 Except in the event of a tropical cyclone warning signal number 8 or above, a black rainstorm warning and/or
an Extreme Conditions announcement issued in the morning on the Listing Date rendering it impossible for
the relevant share certificates to be dispatched to HKSCC in a timely manner, the Company shall procure the
H Share Registrar to arrange for delivery of the supporting documents and H Share certificates in accordance
with the contingency arrangements as agreed between them. Y ou may refer to “– E. Severe Weather
Arrangements” in this section.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 435 ---
White Form eIPO service HKSCC EIPO channel
Note: If you do not collect
your H Share certificate(s)
personally within the time
above, it/they will be sent to
the address specified in your
application instructions by
ordinary post at your own
risk
For physical share certificates
of less than 100,000 Hong
Kong Offer Shares issued
under your own name
Y our H Share certificate(s) will
be sent to the address
specified in your application
instructions by ordinary post
at your own risk.
Time: Thursday, June 27, 2024
Refund mechanism for surplus application monies paid by you
Date Friday, June 28, 2024 Subject to the arrangement
between you and your broker
or custodian.
Responsible party H Share Registrar Y our broker or custodian
Application monies paid
through single bank
account
White Form e-Refund payment
instructions to your
designated bank account.
Y our broker or custodian will
arrange refund to your
designated bank account
subject to the arrangement
between you and it.
Application monies paid
through multiple bank
accounts
Refund cheque(s) will be
despatched to the address as
specified in your application
instructions by ordinary post
at your own risk.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 436 ---
E. SEVERE WEATHER ARRANGEMENTS
The Opening and Closing of the Application Lists
The application lists will not open or close on Tuesday, June 25, 2024 if, there is/are:
 a tropical cyclone warning signal number 8 or above;
 a black rainstorm warning; and/or
 Extreme Conditions,
(collectively, “ Severe Weather Signals ”),
in force in Hong Kong at any time between 9:00 a.m. and 12:00 noon on Tuesday, June 25,
2024.
Instead they will open between 11:45 a.m. and 12:00 noon and/or close at 12:00 noon on
the next business day which does not have Severe Weather Signals in force at any time between
9:00 a.m. and 12:00 noon.
Prospective investors should be aware that a postponement of the opening/closing of the
application lists may result in a delay in the Listing Date. Should there be any changes to the
dates mentioned in the section headed “Expected Timetable” in this prospectus, an
announcement will be made and published on the Stock Exchange’s website at
www.hkexnews.hk and our website at www.juhe.cn of the revised timetable.
If a Severe Weather Signal is hoisted on Thursday, June 27, 2024, the H Share Registrar
will make appropriate arrangements for the delivery of the H Share certificates to the CCASS
Depository’s service counter so that they would be available for trading on Friday, June 28,
2024.
If a Severe Weather Signal is hoisted on Friday, June 28, 2024:
 for physical H share certificates of 100,000 or more Offer Shares issued under your
own name, you may pick them up from the H Share Registrar’s office after the
Severe Weather Signal is lowered or cancelled (e.g. in the afternoon of Friday, June
28, 2024 or on Tuesday, July 2, 2024).
If a Severe Weather Signal is hoisted on Thursday, June 27, 2024:
 for physical H share certificates of less than 100,000 Offer Shares issued under your
own name, despatch will be made by ordinary post when the post office re-opens
after the Severe Weather Signal is lowered or cancelled (e.g. in the afternoon of
Thursday, June 27, 2024 or on Friday, June 28, 2024).
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 437 ---
Prospective investors should be aware that if they choose to receive physical H Share
certificates issued in their own name, there may be a delay in receiving the H Share
certificates.
F. ADMISSION OF THE H SHARES INTO CCASS
If the Stock Exchange grants the listing of, and permission to deal in, the H Shares on the
Stock Exchange and we comply with the stock admission requirements of HKSCC, the H
Shares will be accepted as eligible securities by HKSCC for deposit, clearance and settlement
in CCASS with effect from the date of commencement of dealings in the H Shares or any other
date HKSCC chooses. Settlement of transactions between Exchange Participants is required to
take place in CCASS on the second settlement day after any trading day.
All activities under CCASS are subject to the General Rules of HKSCC and HKSCC
Operational Procedures in effect from time to time.
All necessary arrangements have been made enabling the H Shares to be admitted into
CCASS.
Y ou should seek the advice of your broker or other professional advisor for details of the
settlement arrangement as such arrangements may affect your rights and interests.
G. PERSONAL DATA
The following Personal Information Collection Statement applies to any personal data
collected and held by our Company, the H Share Registrar, the receiving bank and the Relevant
Persons about you in the same way as it applies to personal data about applicants other than
HKSCC Nominees. This personal data may include client identifier(s) and your identification
information. By giving application instructions to HKSCC, you acknowledge that you have
read, understood and agree to all of the terms of the Personal Information Collection Statement
below.
1. Personal Information Collection Statement
This Personal Information Collection Statement informs the applicant for, and holder of,
Hong Kong Offer Shares, of the policies and practices of our Company and the H Share
Registrar in relation to personal data and the Personal Data (Privacy) Ordinance (Chapter 486
of the Laws of Hong Kong).
2. Reasons for the collection of your personal data
It is necessary for applicants and registered holders of Hong Kong Offer Shares to ensure
that personal data supplied to the Company or its agents and the H Share Registrar is accurate
and up-to-date when applying for Hong Kong Offer Shares or transferring Hong Kong Offer
Shares into or out of their names or in procuring the services of the H Share Registrar.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 438 ---
Failure to supply the requested data or supplying inaccurate data may result in your
application for Hong Kong Offer Shares being rejected, or in the delay or the inability of the
Company or the H Share Registrar to effect transfers or otherwise render their services. It may
also prevent or delay registration or transfers of Hong Kong Offer Shares which you have
successfully applied for and/or the despatch of H Share certificate(s) to which you are entitled.
It is important that applicants for and holders of Hong Kong Offer Shares inform our
Company and the H Share Registrar immediately of any inaccuracies in the personal data
supplied.
3. Purposes
Y our personal data may be used, held, processed, and/or stored (by whatever means) for
the following purposes:
 processing your application and refund cheque and White Form e-Refund payment
instructions payment instruction(s), where applicable, verification of compliance
with the terms and application procedures set out in this prospectus and announcing
results of allocation of Hong Kong Offer Shares;
 compliance with applicable laws and regulations in Hong Kong and elsewhere;
 registering new issues or transfers into or out of the names of the holders of the H
Shares including, where applicable, HKSCC Nominees;
 maintaining or updating the register of members of the Company;
 verifying identities of applicants for and holders of the H Shares and identifying any
duplicate applications for the H Shares;
 facilitating Hong Kong Offer Shares balloting;
 establishing benefit entitlements of holders of the H Shares, such as dividends,
rights issues, bonus issues, etc.;
 distributing communications from our Company and its subsidiaries;
 compiling statistical information and profiles of the holder of the H Shares;
 disclosing relevant information to facilitate claims on entitlements; and
 any other incidental or associated purposes relating to the above and/or to enable the
Company and the H Share Registrar to discharge their obligations to applicants and
holders of the H Shares and/or regulators and/or any other purposes to which
applicants and holders of the H Shares may from time to time agree.
HOW TO APPLY FOR HONG KONG OFFER SHARES
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--- page 439 ---
4. Transfer of personal data
Personal data held by our Company and the H Share Registrar relating to the applicants
for and holders of Hong Kong Offer Shares will be kept confidential but our Company and the
H Share Registrar may, to the extent necessary for achieving any of the above purposes,
disclose, obtain or transfer (whether within or outside Hong Kong) the personal data to, from
or with any of the following:
 our Company’s appointed agents such as financial advisers, receiving bank and
overseas principal share registrar;
 HKSCC or HKSCC Nominees, who will use the personal data and may transfer the
personal data to the H Share Registrar for the purposes of providing its services or
facilities or performing its functions in accordance with its rules or procedures and
operating FINI and CCASS (including where applicants for the Hong Kong Offer
Shares request a deposit into CCASS);
 any agents, contractors or third-party service providers who offer administrative,
telecommunications, computer, payment or other services to our Company or the H
Share Registrar in connection with their respective business operation;
 the Stock Exchange, the SFC and any other statutory regulatory or governmental
bodies or otherwise as required by laws, rules or regulations, including for the
purpose of the Stock Exchange’s administration of the Listing Rules and the SFC’s
performance of its statutory functions; and
 any persons or institutions with which the holders of Hong Kong Offer Shares have
or propose to have dealings, such as their bankers, solicitors, accountants or brokers
etc.
5. Retention of personal data
Our Company and the H Share Registrar will keep the personal data of the applicants and
holders of Hong Kong Offer Shares for as long as necessary to fulfil the purposes for which
the personal data were collected. Personal data which is no longer required will be destroyed
or dealt with in accordance with the Personal Data (Privacy) Ordinance (Chapter 486 of the
Laws of Hong Kong).
6. Access to and correction of personal data
Applicants for and holders of Hong Kong Offer Shares have the right to ascertain whether
our Company or the H Share Registrar hold their personal data, to obtain a copy of that data,
and to correct any data that is inaccurate. Our Company and the H Share Registrar have the
right to charge a reasonable fee for the processing of such requests. All requests for access to
data or correction of data should be addressed to our Company and the H Share Registrar, at
their registered address disclosed in the section headed “Corporate information” in this
prospectus or as notified from time to time, for the attention of the company secretary, or the
H Share Registrar for the attention of the privacy compliance officer.
HOW TO APPLY FOR HONG KONG OFFER SHARES
– 428 –


--- page 440 ---
ACCOUNTANTS’ REPORT ON HISTORICAL FINANCIAL INFORMATION TO THE
DIRECTORS OF TIANJU DIHE (SUZHOU) TECHNOLOGY CO., LTD. AND CITIC
SECURITIES (HONG KONG) LIMITED
Introduction
We report on the historical financial information of Tianju Dihe (Suzhou) Technology
Co., Ltd. (the “ Company ”) and its subsidiaries (together the “ Group ”) set out on pages I-4 to
I-75, which comprises the consolidated statements of financial position as of December 31,
2021, 2022 and 2023 and the statements of financial position of the Company as of December
31, 2021, 2022 and 2023, the consolidated statements of profit or loss and other comprehensive
income, the consolidated statements of changes in equity and the consolidated statements of
cash flows of the Group for each of the years ended December 31, 2021, 2022 and 2023 (the
“Track Record Period ”) and material accounting policy information and other explanatory
information (together the “ Historical Financial Information ”). The Historical Financial
Information set out on pages I-4 to I-75 forms an integral part of this report, which has been
prepared for inclusion in the prospectus of the Company dated June 20, 2024 (the
“Prospectus ”) in connection with the initial listing of shares of the Company on the Main
Board of The Stock Exchange of Hong Kong Limited (the “ Stock Exchange ”).
Directors’ Responsibility For The Historical Financial Information
The directors of the Company are responsible for the preparation of the Historical
Financial Information that gives a true and fair view in accordance with the basis of preparation
set out in Note 2 to the Historical Financial Information, and for such internal control as the
directors determine is necessary to enable the preparation of the Historical Financial
Information that is free from material misstatement, whether due to fraud or error.
Reporting Accountants’ Responsibility
Our responsibility is to express an opinion on the Historical Financial Information and to
report our opinion to you. We conducted our work in accordance with Hong Kong Standard on
Investment Circular Reporting Engagements 200 “Accountants’ Reports on Historical
Financial Information in Investment Circulars” issued by the Hong Kong Institute of Certified
Public Accountants (“ HKICPA ”). This standard requires that we comply with ethical standards
and plan and perform our work to obtain reasonable assurance about whether the Historical
Financial Information is free from material misstatement.
Our work involved performing procedures to obtain evidence about the amounts and
disclosures in the Historical Financial Information. The procedures selected depend on the
reporting accountants’ judgment, including the assessment of risks of material misstatement of
the Historical Financial Information, whether due to fraud or error. In making those risk
assessments, the reporting accountants consider internal control relevant to the entity’s
preparation of Historical Financial Information that gives a true and fair view in accordance
with the basis of preparation set out in Note 2 to the Historical Financial Information in order
APPENDIX I ACCOUNTANTS’ REPORT
– I-1 –


--- page 441 ---
to design procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity’s internal control. Our work also
included evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the directors of the Company, as well as evaluating the overall
presentation of the Historical Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion, the Historical Financial Information gives, for the purposes of the
accountants’ report, a true and fair view of the Group’s financial position as of December 31,
2021, 2022 and 2023, the Company’s financial position as of December 31, 2021, 2022 and
2023, and of the Group’s financial performance and cash flows for the Track Record Period in
accordance with the basis of preparation set out in Note 2 to the Historical Financial
Information.
APPENDIX I ACCOUNTANTS’ REPORT
– I-2 –


--- page 442 ---
REPORT ON MATTERS UNDER THE RULES GOVERNING THE LISTING OF
SECURITIES ON THE STOCK EXCHANGE OF HONG KONG LIMITED AND THE
COMPANIES (WINDING UP AND MISCELLANEOUS PROVISIONS) ORDINANCE
Adjustments
In preparing the Historical Financial Information, no adjustments to the Underlying
Financial Statements as defined on page I-4 have been made.
Dividends
We refer to Note 12 to the Historical Financial Information which contains information
about dividends declared and paid by the Company in respect of the Track Record Period.
BDO Limited
Certified Public Accountants
Practising Certificate no.
Hong Kong
June 20, 2024
APPENDIX I ACCOUNTANTS’ REPORT
– I-3 –


--- page 443 ---
HISTORICAL FINANCIAL INFORMATION OF THE GROUP
Preparation of Historical Financial Information
Set out below is the Historical Financial Information which forms an integral part of this
accountants’ report.
The consolidated financial statements of the Group for the Track Record Period, on which
the Historical Financial Information is based, have been prepared in accordance with the
accounting policies which conform with IFRS Accounting standards (“ IFRSs ”) issued by
International Accountings Standards Board (“ IASB ”) and were audited by BDO Limited in
accordance with Hong Kong Standards on Auditing issued by the HKICPA (the “ Underlying
Financial Statements ”).
The Historical Financial Information is presented in Renminbi (“ RMB”) and all values
are rounded to the nearest thousand (RMB’000) except when otherwise indicated.
APPENDIX I ACCOUNTANTS’ REPORT
– I-4 –


--- page 444 ---
CONSOLIDATED STATEMENTS OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME
Y ear ended December 31,
Notes 2021 2022 2023
RMB’000 RMB’000 RMB’000
REVENUE 7 260,011 328,936 441,083
Cost of sales (170,099) (221,382) (316,431)
Gross profit 89,912 107,554 124,652
Other income and other gains, net 8 16,903 11,019 10,704
Selling and distribution expenses (15,449) (14,378) (12,530)
Research and development costs (16,875) (26,345) (24,250)
Administrative and other expenses (20,490) (32,025) (27,518)
Impairment loss on financial and contract
assets, net 10 (418) (1,068) (9,915)
Finance costs 9 (154) (1) (1,014)
Listing expenses – – (22,354)
PROFIT BEFORE TAX 10 53,429 44,756 37,775
Income tax expense 11 (7,463) (3,472) (2,714)
PROFIT FOR THE YEAR 45,966 41,284 35,061
OTHER COMPREHENSIVE
INCOME/(EXPENSE)
Item that may be subsequently reclassified to
profit or loss in subsequent periods:
Exchange differences on translation of
foreign operations (251) 853 224
Item that will not be reclassified to profit or
loss:
Changes in fair value of financial assets at
fair value through other comprehensive
income (“ FVOCI ”), net of tax 32,242 (10,740) (12,265)
OTHER COMPREHENSIVE
INCOME/(EXPENSE) FOR THE YEAR,
NET OF TAX 31,991 (9,887) (12,041)
TOTAL COMPREHENSIVE INCOME FOR
THE YEAR 77,957 31,397 23,020
Profit/(loss) for the year attributable to :
Owners of the Company 46,011 41,249 34,751
Non-controlling interests (45) 35 310
45,966 41,284 35,061
Total comprehensive income/(expenses) for
the year attributable to :
Owners of the Company 78,002 31,362 22,710
Non-controlling interests (45) 35 310
77,957 31,397 23,020
Earnings per share (RMB) attributable to
owners of the Company
Basic and diluted 13 1.02 0.91 0.77
APPENDIX I ACCOUNTANTS’ REPORT
– I-5 –


--- page 445 ---
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of December 31,
Notes 2021 2022 2023
RMB’000 RMB’000 RMB’000
ASSETS AND LIABILITIES
Non-current assets
Property, plant and equipment 15 212,781 233,972 223,466
Intangible assets 17 118 109 100
Financial assets at FVOCI 20 88,189 75,954 61,700
Financial assets at fair value through profit
or loss (“ FVTPL ”) 25 – – 5,245
Prepayments 22 36 5 40
Deferred tax assets 18 556 620 545
Total non-current assets 301,680 310,660 291,096
Current assets
Inventories 19 21,533 12,454 20,850
Financial assets at FVTPL 25 103,066 35,155 –
Trade receivables 21 91,203 123,973 175,077
Prepayments, deposits and other
receivables 22 20,321 59,466 78,743
Contract assets 23 1,117 3,994 1,865
Cash and cash equivalents 24 182,287 168,470 124,417
Time deposits 24 – 30,000 80,000
Tax recoverable – – 11
Total current assets 419,527 433,512 480,963
Current liabilities
Trade payables 26 37,450 36,672 61,491
Other payables and accruals 27 23,113 39,474 19,816
Contract liabilities 23 51,440 29,692 29,802
Lease liabilities 28 –4 3 –
Repurchase liabilities 41 – – 23,013
Income tax payable 2,947 2,008 3,984
Total current liabilities 114,950 107,889 138,106
Net current assets 304,577 325,623 342,857
APPENDIX I ACCOUNTANTS’ REPORT
– I-6 –


--- page 446 ---
As of December 31,
Notes 2021 2022 2023
RMB’000 RMB’000 RMB’000
TOTAL ASSETS LESS CURRENT
LIABILITIES 606,257 636,283 633,953
Non-current liabilities
Lease liabilities 28 –2 2 –
Deferred tax liabilities 18 11,134 9,306 5,536
Total non-current liabilities 11,134 9,328 5,536
Net assets 595,123 626,955 628,417
EQUITY
Equity attributable to owners of the
Company
Share capital 29 45,300 45,300 45,300
Reserves 30 550,215 582,012 583,164
595,515 627,312 628,464
Non-controlling interests 31 (392) (357) (47)
TOTAL EQUITY 595,123 626,955 628,417
APPENDIX I ACCOUNTANTS’ REPORT
– I-7 –


--- page 447 ---
STATEMENTS OF FINANCIAL POSITION OF THE COMPANY
As of December 31,
Notes 2021 2022 2023
RMB’000 RMB’000 RMB’000
ASSETS AND LIABILITIES
Non-current assets
Property, plant and equipment 15 211,580 232,922 222,556
Investments in subsidiaries 16 100,062 104,321 106,393
Intangible assets 17 118 109 100
Financial assets at FVOCI 20 85,882 74,819 61,176
Financial assets at FVTPL 25 – – 5,245
Total non-current assets 397,642 412,171 395,470
Current assets
Inventories 19 21,265 10,388 20,424
Financial assets at FVTPL 25 – 25,155 –
Trade receivables 21 89,479 117,105 168,481
Prepayments, deposits and other receivables 22 11,224 36,409 44,593
Amounts due from subsidiaries 32 130,015 21,359 6,037
Contract assets 23 1,117 3,994 1,865
Cash and cash equivalents 24 142,797 130,733 90,585
Time deposits 24 – 30,000 80,000
Total current assets 395,897 375,143 411,985
Current liabilities
Trade payables 26 36,275 31,218 57,096
Amounts due to subsidiaries 32 83,863 56,306 47,525
Other payables and accruals 27 22,096 38,146 19,074
Contract liabilities 23 44,523 25,329 26,367
Lease liabilities 28 –4 3 –
Repurchase liabilities 41 – – 23,013
Income tax payable 2,757 1,810 3,786
Total current liabilities 189,514 152,852 176,861
Net current assets 206,383 222,291 235,124
TOTAL ASSETS LESS CURRENT
LIABILITIES 604,025 634,462 630,594
Non-current liabilities
Lease liabilities 28 –2 2 –
Deferred tax liabilities 18 11,095 9,306 5,536
Total non-current liabilities 11,095 9,328 5,536
Net assets 592,930 625,134 625,058
EQUITY
Share capital 29 45,300 45,300 45,300
Reserves 30 547,630 579,834 579,758
TOTAL EQUITY 592,930 625,134 625,058
APPENDIX I ACCOUNTANTS’ REPORT
– I-8 –


--- page 448 ---
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Attributable to owners of the Company
Share
capital
Share
premium*
Capital
reserve*
FVOCI
reserve*
Translation
reserve*
Statutory
reserve*
Retained
earnings* Subtotal
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 29)
(Note
30(a))
(Note
30(b))
(Note
30(c))
(Note
30(d))
(Note
30(e))
(Note
30(f)) (Note 31)
At January 1, 2021 45,300 426,720 67 31,053 (318) 8,017 26,274 537,113 (347) 536,766
Profit/(loss) for the year –––––– 4 6 , 0 1 1 4 6 , 0 1 1 (45) 45,966
Exchange differences on
translation of foreign
operations –––– (251) – – (251) – (251)
Changes in fair value of
financial assets at FVOCI,
net of tax – – – 32,242 – – – 32,242 – 32,242
Total comprehensive
income/(expense) for the
year – – – 32,242 (251) – 46,011 78,002 (45) 77,957
Equity-settled share-based
transactions (Note 36) –– 4 0 0–––– 4 0 0– 4 0 0
Dividend declared (Note 12) –––––– (20,000) (20,000) – (20,000)
Transfer of retained earnings ––––– 4,625 (4,625) – – –
Balance at December 31, 2021 45,300 426,720 467 63,295 (569) 12,642 47,660 595,515 (392) 595,123
* These reserve accounts comprise the consolidated reserves as of December 31, 2021, 2022 and 2023 in the
consolidated statements of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
– I-9 –


--- page 449 ---
Attributable to owners of the Company
Share
capital
Share
premium*
Capital
reserve*
FVOCI
reserve*
Translation
reserve*
Statutory
reserve*
Retained
earnings* Subtotal
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 29)
(Note
30(a))
(Note
30(b))
(Note
30(c))
(Note
30(d))
(Note
30(e))
(Note
30(f)) (Note 31)
Balance at January 1, 2022 45,300 426,720 467 63,295 (569) 12,642 47,660 595,515 (392) 595,123
Profit for the year –––––– 4 1 , 2 4 9 4 1 , 2 4 9 3 5 4 1 , 2 8 4
Exchange differences on
translation of foreign
operations –––– 8 5 3–– 8 5 3– 8 5 3
Changes in fair value of
financial assets at FVOCI,
net of tax – – – (10,740) – – – (10,740) – (10,740)
Total comprehensive
(expense)/income for the
year – – – (10,740) 853 – 41,249 31,362 35 31,397
Equity-settled share-based
transactions (Note 36) –– 4 3 5–––– 4 3 5– 4 3 5
Transfer of retained earnings ––––– 3,982 (3,982) – – –
Balance at December 31, 2022 45,300 426,720 902 52,555 284 16,624 84,927 627,312 (357) 626,955
* These reserve accounts comprise the consolidated reserves as of December 31, 2021, 2022 and 2023 in the
consolidated statements of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
– I-10 –


--- page 450 ---
Attributable to owners of the Company
Share
capital
Share
premium*
Capital
reserve*
FVOCI
reserve*
Translation
reserve*
Statutory
reserve*
Retained
earnings* Subtotal
Non-
controlling
interests
Total
equity
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 29)
(Note
30(a))
(Note
30(b))
(Note
30(c)) (Note 30(d))
(Note
30(e))
(Note
30(f)) (Note 31)
Balance at January 1, 2023 45,300 426,720 902 52,555 284 16,624 84,927 627,312 (357) 626,955
Profit for the year –––– –– 3 4 , 7 5 1 3 4 , 7 5 1 3 1 0 3 5 , 0 6 1
Exchange differences on translation of
foreign operations –––– 2 2 4–– 2 2 4 – 2 2 4
Changes in fair value of financial assets at
FVOCI, net of tax – – – (12,265) – – – (12,265) – (12,265)
Total comprehensive (expense)/income
for the year – – – (12,265) 224 – 34,751 22,710 310 23,020
Equity-settled share-based transactions
(Note 36) – – 442 – – – – 442 – 442
Deemed distribution to a shareholder
(Note 41) –––– –– (22,000) (22,000) – (22,000)
Transfer of retained earnings –––– – 1 , 4 1 6 ( 1 , 416) – – –
Balance at December 31, 2023 45,300 426,720 1,344 40,290 508 18,040 96,262 628,464 (47) 628,417
* These reserve accounts comprise the consolidated reserves as of December 31, 2021, 2022 and 2023 in the
consolidated statements of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
– I-11 –


--- page 451 ---
CONSOLIDATED STATEMENTS OF CASH FLOWS
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash flows from operating activities
Profit before tax 53,429 44,756 37,775
Adjustments for:
Depreciation of property, plant and equipment 4,062 10,974 11,678
Amortization of intangible assets 9 9 9
Finance costs 154 1 1,014
Interest income (1,922) (1,356) (2,469)
Loss/(gain) on disposal/written off of property,
plant and equipment 51 (10) 8
Impairment loss on financial and contract assets,
net 418 1,068 9,915
Fair value (gain)/loss on financial assets at
FVTPL (7,316) (3,384) 460
Equity-settled share-based payments 400 435 442
Dividend income (15) (234) –
Operating profit before working capital changes 49,270 52,259 58,832
(Increase)/decrease in inventories (17,216) 9,198 (8,060)
Increase in trade receivables (28,553) (34,545) (61,136)
Increase in prepayments, deposits and other
receivables (10,082) (38,387) (15,363)
(Increase)/decrease in contract assets (1,079) (2,897) 2,148
(Decrease)/increase in trade payables (13,516) (778) 24,819
(Decrease)/increase in other payables and accruals (1,515) 4,722 5,493
(Decrease)/increase in contract liabilities (8,435) (21,748) 110
Cash (used in)/from operations (31,126) (32,176) 6,843
Income tax paid (2,705) (9,544) (4,435)
Income tax refund 35 4,901 2,037
Net cash (used in)/from operating activities (33,796) (36,819) 4,445
APPENDIX I ACCOUNTANTS’ REPORT
– I-12 –


--- page 452 ---
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash flows from investing activities
Purchase of property, plant and equipment (72,831) (20,584) (26,708)
Proceeds from disposal of property, plant and
equipment 16 34 9
Purchase of financial assets at FVTPL (298,525) (390,000) (151,667)
Proceeds from disposal of financial assets at
FVTPL 202,775 461,295 181,117
Interest received 1,922 1,356 2,469
Placement of time deposits – (30,000) (130,000)
Withdrawal of time deposits – – 80,000
Dividend income 15 234 –
Net cash (used in)/from investing activities (166,628) 22,335 (44,780)
Cash flows from financing activities
Proceeds from bank borrowings 20,000 – –
Repayments of bank borrowings (20,000) – –
Interest paid (145) – –
Repayments of principal portion of lease
liabilities (787) (21) (32)
Repayments of interest portion of lease liabilities (9) (1) (1)
Dividend paid (20,000) – –
Payments for listing expenses – – (3,851)
Net cash used in financing activities (20,941) (22) (3,884)
Net decrease in cash and cash equivalents (221,365) (14,506) (44,219)
Cash and cash equivalents at the beginning of the
year 403,836 182,287 168,470
Exchange differences on translating cash flows of
foreign operations (184) 689 166
Cash and cash equivalents at the end
of the year 182,287 168,470 124,417
APPENDIX I ACCOUNTANTS’ REPORT
– I-13 –


--- page 453 ---
NOTES TO THE HISTORICAL FINANCIAL INFORMATION
1. GENERAL INFORMATION
Tianju Dihe (Suzhou) Technology Co., Ltd. (the “ Company ”) is a limited liability company incorporated in
the People’s Republic of China (the “ PRC”) on February 25, 2010. The registered office address and the principal
place of business of the Company is located at 16/F, No. 9 Rongfu Street, Suzhou Industrial Park, Suzhou, Jiangsu
Province, PRC.
The Company and its subsidiaries (collectively referred as the “ Group ”) are principally engaged in the
provision of application programming interfaces (“ API”) marketplace and data management solutions in the PRC.
Mr. Zuo Lei is the largest shareholder of the Company.
Particulars of the Company’s subsidiaries at the date of this report are as follows:
Name of subsidiaries Notes
Date and
place of
incorporation/
establishment
Place of
operation
Issued and fully
paid capital/
registered capital
Percentage
of equity
attributable to
the Company
Principal
activities
Direct Indirect
Suzhou Tianju Renhe
Technology Co., Ltd.
(“Tianju Renhe ”)*
(ʮ
̡) (formerly known as
Ԣଇ̔ၣഖҦஔϞ
ʮ̡)
1 September 7, 2009,
the PRC
The PRC Registered capital of
RMB10,000,000
100.00% – Software and
information
technology
service
Beijing Juli Wanhe
Management Consulting
Co., Ltd.* ( ̏ԯၳɢຬΥ
ʮ̡)
2 April 22, 2015,
the PRC
The PRC Registered capital of
RMB50,000
100.00% – Software and
information
technology
service
Juhe Data HK Limited 3 January 7, 2016,
Hong Kong
Hong
Kong
Issued and fully
paid up capital of
USD1,000,000
100.00% – Investment
holding
Beijing Sidike Technology
Co., Ltd.* (߅
ʮ̡)
2 January 8, 2015,
the PRC
The PRC Registered capital of
RMB1,111,100
85.50% – Technology
promotion and
application
service
Suzhou Zhonghui Juhe
Information Technology
Co., Ltd.* (“ Zhonghui
Juhe ”) (ڦ
ʮ̡)
2 November 16, 2016,
the PRC
The PRC Registered capital of
RMB5,000,000
60.00% – Software and
information
technology
service
Wuhan Jushunhe
Technology Co., Ltd.*
(ʮ
̡)
2 August 9, 2021,
the PRC
The PRC Registered capital of
RMB3,000,000
51.00% – Technology
promotion and
application
service
Suzhou Tianju Daohe
Technology Co., Ltd.* #
(ʮ
̡)
2 December 12, 2019,
the PRC
The PRC Registered capital of
RMB5,000,000
– – Software and
information
technology
service
APPENDIX I ACCOUNTANTS’ REPORT
– I-14 –


--- page 454 ---
Name of subsidiaries Notes
Date and
place of
incorporation/
establishment
Place of
operation
Issued and fully
paid capital/
registered capital
Percentage
of equity
attributable to
the Company
Principal
activities
Direct Indirect
Suzhou Tianju Xinghe
Technology Co., Ltd.*
(“Tianju Xinghe ”) ( ᘽψ
ʮ̡)
2 December 3, 2019,
the PRC
The PRC Registered capital of
RMB5,000,000
– 100% Software and
information
technology
service
(1) No statutory financial statements have been prepared for this entity for the years ended December 31, 2021,
2022 and 2023 as there were no statutory requirement for preparing statutory financial statements.
(2) No statutory financial statements have been prepared for these entities since incorporation, as these entities
were not subject to any statutory audit requirement under the relevant rules and regulations in their
jurisdictions of incorporation.
(3) The statutory financial statements of this subsidiary for the years ended December 31, 2021, 2022 and 2023
prepared under Hong Kong Small and Medium-sized Entity Financial Reporting Standards issued by the Hong
Kong Institute of Certified Public Accountants were audited by Raymond C W Tam & Co., certified public
accountants registered in Hong Kong.
(4) None of the subsidiaries had issued any debt securities for each of the years ended December 31, 2021, 2022
and 2023 (the “ Track Record Period ”).
* The English translation of terms or names in Chinese which are marked with “ *” is for identification purposes
only. In the event of any inconsistency, the Chinese terms or names shall prevail.
# Suzhou Tianju Daohe Technology Co., Ltd. was dissolved due to cessation of business on April 17, 2023.
For the purpose of the Historical Financial Information of this report, the directors of the Company have
prepared the Underlying Financial Statements in accordance with the basis of preparation set out in Note 2 below and
accounting policies set out in Note 4 below which conform with IFRS Accounting Standards (“ IFRSs ”) issued by
International Accounting Standards Board (the “ IASB ”).
The Historical Financial Information has been prepared from the Underlying Financial Statements, with no
adjustments made thereon.
2. BASIS OF PREPARATION
2.1 Statement of compliance
The Historical Financial Information has been prepared based on accounting policies set out in Note 4 which
confirm with IFRSs, which includes, IFRSs, International Accounting Standard (“ IAS”) and the related
interpretations issued by the IASB. In addition, the Historical Financial Information includes applicable disclosures
required by the Rules Governing the Listing of Securities on The Stock Exchange of the Hong Kong Limited (the
“Stock Exchange ”) and by the Hong Kong Companies Ordinance.
For the purpose of preparing and presenting the Historical Financial Information, all relevant standards,
amendments and interpretations to the IFRSs that are effective during the Track Record Period have been adopted
by the Group consistently throughout the Track Record Period.
The preparation of the Historical Financial Information in conformity with IFRSs requires the use of certain
critical accounting estimates. It also requires management to exercise its judgment in the process of applying the
Group’s accounting policies. The areas involving a higher degree of judgment or complexity, or areas where
assumptions and estimates are significant to the Historical Financial Information are disclosed in Note 5 below.
APPENDIX I ACCOUNTANTS’ REPORT
– I-15 –


--- page 455 ---
2.2 Basis of measurement
The Historical Financial Information has been prepared on the historical cost basis except for certain financial
instruments, which are measured at fair values as explained in the material accounting policies set out below.
2.3 Functional and presentation currency
The Historical Financial Information is presented in Renminbi (“ RMB”), which is the same as the functional
currency of the Company.
3. NEW AND REVISED IFRSs ISSUED BUT NOT YET EFFECTIVE
The following new and revised IFRSs, potentially relevant to the Historical Financial Information, have been
issued, but are not yet effective and have not been early adopted by the Group.
Amendments to IAS 1 Classification of Liabilities as Current or Non-current 1
Amendments to IAS 1 Non-current Liabilities with Covenants 1
Amendments to IAS 7 and IFRS 7 Supplier Finance Arrangements 1
Amendments to IAS 21 Lack of Exchangeability 2
Amendments to IFRS 16 Leases Liability in a Sale and Leaseback 1
Amendments to IFRS 9 and IFRS 7 Amendments to the Classification and Measurement of
Financial Instruments 3
IFRS 18 Presentation and Disclosure in Financial Statements 4
IFRS 19 Subsidiaries without Public Accountability: Disclosures 4
Amendments to IFRS 10 and IAS 28 Sale or Contribution of Assets between an Investor and its
Associate or Joint V enture 5
1 Effective for annual periods beginning on or after January 1, 2024
2 Effective for annual periods beginning on or after January 1, 2025
3 Effective for annual periods beginning on or after January 1, 2026
4 Effective for annual periods beginning on or after January 1, 2027
5 No mandatory effective date yet determined but available for adoption
The directors of the Company do not anticipate that the adoption of the new and revised IFRSs in future
periods will have any material impact on the Historical Financial Information in future periods.
4. MATERIAL ACCOUNTING POLICY INFORMATION
4.1 Basis of consolidation
The Historical Financial Information incorporates the financial statements of the Company and entities
controlled by the Company (its subsidiaries) comprising the Group for the Track Record Period.
Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the
Group loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of
during the year are included in the consolidated statements of profit or loss and other comprehensive income from
the date the Group gains control until the date when the Group ceases to control the subsidiary.
Profit or loss and each item of other comprehensive income are attributed to the owners of the Company and
to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the
Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit
balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting
policies in line with the Group’s accounting policies.
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All intra-group transactions, balances and unrealized gains on transactions have been eliminated in full on
consolidation. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the
asset transferred. Adjustments are made to the financial statements of subsidiaries where necessary to ensure
consistency with the policies adopted by the Group.
4.2 Subsidiaries
A subsidiary is an investee over which the Company is able to exercise control. The Company controls an
investee if all three of the following elements are present: power over the investee, exposure, or rights, to variable
returns from the investee, and the ability to use its power to affect those variable returns. Control is reassessed
whenever facts and circumstances indicate that there may be a change in any of these elements of control.
In the Company’s statements of financial position, investment in a subsidiary is stated at cost less impairment
loss, if any. The results of subsidiary are accounted for by the Company on the basis of dividend received and
receivable.
4.3 Revenue recognition
Revenue from contracts with customers is recognized when control of goods or services is transferred to the
customers at an amount that reflects the consideration to which the Group expects to be entitled in exchange for those
goods or services, excluding those amounts collected on behalf of third parties. Revenue excludes value added tax
or other sales taxes and is after deduction of any trade discounts.
Depending on the terms of the contract and the laws that apply to the contract, control of the goods or service
may be transferred over time or at a point in time. Control of the goods or service is transferred over time if the
Group’s performance:
 provides all of the benefits received and consumed simultaneously by the customer;
 creates or enhances an asset that the customer controls as the Group performs; or
 does not create an asset with an alternative use to the Group and the Group has an enforceable right to
payment for performance completed to date.
If control of the goods or services transfers over time, revenue is recognized over the period of the contract
by reference to the progress towards complete satisfaction of that performance obligation. Otherwise, revenue is
recognized at a point in time when the customer obtains control of the goods or service.
Contracts with customers may include multiple performance obligations. For such arrangements, the Group
allocates revenue to each performance obligation based on its relative standalone selling price. The Group generally
determines standalone selling prices based on the prices charged to customers. If the standalone selling price is not
directly observable, it is estimated using expected cost plus a margin or adjusted market assessment approach,
depending on the availability of observable information.
When the contract contains a financing component which provides the customer a significant benefit of
financing the transfer of goods or services to the customer for more than one year, revenue is measured at the present
value of the amounts receivable, discounted using the discount rate that would be reflected in a separate financing
transaction between the Group and the customer at contract inception. Where the contract contains a financing
component which provides a significant financing benefit to the Group, revenue recognized under that contract
includes the interest expense accreted on the contract liability under the effective interest method. For contracts
where the period between the payment and the transfer of the promised goods or services is one year or less, the
transaction price is not adjusted for the effects of a significant financing component, using the practical expedient
in IFRS 15.
(i) API marketplace
Revenue from the service provided to customers includes query, short messaging service (“ SMS”) notice and
top-up. Revenue is recognized at point in time when relevant services are fulfilled. For contracts that are charged
based on usage and unit price, the Group recognizes revenue based on the actual usage and agreed unit price of the
current period. For sales contracts with fixed contract periods, the Group recognizes revenue over time on a periodic
basis during the contract period, based on the total contract amount.
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(ii) Data management solutions
The Group provides an array of data management solutions for government and corporate organizations to
enable them to systematically and securely digitize, manage, share and derive insights from data within and across
organizations. Revenue is recognized at a point in time when the software platform and related services are delivered
to and accepted by the customer. The Group also provides related maintenance and upgrade services for a specific
period after sale as stipulated in the same contract. These maintenance and upgrade services are provided to maintain
and improve the effectiveness of the software and therefore are accounted for as a separate performance obligation.
Revenue from provision of maintenance and upgrade services is recognized over the service period.
(iii) Principal versus agent consideration in revenue recognition
The determination of whether revenue shall be reported on a gross or net basis is based on an assessment of
whether the Group is acting as the principal or an agent in the transactions. If the Group provides significant
integration service to the hardware and is responsible for the overall management of the contract, the Group is the
principal in the transaction and recognizes revenue in the gross amount of consideration to which it is entitled from
the customer. The Group reports the amount received from the customers and the amounts paid to the suppliers related
to these transactions on a net basis if the Group is not primarily obligated in a transaction, does not generally bear
the inventory risk and does not have the ability to establish the price.
(iv) Contract assets and contract liabilities
A contract asset represents the Group’s right to consideration in exchange for services that the Group has
transferred to a customer that is not yet unconditional. In contrast, a receivable represents the Group’s unconditional
right to consideration, i.e. only the passage of time is required before payment of that consideration is due. Contract
asset is recognized when the customers retain retention money to secure the due performance of the contracts.
Contract assets are assessed for expected credit losses (“ ECLs ”) in accordance with the policy set out in Note 4.10(b).
Loss allowance for contract assets is measured at an amount equal to lifetime ECLs. ECLs on contract assets are
estimated using a provision matrix based on the Group’s historical credit loss experience, adjusted for factors that
are specific to the customers and an assessment of both the current and forecast general economic conditions at the
reporting date. Any amount previously recognized as a contract asset is reclassified to trade receivables at the point
at which the milestones are reached. If the considerations (including advances received from customers) exceed the
revenue recognized to date, then the Group recognizes a contract liability for the difference.
A contract liability represents the Group’s obligation to transfer services to a customer for which the Group
has received consideration (or an amount of consideration is due) from the customer.
A contract asset and a contract liability relating to a contract are accounted for and presented on a net basis.
(v) Contract costs
The Group recognizes an asset from the costs incurred to fulfill a contract when those costs meet all of the
following criteria:
(a) the costs relate directly to a contract or to an anticipated contract that the entity can specifically identify;
(b) the costs generate or enhance resources of the entity that will be used in satisfying (or in continuing to
satisfy) performance obligations in the future; and
(c) the costs are expected to be recovered.
The asset recognized is subsequently amortized to profit or loss on a systematic basis that is consistent with the
transfer to the customer of the goods or services to which the cost relate. The asset is subject to impairment review.
(vi) Other income
Interest income is accrued on a time basis on the principal outstanding at the applicable interest rate.
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4.4 Property, plant and equipment
Property, plant and equipment, other than construction-in-progress, are stated at cost less accumulated
depreciation and any accumulated impairment losses.
The cost of property, plant and equipment includes its purchase price and the costs directly attributable to the
acquisition of the items.
Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Group and the cost
of the item can be measured reliably. The carrying amount of the replaced part is derecognized. All other costs such
as repairs and maintenance are recognized as an expense in profit or loss during the financial period in which they
are incurred.
Property, plant and equipment are depreciated so as to write off their costs net of estimated residual values over
their estimated useful lives on straight-line method. The useful lives, residual value and depreciation method are
reviewed, and adjusted if appropriate, at the end of each reporting period. The useful lives are as follows:
Leasehold land Over the lease term
Buildings 20-30 years
Leasehold improvements Over shorter of lease term or 5-10 years
Motor vehicles 4 years
Furniture, fixtures and office equipment 3-10 years
Other properties leased for own use Over the lease term
Construction-in-progress is stated at cost less any impairment losses. Cost comprises direct costs of
construction as well as borrowing costs capitalized during the periods of construction and installation. Capitalization
of these costs ceases and the construction in progress is transferred to the appropriate classes of property, plant and
equipment when substantially all the activities necessary to prepare the assets for their intended use are completed.
No depreciation is provided for in respect of construction in progress until it is completed and ready for its intended
use.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period.
An asset is written down immediately to its recoverable amount if its carrying amount is higher than the asset’s
estimated recoverable amount.
The gain or loss on disposal of an item of property, plant and equipment is the difference between the net sale
proceeds and its carrying amount, and is recognized in profit or loss on disposal.
4.5 Inventories
Inventories are referred to purchased hardware and components and contract fulfillment cost. Inventories are
stated at the lower of cost and net realizable value. Cost is determined on weighted average basis. Net realizable value
is the estimated selling price in the ordinary course of business, less the estimated costs of completion and costs
necessary to make the sale.
4.6 Leases
All leases are required to be capitalized in the consolidated statements of financial position/statements of
financial position as right-of-use assets and lease liabilities, but accounting policy choices exist for an entity to
choose not to capitalize (i) leases for which the underlying asset is of low-value; and/or (ii) leases which are
short-term leases. The Group has elected not to recognize right-of-use assets and lease liabilities for low-value assets
and leases for which at the commencement date have a lease term of 12 months or less and do not contain purchase
option. The lease payments associated with those leases have been expensed on straight-line basis over the lease term.
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Accounting as a lessee
Right-of-use asset
The right-of-use asset is recognized at cost and comprises: (i) the amount of the initial measurement of the
lease liability (see below for the accounting policy to account for lease liability); (ii) any lease payments made at or
before the commencement date, less any lease incentives received; (iii) any initial direct costs incurred by the lessee;
and (iv) an estimate of costs to be incurred by the lessee in dismantling and removing the underlying asset to the
condition required by the terms and conditions of the lease, unless those costs are incurred to produce inventories.
The Group measures the right-of-use assets applying a cost model. Under the cost model, the Group measures the
right-to-use at cost, less any accumulated depreciation and any impairment losses, and adjusted for any
remeasurement of lease liabilities. Right-of-use assets are depreciated over the shorter of its estimated useful life and
the lease term on a straight-line basis. The right-of-use assets are presented within the same line item of property,
plant and equipment.
4.7 Intangible assets and research and development costs
Intangible assets
Intangible assets acquired separately are initially recognized at cost. Subsequently, intangible assets with
indefinite useful lives are carried at cost less any accumulated impairment losses. Intangible assets with finite useful
lives are carried at cost less accumulated amortization and accumulated impairment losses.
The amortization expense is recognized in profit or loss. The useful lives and amortization method are
reviewed, and adjusted if appropriate, at the end of each reporting period. Amortization is provided on a straight-line
basis over their useful lives as follows:
Patents 10-20 years
Intangible assets are tested for impairment as described in Note 4.8.
Research and development costs
Costs associated with research activities are expensed in profit or loss as they occur. Costs that directly
attributable to the development activities are recognized as intangible assets provided they meet the following
recognition requirements:
(i) demonstration of technical feasibilities of the prospective product internal use or sale;
(ii) sufficient technical, financial and other resources are available for completion;
(iii) there is intention to complete the intangible asset and use or sell it;
(iv) the Group’s ability to use or sell the intangible asset is demonstrated;
(v) the intangible asset will generate probable economic benefits through internal use or sale; and
(vi) the expenditure attributable to the intangible asset can be reliably measured.
Capitalized development costs are amortized over the periods the Group expects to benefit from using or
selling the products developed.
Development expenditure not satisfying the above criteria and expenditure on the research phase of internal
projects are expensed as incurred.
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4.8 Impairment of assets (other than financial assets)
At the end of each reporting period, the Group reviews the carrying amounts of the following assets to
determine whether there is any indication that those assets have suffered an impairment loss or an impairment loss
previously recognized no longer exists or may have decreased:
 Property, plant and equipment, including right-of-use assets;
 Investments in subsidiaries; and
 Intangible assets.
Where an asset does not generate cash inflows largely independent of those from other assets, the recoverable
amount is determined for the smallest group of assets that generates cash inflows independently (ie. cash generating
units (“ CGUs ”)). As a result, some assets are tested individually for impairment and some are tested at CGU level.
Corporate assets are allocated to individual CGUs when a reasonable and consistent basis of allocation can be
identified, or otherwise they are allocated to the smallest group of CGUs for which a reasonable and consistent
allocation basis can be identified.
If the recoverable amount (i.e. the greater of the fair value less costs of disposal and value-in-use) of an asset
is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount.
An impairment loss is recognized as an expense immediately, unless the relevant asset is carried at a revalued amount
under another IFRS, in which case the impairment loss is treated as a revaluation decrease under that IFRS.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised
estimate of its recoverable amount, to the extent that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment loss been recognized for the asset in prior years. In
respect of assets other than goodwill, reversal of an impairment loss is recognized in profit or loss immediately,
unless the relevant asset is carried at a revalued amount under another IFRS, in which case the reversal of the
impairment loss is treated as a revaluation increase under that IFRS. An impairment loss in respect of goodwill is not
reversed.
V alue-in-use is based on the estimated future cash flows expected to be derived from the asset or CGU,
discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset or CGU.
4.9 Cash and cash equivalents
Cash and cash equivalents include cash on hand and short-term deposits as well as short term highly liquid
investments with original maturities of three months or less that are readily convertible into known amounts of cash
and which are subject to an insignificant risk of changes in value. Cash equivalents are held for the purpose of
meeting short-term cash commitments rather than for investment or other purposes.
4.10 Financial instruments
(a) Financial assets
A financial asset (unless it is a trade receivable without a significant financing component) is initially
measured at fair value plus, for an item not at fair value through profit or loss, transaction costs that are directly
attributable to its acquisition or issue. A trade receivable without a significant financing component is initially
measured at the transaction price. Transaction costs directly attributable to the acquisition of financial assets at
FVTPL are recognized immediately in profit or loss.
All regular way purchases and sales of financial assets are recognized on the trade date, that is, the date that
the Group commits to purchase or sell the asset. Regular way purchases or sales are purchases or sales of financial
assets that require delivery of assets within the period generally established by regulation or convention in the market
place.
Financial assets with embedded derivatives are considered in their entirety when determining whether their
cash flows are solely payment of principal and interest.
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Debt instruments
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset
and the cash flow characteristics of the asset. There are three measurement categories into which the Group classifies
its debt instruments:
Amortized cost: Assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are measured at amortized cost. Financial assets at amortized cost are
subsequently measured using the effective interest method. Interest income, foreign exchange gains and losses and
impairment are recognized in profit or loss. Any gain on derecognition is recognized in profit or loss.
FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial assets, where
the assets’ cash flows represent solely payments of principal and interest, are measured at FVOCI. Debt investments
at FVOCI are subsequently measured at fair value. Interest income calculated using the effective interest method,
foreign exchange gains and losses and impairment are recognized in profit or loss. Other net gains and losses are
recognized in other comprehensive income. On derecognition, gains and losses accumulated in other comprehensive
income are reclassified to profit or loss.
FVTPL: Financial assets at FVTPL include financial assets held for trading, financial assets designated upon
initial recognition at FVTPL, or financial assets mandatorily required to be measured at fair value. Financial assets
are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term.
Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are
designated as effective hedging instruments. Financial assets with cash flows that are not solely payments of principal
and interest are classified and measured at FVTPL, irrespective of the business model. Notwithstanding the criteria
for debt instruments to be classified at amortized cost or at FVOCI, as described above, debt instruments may be
designated at FVTPL on initial recognition if doing so eliminates, or significantly reduces, an accounting mismatch.
Equity instruments
On initial recognition of an equity investment that is not held for trading, the Group could irrevocably elect
to present subsequent changes in the investment’s fair value in other comprehensive income. This election is made
on an investment-by-investment basis. Equity investments at FVOCI are measured at fair value. Dividend income are
recognized in profit or loss unless the dividend income clearly represents a recovery of part of the cost of the
investments. Other net gains and losses are recognized in other comprehensive income and are not reclassified to
profit or loss. All other equity instruments are classified as FVTPL, whereby changes in fair value, dividends and
interest income are recognized in profit or loss.
(b) Impairment loss on financial assets
The Group recognizes loss allowances for ECL on trade receivables, contract assets and financial assets
measured at amortized cost. The ECLs are measured on either of the following bases: (1) 12-months ECLs: these are
the ECLs that result from possible default events within the 12 months after the reporting date; and (2) lifetime ECLs:
these are ECLs that result from all possible default events over the expected life of a financial instrument. The
maximum period considered when estimating ECLs is the maximum contractual period over which the Group is
exposed to credit risk.
ECLs are a probability-weighted estimate of credit losses. Credit losses are measured as the difference between
all contractual cash flows that are due to the Group in accordance with the contract and all the cash flows that the
Group expects to receive. The shortfall is then discounted at an approximation to the assets’ original effective interest
rate.
The Group measures loss allowances for trade receivables and contract assets using IFRS 9 simplified
approach and has calculated ECLs based on lifetime ECLs individually or collectively using a provision matrix with
appropriate groupings. Provision matrix are based on the Group’s historical credit loss experience, adjusted for
forward-looking factors specific to the debtors and the economic environment and an assessment of both the current
as well as the forecast direction of conditions at the reporting date, including time value of money where appropriate.
For other debt financial assets, the ECLs are based on the 12-month ECLs. However, when there has been a
significant increase in credit risk since origination, the allowance will be based on the lifetime ECLs.
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When determining whether the credit risk of a financial asset has increased significantly since initial
recognition and when estimating ECLs, the Group considers reasonable and supportable information that is relevant
and available without undue cost or effort. This includes both quantitative and qualitative information analysis, based
on the Group’s historical experience and informed credit assessment and including forward-looking information.
The Group assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days
past due. The Group considers a financial asset to be in default when the debtor is unlikely to pay its credit
obligations to the Group in full, without recourse by the Group to action such as realizing security (if any is held);
or the financial asset is more than 90 days past due.
Depending on the nature of the financial instruments, the assessment of a significant increase in credit risk is
performed on either an individual basis or a collective basis. When the assessment is performed on a collective basis,
the financial instruments are grouped based on shared credit risk characteristics, such as past due status and credit
risk ratings.
A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated
future cash flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired includes
observable data about the following events:
 significant financial difficulty of the issuer or the borrower;
 the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial
difficulty, having granted to the borrower a concession(s) that the lender(s) would not otherwise
consider;
 it is becoming probable that the borrower will enter bankruptcy or other financial reorganization; or
 a breach of contract, such as a default or past due event.
The Group recognizes an impairment gain or loss in profit or loss for all financial instruments with a
corresponding adjustment to their carrying amount through a loss allowance account.
The Group writes off a financial asset when there is information indicating that the counterparty is in severe
financial difficulty and there is no realistic prospect of recovery, for example, when the counterparty has been placed
under liquidation or has entered into bankruptcy proceedings. Financial assets written off may still be subject to
enforcement activities under the Group’s recovery procedures, taking into account legal advice where appropriate.
Any recoveries made are recognized in profit or loss.
Interest income on credit-impaired financial assets is calculated based on the amortized cost (i.e. the gross
carrying amount less loss allowance) of the financial asset. For non credit-impaired financial assets, interest income
is calculated based on the gross carrying amount.
(c) Financial liabilities
The Group classifies its financial liabilities, depending on the purpose for which the liabilities were incurred.
Financial liabilities at amortized cost are initially measured at fair value, net of directly attributable costs incurred.
Financial liabilities at amortized cost
Financial liabilities at amortized cost including trade payables and other payables and accruals are initially
recognized at fair value, net of transaction costs incurred, and subsequently measured at amortized cost, using the
effective interest method. The related interest expense is recognized in profit or loss.
Gains or losses are recognized in profit or loss when the liabilities are derecognized as well as through the
amortization process.
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Repurchase liabilities
A contract that creates a contractual obligation to purchase the Company’s own equity instruments for cash or
another financial asset and the issuer does not have the unconditional ability to avoid payment gives rise to a financial
liability. The liability is accounted for at the present value of the redemption amount, even if the Group’s obligations
to purchase is conditional on the counterparty exercising a right to redeem. The contract itself is an equity instrument
and/or the exercise price is variable. Subsequently, changes in the measurement of the gross obligation due to the
unwinding of the discount are recognized in profit or loss.
If the contract expires without delivery, the carrying amount of the repurchase liability is reclassified to equity.
The Group derecognizes the repurchase liabilities when, and only when, the Group’s obligations are discharged,
cancelled or have expired.
(d) Effective interest method
Effective interest method is a method of calculating the amortized cost of a financial asset or financial liability
and of allocating interest income or interest expense over the relevant period. Effective interest rate is the rate that
exactly discounts estimated future cash receipts or payments through the expected life of the financial asset or
liability, or where appropriate, a shorter period.
(e) Equity instruments
Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.
(f) Derecognition
The Group derecognizes a financial asset when the contractual rights to the future cash flows in relation to the
financial asset expire or when the financial asset has been transferred and the transfer meets the criteria for
derecognition in accordance with IFRS 9.
Financial liabilities are derecognized when the obligation specified in the relevant contract is discharged,
cancelled or expires.
4.11 Foreign currency translation
Transactions entered into by the group entities in currencies other than their functional currency are recorded
at the rates ruling when the transactions occur. Foreign currency monetary assets and liabilities are translated at the
rates ruling at the end of each reporting period. Non-monetary items that are measured in terms of historical cost in
a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary items, and on the translation of monetary items,
are recognized in profit or loss in the period in which they arise. Exchange differences arising on the retranslation
of non-monetary items carried at fair value are included in profit or loss for the period except for differences arising
on the retranslation of non-monetary items in respect of which gains and losses are recognized in other
comprehensive income, in which case, the exchange differences are also recognized in other comprehensive income.
On consolidation, income and expense items of foreign operations are translated into RMB at the average
exchange rates for the period, unless exchange rates fluctuate significantly during the period, in which case, the rates
ruling when the transactions took place are used. All assets and liabilities of foreign operations are translated at the
rate ruling at the end of each reporting period. Exchange differences arising, if any, are recognized in other
comprehensive income and accumulated in equity as translation reserve. Exchange differences recognized in profit
or loss of group entities’ separate financial statements on the translation of long-term monetary items forming part
of the Group’s net investment in the foreign operation concerned are reclassified to other comprehensive income and
accumulated in equity as translation reserve.
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4.12 Income tax
Income taxes for the period comprise current tax and deferred tax.
Current tax is based on the profit or loss from ordinary activities adjusted for items that are non-assessable or
disallowable for income tax purposes and is calculated using tax rates that have been enacted or substantively enacted
at the end of each reporting period. The amount of current tax payable or receivable is the best estimate of the tax
amount expected to be paid or received that reflects any uncertainty related to income tax.
Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the corresponding amounts used for tax purposes. Deferred tax
liabilities are generally recognized for all taxable temporary differences. Deferred tax assets are recognized to the
extent that it is probable that taxable profits will be available against which deductible temporary differences can be
utilized. Deferred tax is measured at the tax rates appropriate to the expected manner in which the carrying amount
of the asset or liability is realized or settled and that have been enacted or substantively enacted at the end of each
reporting period, and reflects any uncertainty related to income taxes.
Deferred tax liabilities are recognized for taxable temporary differences arising on investments in subsidiaries,
except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary
difference will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to income tax levied by the same taxation authority and the Group
intends to settle its current tax assets and liabilities on a net basis.
The carrying amount of deferred tax assets is reviewed at reporting date and reduced to the extent that it is
no longer probable that sufficient taxable profits will be available to allow all or part of the assets to be recovered.
Income taxes are recognized in profit or loss, except when they relate to items recognized in other
comprehensive income or directly in equity in which case the taxes are also recognized in other comprehensive
income or when they relate to items recognized directly in equity in which case the taxes are also recognized directly
in equity.
4.13 Employee benefits
(a) Defined contribution retirement plan
Pursuant to the relevant regulations of the PRC government, the Group participates in a central pension scheme
operated by the local municipal government, whereby the Group is required to contribute a certain percentage of the
basic salaries of its employees to the scheme to fund their retirement benefits. The local municipal government
undertakes to assume the retirement benefits obligations of all existing and future retired employees of the Group.
The only obligation of the Group with respect to the scheme is to pay the ongoing required contributions under the
scheme. Contributions under the scheme are charged to profit or loss as incurred. There are no provisions under the
scheme whereby forfeited contributions may be used to reduce future contributions.
(b) Short-term employee benefits
Short-term employee benefits are employee benefits (other than termination benefits) that are expected to be
settled wholly before twelve months after the end of each annual reporting period in which the employees render the
related service. Short-term employee benefits are recognized in the period when the employees render the related
service.
(c) Termination benefits
Termination benefits are recognized on the earlier of when the Group can no longer withdraw the offer of those
benefits and when the Group recognizes restructuring costs involving the payment of termination benefits.
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4.14 Provisions and contingent liabilities
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past
event, and it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable
estimate of the amount of the obligation can be made. Where the time value of money is material, provisions are
stated at the present value of the expenditure expected to settle the obligation.
Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be
estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic
benefit is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence
of one or more future uncertain events not wholly within the control of the Group are also disclosed as contingent
liabilities unless the probability of outflow of economic benefits is remote.
4.15 Borrowings costs
Borrowing costs attributable directly to the acquisition, construction or production of qualifying assets which
require a substantial period of time to be ready for their intended use or sale, are capitalized as part of the cost of
those assets, until such time as the assets are substantially ready for their intended use or sale. Income earned on
temporary investments of specific borrowings pending their expenditure on qualifying assets is deducted from
borrowing costs eligible for capitalization. All other borrowing costs are recognized in profit or loss in the period in
which they are incurred.
4.16 Government grants
Government grants are not recognized until there is reasonable assurance that the Group will comply with the
conditions attaching to them and that the grants will be received.
Government grants that are receivable as compensation for expenses or losses already incurred or for the
purpose of giving immediate financial support to the Group with no future related costs are recognized in profit or
loss in the period in which they become receivable.
4.17 Share-based payments
The shareholder of the Company operates equity-settled share-based compensation plans and the shares are
awarded to employees and directors providing services to the Group.
All services received in exchange for the grant of any share-based compensation are measured at their fair
value. These are indirectly determined by reference to the equity instruments awarded. Their value is appraised at the
grant date and excludes the impact of any non-market vesting conditions.
All share-based compensation is recognized as an expense in profit or loss over the vesting period if vesting
conditions apply, or recognized as an expense in full at the grant date when the equity instruments granted vest
immediately unless the compensation qualifies for recognition as an asset, with a corresponding increase in the
capital reserve in equity. If vesting conditions apply, the expense is recognized over the vesting period, based on the
best available estimate of the number of equity instruments expected to vest. Non-market vesting conditions are
included in assumptions about the number of equity instruments that are expected to vest. Estimates are subsequently
revised, if there is any indication that the number of equity instruments expected to vest differs from previous
estimates.
At the time when shares granted are vested, the amount previously recognised in capital reserve will be
transferred to share premium.
4.18 Related parties
For the purposes of the Historical Financial Information, a party is considered to be related to the Group if:
(a) A person or a close member of that person’s family is related to the Group if that person:
(i) has control or joint control over the Group;
(ii) has significant influence over the Group; or
(iii) is a member of key management personnel of the Group or the Company’s parent.
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(b) An entity is related to the Group if any of the following conditions apply:
(i) The entity and the Group are members of the same group (which means that each parent,
subsidiary and fellow subsidiary is related to the others).
(ii) One entity is an associate or joint venture of the other entity (or an associate or joint venture of
a member of a group of which the other entity is a member).
(iii) Both entities are joint ventures of the same third party.
(iv) One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
(v) The entity is a post-employment benefit plan for the benefit of the employees of the Group or an
entity related to the Group.
(vi) The entity is controlled or jointly controlled by a person identified in (a).
(vii) A person identified in (a)(i) has significant influence over the entity or is a member of key
management personnel of the entity (or of a parent of the entity).
(viii) The entity, or any member of a group of which it is a part, provides key management personnel
services to the Group or the Company’s parent.
Close members of the family of a person are those family members who may be expected to influence, or be
influenced by, that person in their dealings with the entity and include:
(i) that person’s children and spouse or domestic partner;
(ii) children of that person’s spouse or domestic partner; and
(iii) dependents of that person or that person’s spouse or domestic partner.
5. CRITICAL ACCOUNTING JUDGEMENT AND KEY SOURCES OF ESTIMATION UNCERTAINTY
In the application of the Group’s accounting policies, which are described in Note 4, the directors of the
Company are required to make judgments, estimates and assumptions about the carrying amounts of assets and
liabilities that are not readily apparent from other sources. The estimates, judgments and associated assumptions are
based on historical experience and other factors that are considered to be relevant. Actual results may differ from
these estimates.
The estimates and underlying assumptions are reviewed on an on-going basis. Revisions to accounting
estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in
the period of the revision and future periods if revision affects both current and future periods.
The following are key assumptions concerning the future, and other key sources of estimation uncertainty at
the end of each reporting period that may have a significant risk of causing a material adjustment to the carrying
amounts of assets and liabilities within the next financial year.
Fair value measurement of financial instruments
The Group’s unlisted equity instruments and unlisted debt security are measured at fair values based on the
valuation performed by an independent professional valuer with fair values being determined based on significant
unobservable inputs using valuation techniques. Judgment and estimation are required in establishing the relevant
valuation techniques and the relevant inputs thereof. Changes in assumptions relating to these factors could result in
material adjustments to the fair values of these instruments. Further disclosures are set out in Note 20 and 25.
APPENDIX I ACCOUNTANTS’ REPORT
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Impairment of financial and contract assets
The measurement of the ECLs allowance for financial assets measured at amortized cost and contract assets
is an area that requires the use of significant assumptions about future economic conditions and credit behaviour (e.g.
the likelihood of customers defaulting and the resulting losses). A number of significant judgments, including
determining the criteria for significant increase in credit risk, are also required in applying the accounting
requirements for measuring ECLs. Details about the judgments and assumptions used in measuring ECLs is set out
in Note 4.10(b) and Note 39(b) to the Historical Financial Information. Changes to these estimates and assumptions
can result in significant changes to the timing and amount of ECLs to be recognized.
Income taxes and deferred taxes
There are certain transactions and calculations for which the ultimate tax determination is uncertain during the
ordinary course of business. Where the final tax outcome of these matters is different from the amounts that were
initially recorded, such differences will impact the current and deferred income tax assets and liabilities in the period
in which such determination is made.
The Group recognizes deferred tax assets based on estimates that is probable to generate sufficient taxable
profits in the foreseeable future against which the deductible losses will be utilized. The recognition of deferred tax
assets mainly involves management’s judgments and estimations about the timing and the amount of taxable profits
of the group entities which have tax losses.
Principal versus agent consideration in revenue recognition
Under IFRS 15, whether revenue should be recognized on gross or net basis depends on whether the entity is
acting as a principal or an agent in the transaction. The principal is the entity that controls the goods or services
before they are transferred to the customer, whereas the agent facilitates the transfer of goods or services between
the customer and the principal.
If the entity has control over the goods or services before they are transferred to the customer, whilst indicators
include having the discretion to establishes the price, bearing inventory risk, and being primarily responsible for
fulfilling the performance obligation to the customer, then it is acting as a principal and should recognize revenue
on a gross basis. The aforesaid indicators cannot individually conclude whether the entity is acting as a principal or
agent in the transaction, but the assessment will be based on several indicators taken as a whole.
If the entity is an agent, instead of a principal, it should recognize revenue on a net basis, which means that
the amount recognized as revenue is the commission or fee earned by the entity for facilitating the transfer of goods
or services between the customer and the principal.
API marketplace – Query and SMS notice
For the Group’s query and SMS notice services, the Group has entered into contractual agreements with its
customers to provide them with relevant query information and SMS services, and customers view the Group as the
party primarily responsible for fulfilling the performance obligation.
The Group provides value-added services to its customers through its APIs, going beyond the role of a mere
intermediary to facilitate the transmission of information between suppliers and customers. The customers obtain
from the Group the requested query information and SMS services in accordance with their requirements. From the
customers’ point of view, it is the Group that provides value-added service on these query information and SMS
notification services which meet their needs through suppliers selected by the Group from a customer approved
supplier list and the customers do not know which supplier is finally deployed; and the customers consider the Group
to be primarily responsible for fulfilling the performance obligation. In addition:
 The Group retains sole discretion to establish the price for the query information and SMS services
provided to the customers. The Group is required to pay the suppliers a fixed price for each service used,
which is not affected by the price paid by the Group’s customers. This discretion to establish prices
demonstrates the Group’s ability to obtain substantially all of the remaining benefits from the
Query/SMS notice services, in contrast to an agent who normally charges a commission or fee as a
percentage of the customer’s paid price.
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 The Group does not bear any inventory risks related to the Query/SMS notice services. The Group only
requests the services from the supplier upon receiving a customer’s request for Query and SMS notice
services. The Group does not commit to paying the supplier for the services until the request from the
customer is received, sent to the supplier, and the result is obtained.
 During the course of providing the services, the Group may source information requested or SMS
services required by the customers from multiple suppliers via the API marketplace, and the Group has
discretion in selecting suppliers from a customer approved supplier list that meet the customer’s needs
to provide the requested query information and SMS services.
Therefore, the Group is acting as a principal for query and SMS notice services even though it does not bear
inventory risk considering the nature of the query and SMS services, and relevant revenue should be recognized on
gross basis, i.e., the selling prices of the service.
API marketplace – Top-up
For the top-up service, the Group’s performance obligation is to arrange for the provision of the top-up service
requested by the end-user through the Group’s customers to the relevant telecommunication operators. Although the
top-up request is made through the Group’s API, to fulfill its performance obligation, the Group only has to pass the
request order to the supplier, and the primary responsibility for successful top-up rests with the telecommunication
operators for crediting the relevant top-up value to the end users. The Group only facilitates the transmission of this
top-up request with limited involvement in the top-up request process with the customer’s designated
telecommunication operators. In addition:
 The revenue earned from top-up service is based on agreed fees, which are calculated as a percentage
of the total top-up face value and the amount of the fee earned is low. The Group does not have the sole
discretion to establish prices and the Group only earns a narrow margin instead of obtaining
substantially all of the remaining benefits from the top-up service. This is consistent with the definition
of revenue earned by an agent under IFRS 15, which is a commission or fee earned for facilitating a
transaction between two parties.
 The Group does not bear any inventory risks related to top-up service being provided to the customer.
As an intermediary facilitating the transmission of this top-up request between the customer and the
supplier, the Group does not commit to pay the supplier for the services until it has received a request
from the customer and sent the corresponding request to the supplier. The Group does not hold any
inventory for top-up services.
 The Group does not have discretion on selecting ultimate suppliers for customers. For example, the
Group can only choose China Mobile for a China Mobile user’s top up; thus the Group is an agent
between China Mobile and the customer.
Therefore, the Group is acting as an agent for the top-up service, and relevant revenue should be recognized
on net basis, i.e. the selling price of the service less the cost of purchase from the service provider.
6. SEGMENT INFORMATION
(a) Operating segment information
The Group has identified its operating segments and prepared segment information based on the regular
internal financial information reported to the directors of the Company, being chief operating decision maker, for
their decisions about resources allocation to the Group’s business components and for their review of these
components’ performance.
During the Track Record Period, the Group is principally engaged in the provision of API marketplace services
and data management solutions in the PRC. Information reported to the directors of the Company for the purpose of
resources allocation and performance assessment focuses on the operating results of the business. Therefore, the chief
operating decision maker of the Company regards that there is only one operating segment which is used to make
strategic decisions. No other discrete financial information is provided other than the Group’s results and financial
position as a whole. Accordingly, only entity-wide disclosures, major customers and geographical information are
presented.
APPENDIX I ACCOUNTANTS’ REPORT
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(b) Geographical information
The Group is domiciled in the PRC, which is the location of the Group’s principal office. The Group’s revenues
from external customers are divided into the following geographical area:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
The PRC 260,011 328,936 441,083
The Group’s revenue information above is based on the delivery destinations of the Group’s products and
services requested by the customers. The geographical location of non-current assets is based on the physical location
of the assets. As of December 31, 2021, 2022 and 2023, all of the Group’s non-current assets were located in the PRC.
(c) Information about major customers
Revenue from major customers, each of them accounting for 10% or more of the Group’s revenue for each of
the years during the Track Record Period, is set out below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Customer A N/A* 40,890 70,575
Customer B 30,432 N/A* N/A*
Customer C 26,397 N/A* N/A*
Customer D 27,646 N/A* 62,276
Customer E N/A* N/A* 88,624
* The corresponding revenue is not disclosed as it did not contribute over 10% of the total revenue of the
Group during that year.
7. REVENUE
Revenue represents the revenue from API marketplace and data management solutions.
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue from API marketplace
Query 124,467 145,279 271,356
SMS notice 57,883 70,627 64,543
Top-up 12,370 7,626 6,170
194,720 223,532 342,069
Revenue from data management solutions 65,291 105,404 99,014
260,011 328,936 441,083
APPENDIX I ACCOUNTANTS’ REPORT
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Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Timing of revenue recognition under IFRS 15
At a point in time 259,256 326,440 430,827
Over time 755 2,496 10,256
260,011 328,936 441,083
All contracts are for periods of one year or less or are billed based on time incurred. As permitted under IFRS
15, the transaction price allocated to these unsatisfied contracts is not disclosed.
The following table provides information about trade receivables, contract assets and contract liabilities from
contracts with customers.
As of
January, As of December 31,
2021 2021 2022 2023
RMB’000 RMB’000 RMB’000 RMB’000
Trade receivables
(Note 21) 63,087 91,203 123,973 175,077
Contract assets
(Note 23(a)) 44 1,117 3,994 1,865
Contract liabilities
(Note 23(b)) 59,875 51,440 29,692 29,802
8. OTHER INCOME AND OTHER GAINS, NET
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Bank interest income 1,922 1,356 2,469
Fair value gain/(loss) on financial assets at
FVTPL (Note 25) 7,316 3,384 (460)
Government grants (Note) 7,419 5,557 8,437
Dividend income 15 234 –
(Loss)/gain on disposal/
written off of property, plant and equipment (51) 10 (8)
Others 282 478 266
16,903 11,019 10,704
Note: Government grants mainly comprised of subsidies received/receivable for subsidising the Group’s
business. There was no unfulfilled condition to receive government grants at the end of each reporting
period.
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9. FINANCE COSTS
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Interest on lease liabilities 9 1 1
Interest on bank borrowings 145 – –
Interest on repurchase liabilities (Note 41) – – 1,013
154 1 1,014
10. PROFIT BEFORE TAX
Profit before tax is arrived at after charging/(crediting) the followings:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cost of inventories recognized as expenses 35,413 68,972 71,277
Auditors’ remuneration 91 62 83
Depreciation of property, plant and equipment
(Note 15) 4,128 11,094 12,014
– Less: depreciation capitalized to contract
costs and inventories (66) (120) (336)
4,062 10,974 11,678
Amortization of intangible assets (Note 17) 999
Professional fees (included in administrative and
other expenses) (Note) 5,184 8,380 95
Listing expenses – – 22,354
Short-term lease expenses 215 237 10
Expenses relating to leases of low-value assets 13 2 3
Employee costs (including directors’ emoluments
(Note 14) ):
– Salaries and wages 33,101 49,068 48,793
– Retirement scheme contributions 6,481 8,631 9,628
39,582 57,699 58,421
Equity-settled share-based payments (Note 36) 400 435 442
Impairment loss on financial and contract assets,
net (Note 39(b)) :
– Trade receivables 437 1,775 10,032
– Contract assets 6 20 (19)
– Deposits and other receivables (25) (727) (98)
418 1,068 9,915
Note: Professional fees include expenses related to previous listing exercise attempt.
APPENDIX I ACCOUNTANTS’ REPORT
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11. INCOME TAX (EXPENSE)/CREDIT
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current year – PRC Enterprise Income Tax (7,116) (3,704) (4,363)
Deferred tax (Note 18) (347) 232 1,649
(7,463) (3,472) (2,714)
The Group is subject to income tax on an entity basis on assessable profits arising in or derived from the tax
jurisdictions in which members of the Group are domiciled and operated.
Pursuant to the income tax rules and regulations of the PRC, the provision for PRC income tax of the group
entities is calculated based on the statutory tax rate of 25% during the Track Record Period, except for (a) the
Company which is registered as a High and New-Tech Enterprise pursuant to the PRC tax regulations and entitled
to a preferential tax rate of 15% for the years ended December 31, 2021, 2022 and 2023; (b) Tianju Renhe which is
registered as a High and New-Tech Enterprise pursuant to the PRC tax regulations and entitled to a preferential tax
rate of 15% for the years ended December 31, 2021, 2022 and 2023; (c) Tianju Xinghe which is registered as a
qualified Micro and Small Enterprise pursuant to the PRC tax regulations and entitled to a preferential tax rate of
2.5%, 2.5% and 5% for the years ended December 31, 2021, 2022 and 2023; and (d) Zhonghui Juhe which is
registered as a qualified Micro and Small Enterprise pursuant to the PRC tax regulations and entitled to a preferential
tax rate of 2.5%, 2.5% and 5% for the years ended December 31, 2021, 2022 and 2023.
The income tax expense for the Track Record Period can be reconciled to the profit before tax per the
consolidated statements of profit or loss and other comprehensive income as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Profit before tax 53,429 44,756 37,775
Tax calculated at applicable tax rates 13,129 11,433 9,458
Tax effect of expenses not deductible for tax
purpose 200 274 462
Tax effect of tax exemption and incentive
granted (5,092) (4,829) (3,862)
Tax incentives for research and development
costs (1,792) (2,967) (2,976)
Effect of opening deferred tax of change in tax
rate 532 – (18)
Utilization of tax losses previously not
recognized – (443) (354)
Tax effect of deductible temporary difference and
deductible tax loss for which no deferred tax
asset was recognized 486 4 4
Income tax expense 7,463 3,472 2,714
APPENDIX I ACCOUNTANTS’ REPORT
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12. DIVIDENDS
The final dividend for the year ended December 31, 2020 of RMB0.44 per ordinary share, in an aggregate
amount of RMB20,000,000 was approved and paid during the year ended December 31, 2021, respectively.
No dividend has been declared during the years ended December 31, 2022 and 2023.
13. EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share attributable to the ordinary equity holders of the
Company is based on the following data:
Y ear ended December 31,
2021 2022 2023
Earnings for the purpose of basic and diluted
earnings per share (RMB’000) 46,011 41,249 34,751
Number of shares
Weighted average number of ordinary shares
for the purposes of basic and diluted earnings
per share 45,300,000 45,300,000 45,300,000
Diluted earnings per share are the same as the basic earnings per share as the Company had no dilutive
potential ordinary shares in existence for the years ended December 31, 2021 and 2022. For the year ended December
31, 2023, the potential ordinary shares, i.e. shares with repurchase liabilities, were not included in the calculation of
diluted earnings per share as their inclusion would be anti-dilutive.
14. DIRECTORS’ AND SUPERVISORS’ EMOLUMENTS AND FIVE HIGHEST PAID INDIVIDUALS
(a) Directors’ and supervisors’ emoluments
Details of directors’ and supervisors’ remuneration during the Track Record Period are as follows:
Fees Salaries
Allowance
and other
benefits
Discretionary
bonus
Retirement
scheme
contributions
Equity-
settled
share-based
payments Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended December 31, 2021
Executive directors
Mr. Zuo Lei – 480 – – 65 – 545
Mr. Wang Haojin – 240 – – 60 70 370
Mr. Lin Shan – 156 – – 40 – 196
Ms. Y ang Y anjun – 500 – 18 64 60 642
– 1,376 – 18 229 130 1,753
Non-executive directors
Mr. Qiu Jianqiang – – – – – – –
Mr. Ren Chengyuan (Note ii) ––– – –––
Mr. Wu Xuejun (Note i) ––– – –––
––– – –––
APPENDIX I ACCOUNTANTS’ REPORT
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Fees Salaries
Allowance
and other
benefits
Discretionary
bonus
Retirement
scheme
contributions
Equity-
settled
share-based
payments Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Independent non-executive
directors
Mr. Huang Xuexian – – 80 – – – 80
Mr. Chen Xinhe – – 80 – – – 80
Mr. Zhang Weining (Note iii) – – 2 0–– – 2 0
Ms. Xing Y an (Note iv) – – 4 2–– – 4 2
– – 222 – – – 222
Supervisors
Ms. Ji Shilin – 263 – 29 39 – 331
Mr. Y u Gang – – – – – – –
Ms. Ren Y uan – – – – – – –
– 263 – 29 39 – 331
Fees Salaries
Allowance
and other
benefits
Discretionary
bonus
Retirement
scheme
contributions
Equity-
settled
share-based
payments Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended December 31, 2022
Executive directors
Mr. Zuo Lei – 480 – – 78 – 558
Mr. Wang Haojin – 241 – – 68 70 379
Mr. Lin Shan – 157 – – 44 – 201
Ms. Y ang Y anjun – 479 – 20 78 60 637
– 1,357 – 20 268 130 1,775
Non-executive directors
Mr. Qiu Jianqiang – – – – – – –
Mr. Ren Chengyuan – – – – – – –
––– – –––
Independent non-executive
directors
Mr. Huang Xuexian – – 80 – – – 80
Mr. Chen Xinhe – – 80 – – – 80
Ms. Xing Y an – – 80 – – – 80
– – 240 – – – 240
APPENDIX I ACCOUNTANTS’ REPORT
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Fees Salaries
Allowance
and other
benefits
Discretionary
bonus
Retirement
scheme
contributions
Equity-
settled
share-based
payments Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Supervisors
Ms. Ji Shilin – 361 – 27 69 – 457
Mr. Y u Gang – – – – – – –
Ms. Ren Y uan – – – – – – –
– 361 – 27 69 – 457
Fees Salaries
Allowance
and other
benefits
Discretionary
bonus
Retirement
scheme
contributions
Equity-
settled
share-based
payments Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Y ear ended December 31, 2023
Executive directors
Mr. Zuo Lei – 480 – – 81 – 561
Mr. Wang Haojin – 240 – – 69 70 379
Mr. Lin Shan – 156 – – 45 – 201
Ms. Y ang Y anjun – 480 – 20 81 60 641
– 1,356 – 20 276 130 1,782
Non-executive directors
Mr. Qiu Jianqiang – – – – – – –
Mr. Ren Chengyuan (Note ii) ––– – –––
Mr. Gao Y uan (Note viii) ––– – –––
––– – –––
Independent non-executive
directors
Mr. Huang Xuexian – – 80 – – – 80
Mr. Chen Xinhe – – 80 – – – 80
Ms. Xing Y an (Note iv) – – 3 0–– – 3 0
Mr. Li Shun Fai (Note iv & v) – – 6 9–– – 6 9
– – 259 – – – 259
Supervisors
Ms. Ji Shilin (Note vi) – 145 – – 23 – 168
Mr. Y u Gang – – – – – – –
Ms. Ren Y uan – – – – – – –
Mr. Gao Qi (Note vii) – 239 – 27 54 – 320
– 384 – 27 77 – 488
APPENDIX I ACCOUNTANTS’ REPORT
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Notes:
(i) Mr. Wu Xuejun resigned as a non-executive director of the Company on March 31, 2021.
(ii) Mr. Ren Chengyuan was appointed as a non-executive director of the Company on June 22, 2021 and resigned
on July 18, 2023.
(iii) Mr. Zhang Weining resigned as an independent non-executive director of the Company on May 31, 2021.
(iv) Ms. Xing Y an was appointed as an independent non-executive director of the Company on June 22, 2021 and
proposed resignation on April 27, 2023. She performed her duty until a replacement from the new independent
non-executive director, Mr. Li Shun Fai, on May 18, 2023.
(v) Mr. Li Shun Fai was appointed as an independent non-executive director of the Company on May 18, 2023.
(vi) Ms. Ji Shilin resigned as a supervisor of the Company on April 27, 2023.
(vii) Mr. Gao Qi was appointed as a supervisor of the Company on April 27, 2023.
(viii) Mr. Gao Y uan was appointed as a non-executive director of the Company on July 24, 2023.
(ix) No emoluments were paid by the Group to any directors or supervisors as an inducement to join or upon
joining the Group or as compensation for loss or termination of their office during the Track Record Period.
(x) The executive directors’ emoluments shown above were for their services in connection with the management
of the affairs of the Group and the Company. The non-executive directors and the independent non-executive
directors’ emoluments shown above were for their services as directors of the Company.
(b) Five highest paid individuals
Of the five individuals with the highest emoluments in the Group, included two, one, and nil directors or
supervisors of the Company for each of the years ended December 31, 2021, 2022 and 2023 respectively, whose
emoluments are disclosed above. The emoluments of the remaining three, four and five individuals for each of the
years ended December 31, 2021, 2022 and 2023 respectively are analyzed below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Salaries 1,602 2,273 2,887
Allowance and other benefits – – –
Discretionary bonuses 180 382 267
Retirement scheme contributions 251 313 411
Equity-settled share-based payments 110 170 170
2,143 3,138 3,735
The number of the highest paid non-director individuals fell within the following emolument bands:
Y ear ended December 31,
2021 2022 2023
No. of
individuals
No. of
individuals
No. of
individuals
Nil to HK$1,000,000 3 3 5
HK$1,000,001 to HK$1,500,000 – 1 –
345
During the Track Record Period, no emoluments were paid by the Group to any director or supervisor or any
of the five highest paid individuals as an inducement to join or upon joining the Group, or as compensation for loss
of office. There were no arrangements under which a director or supervisor waived or agreed to waive any emolument
during the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-37 –


--- page 477 ---
15. PROPERTY, PLANT AND EQUIPMENT
The Group
Leasehold
land Buildings
Leasehold
improvements
Motor
vehicles
Furniture,
fixtures
and office
equipment
Other
properties
leased for
own use
Construction-
in-progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At January 1, 2021 6,482 38,553 1,918 1,633 4,145 1,538 108,688 162,957
Additions – 11,490 – – 658 – 53,136 65,284
Disposals/written off – – – (155) (133) (1,538) – (1,826)
At December 31,
2021 and
January 1, 2022 6,482 50,043 1,918 1,478 4,670 – 161,824 226,415
Additions – – 10,819 – 5,554 86 15,850 32,309
Disposals/written off – – (655) – (379) – – (1,034)
Transferred upon
completion – 177,674 –––– (177,674) –
At December 31,
2022 and
January 1, 2023 6,482 227,717 12,082 1,478 9,845 86 – 257,690
Additions – – 618 624 315 – – 1,557
Disposals/written off – – – – (166) – – (166)
Termination of
leases – – – – – (86) – (86)
At December 31,
2023 6,482 227,717 12,700 2,102 9,994 – – 258,995
Accumulated
depreciation:
At January 1, 2021 567 6,867 781 567 1,714 769 – 11,265
Charge for the year 131 2,013 253 338 624 769 – 4,128
Disposals/written off – – – (93) (128) (1,538) – (1,759)
At December 31,
2021 and
January 1, 2022 698 8,880 1,034 812 2,210 – – 13,634
Charge for the year 131 7,534 1,129 301 1,982 17 – 11,094
Disposals/written off – – (654) – (356) – – (1,010)
At December 31,
2022 and
January 1, 2023 829 16,414 1,509 1,113 3,836 17 – 23,718
Charge for the year 131 8,003 1,427 340 2,076 37 – 12,014
Disposals/written off – – – – (149) – – (149)
Termination of
leases – – – – – (54) – (54)
At December 31,
2023 960 24,417 2,936 1,453 5,763 – – 35,529
Net carrying
amount:
At December 31,
2021 5,784 41,163 884 666 2,460 – 161,824 212,781
At December 31,
2022 5,653 211,303 10,573 365 6,009 69 – 233,972
At December 31,
2023 5,522 203,300 9,764 649 4,231 – – 223,466
APPENDIX I ACCOUNTANTS’ REPORT
– I-38 –


--- page 478 ---
The Company
Leasehold
land Buildings
Leasehold
improvements
Motor
vehicles
Furniture,
fixtures
and office
equipment
Other
properties
leased for
own use
Construction-
in-progress Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
Cost:
At January 1, 2021 6,482 38,553 1,918 1,633 3,167 1,538 108,688 161,979
Additions – 11,490 – – 146 – 53,136 64,772
Disposals/written off – – – (155) (133) (1,538) – (1,826)
At December 31,
2021 and
January 1, 2022 6,482 50,043 1,918 1,478 3,180 – 161,824 224,925
Additions – – 10,819 – 5,550 86 15,850 32,305
Disposals/written off – – (655) – (370) – – (1,025)
Transferred upon
completion – 177,674 –––– (177,674) –
At December 31,
2022 and
January 1, 2023 6,482 227,717 12,082 1,478 8,360 86 – 256,205
Additions – – 618 624 315 – – 1,557
Disposals/written off – – – – (157) – – (157)
Termination of
leases – – – – – (86) – (86)
At December 31,
2023 6,482 227,717 12,700 2,102 8,518 – – 257,519
Accumulated
depreciation:
At January 1, 2021 567 6,867 781 567 1,557 769 – 11,108
Charge for the year 131 2,013 253 338 491 769 – 3,995
Disposals/written off – – – (93) (127) (1,538) – (1,758)
At December 31,
2021 and
January 1, 2022 698 8,880 1,034 812 1,921 – – 13,345
Charge for the year 131 7,534 1,129 301 1,829 17 – 10,941
Disposals/written off – – (654) – (349) – – (1,003)
At December 31,
2022 and
January 1, 2023 829 16,414 1,509 1,113 3,401 17 – 23,283
Charge for the year 131 8,003 1,427 340 1,936 37 – 11,874
Disposals/written off – – – – (140) – – (140)
Termination of
leases – – – – – (54) – (54)
At December 31,
2023 960 24,417 2,936 1,453 5,197 – – 34,963
Net carrying
amount:
At December 31,
2021 5,784 41,163 884 666 1,259 – 161,824 211,580
At December 31,
2022 5,653 211,303 10,573 365 4,959 69 – 232,922
At December 31,
2023 5,522 203,300 9,764 649 3,321 – – 222,556
APPENDIX I ACCOUNTANTS’ REPORT
– I-39 –


--- page 479 ---
The Group and the Company
The analysis of the net book value of right-of-use assets by class of underlying assets as of the end of each
reporting period is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Leasehold land 5,784 5,653 5,522
Other properties leased for own use – 69 –
5,784 5,722 5,522
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Additions to right-of-use assets – 86 –
Depreciation charge of right-of-use assets by
class of underlying assets:
– Leasehold land 131 131 131
– Other properties leased for own use 769 17 37
900 148 168
The Group had total cash outflows for leases of RMB1,024,000, RMB261,000 and RMB46,000 for the years
ended December 31, 2021, 2022 and 2023, respectively. The Group also had non-cash additions to right-of-use assets
and lease liabilities of RMB86,000 for the years ended December 31, 2022.
The Group regularly entered into short-term leases for office equipment. As of December 31, 2021, 2022 and
2023, the portfolio of short-term leases is similar to the portfolio of short-term leases to which the short-term lease
expense disclosed in Note 10.
16. INVESTMENTS IN SUBSIDIARIES
The Company
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Unlisted investment, at cost 107,571 107,621 107,621
Impairment (7,509) (3,300) (1,228)
100,062 104,321 106,393
The particulars of the directly and indirectly held subsidiaries of the Company are set out in Note 1.
APPENDIX I ACCOUNTANTS’ REPORT
– I-40 –


--- page 480 ---
As at December 31, 2021, 2022 and 2023, the Company has assessed the recoverable amounts of its investment
in subsidiaries and as a result the carrying amount of the investments in subsidiaries were written down to its
recoverable amounts of RMB100,062,000, RMB104,321,000 and RMB106,393,000. The recoverable amounts of
investments have been determined based on fair value less cost of disposal, and were classified as Level 3 recurring
fair value measurements, as significant inputs are not based on observable market data. The key significant
unobservable inputs to determine the fair value less cost of disposal are the net assets value of the subsidiaries. The
higher the net assets value of the subsidiaries, the higher the fair value less cost of disposal will be and lower the
impairment required.
17. INTANGIBLE ASSETS
The Group and the Company
Patents
RMB’000
Cost:
At January 1, 2021, December 31, 2021, January 1, 2022, December 31, 2022,
January 1, 2023 and December 31, 2023 143
Accumulated amortization:
At January 1, 2021 16
Charge for the year 9
At December 31, 2021 and January 1, 2022 25
Charge for the year 9
At December 31, 2022 and January 1, 2023 34
Charge for the year 9
At December 31, 2023 43
Net carrying value:
At December 31, 2021 118
At December 31, 2022 109
At December 31, 2023 100
APPENDIX I ACCOUNTANTS’ REPORT
– I-41 –


--- page 481 ---
18. DEFERRED TAX
Deferred tax recognized and movements during the Track Record Period are as follows:
The Group
Impairment
losses on
financial
and contract
assets
Unused tax
loss
Fair value
change on
financial
assets at
FVTPL
Fair value
change on
financial
assets at
FVOCI Total
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2021 1,054 36 – (5,421) (4,331)
(Charged)/credited to profit
or loss (289) 709 (767) – (347)
Charged to other
comprehensive income – – – (5,900) (5,900)
At December 31, 2021 and
January 1, 2022 765 745 (767) (11,321) (10,578)
Credited/(charged) to profit
or loss 157 (668) 743 – 232
Credited to other
comprehensive income – – – 1,660 1,660
At December 31, 2022 and
January 1, 2023 922 77 (24) (9,661) (8,686)
Credited/(charged) to profit
or loss 1,488 (77) 238 – 1,649
Credited to other
comprehensive income – – – 2,046 2,046
At December 31, 2023 2,410 – 214 (7,615) (4,991)
The following is the analysis of the deferred tax balances for the financial reporting purposes:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Deferred tax assets 556 620 545
Deferred tax liabilities (11,134) (9,306) (5,536)
(10,578) (8,686) (4,991)
Deferred income tax assets are recognized for deductible temporary differences to the extent that the
realization of the related tax benefits through future taxable profits is probable. The Group has tax losses arising in
China that will expire in five years for offsetting against future taxable profits.
APPENDIX I ACCOUNTANTS’ REPORT
– I-42 –


--- page 482 ---
The amounts and expiration dates of the tax losses carried forward as of December 31, 2021, 2022 and 2023
are listed below:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
2024 791 – –
2025 1,760 – –
2026 7,336 4,152 945
2027 – 17 17
2028 – – 14
9,887 4,169 976
As of December 31, 2021, 2022 and 2023, the Group did not recognize deferred income tax assets of
RMB963,000, RMB524,000 and RMB174,000, respectively, in respect of deductible temporary differences and
cumulative tax losses amounting RMB6,251,000, RMB3,313,000 and RMB976,000, that can be carried forward
against future taxable income.
The Company
Impairment
losses on
financial and
contract
assets
Fair value
change on
financial
assets at
FVTPL
Fair value
change on
financial
assets at
FVOCI Total
RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2021 173 – (5,421) (5,248)
Credited to profit or loss 53 – – 53
Charged to other comprehensive
income – – (5,900) (5,900)
At December 31, 2021 and
January 1, 2022 226 – (11,321) (11,095)
Credited/(charged) to profit or loss 153 (24) – 129
Credited to other comprehensive
income – – 1,660 1,660
At December 31, 2022 and
January 1, 2023 379 (24) (9,661) (9,306)
Credited to profit or loss 1,486 238 – 1,724
Credited to other comprehensive
income – – 2,046 2,046
At December 31, 2023 1,865 214 (7,615) (5,536)
APPENDIX I ACCOUNTANTS’ REPORT
– I-43 –


--- page 483 ---
The following is the analysis of the deferred tax balances for the financial reporting purposes:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Deferred tax liabilities (11,095) (9,306) (5,536)
19. INVENTORIES
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Data management solutions 21,533 12,454 20,850
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Data management solutions 21,265 10,388 20,424
20. FINANCIAL ASSETS AT FVOCI
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted equity investments, at fair value 88,189 75,954 61,700
The above equity investments were irrevocably designated at fair value through other comprehensive income
as the Group considers that these investments are long-term strategic in nature.
The movements during the Track Record Period of the unlisted equity investments at level 3 fair value
measurement are set out below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 50,114 88,189 75,954
Fair value changes 38,142 (12,400) (14,311)
Exchange difference (67) 165 57
At the end of the year 88,189 75,954 61,700
APPENDIX I ACCOUNTANTS’ REPORT
– I-44 –


--- page 484 ---
The unlisted equity investments were valued by independent qualified professional valuer as of December 31,
2021, 2022 and 2023. As of December 31, 2021, 2022 and 2023, the unlisted equity investments were classified as
Level 3 recurring fair value measurement. There was no transfer between different levels of the fair value hierarchy
for the years ended December 31, 2021, 2022 and 2023. There has been no change in valuation technique used during
the Track Record Period.
Information about fair value measurement using significant unobservable inputs:
Valuation
approach
Significant
unobservable
inputs
Range of estimates
As of December 31,
Relationship of
unobservable inputs
to fair value2021 2022 2023
Unlisted equity
investments
Market
approach
Discount for
lack of
marketability
20.60% 20.50% 20.50% The higher the discount
for lack of
marketability, the lower
the fair value
Enterprise
multiple
7.92-
35.17
4.53-
30.08
4.24-
33.90
The higher the
enterprise multiple, the
higher the fair value
If all other variables held constant, a 5% higher/lower discount for lack of marketability rate would have a
decrease/increase the other comprehensive income for the years ended December 31, 2021, 2022 and 2023 by
approximately RMB978,000, RMB833,000 and RMB673,000, respectively.
If all other variables held constant, a 5% higher/lower in the enterprise multiple rate would have a
increase/decrease the other comprehensive income for the years ended December 31, 2021, 2022 and 2023 by
approximately RMB3,626,000, RMB3,222,000 and RMB2,998,000, respectively.
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted equity investments, at fair value 85,882 74,819 61,176
The above equity investments were irrevocably designated at fair value through other comprehensive income
as the Company considers that these investments are long-term strategic in nature.
The movements during the Track Record Period of the unlisted equity investments at level 3 fair value
measurement are set out below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 46,544 85,882 74,819
Fair value changes 39,338 (11,063) (13,643)
At the end of the year 85,882 74,819 61,176
The unlisted equity investments were valued by independent qualified professional valuer as of December 31,
2021, 2022 and 2023. As of December 31, 2021, 2022 and 2023, the unlisted equity investment were classified as
Level 3 recurring fair value measurement. There was no transfer between different levels of the fair value hierarchy
for the years ended December 31, 2021, 2022 and 2023. There has been no change in valuation technique used during
the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-45 –


--- page 485 ---
Information about fair value measurement using significant unobservable inputs:
Valuation
approach
Significant
unobservable
inputs
Range of estimates
As of December 31,
Relationship of
unobservable inputs
to fair value2021 2022 2023
Unlisted equity
investments
Market
approach
Discount for
lack of
marketability
20.60% 20.50% 20.50% The higher the discount
for lack of
marketability, the
lower the fair value
Enterprise
multiple
35.17 30.08 33.90 The higher the
enterprise multiple,
the higher the fair
value
If all other variables held constant, a 5% higher/lower in discount for lack of marketability rate would have
a decrease/increase the other comprehensive income for the years ended December 31, 2021, 2022 and 2023 by
approximately RMB946,000, RMB819,000 and RMB666,000, respectively.
If all other variables held constant, a 5% higher/lower in the enterprise multiple rate would have a
increase/decrease the other comprehensive income for the years ended December 31, 2021, 2022 and 2023 by
approximately RMB3,499,000, RMB3,159,000 and RMB2,941,000, respectively.
21. TRADE RECEIV ABLES
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade receivables 95,273 129,818 190,954
Less: impairment loss allowance (4,070) (5,845) (15,877)
91,203 123,973 175,077
An aging analysis of trade receivables, net of impairment losses, as of the end of each reporting period, based
on the invoice dates, is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Unbilled receivables (Note) 83,194 94,891 127,106
Billed receivables
Within 30 days 7,273 19,656 18,480
31-60 days 512 1,226 15,940
61-90 days 57 4,100 4,067
91-180 days 103 1,045 4,085
Over 180 days 64 3,055 5,399
8,009 29,082 47,971
91,203 123,973 175,077
Note: The unbilled receivables represent the Group’s unconditional right to consideration, of which invoices
have not been issued.
APPENDIX I ACCOUNTANTS’ REPORT
– I-46 –


--- page 486 ---
The Group recognized impairment loss based on the accounting policy stated in Note 4.10(b). Trade
receivables are generally due within 5 to 45 days from the date of billing.
Further details on the Group’s credit policy and credit risk analysis arising from trade receivables are set out
in Note 39(b).
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade receivables 90,063 119,428 180,855
Less: impairment loss allowance (584) (2,323) (12,374)
89,479 117,105 168,481
An aging analysis of trade receivables, net of impairment losses, as of the end of each reporting period, based
on the invoice dates, is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Unbilled receivables (Note) 81,470 88,023 120,510
Billed receivables
Within 30 days 7,273 19,656 18,480
31-60 days 512 1,226 15,940
61-90 days 57 4,100 4,067
91-180 days 103 1,045 4,085
Over 180 days 64 3,055 5,399
8,009 29,082 47,971
89,479 117,105 168,481
Note: The unbilled receivables represent the Company’s unconditional right to consideration, of which
invoices have not been issued.
The Company recognized impairment loss based on the accounting policy stated in Note 4.10(b). Trade
receivables are generally due within 5 to 45 days from the date of billing.
Further details on the Company’s credit policy and credit risk analysis arising from trade receivables are set
out in Note 39(b).
APPENDIX I ACCOUNTANTS’ REPORT
– I-47 –


--- page 487 ---
22. PREPAYMENTS, DEPOSITS AND OTHER RECEIV ABLES
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current portion
Deposits and other receivables 3,048 4,612 2,201
Prepayments 18,302 55,146 70,339
Prepaid listing expenses and deferred issue costs – – 6,397
21,350 59,758 78,937
Less: impairment loss allowance (1,029) (292) (194)
20,321 59,466 78,743
Non-current portion
Prepayments 36 5 40
20,357 59,471 78,783
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current portion
Deposits and other receivables 2,772 4,169 1,647
Prepayments 9,377 32,424 36,613
Prepaid listing expenses and deferred issue costs – – 6,397
12,149 36,593 44,657
Less: impairment loss allowance (925) (184) (64)
11,224 36,409 44,593
APPENDIX I ACCOUNTANTS’ REPORT
– I-48 –


--- page 488 ---
23. CONTRACT ASSETS AND CONTRACT LIABILITIES
(a) Contract assets
Contract assets arising from data management solutions primarily relate to the Group’s and the Company’s
rights to consideration for work completed at the reporting date. Any amount previously recognized as a contract
asset is reclassified to trade receivables at the point at which it becomes unconditional and the milestones are reached.
The Group and the Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Contract assets arising from data
management solutions 1,124 4,021 1,873
Less: impairment loss allowance (7) (27) (8)
1,117 3,994 1,865
Movements in contract assets during the Track Record Period are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 45 1,124 4,021
Additions 1,124 4,641 1,022
Amounts recognized as trade receivables during
the year (45) (1,744) (3,170)
At the end of the year 1,124 4,021 1,873
Less: impairment loss allowance (7) (27) (8)
1,117 3,994 1,865
The Group’s and the Company’s data management solutions contracts include payment schedules, which
require stage payments after certain period of the contract date. Additionally, the Group typically agrees a 6-month
to 3-year retention period fo r 2 – 10% of the contract sum. This amount is included in contract assets until the end
of retention period as the Group’s entitlement to this final payment is conditional on the Group’s satisfactory work.
No contracts has significant financing component. The changes in contract assets are due to (i) adjustments arising
from changes in the measure of progress of contracting work, or (ii) reclassification to trade receivables when the
Group has unconditional right to the consideration. The contract assets are all classified as current assets as it is
within the normal operating cycle.
The expected timing of recovery or settlement for contract assets as of the end of each reporting period is as
follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Due within one year 1,124 2,958 1,397
Due after one year – 1,063 476
1,124 4,021 1,873
APPENDIX I ACCOUNTANTS’ REPORT
– I-49 –


--- page 489 ---
The contract assets of RMB1,124,000, RMB4,021,000 and RMB1,873,000 as of December 31, 2021, 2022 and
2023 are generally expected to be settled within the next 3 years upon completion of services and acceptance by the
customers.
Further details on the Group’s and the Company’s credit policy and credit risk analysis arising from contract
assets are set out in Note 39(b).
(b) Contract liabilities
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Contract liabilities arising from
API marketplace 31,891 26,902 20,491
Data management solutions 19,549 2,790 9,311
51,440 29,692 29,802
The contract liabilities represented the advance consideration received from customers. The addition of
contract liabilities was mainly due to the increase of cash payments made upfront by the Group’s customers under
sales contracts. The Group receives payment from customers based on billing schedule as established in contracts.
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue recognized that was included in the
contract liabilities balance at the beginning of
the year 59,317 51,340 28,751
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Contract liabilities arising from
API marketplace 24,974 23,184 17,703
Data management solutions 19,549 2,145 8,664
44,523 25,329 26,367
The contract liabilities represented the advance consideration received from customers. The addition of
contract liabilities was mainly due to the increase of cash payments made upfront by the Company’s customers under
sales contracts. The Company receives payment from customers based on billing schedule as established in contracts.
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Revenue recognized that was included in the
contract liabilities balance at the beginning of
the year 36,536 44,355 24,531
APPENDIX I ACCOUNTANTS’ REPORT
– I-50 –


--- page 490 ---
24. CASH AND CASH EQUIV ALENTS AND TIME DEPOSITS
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash and cash equivalents 182,287 168,470 124,417
Time deposits with original maturity over
three months – 30,000 80,000
182,287 198,470 204,417
The Group’s cash and cash equivalents comprise cash on hand, bank deposits carrying interest at floating rates
based on daily bank deposit rates and short-term bank deposits carrying interests at prevailing market interest rate.
Time deposits with original maturity over three months comprise bank deposits carrying interest at fixed rate or
floating rates at prevailing market interest rate. The directors of the Company consider that the carrying value of the
deposits at the end of each reporting period approximates to their fair values.
As of the end of each reporting period, all of the Group’s cash at banks and on hands and time deposits with
original maturity over three months are denominated in RMB and placed in the PRC. RMB is not a freely convertible
currency. Under the PRC’s Foreign Exchange Control Regulations and Administration of Settlement and Sales and
Payment of Foreign Exchange Regulations, the Group is permitted to exchange RMB for foreign currencies through
banks that are authorized to conduct foreign exchange business.
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Cash and cash equivalents 142,797 130,733 90,585
Time deposits with original maturity over
three months – 30,000 80,000
142,797 160,733 170,585
The Company’s cash and cash equivalents comprise cash on hand, bank deposits carrying interest at floating
rates based on daily bank deposit rates and short-term bank deposits carrying interests at prevailing market interest
rate. Time deposits with original maturity over three months comprise bank deposits carrying interest at fixed rate
or floating rates at prevailing market interest rate. The directors of the Company consider that the carrying value of
the deposits at the end of each reporting period approximates to their fair values.
As of the end of each reporting period, all of the Company’s cash at banks and on hands and time deposits with
original maturity over three months are denominated in RMB and placed in the PRC. RMB is not a freely convertible
currency. Under the PRC’s Foreign Exchange Control Regulations and Administration of Settlement and Sales and
Payment of Foreign Exchange Regulations, the Company is permitted to exchange RMB for foreign currencies
through banks that are authorized to conduct foreign exchange business.
APPENDIX I ACCOUNTANTS’ REPORT
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25. FINANCIAL ASSETS AT FVTPL
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted debt security – – 5,245
Current assets
Structured deposits 103,066 35,155 –
103,066 35,155 5,245
The Group’s unlisted debt security represents investment in an unlisted investment fund incorporated in the
PRC. This investment fund is principally engaged in trading of securities.
The Group’s structured deposits represent RMB-denominated structured deposits. The expected annual interest
rate for the structured deposits to be received is uncertain until maturity. The annual expected return rates range from
1.20% to 4.00%.
Information about valuation technique and key inputs:
Fair value hierarchy Valuation technique and key inputs
Unlisted debt security Level 3 Asset-based approach with adjustment on discount for
lack of control
Structured deposits Level 2 Redemption value quoted by banks with reference to
the expected return of the underlying assets
The movements during the Track Record Period of the unlisted debt security at level 3 fair value measurement
are set out below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year – – –
Addition – – 6,667
Fair value changes – – (1,422)
At the end of the year – – 5,245
The unlisted debt security was valued by independent qualified professional valuer as of December 31, 2023.
As of December 31, 2023, the unlisted debt security was classified as Level 3 recurring fair value measurement.
There was no transfer between different levels of the fair value hierarchy for the years ended December 31, 2021,
2022 and 2023. There has been no change in valuation technique used during the Track Record Period.
APPENDIX I ACCOUNTANTS’ REPORT
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Information about fair value measurement using significant unobservable inputs under level 3 fair value
measurement:
Valuation
approach
Significant
unobservable
inputs
Range of estimates Relationship of
unobservable
inputs to fair value
As of December 31,
2021 2022 2023
Unlisted debt security Asset-based
approach
Discount for lack of
control
– – 20.8% The higher the
discount for lack of
control, the lower
the fair value
If all other variables held constant, a 5% higher/lower in discount for lack of control rate would have a
decrease/increase the profit or loss for each of the years ended December 31, 2021, 2022 and 2023 by approximately
RMBnil, RMBnil and RMB69,000, respectively.
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Non-current assets
Unlisted debt security – – 5,245
Current assets
Structured deposits – 25,155 –
– 25,155 5,245
The Company’s unlisted debt security represents investment in an unlisted investment fund incorporated in the
PRC. This investment fund is principally engaged in trading of securities.
The Company’s structured deposits represent RMB-denominated structured deposits. The expected annual
interest rate for the structured deposits be received is uncertain until maturity. The annual expected return rates range
from 1.20% to 4.00%.
Information about valuation technique and key inputs:
Fair value hierarchy Valuation technique and key inputs
Unlisted debt security Level 3 Asset-based approach with adjustment on discount for
lack of control
Structured deposits Level 2 Redemption value quoted by banks with reference to
the expected return of the underlying assets
The movements during the Track Record Period of the unlisted debt security at level 3 fair value measurement
are set out below:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year – – –
Addition – – 6,667
Fair value changes – – (1,422)
At the end of the year – – 5,245
APPENDIX I ACCOUNTANTS’ REPORT
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The unlisted debt security was valued by independent qualified professional valuer as of December 31, 2023.
As of December 31, 2023, the unlisted debt security was classified as Level 3 recurring fair value measurement.
There was no transfer between different levels of the fair value hierarchy for the years ended December 31, 2021,
2022 and 2023. There has been no change in valuation technique used during the Track Record Period.
Information about fair value measurement using significant unobservable inputs under level 3 fair value
measurement:
Valuation
approach
Significant
unobservable
inputs
Range of estimates Relationship of
unobservable
inputs to fair value
As of December 31,
2021 2022 2023
Unlisted debt security Asset-based
approach
Discount for lack of
control
– – 20.80% The higher the
discount for lack of
control, the lower
the fair value
If all other variables held constant, a 5% higher/lower in discount for lack of control rate would have a
decrease/increase the profit or loss for each of the years ended December 31, 2021, 2022 and 2023 by approximately
RMBnil, RMBnil and RMB69,000, respectively.
26. TRADE PAYABLES
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade payables 37,450 36,672 61,491
A credit period of up to 3 months, if applicable, from the date of billing is generally granted by the Group’s
trade suppliers. Based on the receipt of services and goods, which normally coincided with the invoice dates, the
aging analysis of the Group’s trade payables as of the end of each reporting period is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within one year 36,389 30,179 50,130
1-2 years 775 6,086 7,959
Over 2 years 286 407 3,402
37,450 36,672 61,491
The Group’s trade payables are short-term in nature and hence, the carrying amount of trade payables are
considered to approximate to their fair value.
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade payables 36,275 31,218 57,096
APPENDIX I ACCOUNTANTS’ REPORT
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A credit period of up to 3 months, if applicable, from the date of billing is generally granted by the Company’s
trade suppliers. Based on the receipt of services and goods, which normally coincided with the invoice dates, the
aging analysis of the Company’s trade payables as of the end of each reporting period is as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Within one year 35,215 24,730 45,740
1-2 years 775 6,082 7,959
Over 2 years 285 406 3,397
36,275 31,218 57,096
The Company’s trade payables are short-term in nature and hence, the carrying amount of trade payables are
considered to approximate to their fair value.
27. OTHER PAYABLES AND ACCRUALS
The Group
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Deposits received 130 130 82
Other payables 39 37 22
Other tax payables 2,457 3,785 1,453
Construction costs payable 15,566 27,205 2,054
Accruals 4,921 8,317 5,934
Accrued listing expenses – – 10,271
23,113 39,474 19,816
As of December 31, 2021, 2022 and 2023, all other payables and accruals were non-interest bearing, unsecured
and repayable on demand.
The Company
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Deposits received 130 130 82
Other payables 39 37 22
Other tax payables 2,000 3,310 1,230
Construction costs payable 15,566 27,205 2,054
Accruals 4,361 7,464 5,415
Accrued listing expenses – – 10,271
22,096 38,146 19,074
As of December 31, 2021, 2022 and 2023, all other payables and accruals were non-interest bearing, unsecured
and repayable on demand.
APPENDIX I ACCOUNTANTS’ REPORT
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28. LEASE LIABILITIES
The Group and the Company
The Group and the Company lease properties to operate its business. These leases are typically made for fixed
terms of 2 years. Lease terms are negotiated on an individual basis and contain different payments and conditions.
These lease agreements do not impose any covenants, but leased assets may not be used as security for borrowing
purpose.
The Group and the Company also lease properties with term of less than one year. These leases are short-term
and the Group has elected not to recognize right-of-use assets and lease liabilities for these leases.
Present value of future lease payments of the leases is analyzed as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Current – 43 –
Non-current – 22 –
–6 5 –
Movement of the lease liabilities is analyzed as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 787 – 65
Addition of new leases – 86 –
Interest expense 9 1 1
Capital element of lease payments (787) (21) (32)
Interest element of lease payments (9) (1) (1)
Termination of leases – – (33)
At the end of the year – 65 –
Total cash outflows in respect of the capital element of lease liabilities for the years ended December 31, 2021,
2022 and 2023 were RMB787,000, RMB21,000 and RMB32,000, respectively.
The future lease payments of the Group’s and the Company’s leases (excluding short-term leases) were
scheduled to repay as follows:
Minimum lease
payments
Future interest
expenses Present value
RMB’000 RMB’000 RMB’000
As of December 31, 2021
– within 1 year – – –
– 1 to 2 years, inclusive – – –
– 3 to 5 years, inclusive – – –
– over 5 years – – –
–––
APPENDIX I ACCOUNTANTS’ REPORT
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Minimum lease
payments
Future interest
expenses Present value
RMB’000 RMB’000 RMB’000
As of December 31, 2022
– within 1 year 44 (1) 43
– 1 to 2 years, inclusive 22 – 22
– 3 to 5 years, inclusive – – –
– over 5 years – – –
66 (1) 65
Minimum lease
payments
Future interest
expenses Present value
RMB’000 RMB’000 RMB’000
As of December 31, 2023
– within 1 year – – –
– 1 to 2 years, inclusive – – –
– 3 to 5 years, inclusive – – –
– over 5 years – – –
–––
29. SHARE CAPITAL
The Company
Number of shares
Authorized
Ordinary shares of RMB1.00 each
At January 1, 2021, December 31, 2021,
January 1, 2022, December 31, 2022,
January 1, 2023 and December 31, 2023 45,300,000
Number of
shares in issue Share capital
Share
premium
Issued RMB’000 RMB’000
At January 1, 2021, December 31, 2021, January
1, 2022, December 31, 2022, January 1, 2023
and December 31, 2023 45,300,000 45,300 426,720
30. RESERVES
The Group and the Company
The Group’s and the Company’s reserves and the movements therein for the years ended December 31, 2021,
2022 and 2023 are presented in the consolidated statements of changes in equity and the summary to the Company’s
reserve as set out below, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
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Summary to the Company’s reserve is as follows:
Share
premium*
Capital
reserve*
FVOCI
reserve*
Statutory
reserve*
Retained
earnings*
Total
reserve
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 30(a)) (Note 30(b)) (Note 30(c)) (Note 30(e)) (Note 30(f))
At January 1, 2021 426,720 67 30,722 8,016 21,996 487,521
Profit for the year –––– 46,271 46,271
Changes in fair value of financial
assets at FVOCI, net of tax – – 33,438 – – 33,438
Total comprehensive income for
the year – – 33,438 – 46,271 79,709
Equity-settled share-based
transactions (Note 36) – 4 0 0––– 4 0 0
Dividend declared
(Note 12) –––– (20,000) (20,000)
Transfer of retained earnings – – – 4,625 (4,625) –
Balance at December 31, 2021 426,720 467 64,160 12,641 43,642 547,630
* These reserve accounts comprise the reserves as of December 31, 2021, 2022 and 2023 in the
Company’s statements of financial position.
Share
premium*
Capital
reserve*
FVOCI
reserve*
Statutory
reserve*
Retained
earnings*
Total
reserve
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
(Note 30(a)) (Note 30(b)) (Note 30(c)) (Note 30(e)) (Note 30(f))
Balance at January 1, 2022 426,720 467 64,160 12,641 43,642 547,630
Profit for the year –––– 41,172 41,172
Changes in fair value of financial
assets at FVOCI, net of tax – – (9,403) – – (9,403)
Total comprehensive
(expense)/income for the year – – (9,403) – 41,172 31,769
Equity-settled share-based
transactions (Note 36) – 4 3 5––– 4 3 5
Transfer of retained earnings – – – 3,982 (3,982) –
Balance at December 31, 2022 426,720 902 54,757 16,623 80,832 579,834
Balance at January 1, 2023 426,720 902 54,757 16,623 80,832 579,834
Profit for the year –––– 33,079 33,079
Changes in fair value of financial
assets at FVOCI, net of tax – – (11,597) – – (11,597)
Total comprehensive income for
the year – – (11,597) – 33,079 21,482
Equity-settled share-based
transactions (Note 36) – 4 4 2––– 4 4 2
Deemed distribution to a
shareholder (Note 41) –––– (22,000) (22,000)
Transfer of retained earnings – – – 1,416 (1,416) –
Balance at December 31, 2023 426,720 1,344 43,160 18,039 90,495 579,758
* These reserve accounts comprise the reserves as of December 31, 2021, 2022 and 2023 in the
Company’s statements of financial position.
APPENDIX I ACCOUNTANTS’ REPORT
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(a) Share premium
Share premium represents the excess of issuing price over the nominal values of ordinary shares.
(b) Capital reserve
As detailed in Note 36, one of the Company’s shareholders has awarded of his own shares as equity-settled
share-based remuneration for the Group’s employees and directors in exchange for their services provided to the
Group. Since the Group has no obligation to settle these awards, they represent a capital contribution from the
shareholder.
(c) FVOCI reserve
FVOCI reserve comprises the cumulative net change in the fair value of equity investments designated at
FVOCI under IFRS 9 that are held at the end of each reporting period.
(d) Translation reserve
The translation reserve is used to record exchange differences arising from the translation of the financial
statements of group entities whose the functional currencies are not RMB.
(e) Statutory reserve
In accordance with the PRC Company Law and the articles of association of the subsidiaries established in the
PRC, PRC group entities are required to appropriate 10% of their net profits after tax, as determined under the
generally accepted accounting principles of the PRC, to the statutory reserve until the reserve balance reaches 50%
of their respective registered capital. Subject to certain restrictions set out in the relevant PRC regulations and in the
articles of association of the group entities, the statutory reserve may be used either to offset losses, or to be converted
to increase share capital provided that the balance after such conversion is not less than 25% of the registered capital
of the group entities. The reserve cannot be used for purposes other than those for which it is created and is not
distributable as cash dividends.
(f) Retained earnings
Cumulative net gains and losses recognized in profit or loss.
31. NON-CONTROLLING INTERESTS
The Group
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year (347) (392) (357)
(Loss)/profit for the year (45) 35 310
At the end of the year (392) (357) (47)
32. AMOUNTS DUE FROM/(TO) SUBSIDIARIES
As of December 31, 2021, 2022 and 2023, the balances are unsecured, interest-free and repayable on demand.
APPENDIX I ACCOUNTANTS’ REPORT
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33. NOTES SUPPORTING TO CONSOLIDATED STATEMENTS OF CASH FLOWS
The table below shows the details changes in the Group’s liabilities arising from financing activities.
Liabilities arising from financing activities are those for which each cash flows were, or future cash flows will be,
classified in the Group’s consolidated statements of cash flows from financing activities.
Dividend
payable Borrowings
Lease
liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2021 – – 787 787
Changes from financing
cash flows:
Proceeds from bank borrowings – 20,000 – 20,000
Repayments of bank borrowings – (20,000) – (20,000)
Repayment of lease liabilities – – (787) (787)
Interest paid – (145) (9) (154)
Dividend paid (20,000) – – (20,000)
Total changes from financing
cash flows (20,000) (145) (796) (20,941)
Other changes:
Interest expenses – 145 9 154
Dividend declared 20,000 – – 20,000
Total other changes 20,000 145 9 20,154
At December 31, 2021 ––––
Dividend
payable Borrowings
Lease
liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2022 ––––
Changes from financing
cash flows:
Repayments of lease liabilities – – (21) (21)
Interest paid – – (1) (1)
Total changes from financing
cash flows – – (22) (22)
Other changes:
Interest expenses ––11
New leases – – 86 86
Total other changes – – 87 87
At December 31, 2022 – – 65 65
APPENDIX I ACCOUNTANTS’ REPORT
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Dividend
payable Borrowings
Lease
liabilities Total
RMB’000 RMB’000 RMB’000 RMB’000
At January 1, 2023 – – 65 65
Changes from financing
cash flows:
Repayments of lease liabilities – – (32) (32)
Interest paid – – (1) (1)
Total changes from financing
cash flows – – (33) (33)
Other changes:
Interest expenses ––11
Termination of leases – – (33) (33)
Total other changes – – (32) (32)
At December 31, 2023 ––––
34. CAPITAL COMMITMENTS
The Group
As of December 31, 2021, 2022 and 2023, the Group had outstanding capital commitments as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Contracted, but not provided for:
– Construction-in-progress 15,851 – –
– Office equipment 3,851 – –
– Leasehold improvements 9,908 – –
– Financial assets at FVTPL – – 13,333
29,610 – 13,333
The Company
As of December 31, 2021, 2022 and 2023, the Company had outstanding capital commitments as follows:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Contracted, but not provided for:
– Construction-in-progress 15,851 – –
– Office equipment 3,851 – –
– Leasehold improvements 9,908 – –
– Financial assets at FVTPL – – 13,333
– Capital contribution payable to subsidiaries 4,280 4,230 4,230
33,890 4,230 17,563
APPENDIX I ACCOUNTANTS’ REPORT
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35. RELATED PARTY TRANSACTIONS
Parties are considered to be related if one party has the ability, directly or indirectly, to control the other party,
or exercise significant influence over the other party in making financial and operating decisions. Parties are also
considered to be related if they are subject to common control or common significant influence.
(a) The directors of the Company are of the view that the following parties/companies were related parties that
had transactions or balances with the Group:
Name of related parties Relationship with the Group
JD Technology Holding Co., Ltd.* (΅
ʮ̡)
Shareholder of the Company
Beijing Chuanrui Hongke Technology Co., Ltd.* ( ̏ԯ
ʮ̡)
Company controlled by a significant
shareholder
Jiangsu JD Information Technology Co., Ltd.* ( Ϫᘽԯ
ʮ̡)
Company subject to common significant
influence
Jiangsu Jingdong Xuke Information Technology Co.,
Ltd.* (ʮ̡)
Company subject to common significant
influence
* The English translation of terms or names in Chinese which are marked with “ *” is for identification
purposes only. In the event of any inconsistency, the Chinese terms or names shall prevail.
(b) The Group entered into the following related party transactions with related companies during the Track
Record Period:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Shareholder
Provision of API marketplace services 26 – –
Related companies
Purchase of API marketplace services 1 – –
Provision of API marketplace services 5,537 4,922 5,056
The terms of the related party transactions carried out during the Track Record Period were mutually agreed
by the Group and the related companies.
(c) Balance with related parties
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Trade receivables
Jiangsu JD Information Technology Co., Ltd. 109 109 109
Jiangsu Jingdong Xuke Information Technology
Co., Ltd. 614 2,809 5,497
Prepayments, deposits and
other receivables
Beijing Chuanrui Hongke Technology Co., Ltd. 44 44 44
Contract liabilities
Jiangsu JD Information Technology Co., Ltd. 13 – 13
All of the above related party balances are of trade nature.
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 502 ---
(d) Compensation of key management personnel of the Group
The compensation of key management personnel of the Group during the Track Record Period represented the
directors’ emoluments as disclosed in Note 14(a) to the Historical Financial Information.
36. SHARE-BASED PAYMENTS
One of the Company’s shareholders operates an equity-settled share-based remuneration scheme by granting
awards of his own shares to the employees and directors of the Group in exchange for their services provided to the
Group.
On November 1, 2020 and March 1, 2022, the Company’s shareholder granted a total of 428,000 and 42,800
of its own shares, respectively, to certain eligible persons within the Group. These grants allow the eligible persons
to purchase ordinary shares of the shareholder’s equity under the Employee Share Award Scheme (the “ Scheme ”).
The shares vest five years from the date of issue. If an eligible person leaves the Company within this five-year
period, he/she is obligated to sell the shares back to the issuer at the original price.
The fair value of the awarded shares is determined by the total number of shares awarded and exercised,
multiplied by the fair value of the shares on the grant date. The fair value of the shares awarded by the shareholder
granted on November 1, 2020 of RMB2,163,000 was primarily established with reference to a recent equity
transaction of the Company close to the grant date. The fair value of the shares awarded by the shareholder granted
on March 1, 2022 of RMB86,000 was primarily established using market approach with reference to price-to-earning
multiple by referring to other similar companies and a discounted rate for lack of marketability. The share-based
payment expenses of RMB400,000, RMB435,000 and RMB442,000, respectively were charged to profit or loss of
the Group during the years ended December 31, 2021, 2022 and 2023.
No share awards were forfeited during the years ended December 31, 2021, 2022 and 2023.
37. CAPITAL MANAGEMENT POLICIES AND PROCEDURES
The Group manages its capital to ensure that the entities in the Group will be able to continue as a going
concern while maximizing the return to shareholders through the optimization of the debt and equity balance.
The capital structure of the Group consists of net debt, net of cash and cash equivalents and equity attributable
to owners of the Company, comprising issued share capital, reserves and retained earnings, respectively.
The directors of the Company review the capital structure on a continuous basis taking into account the cost
of capital and the risk associated with the capital. The Group will balance its overall capital structure through the
payment of dividends, new shares issue and share buy back as well as the issue of new debts or redemption of existing
debt, if necessary.
Management regards total equity as capital. The amount of capital as of December 31, 2021, 2022 and 2023
amounted to approximately RMB595,123,000, RMB626,955,000 and RMB628,417,000, respectively, which
management considers as optimal having considered the projected capital expenditures and the projected strategic
investment opportunities.
38. SUMMARY OF FINANCIAL ASSETS AND FINANCIAL LIABILITIES BY CATEGORY
The Group
The following table shows the carrying amounts of financial assets and liabilities of the Group:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at FVOCI:
Financial assets at FVOCI 88,189 75,954 61,700
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 503 ---
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Financial assets at amortized cost:
Trade receivables 91,203 123,973 175,077
Deposits and other receivables 2,019 4,320 2,007
Cash and cash equivalents 182,287 168,470 124,417
Time deposits – 30,000 80,000
275,509 326,763 381,501
Financial assets at FVTPL:
Financial assets at FVTPL 103,066 35,155 5,245
Financial liabilities
Financial liabilities measured at amortized cost:
Trade payables 37,450 36,672 61,491
Other payables and accruals 20,656 35,689 18,363
Lease liabilities – 65 –
Repurchase liabilities – – 23,013
58,106 72,426 102,867
The Company
The following table shows the carrying amounts of financial assets and liabilities of the Company:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Financial assets
Financial assets at FVOCI:
Financial assets at FVOCI 85,882 74,819 61,176
Financial assets at amortized cost:
Trade receivables 89,479 117,105 168,481
Deposits and other receivables 1,847 3,985 1,583
Amounts due from subsidiaries 130,015 21,359 6,037
Cash and cash equivalents 142,797 130,733 90,585
Time deposits – 30,000 80,000
364,138 303,182 346,686
Financial assets at FVTPL:
Financial assets at FVTPL – 25,155 5,245
APPENDIX I ACCOUNTANTS’ REPORT
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--- page 504 ---
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Financial liabilities
Financial liabilities measured at amortized cost:
Trade payables 36,275 31,218 57,096
Amounts due to subsidiaries 83,863 56,306 47,525
Other payables and accruals 20,096 34,836 17,844
Lease liabilities – 65 –
Repurchase liabilities – – 23,013
140,234 122,425 145,478
39. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The main risks arising from the Group’s financial instruments in the normal course of the Group’s business are
interest rate risk, credit risk, liquidity risk, equity price risk and foreign currency risk. These risks are limited by the
Group’s financial management policies and practices described below. Generally, the Group introduces conservative
strategies on its risk management. The Group has not used any derivatives and other instruments for hedging purposes
nor does it hold or issue derivative financial instruments for trading purposes.
(a) Interest rate risk
The Group’s interest-bearing financial instruments at variable rates as of December 31, 2021, 2022 and 2023
are the cash at bank and time deposits except for fixed deposits, and the cash flow interest risk arising from the
change of market interest rate on these balances of relatively short maturity is not considered significant. The Group’s
interest-bearing financial instruments at fixed interest rates as of December 31, 2021, 2022 and 2023 are fixed
deposits and the change of market interest rate does not expose the Group to fair value interest risk. The directors
of the Company consider that the Group’s exposure to interest rate risk is not significant and no sensitivity analysis
of interest rate risk is presented.
(b) Credit risk
The Group’s credit risk is primarily attributable to its trade receivables, deposits and other receivables and
contract assets. Management has a credit policy in place and the exposures to these credit risks are monitored on an
ongoing basis.
In respect of trade receivables, deposits and other receivables and contract assets, credit evaluations are
performed on all debtors. These evaluations focus on the customer’s past history of making payments when due and
current ability to pay, and take into account information specific to the customers as well as pertaining to the
economic environment in which the customers operate. Ongoing credit evaluation is performed on the financial
condition of trade customers and, where appropriate, credit guarantee insurance cover is purchased. Trade receivables
are due from the date of billing. Normally, the Group does not obtain collateral from customers.
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer.
The default risk of the industry and country in which customers operate also has an influence on credit risk but to
a lesser extent. 15.9%, 19.3%, 24.3% and 38.2%, 40.5%, 58.1% of the Group’s trade receivables, deposits and other
receivables and contract assets was due from the Group’s largest customer and the five largest customers respectively
as of December 31, 2021, 2022 and 2023, respectively.
The Group
(i) Trade receivables/contract assets
The Group measures loss allowances for trade receivables and contract assets at an amount equal to lifetime
ECLs, individually and collectively using a provision matrix. As the Group’s historical credit loss experience does
not indicate significantly different loss patterns for different customer bases, the loss allowance based on past due
status is not further distinguished between the Group’s different customer bases.
APPENDIX I ACCOUNTANTS’ REPORT
– I-65 –


--- page 505 ---
The following table provides information about the Group’s exposure to credit risk and ECLs for trade
receivables and contract assets as of the end of each reporting period:
Unbilled
and not yet
past due
1–3
months
4–6
months
7–9
months
1 0–1 2
months
Over 12
months
Individually
assessed Total
At December 31, 2021
Expected loss rate (%) 0.62% 1.42% 4.72% 15.74% 46.19% 100.00% 100.00%
Gross carrying amount
(RMB’000) 92,442 352 106 – – 22 3,475 96,397
Loss allowance (RMB’000) 57 055–– 2 2 3,475 4,077
At December 31, 2022
Expected loss rate (%) 0.66% 2.10% 6.14% 21.63% 45.69% 100.00% 100.00%
Gross carrying amount
(RMB’000) 119,414 6,281 668 1,646 2,355 – 3,475 133,839
Loss allowance (RMB’000) 792 132 41 356 1,076 – 3,475 5,872
At December 31, 2023
Expected loss rate (%) 0.43% 4.24% 13.35% 40.65% 61.01% 100.00% 100.00%
Gross carrying amount
(RMB’000) 161,917 7,335 4,007 5,265 5,368 5,460 3,475 192,827
Loss allowance (RMB’000) 689 311 535 2,140 3,275 5,460 3,475 15,885
Expected loss rates are based on actual loss experience over the past 3 years. These rates are adjusted to reflect
differences between economic conditions during the Track Record Period over which the historic data has been
collected, current conditions and the Group’s view of economic conditions over the expected lives of the receivables.
Due to slower collection of past due receivables as the customers were still recovering from the negative
financial impact of the COVID-19 pandemic, the expected loss rate for 7-9 months increased from 15.74% to 21.63%
as of December 31, 2022 and further increased to 40.65% as of December 31, 2023 because of same reason.
The expected loss rate for 10-12 months remained stable at 46.19% and 45.69%, respectively, as of December
31, 2021 and 2022. It increased to 61.01% as of December 31, 2023 because of slow settlement from the customers.
Movements in the loss allowance for impairment of trade receivables are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 3,633 4,070 5,845
Provision for loss allowance 437 1,775 10,032
At the end of the year 4,070 5,845 15,877
Changes in loss allowance for impairment of trade receivables during the Track Record Period were mainly
contributed from the followings:
– For the years ended December 31, 2021, 2022 and 2023, increase in the ending balances of trade
receivables resulted in an increase in loss allowance of RMB437,000, RMB1,775,000 and
RMB10,032,000, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-66 –


--- page 506 ---
Movements in the loss allowance for impairment of contract assets are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 1 7 27
Provision for/(reversal of) loss allowance 6 20 (19)
At the end of the year 7 27 8
Changes in loss allowance for impairment of contract assets during the Track Record Period were mainly
contributed from the followings:
– For the years ended December 31, 2021 and 2022, increase in the ending balances of contract assets
resulted in an increase in loss allowance of RMB6,000 and RMB20,000, respectively.
– For the year ended December 31, 2023, decrease in the ending balance of contract assets resulted in a
decrease in loss allowance of RMB19,000.
(ii) Deposits and other receivables
In respect of deposits and other receivables, the Group has applied the general approach prescribed by IFRS
9, by measuring loss allowance at an amount equal to 12-month ECLs for deposits and other receivables. To measure
the ECLs, deposits and other receivables have been grouped based on shared credit risk characteristics, ECLs are
estimated based on historical credit loss experience, adjusted for factors that are specific to the debtors and general
economic conditions.
As of the end of each reporting period, all deposits and other receivables are measured at an amount equal to
12-month ECLs. However, when there has been a significant increase in credit risk since origination, the allowance
will be based on the lifetime ECLs. The following table provides information about the Group’s exposure to credit
risk and ECLs for deposits and other receivables:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Gross carrying amount
– Deposits and other receivables 3,048 4,612 2,201
Loss allowance
– Deposits and other receivables 1,029 292 194
Movements in the loss allowance account for impairment of deposits and other receivables are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 1,044 1,029 292
Reversal for loss allowance (25) (727) (98)
Written-off/(written back) 10 (10) –
At the end of the year 1,029 292 194
APPENDIX I ACCOUNTANTS’ REPORT
– I-67 –


--- page 507 ---
Changes in loss allowance for impairment of deposits and other receivables during the Track Record Period
were mainly contributed from the followings:
– For the years ended December 31, 2021, 2022 and 2023 decrease in the long term outstanding balances
of deposits and other receivables resulted in a decrease in loss allowance of RMB25,000, RMB727,000
and RMB98,000, respectively.
In respect of the Group’s cash and cash equivalents and restricted bank deposits, the directors of the Company
consider the probability of default is low on these balances since the counterparties are financial institutions with high
credit ratings or with good reputation.
The Company
(ii) Trade receivables/contract assets
The Company measures loss allowances for trade receivables and contract assets at an amount equal to lifetime
ECLs, individually and collectively using a provision matrix. As the Company’s historical credit loss experience does
not indicate significantly different loss patterns for different customer bases, the loss allowance based on past due
status is not further distinguished between the Company’s different customer bases.
The following table provides information about the Company’s exposure to credit risk and ECLs for trade
receivables and contract assets as of the end of each reporting period:
Unbilled
and not yet
past due
1–3
months
4–6
months
7–9
months
1 0–1 2
months
Over
12 months Total
At December 31, 2021
Expected loss rate (%) 0.62% 1.42% 4.72% 15.74% 46.19% 100.00%
Gross carrying amount
(RMB’000) 90,707 352 106 – – 22 91,187
Loss allowance (RMB’000) 55 955–– 2 2 5 9 1
At December 31, 2022
Expected loss rate (%) 0.66% 2.10% 6.14% 21.63% 45.69% 100.00%
Gross carrying amount
(RMB’000) 112,499 6,281 668 1,646 2,355 – 123,449
Loss allowance (RMB’000) 745 132 41 356 1,076 – 2,350
At December 31, 2023
Expected loss rate (%) 0.43% 4.24% 13.35% 40.65% 61.01% 100.00%
Gross carrying amount
(RMB’000) 155,293 7,335 4,007 5,265 5,368 5,460 182,728
Loss allowance (RMB’000) 661 311 535 2,140 3,275 5,460 12,382
Expected loss rates are based on actual loss experience over the past 3 years. These rates are adjusted to reflect
differences between economic conditions during the Track Record Period over which the historic data has been
collected, current conditions and the Company’s view of economic conditions over the expected lives of the
receivables.
Due to slower collection of past due receivables as the customers were still recovering from the negative
financial impact of the COVID-19 pandemic, the expected loss rate for 7-9 months increased from 15.74% to 21.63%
as of December 31, 2022 and further increased to 40.65% as of December 31, 2023 because of same reason.
The expected loss rate for 10-12 months remained stable at 46.19% and 45.69%, respectively, as of December
31, 2021 and 2022. It increased to 61.01% as of December 31, 2023 because of slow settlement from the customers.
APPENDIX I ACCOUNTANTS’ REPORT
– I-68 –


--- page 508 ---
Movements in the loss allowance for impairment of trade receivables are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 265 584 2,323
Provision for loss allowance 319 1,739 10,051
At the end of the year 584 2,323 12,374
Changes in loss allowance for impairment of trade receivables during the Track Record Period were mainly
contributed from the followings:
– For the years ended December 31, 2021, 2022 and 2023, increase in the ending balances of trade
receivables resulted in an increase in loss allowance of RMB319,000, RMB1,739,000 and
RMB10,051,000, respectively.
Movements in the loss allowance for impairment of contract assets are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 1 7 27
Provision for/(reversal of) loss allowance 6 20 (19)
At the end of the year 7 27 8
Changes in loss allowance for impairment of contract assets during the Track Record Period were mainly
contributed from the followings:
– For the years ended December 31, 2021 and 2022, increase in the ending balances of contract assets
resulted in an increase in loss allowance of RMB6,000 and RMB20,000, respectively.
– For the year ended December 31, 2023, decrease in the ending balance of contract assets resulted in a
decrease in loss allowance of RMB19,000.
(ii) Deposits and other receivables
In respect of deposits and other receivables, the Company has applied the general approach prescribed by IFRS
9, by measuring loss allowance at an amount equal to 12-month ECLs for deposits and other receivables. To measure
the ECLs, deposits and other receivables have been grouped based on shared credit risk characteristics, ECLs are
estimated based on historical credit loss experience, adjusted for factors that are specific to the debtors and general
economic conditions.
APPENDIX I ACCOUNTANTS’ REPORT
– I-69 –


--- page 509 ---
As of the end of each reporting period, all deposits and other receivables are measured at an amount equal to
12-month ECLs. However, when there has been a significant increase in credit risk since origination, the allowance
will be based on the lifetime ECLs. The following table provides information about the Company’s exposure to credit
risk and ECLs for deposits and other receivables:
As of December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
Gross carrying amount
– Deposits and other receivables 2,772 4,169 1,647
Loss allowance
– Deposits and other receivables 925 184 64
Movements in the loss allowance account for impairment of deposits and other receivables are as follows:
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
At the beginning of the year 896 925 184
Provision for/(reversal of) loss allowance 29 (741) (120)
At the end of the year 925 184 64
Changes in loss allowance for impairment of deposits and other receivables during the Track Record Period
were mainly contributed from the followings:
– For the year ended December 31, 2021, increase in the long term outstanding balances of deposits and
other receivables resulted in an increase in loss allowance of RMB29,000.
– For the years ended December 31, 2022 and 2023, decrease in the long term outstanding balances of
deposits and other receivables resulted in a decrease in loss allowance of RMB741,000 and
RMB120,000, respectively.
In respect of the Company’s cash and cash equivalents and restricted bank deposits, the directors of the
Company consider the probability of default is low on these balances since the counterparties are financial
institutions with high credit ratings or with good reputation.
(c) Liquidity risk
Ultimate responsibility for liquidity risk management rests with the directors of the Company, which has built
an appropriate liquidity risk management framework for the management of the Group’s short, medium and long-term
funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves.
The following tables detail the Group’s remaining contractual maturity for its non-derivative financial
liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the
earliest date on which the Group can be required to pay. The tables include both interest and principal cash flows.
To the extent that interest flows are at floating rate, the undiscounted amounts are derived from current interest rate
at the end of each reporting period.
APPENDIX I ACCOUNTANTS’ REPORT
– I-70 –


--- page 510 ---
The Group
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2021
Trade payables 37,450 37,450 37,45 0–––
Other payables and
accruals 20,656 20,656 20,65 6–––
58,106 58,106 58,10 6–––
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2022
Trade payables 36,672 36,672 36,67 2–––
Other payables and
accruals 35,689 35,689 35,68 9–––
Lease liabilities 65 66 44 22 – –
72,426 72,427 72,405 22 – –
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2023
Trade payables 61,491 61,491 61,49 1–––
Other payables and
accruals 18,363 18,363 18,36 3–––
Repurchase liabilities 23,013 24,200 24,20 0–––
102,867 104,054 104,05 4–––
APPENDIX I ACCOUNTANTS’ REPORT
– I-71 –


--- page 511 ---
The Company
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2021
Trade payables 36,275 36,275 36,27 5–––
Amounts due to
subsidiaries 83,863 83,863 83,86 3–––
Other payables and
accruals 20,096 20,096 20,09 6–––
140,234 140,234 140,23 4–––
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2022
Trade payables 31,218 31,218 31,21 8–––
Amounts due to
subsidiaries 56,306 56,306 56,30 6–––
Other payables and
accruals 34,836 34,836 34,83 6–––
Lease liabilities 65 66 44 22 – –
122,425 122,426 122,404 22 – –
Carrying
amount
Total
contractual
undiscounted
cash flows
Within
1 year or
on demand
More than
1 year but
less than
2 years
More than
2 years but
less than
5 years
More than
5 years
RMB’000 RMB’000 RMB’000 RMB’000 RMB’000 RMB’000
As of December 31,
2023
Trade payables 57,096 57,096 57,09 6–––
Amounts due to
subsidiaries 47,525 47,525 47,52 5–––
Other payables and
accruals 17,844 17,844 17,84 4–––
Repurchase liabilities 23,013 24,200 24,20 0–––
145,478 146,665 146,66 5–––
APPENDIX I ACCOUNTANTS’ REPORT
– I-72 –


--- page 512 ---
(d) Equity price risk
The following table illustrates the sensitivity of the carrying amount of financial assets at FVOCI and FVTPL
during the Track Record Period to a change in the significant unobservable inputs while all other variable held
constant. A positive number below indicates an increase in total comprehensive income for the year. For a decrease
in total comprehensive income for the year, the balance below would be negative.
The Group
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
10% higher in the fair value of the investment 7,531 6,473 5,252
10% lower in the fair value of the investment (7,531) (6,473) (5,252)
The Company
Y ear ended December 31,
2021 2022 2023
RMB’000 RMB’000 RMB’000
10% higher in the fair value of the investment 7,300 6,360 5,200
10% lower in the fair value of the investment (7,300) (6,360) (5,200)
(e) Foreign currency risk
Currency risk refers to the risk that the fair values or future cash flows of a financial instrument will fluctuate
because of changes in foreign exchange rates. Currency risk to the Group is minimal as most of the Group’s
transactions are carried out in functional currency of the respective entities.
40. FAIR V ALUE MEASUREMENT
The hierarchy groups financial assets and liabilities into three levels based on the relative reliability of
significant inputs used in measuring the fair value of these financial assets and liabilities. The fair value hierarchy
has the following levels:
– Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
– Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset on
liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices); and
– Level 3: inputs for the asset or liability that are not based on observable market data (unobservable
inputs).
The level in the fair value hierarchy within which the financial assets and liabilities is categorized in its
entirety is based on the lowest level of input that is significant to the fair value measurement. The financial assets
and liabilities measured at fair value are grouped into the fair value hierarchy as follows:
The Group
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As of December 31, 2021
Financial assets at FVOCI – – 88,189 88,189
Financial assets at FVTPL – 103,066 – 103,066
APPENDIX I ACCOUNTANTS’ REPORT
– I-73 –


--- page 513 ---
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As of December 31, 2022
Financial assets at FVOCI – – 75,954 75,954
Financial assets at FVTPL – 35,155 – 35,155
As of December 31, 2023
Financial assets at FVOCI – – 61,700 61,700
Financial assets at FVTPL – – 5,245 5,245
The Company
Level 1 Level 2 Level 3 Total
RMB’000 RMB’000 RMB’000 RMB’000
As of December 31, 2021
Financial assets at FVOCI – – 85,882 85,882
As of December 31, 2022
Financial assets at FVOCI – – 74,819 74,819
Financial assets at FVTPL – 25,155 – 25,155
As of December 31, 2023
Financial assets at FVOCI – – 61,176 61,176
Financial assets at FVTPL – – 5,245 5,245
The reconciliation from the opening to the closing balances of the financial assets at FVOCI and FVTPL under
level 3 fair value measurement during the Track Record Period is disclosed in Note 20 and Note 25, respectively.
41. REPURCHASE LIABILITIES
The Group and the Company
On July 22, 2023, Mr. Zuo Lei, the largest shareholder and executive director of the Company, transferred his
369,111 shares of the Company to China-Singapore Suzhou Industrial Park V entures Co., Ltd. ( ʕอᘽψʈุ෤ਜ௴
ʮ̡) (“China-Singapore V entures”) at a cash consideration of RMB22.0 million, pursuant to the share
transfer agreement signed and executed on that day. If the Company fails to complete its initial listing of shares on
the Stock Exchange or any other securities exchange approved by China-Singapore V entures by June 30, 2024,
China-Singapore V entures has the rights to issue a notice requiring the Company and Mr. Zuo Lei to repurchase all
or part of the shares of the Company held by China-Singapore V entures by cash at an amount based on relevant
investment cost incurred by China-Singapore V entures plus 10% interest per annum. The repurchase obligation of the
Company and Mr. Zuo Lei is joint and several. According to the agreement, the aforementioned repurchase rights will
automatically terminate and be void from the beginning on the day the Company submitted its listing application; if
the aforementioned listing application is voluntarily withdrawn, returned in writing, revoked, or not approved for any
reason, the rights of China-Singapore V entures stipulated in these clauses shall be automatically resumed.
The repurchase obligation bored by the Group is initially recognized at present value of the redemption amount
at approximately RMB22,000,000. There were no service obligations or other conditions imposed in the share
transfer agreement or by the Company on Mr. Zuo Lei, whether in his capacity as a Director or employee of the
Company. In addition, the cash consideration did not appear to be less than the fair value of the Shares transferred.
Therefore, the Company considered that no unidentifiable goods or services are deemed to be existed in substance.
Management confirmed that Mr. Zuo Lei’s involvement in this transaction is solely acting in his capacity as a
Shareholder and not in exchange for his goods and services provided as a Director or employee of the Company. As
such, the cash consideration received is treated as a transaction with the owner and therefore the corresponding
balance is considered as deemed distribution to a Shareholder as the transaction is non-reciprocal in nature. During
the Track Record Period, the unwinding of the discount of the repurchase liabilities amounted to approximately nil,
nil, and RMB1,013,000 for the years ended December 31, 2021, 2022 and 2023, respectively. The carrying amounts
of the repurchase liabilities were approximately nil, nil, and RMB23,013,000 as at December 31, 2021, 2022 and
2023, respectively.
APPENDIX I ACCOUNTANTS’ REPORT
– I-74 –


--- page 514 ---
42. CONTINGENCIES
As of December 31, 2021, 2022 and 2023, there were no significant contingencies items for the Group and the
Company.
43. SUBSEQUENT FINANCIAL INFORMATION
No audited financial statements have been prepared by the Group and the Company or any of the companies
comprising the Group in respect of any period subsequent to December 31, 2023.
APPENDIX I ACCOUNTANTS’ REPORT
– I-75 –


--- page 515 ---
(A) UNAUDITED PRO FORMA STATEMENT OF ADJUSTED CONSOLIDATED NET
TANGIBLE ASSETS
The following unaudited pro forma statement of adjusted consolidated net tangible assets
of the Group attributable to owners of the Company prepared in accordance with paragraph
4.29 of the Listing Rules is for illustrative purpose only, and is set forth here to illustrate the
effect of the Global Offering on the audited consolidated net tangible assets of the Group
attributable to owners of the Company as of December 31, 2023 as if the Global Offering had
taken place on December 31, 2023.
This unaudited pro forma statement of adjusted consolidated net tangible assets of the
Group attributable to owners of the Company has been prepared for illustrative purposes only
and, because of its hypothetical nature, it may not give a true picture of the consolidated net
tangible assets of the Group attributable to owners of the Company as of December 31, 2023
or at any future dates following the Global Offering. It is prepared based on the audited
consolidated net tangible assets of the Group attributable to owners of the Company as of
December 31, 2023 as set out in the Accountants’ Report on historical financial information of
the Group, the text of which is set out in Appendix I to this Prospectus, and adjusted as
described below.
Audited
consolidated net
tangible assets of
the Group
attributable to
owners of the
Company as of
December 31,
2023
Estimated net
proceeds from
the Global
Offering
Estimated
impact related to
the repurchase
liabilities upon
Listing
Unaudited pro
forma adjusted
consolidated net
tangible assets of
the Group
attributable to
owners of the
Company as of
December 31,
2023
Unaudited pro forma adjusted
consolidated net tangible assets
of the Group attributable to
owners of the Company as of
December 31, 2023 per Share
RMB’000 RMB’000 RMB’000 RMB’000 RMB HK$
(Note 1) (Note 2) (Note 3) (Note 4)
Based on the Offer
Price of HK$83.33
per H Share 628,364 335,511 23,013 986,888 19.69 21.63
Notes:
(1) The audited consolidated net tangible assets of the Group attributable to owners of the Company as of
December 31, 2023 is extracted from the Accountants’ Report set out in Appendix I to this Prospectus, which
is based on the audited consolidated net assets of our Group attributable to owners of the Company as of
December 31, 2023 of approximately RMB628,464,000 with an adjustment for intangible assets as of
December 31, 2023 of approximately RMB100,000.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-1 –


--- page 516 ---
(2) The estimated net proceeds from the Global Offering are based on the Offer Price of HK$83.33 per Offer
Share, after deduction of the estimated underwriting fees and other related expenses payable by the Company
(excluding the listing expenses that have been charged to profit or loss during the Track Record Period) which
have not been reflected in consolidated net tangible assets of the Group attributable to owners of the Company
as of December 31, 2023.
(3) Upon Listing, the repurchase rights of China-Singapore V entures with details set out and disclosed in page I-74
to this prospectus will be terminated and the carrying amount of the repurchase liabilities of the Group from
the obligations to purchase the Company’s own equity instruments for cash will be reclassified to equity.
Accordingly, for the purpose of the unaudited pro forma financial information, the unaudited pro forma
adjusted consolidated net tangible assets of the Group attributable to the owners of the Company will be
increased by RMB23,013,000, being the carrying amount of the repurchase liabilities as of December 31, 2023.
(4) The unaudited pro forma adjusted consolidated net tangible assets of the Group attributable to owners of the
Company as of December 31, 2023 per Share is calculated based on a total of 50,118,200 Shares in issue
immediately following the completion of the Global Offering.
(5) For the purpose of this unaudited pro forma statement of adjusted consolidated net tangible assets of the Group
attributable to owners of the Company as of December 31, 2023 per Share, the amounts stated in Renminbi
are converted from or into Hong Kong dollars at an exchange rate of HK$1.0 to RMB0.91037. No
representation is made that RMB has been, could have been or may be converted into HK$, or vice versa, at
that rate.
(6) The Group’s property interests (including leasehold land and certain buildings) as of December 31, 2023 have
been valued by Ravia Global Appraisal Advisory Limited, an independent property valuer. Details of the
valuation are set out in Appendix V to this prospectus. The unaudited pro forma adjusted consolidated net
tangible assets of the Group attributable to owners of the Company as of December 31, 2023 does not take into
account the deficits arising from the revaluation of the Group’s property interests amount to approximately
RMB7,412,000. Revaluation deficits have not been recorded in the historical financial information of the
Group as of December 31, 2023 and will not be recorded in the consolidated financial statements of the Group
in future periods as the Group’s property, plant and equipment are stated at cost less accumulated depreciation
and impairment loss, if any. Had the property interests been stated at valuation, no additional depreciation
would have been charged to the consolidated statements of profit or loss and comprehensive income.
(7) No adjustment has been made to the unaudited pro forma adjusted consolidated net tangible assets of the Group
attributable to owners of the Company as of December 31, 2023 to reflect any trading results or other
transactions of the Group entered into subsequent to December 31, 2023.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-2 –


--- page 517 ---
(B) INDEPENDENT REPORTING ACCOUNTANTS’ ASSURANCE REPORT ON THE
COMPILATION OF UNAUDITED PRO FORMA FINANCIAL INFORMATION
To the directors of Tianju Dihe (Suzhou) Technology Co., Ltd.
We have completed our assurance engagement to report on the compilation of unaudited
pro forma financial information of Tianju Dihe (Suzhou) Technology Co., Ltd. (the
“Company ”) and its subsidiaries (collectively the “ Group ”) prepared by the directors of the
Company (the “ Directors ”) for illustrative purposes only. The unaudited pro forma financial
information consists of the unaudited pro forma statement of adjusted consolidated net tangible
assets as of December 31, 2023 and related notes (the “ Unaudited Pro Forma Financial
Information ”) as set out on pages II-1 to II-2 of Appendix II to the Company’s prospectus
dated 20 June 2024 (the “ Prospectus ”) in connection with the proposed initial public offering
of the Company’s shares on the Main Board of The Stock Exchange of Hong Kong Limited (the
“Global Offering ”). The applicable criteria on the basis of which the Directors have compiled
the Unaudited Pro Forma Financial Information are described on pages II-1 to II-2 of Appendix
II to the Prospectus.
The Unaudited Pro Forma Financial Information has been compiled by the Directors to
illustrate the impact of the Global Offering on the Group’s consolidated financial position as
of December 31, 2023 as if the Global Offering had taken place on the same date. As part of
this process, information about the Group’s consolidated financial position has been extracted
by the Directors from the Group’s historical financial information for each of the three years
ended December 31, 2023, on which the Accountant’s Report set out in Appendix I to the
Prospectus has been published.
Directors’ Responsibilities for the Unaudited Pro Forma Financial Information
The Directors are responsible for compiling the Unaudited Pro Forma Financial
Information in accordance with paragraph 4.29 of the Rules Governing the Listing of Securities
on The Stock Exchange of Hong Kong Limited (the “ Listing Rules ”) and with reference to
Accounting Guideline (“ AG”) 7 Preparation of Pro Forma Financial Information for Inclusion
in Investment Circulars issued by the Hong Kong Institute of Certified Public Accountants
(the “ HKICPA ”).
Our Independence and Quality Management
We have complied with the independence and other ethical requirements of the “Code of
Ethics for Professional Accountants” issued by the HKICPA, which is founded on fundamental
principles of integrity, objectivity, professional competence and due care, confidentiality and
professional behavior.
Our firm applies Hong Kong Standard on Quality Management (HKSQM) 1, Quality
Management for Firms that Perform Audits or Reviews of Financial Statements, or Other
Assurance or Related Services Engagements issued by the HKICPA, which requires the firm
to design, implement and operate a system of quality management including policies or
procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-3 –


--- page 518 ---
Reporting Accountants’ Responsibilities
Our responsibility is to express an opinion, as required by paragraph 4.29(7) of the
Listing Rules, on the Unaudited Pro Forma Financial Information and to report our opinion to
you. We do not accept any responsibility for any reports previously given by us on any
financial information used in the compilation of the Unaudited Pro Forma Financial
Information beyond that owed to those to whom those reports were addressed by us at the dates
of their issue.
We conducted our engagement in accordance with Hong Kong Standard on Assurance
Engagements 3420, Assurance Engagements to Report on the Compilation of Pro Forma
Financial Information Included in a Prospectus, issued by the HKICPA. This standard requires
that the reporting accountants plan and perform procedures to obtain reasonable assurance
about whether the directors have compiled the unaudited pro forma financial information in
accordance with paragraph 4.29 of the Listing Rules and with reference to AG 7 issued by the
HKICPA.
For purposes of this engagement, we are not responsible for updating or reissuing any
reports or opinions on any historical financial information used in compiling the Unaudited Pro
Forma Financial Information, nor have we, in the course of this engagement, performed an
audit or review of the financial information used in compiling the Unaudited Pro Forma
Financial Information.
The purpose of Unaudited Pro Forma Financial Information included in a prospectus is
solely to illustrate the impact of a significant event or transaction on unadjusted financial
information of the Group as if the event had occurred or the transaction had been undertaken
at an earlier date selected for purposes of the illustration. Accordingly, we do not provide any
assurance that the actual outcome of the Global Offering at December 31, 2023 would have
been as presented.
A reasonable assurance engagement to report on whether the Unaudited Pro Forma
Financial Information has been properly compiled on the basis of the applicable criteria
involves performing procedures to assess whether the applicable criteria used by the Directors
in the compilation of the Unaudited Pro Forma Financial Information provide a reasonable
basis for presenting the significant effects directly attributable to the event or transaction, and
to obtain sufficient appropriate evidence about whether:
 the related unaudited pro forma adjustments give appropriate effect to those criteria;
and
 the Unaudited Pro Forma Financial Information reflects the proper application of
those adjustments to the unadjusted financial information.
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-4 –


--- page 519 ---
The procedures selected depend on the reporting accountants’ judgement, having regard
to the reporting accountants’ understanding of the nature of the Group, the event or transaction
in respect of which the Unaudited Pro Forma Financial Information has been compiled, and
other relevant engagement circumstances.
The engagement also involves evaluating the overall presentation of the Unaudited Pro
Forma Financial Information.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Opinion
In our opinion:
(a) the Unaudited Pro Forma Financial Information has been properly compiled by the
Directors on the basis stated;
(b) such basis is consistent with the accounting policies of the Group; and
(c) the adjustments are appropriate for the purposes of the Unaudited Pro Forma
Financial Information as disclosed pursuant to paragraph 4.29(1) of the Listing
Rules.
BDO Limited
Certified Public Accountants
Hong Kong
June 20, 2024
APPENDIX II UNAUDITED PRO FORMA FINANCIAL INFORMATION
– II-5 –


--- page 520 ---
TAXATION OF SECURITY HOLDERS
The taxation of income and capital gains of holders of H Shares is subject to the laws and
practices of the PRC and of jurisdictions in which holders of H Shares are residents or
otherwise subject to tax. The following summary of certain relevant taxation provisions is
based on current effective laws and practices, and no predictions are made about changes or
adjustments to relevant laws or policies, and no comments or suggestions will be made
accordingly. The discussion has no intention to cover all possible tax consequences resulting
from the investment in H Shares, nor does it take the specific circumstances of any particular
investor into account, some of which may be subject to special provisions. Accordingly, you
should consult your own tax advisor regarding the tax consequences of an investment in H
Shares. The discussion is based upon laws and relevant interpretations in effect as of the date
of this prospectus, which is subject to change or adjustment and may have retrospective effect.
No issues on PRC or Hong Kong taxation other than income tax, capital appreciation and profit
tax, business tax/appreciation tax, stamp duty and estate duty were referred in the discussion.
Prospective investors are urged to consult their financial advisors regarding the PRC, Hong
Kong and other tax consequences of owning and disposing of H Shares.
The PRC Taxation
Taxation on Dividends
Individual Investor
Pursuant to the Individual Income Tax Law of the PRC (੻೼
), which was most recently amended on August 31, 2018 and the Implementation
Provisions of the Individual Income Tax Law of the PRC (ྼ
ૢԷ), which was most recently amended on December 18, 2018 (hereinafter collectively
referred to as the “ IIT Law ”), dividends distributed by PRC enterprises are subject to
individual income tax levied at a flat rate of 20%. For a foreign individual who is not a resident
of the PRC, the receipt of dividends from an enterprise in the PRC is normally subject to
individual income tax of 20% unless specifically exempted by the tax authority of the State
Council or reduced by relevant tax treaty.
Pursuant to the Circular on Issues Concerning Taxation and Administration of Individual
Income Tax After the Repeal of the Document Guo Shui Fa [1993] No. 045 (਷೼೯
[1993]045) issued by the STA on June 28,
2011, for a domestic non-foreign invested enterprise who has been issuing shares in Hong
Kong, its foreign individual shareholders may enjoy the relevant preferential tax treatment
according to the taxation agreement between the PRC and the country where they reside and
the taxation arrangement between the PRC and Hong Kong (or Macau). When domestic
non-foreign invested enterprises, which issue stocks in Hong Kong, pay dividends and bonus,
in general, it will withhold 10% of the dividends and profits as individual income tax and no
applications are needed. Where the individuals who receive the dividends are residents of
countries where the agreed tax rate is lower than 10%, the withholding agent shall, according
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 521 ---
to regulations provisions, handle the applications for relevant preferential treatments and
refund the extra tax upon the approval of competent tax authorities. Where the individuals are
residents of countries where the agreed tax rate is higher than 10% but lower than 20%, the
withholding agent shall withhold the individual income tax according to the agreed actual tax
rate when paying the dividends and bonuses and no applications are needed in such cases.
Where the dividend receiving individuals are residents of countries which have not established
tax treaties with China or other circumstances exist, the withholding agent shall withhold the
individual income tax based on the rate of 20% when paying dividends and bonuses.
Enterprise Investor
In accordance with Enterprise Income Tax Law of the PRC (੻
) (the “ EIT Law ”) and the Regulations for the Implementation of the Law on Enterprise
Income Tax of the PRC (ૢԷ), the rate of enterprise
income tax shall be 25%. A non-resident enterprise is generally subject to a 10% corporate
income tax on PRC-sourced income (including dividends received from a PRC resident
enterprise that issues shares in Hong Kong), if it does not have an establishment or premise in
the PRC or has an establishment or premise in the PRC but its PRC-sourced income has no real
connection with such establishment or premise. The aforesaid income tax payable for
non-resident enterprises are deducted at source, where the payer of the income is required to
withhold the income tax from the amount to be paid to the non-resident enterprise.
The Circular of the State Administration of Tax on Issues Relating to the Withholding and
Remitting of Corporate Income Tax by PRC Resident Enterprises on Dividends Distributed to
Overseas Non-Resident Enterprise Shareholders of H Shares (͏Ά
ุΣྤ̮H), which was
issued and implemented by the SA T on November 6, 2008, further clarified that a PRC-resident
enterprise must withhold corporate income tax at a rate of 10% on the dividends of 2008 and
onwards that it distributes to overseas non-resident enterprise shareholders of H Shares.
Pursuant to the Arrangement between the Mainland of PRC and the Hong Kong
Special Administrative Region on the Avoidance of Double Taxation and the Prevention of
Fiscal Evasion (τર)
(the “ Arrangement ”), which was signed on August 21, 2006 and came into effect on August
12, 2006, the Chinese Government may levy taxes on the dividends paid by a Chinese company
to Hong Kong residents (including natural persons and legal entities) in an amount not
exceeding 10% of the total dividends payable by the Chinese company unless a Hong Kong
resident directly holds 25% or more of the equity interest in a Chinese company, then such tax
shall not exceed 5% of the total dividends payable by the Chinese company. The Fifth Protocol
of the Arrangement between the Mainland of PRC and the Hong Kong Special Administrative
Region on the Avoidance of Double Taxation and the Prevention of Fiscal Evasion ( <ʫή
τર>), which came
into effect on December 6, 2019, adds a criteria for the qualification of entitlement to enjoy
treaty benefits. Although there may be other provisions under the Arrangement, the treaty
benefits under the criteria shall not be granted in the circumstance where relevant gains, after
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-2 –


--- page 522 ---
taking into account all relevant facts and conditions, are reasonably deemed to be one of the
main purposes for the arrangement or transactions which will bring any direct or indirect
benefits under this Arrangement, except when the grant of benefits under such circumstance is
consistent with relevant objective and goal under the Arrangement. The application of the
dividend clause of tax agreements is subject to the requirements of PRC tax law and regulation,
such as the Notice of the State Administration of Taxation on the Issues Concerning the
Application of the Dividend Clauses of Tax Agreements (ٰ֛
).
Tax Treaties
Non-resident investors residing in jurisdictions which have entered into treaties or
adjustments for the avoidance of double taxation with the PRC might be entitled to a reduction
of the Chinese corporate income tax imposed on the dividends received from PRC companies.
The PRC currently has entered into Avoidance of Double Taxation Treaties or Arrangements
with a number of countries and regions including Hong Kong, Macau, Australia, Canada,
France, Germany, Japan, Malaysia, the Netherlands, Singapore, the United Kingdom and the
United States. Non-PRC resident enterprises entitled to preferential tax rates in accordance
with the relevant taxation treaties or arrangements are required to apply to the Chinese tax
authorities for a refund of the corporate income tax in excess of the agreed tax rate, and the
refund application is subject to approval by the Chinese tax authorities.
Taxation on Share Transfer
VAT and Local Additional Tax
According to the V A T Law, all enterprises and individuals that engage in the sale of
goods, the provision of processing, repair and replacement services, sales of service, intangible
assets and real estate and the importation of goods within the territory of the PRC shall pay
V A T at the rate of 0%, 6%, 11% and 17% for the different goods it sells and different services
it provides, except when specified otherwise.
According to the V alue-added Tax Notice, the V A T rates of 17% and 11% applicable to
the taxpayers who have V A T taxable sales activities or imported goods are adjusted to 16% and
10%, respectively. Subsequently, the MOF, the STA and the General Administration of
Customs of the PRC jointly issued the Announcement on Relevant Policies for Deepening
V alue-Added Tax Reform to further adjust the V A T rates of 16% and 10% applicable to the
taxpayers who have V A T taxable sales activities or imported goods to 13% and 9%,
respectively.
Pursuant to the Notice on Fully Implementing the Pilot Reform for the Transition from
Business Tax to V A T () (the “ Circular 36 ”),
which was implemented on May 1, 2016, entities and individuals engaged in the services sale
in the PRC are subject to V A T and “engaged in the services sale in the PRC” means that the
seller or buyer of the taxable services is located in the PRC. Circular 36 also provides that
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-3 –


--- page 523 ---
transfer of financial products, including transfer of the ownership of marketable securities,
shall be subject to V A T at 6% on the taxable revenue (which is the balance of sales price upon
deduction of purchase price), for a general or a foreign V A T taxpayer. However, individuals
who transfer financial products are exempt from V A T, which is also provided in the Notice of
Ministry of Finance and State Administration of Taxation on Several Tax Exemption Policies
for Business Tax on Sale and Purchase of Financial Commodities by Individuals (௅e
) effective on January 1,
2009. According to these regulations, if the holder is a non-resident individual, the PRC V A T
is exempted from the sale or disposal of H shares; if the holder is a non-resident enterprise and
the H-share buyer is an individual or entity located outside China, the holder is not necessarily
required to pay the PRC V A T, but if the H-share buyer is an individual or entity located in
China, the holder may be required to pay the PRC V A T. However, it is still uncertain whether
the non-Chinese resident enterprises are required to pay the PRC V A T for the disposal of H
shares in practice.
At the same time, V A T payers are also required to pay urban maintenance and
construction tax, education surtax and local education surcharge (hereinafter collectively
referred to as “ Local Additional Tax ”), which shall be usually subject to 12% of the
value-added tax, business tax and consumption tax actually paid (if any).
Income tax
Individual Investors
According to the IIT Law, gains on the transfer of equity interests in the PRC resident
enterprises are subject to individual income tax at a rate of 20%. Pursuant to the Circular on
Declaring that Individual Income Tax Continues to be Exempted over Income of Individuals
from the Transfer of Shares ()
issued by the Ministry of Finance and the SA T on March 30, 1998, from January 1, 1997,
income of individuals from transfer of the shares of listed enterprises continues to be exempted
from individual income tax. The SA T has not expressly stated whether it will continue to
exempt tax on income of individuals from transfer of the shares of listed enterprises in the
latest amended Individual Income Tax Law.
However, on December 31, 2009, the Ministry of Finance, SA T and China Securities
Regulatory Commission jointly issued the Circular on Related Issues on Levying Individual
Income Tax over the Income Received by Individuals from the Transfer of Listed Shares
Subject to Sales Limitation (ٙ
), which promulgated on December 31, 2009 and came into effect since January 1, 2010,
which states that individuals’ income from the transfer of listed shares obtained from the public
offering of listed companies and transfer market on the Shanghai Stock Exchange and the
Shenzhen Stock Exchange shall continue to be exempted from individual income tax, except
for the relevant shares which are subject to sales restriction (as defined in the Supplementary
Notice on Issues Concerning the Levy of Individual Income Tax on Individuals’ Income from
the Transfer of Restricted Stocks of Listed Companies (੻
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-4 –


--- page 524 ---
) jointly issued and implemented by such departments
on November 10, 2010). As of the Latest Practicable Date, no aforesaid provisions have
expressly provided that individual income tax shall be levied from non-Chinese resident
individuals on the transfer of shares in PRC resident enterprises listed on overseas stock
exchanges.
Enterprise Investors
In accordance with the EIT Law, a non-resident enterprise is generally subject to
corporate income tax at the rate of a 10% on PRC-sourced income, including gains derived
from the disposal of equity interests in a PRC resident enterprise, if it does not have an
establishment or premise in the PRC or has an establishment or premise in the PRC but its
PRC-sourced income has no real connection with such establishment or premise. Such income
tax payable for non-resident enterprises are deducted at source, where the payer of the income
is required to withhold the income tax from the amount to be paid to the non-resident
enterprise. Such tax may be reduced or exempted pursuant to relevant tax treaties or
agreements on avoidance of double taxation.
Stamp Duty
Pursuant to the Stamp Duty Law of the PRC (), which was
issued on June 10, 2021 and came into effect on July 1, 2022, PRC stamp duty only applies to
specific taxable document executed or received within the PRC, having legally binding force
in the PRC and protected under the PRC laws, thus the requirements of the stamp duty imposed
on the transfer of shares of PRC listed companies shall not apply to the acquisition and disposal
of H Shares by non-PRC investors outside of the PRC.
Estate Duty
As of the date of this prospectus, no estate duty has been levied in the PRC under the PRC
laws.
Hong Kong Taxation
Tax on dividends
Under the current practice of the Inland Revenue Department of Hong Kong, no tax is
payable in Hong Kong in respect of dividends paid by us.
Capital gains tax and profit tax
No tax is imposed in Hong Kong in respect of capital gains from the sale of H Shares.
However, trading gains from the sale of the H Shares by persons carrying on a trade, profession
or business in Hong Kong, where such gains are derived from or arise in Hong Kong from such
trade, profession or business will be subject to Hong Kong profits tax, which is currently
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-5 –


--- page 525 ---
imposed at the maximum rate of 16.5% on corporations and at the maximum rate of 15% on
unincorporated businesses. Certain categories of taxpayers (for example, financial institutions,
insurance companies and securities dealers) are likely to be regarded as deriving trading gains
rather than capital gains unless these taxpayers can prove that the investment securities are held
for long-term investment purposes. Trading gains from sales of H Shares effected on the Stock
Exchange will be considered to be derived from or arise in Hong Kong. Liability for Hong
Kong profit tax would thus arise in respect of trading gains from sales of H Shares effected on
the Stock Exchange realized by persons carrying on a business of trading or dealing in
securities in Hong Kong.
Stamp duty
Hong Kong stamp duty, currently charged at the ad valorem rate of 0.1% on the higher
of the consideration for or the market value of the H Shares, will be payable by the purchaser
on every purchase and by the seller on every sale of Hong Kong securities, including H Shares
(in other words, a total of 0.2% is currently payable on a typical sale and purchase transaction
involving H Shares). In addition, a fixed duty of HK$5.00 is currently payable on any
instrument of transfer of H Shares. Where one of the parties is a resident outside Hong Kong
and does not pay the ad valorem duty due by it, the duty not paid will be assessed on the
instrument of transfer (if any) and will be payable by the transferee. If no stamp duty is paid
on or before the due date, a penalty of up to ten times the duty payable may be imposed.
Estate duty
The Revenue (Abolition of Estate Duty) Ordinance 2005 came into effect on February 11,
2006 in Hong Kong, pursuant to which no Hong Kong estate duty is payable and no estate duty
clearance papers are needed for an application of a grant of representation in respect of holders
of H Shares whose deaths occur on or after February 11, 2006.
FOREIGN EXCHANGE
The lawful currency of the PRC is Renminbi, which is currently subject to foreign
exchange control and cannot be freely converted into foreign currency. The SAFE, with the
authorization of the PBOC, is empowered with the functions of administering all matters
relating to foreign exchange, including the enforcement of foreign exchange control
regulations.
The Foreign Exchange Administration Regulations of the PRC ( ʕശɛ͏΍ձ਷̮ි၍
ଣૢԷ), which was issued by the State Council on January 29, 1996, implemented on April
1, 1996 and latest amended on August 5, 2008, classifies all international payments and
transfers into current items and capital items. Current items are subject to the reasonable
examination of the veracity of transaction documents and the consistency of the transaction
documents and the foreign exchange receipts and payments by financial institutions engaging
in conversion and sale of foreign currencies and supervision and inspection by the foreign
exchange control authorities. For capital items, overseas organizations and overseas
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-6 –


--- page 526 ---
individuals making direct investments in China shall, upon approval by the relevant authorities
in charge, process registration formalities with the foreign exchange control authorities.
Foreign exchange income received overseas can be repatriated or deposited overseas, and
foreign exchange and foreign exchange settlement funds under the capital account are required
to be used only for purposes as approved by the competent authorities and foreign exchange
administrative authorities. In the event that international revenues and expenditure occur or
may occur a material misbalance, or the national economy encounters or may encounter a
severe crisis, the State may adopt necessary safeguard and control measures on international
revenues and expenditure.
The Regulations for the Administration of Settlement, Sale and Payment of Foreign
Exchange (), which was promulgated by the PBOC on June
20, 1996 and implemented on July 1, 1996, removes other restrictions on convertibility of
foreign exchange under current items, while imposing existing restrictions on foreign exchange
transactions under capital account items.
According to the Announcement on Improving the Reform of the Renminbi Exchange
Rate Formation Mechanism (ʮѓ), which was
issued by the PBOC and implemented on July 21, 2005, the PRC has started to implement a
managed floating exchange rate system in which the exchange rate would be determined based
on market supply and demand and adjusted with reference to a basket of currencies since July
21, 2005. Therefore, the Renminbi exchange rate was no longer pegged to the U.S. dollar.
PBOC would publish the closing price of the exchange rate of the Renminbi against trading
currencies such as the U.S. dollar in the interbank foreign exchange market after the closing
of the market on each working day, as the central parity of the currency against Renminbi
transactions on the following working day.
According to the relevant laws and regulations in the PRC, PRC enterprises (including
foreign investment enterprises) which need foreign exchange for current item transactions may,
without the approval of the foreign exchange administrative authorities, effect payment
through foreign exchange accounts opened at the designated foreign exchange bank, on the
strength of valid transaction receipts and proof. Foreign investment enterprises which need
foreign exchange for the distribution of profits to their shareholders and PRC enterprises
which, in accordance with regulations, are required to pay dividends to their shareholders in
foreign exchange (such as our Company) may, on the strength of resolutions of the board of
directors or the shareholders’ meeting on the distribution of profits, effect payment from
foreign exchange accounts at the designated foreign exchange bank, or effect exchange and
payment at the designated foreign exchange bank.
According to the Decisions on Matters including Canceling and Adjusting a Batch of
Administrative Approval Items ()
which was promulgated by the State Council on October 23, 2014, it decided to cancel the
approval requirement of the SAFE and its branches for the remittance and settlement of the
proceeds raised from the overseas listing of the foreign shares into RMB domestic accounts.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-7 –


--- page 527 ---
According to the Notice on Relevant Issue Concerning the Administration of Foreign
Exchange for Overseas Listing () issued by the
SAFE and implemented on December 26, 2014, a domestic company shall, within 15 business
days from the date of the end of its overseas listing issuance, register the overseas listing with
the local branch office of state administration of foreign exchange at the place of its
establishment; the proceeds from an overseas listing of a domestic company may be remitted
to the domestic account or deposited in an overseas account, but the use of the proceeds shall
be consistent with the content of the document and other disclosure documents.
According to the Notice of the State Administration of Foreign Exchange on
Further Simplifying and Improving Policies for the Foreign Exchange Administration of
Direct Investment (ஷ
), which was issued by the SAFE on February 13, 2015, came into effect on June 1, 2015
and partially repealed on December 30, 2019, the confirmation of foreign exchange registration
under domestic direct investment and the confirmation of foreign exchange registration under
overseas direct investment shall be directly examined and handled by banks. SAFE and its
branch offices shall indirectly regulate the foreign exchange registration of direct investment
through banks.
In accordance with the Administrative Provisions on Foreign Exchange in Domestic
Direct Investment by Foreign Investors () (the
“SAFE Circular No. 21 ”), which was promulgated on 10 May, 2013 with effect from 13 May
2013, amended on 10 October, 2018 and partially abolished on 30 December, 2019. The SAFE
Circular No. 21 specifies that the administration by SAFE or its local branches over direct
investment by foreign investors in the PRC must be conducted by way of registration and banks
must process foreign exchange business relating to the direct investment in the PRC based on
the registration information provided by SAFE and its branches.
According to the SAFE Circular 19, foreign-invested enterprises could settle their foreign
exchange capital on a discretionary basis according to the actual needs of their business
operations. Whilst, foreign-invested enterprises are prohibited to use the foreign exchange
capital settled in RMB (a) for any expenditures beyond the business scope of the foreign-
invested enterprises or forbidden by laws and regulations; (b) for direct or indirect securities
investment; (c) to provide entrusted loans (unless permitted in the business scope), repay loans
between enterprises (including advances by third parties) or repay RMB bank loans that have
been on lent to a third party; and (d) to purchase real estates not for self-use purposes (save
for real estate enterprises).
According to the SAFE Circular 16, foreign currency earnings in capital account that
relevant policies of willingness exchange settlement have been clearly implemented on
(including the recalling of raised capital by overseas listing) may undertake foreign exchange
settlement in the banks according to actual business needs of the domestic institutions. The
tentative percentage of foreign exchange settlement for foreign currency earnings in capital
account of domestic institutions is 100%, subject to adjust of the SAFE in due time in
accordance with international revenue and expenditure situations.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
– III-8 –


--- page 528 ---
The SAFE Circular 28 cancelled restrictions on domestic equity investments made with
capital funds by non-investing foreign-funded enterprises. In addition, restrictions on the use
of funds for foreign exchange settlement of domestic accounts for the realization of assets have
been removed and restrictions on the use and foreign exchange settlement of foreign investors’
security deposits have been relaxed. Eligible enterprises in the pilot area are also allowed to
use revenues under capital accounts, such as capital funds, foreign debts and overseas listing
revenues for domestic payments without providing materials to the bank in advance for
authenticity verification on an item by item basis, while the use of funds should be true, in
compliance with applicable rules and conforming to the current capital revenue management
regulations.
APPENDIX III TAXATION AND FOREIGN EXCHANGE
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--- page 529 ---
PRC LEGAL SYSTEM
The PRC legal system is based on the Constitution of the PRC ()
(the “Constitution”) and is made up of written laws, administrative regulations, local
regulations, separate regulations, autonomous regulations, rules and regulations of
departments, rules and regulations of local governments, international treaties of which the
PRC government is a signatory, and other regulatory documents. Court verdicts do not
constitute binding precedents. However, they may be used as judicial reference and guidance.
According to the Constitution and the Legislation Law of the PRC (2023 revision) ( ʕ
جج2023ࠈࡌ)) (the “ Legislation Law ”), the National People’s
Congress of the People’s Republic of China (the “ NPC”) and the Standing Committee of the
NPC are empowered to exercise the legislative power of the State in accordance with the
Constitution. The NPC has the power to formulate and amend basic laws governing civil and
criminal matters, state organs and other matters. The Standing Committee of the NPC is
empowered to formulate and amend laws other than those required to be enacted by the NPC
and to supplement and amend any parts of laws enacted by the NPC during the adjournment
of the NPC, provided that such supplements and amendments are not in conflict with the basic
principles of such laws. The NPC can authorize the Standing Committee of the NPC to
formulate relevant laws.
The State Council is the highest organ of the PRC administration and has the power to
formulate administrative regulations based on the Constitution and laws.
The people’s congresses of provinces, autonomous regions and municipalities and their
respective standing committees may formulate local regulations based on the specific
circumstances and actual requirements of their own respective administrative areas, provided
that such local regulations do not contravene any provision of the Constitution, laws or
administrative regulations.
The ministries and commissions of the State Council, PBOC, the State Audit
Administration as well as the other organs endowed with administrative functions directly
under the State Council and the organs prescribed by laws may, in accordance with the laws
as well as the administrative regulations, decisions and orders of the State Council and within
the limits of their power, formulate rules.
The people’s congresses of cities divided into districts and their respective standing
committees may formulate local regulations in terms of urban and rural development and
management, ecological civilization development, historical and cultural protection and
grassroots governance based on the specific circumstances and actual requirements of such
cities, which will become enforceable after being reported to and approved by the standing
committees of the people’s congresses of the relevant provinces or autonomous regions but
such local regulations shall conform with the Constitution, laws, administrative regulations,
and the relevant local regulations of the relevant provinces or autonomous regions. People’s
congresses of national autonomous areas have the power to enact autonomous regulations and
separate regulations in light of the political, economic and cultural characteristics of the
nationality (nationalities) in the areas concerned.
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The people’s governments of the provinces, autonomous regions, and municipalities
directly under the central government and the cities divided into districts or autonomous
prefectures may enact rules, in accordance with laws, administrative regulations and the local
regulations of their respective provinces, autonomous regions or municipalities.
The Constitution has supreme legal authority and no laws, administrative regulations,
local regulations, autonomous regulations, separate regulations or rules may contravene the
Constitution. The authority of laws is greater than that of administrative regulations, local
regulations and rules. The authority of administrative regulations is greater than that of local
regulations and rules. The authority of local regulations is greater than that of the rules of the
local governments at or below the corresponding level. The authority of the rules enacted by
the people’s governments of the provinces or autonomous regions is greater than that of the
rules enacted by the people’s governments of the city divided into districts or autonomous
prefecture within the administrative areas of the provinces and the autonomous regions.
The NPC has the power to alter or annul any inappropriate laws enacted by its Standing
Committee, and to annul any autonomous regulations or separate regulations which have been
approved by its Standing Committee but which contravene the Constitution or the Legislation
Law. The Standing Committee of the NPC has the power to annul any administrative
regulations that contravene the Constitution and laws, to annul any local regulations that
contravene the Constitution, laws or administrative regulations, and to annul any autonomous
regulations or local regulations which have been approved by the standing committees of the
people’s congresses of the relevant provinces, autonomous regions or municipalities directly
under the central government, but which contravene the Constitution and the Legislation Law.
The State Council has the power to alter or annul any inappropriate ministerial rules and rules
of local governments. The people’s congresses of provinces, autonomous regions or
municipalities directly under the central government have the power to alter or annul any
inappropriate local regulations enacted or approved by their respective standing committees.
The people’s governments of provinces and autonomous regions have the power to alter or
annul any inappropriate rules enacted by the people’s governments at a lower level.
According to the Constitution and the Legislation Law, the power to interpret laws is
vested in the Standing Committee of the NPC. According to the Decision of the Standing
Committee of the NPC Regarding the Strengthening of Interpretation of Laws ( Ό਷ɛ͏˾
Ӕᙄ) passed on June 10, 1981, the Supreme
People’s Court of the PRC (the “ Supreme People’s Court ”) has the power to give general
interpretation on questions involving the specific application of laws and decrees in court
trials. The State Council and its ministries and commissions are also vested with the power to
give interpretation of the administrative regulations and department rules which they have
promulgated. At the regional level, the power to give interpretations of the local laws and
regulations as well as administrative rules is vested in the regional legislative and
administrative organs which promulgate such laws, regulations and rules.
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PRC JUDICIAL SYSTEM
Under the Constitution and the PRC Law on the Organization of the People’s Courts ( ʕ
), which was adopted in 1980 and amended in 1983, 1986,
2006 and 2018, the PRC judicial system is made up of the Supreme People’s Court, the local
people’s courts and special people’s courts.
The local people’s courts are comprised of the primary people’s courts, the intermediate
people’s courts and the higher people’s courts. The higher level people’s courts supervise the
primary and intermediate people’s courts. The people’s procuratorates also have the right to
exercise legal supervision over the civil proceedings of people’s courts of the same level and
lower levels. The Supreme People’s Court is the highest judicial body in the PRC. It supervises
the judicial administration of the people’s courts at all levels.
The PRC Civil Procedure Law () (the “ Civil Procedure
Law”), which was adopted in 1991 and amended in 2007, 2012, 2017, 2021 and 2023, sets
forth the criteria for instituting a civil action, the jurisdiction of the people’s courts, the
procedures to be followed for conducting a civil action and the procedures for enforcement of
a civil judgment or order. All parties to a civil action conducted within the PRC must comply
with the Civil Procedure Law. Generally, a civil case is initially heard by a local court of the
municipality or province in which the defendant resides. The parties to a contract may, by
express agreement, select a judicial court where civil actions may be brought, provided that the
judicial court is either the plaintiff’s or the defendant’s domicile, the place of execution or
implementation of the contract or the place of the object of the action, provided that the
provisions of this law regarding the level of jurisdiction and exclusive jurisdiction shall not be
violated.
A foreign national or enterprise generally has the same litigation rights and obligations as
a citizen or legal person of the PRC. If a foreign country’s judicial system limits the litigation
rights of PRC citizens and enterprises, the PRC courts may apply the same limitations to the
citizens and enterprises of that foreign country within the PRC.
If any party to a civil action refuses to comply with a judgment or ruling made by a
people’s court or an award made by an arbitration panel in the PRC, the other party may apply
to the people’s court for the enforcement of the same. There are time limits of two years
imposed on the right to apply for such enforcement. If a person fails to satisfy a judgment made
by the court within the stipulated time, the court will, upon application by either party, enforce
the judgment in accordance with the law.
A party seeking to enforce a judgment or ruling of a people’s court against a party who
is not personally or whose property is not within the PRC may apply to a foreign court with
jurisdiction over the case for recognition and enforcement of the judgment or ruling. A foreign
judgment or ruling may also be recognized and enforced by the people’s court according to
PRC enforcement procedures if the PRC has entered into or acceded to an international treaty
with the relevant foreign country, which provides for such recognition and enforcement, or if
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the judgment or ruling satisfies the court’s examination according to the principle of
reciprocity, unless the people’s court finds that the recognition or enforcement of such
judgment or ruling will result in a violation of the basic legal principles of the PRC, its
sovereignty or security or against social and public interest.
THE COMPANY LA W AND ADMINISTRATIVE MEASURES
A joint stock limited company which was incorporated in the PRC and seeking a listing
on the Stock Exchange is mainly subject to the following laws and regulations in the PRC:
 The PRC Company Law which was promulgated by the Standing Committee of the
NPC on December 29, 1993, came into effect on July 1, 1994, revised on December
25, 1999, August 28, 2004, October 27, 2005, December 28, 2013, October 26, 2018
and December 29, 2023 respectively and the latest revision of which would be
implemented on July 1, 2024;
 According to the Overseas Listing Trial Measures and Guidelines on the Application
of Regulatory Rules – No. 1 for Overseas Offering and Listing (ܸ
ˏ–ྤ̮೯Бɪ̹ᗳୋ1໮) which was promulgated by the CSRC on February 17,
2023, and came into effect on March 31, 2023, the domestic companies that directly
offer and list securities in overseas markets, shall formulate their articles of
association in line with the Guidelines for the Articles of Association of Listed
Companies (ˏ) (the “ PRC Guidelines on AoA ”) promulgated
by the CSRC on March 16, 2006 and latest amended and implemented on
December 15, 2023.
Set out below is a summary of the major provisions of the Company Law, the Overseas
Listing Trial Measures and PRC Guidelines on AoA applicable to our Company.
General
A joint stock limited company refers to an enterprise legal person incorporated under the
Company Law with its registered capital divided into shares of equal par value. The liability
of its shareholders is limited to the amount of shares held by them and the company is liable
to its creditors for an amount equal to the total value of its assets.
A joint stock limited company shall conduct its business in accordance with laws and
administrative regulations. It may invest in other limited liability companies and joint stock
limited companies and its liabilities with respect to such invested companies are limited to the
amount invested. Unless otherwise provided by law, the joint stock limited company may not
be a contributor that undertakes joint and several liabilities for the debts of the invested
companies.
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Incorporation
A joint stock limited company may be incorporated by promotion or public subscription.
A joint stock limited company may be incorporated by a minimum of two but not more
than 200 promoters, and at least half of the promoters must have residence within the PRC.
The promoters must convene an inaugural meeting within 30 days after the issued shares
have been fully paid up, and must give notice to all subscribers or make an announcement of
the date of the inaugural meeting 15 days before the meeting. The inaugural meeting may be
convened only with the presence of promoters or subscribers representing at least half of the
shares in the company. At the inaugural meeting, matters including the adoption of articles of
association and the election of members of the board of directors and members of the board of
supervisors of the company will be dealt with. All resolutions of the meeting require the
approval of subscribers with more than half of the voting rights present at the meeting.
Within 30 days after the conclusion of the inaugural meeting, the board of directors must
apply to the registration authority for registration of the establishment of the joint stock limited
company. A company is formally established, and has the status of a legal person, after the
business license has been issued by the relevant registration authority. Joint stock limited
companies established by the subscription method shall file the approval on the offering of
shares issued by the securities administration department of the State Council with the
company registration authority for record.
A joint stock limited company’s promoters shall be liable for: (i) the payment of all
expenses and debts incurred in the incorporation process jointly and severally if the company
cannot be incorporated; (ii) the refund of subscription monies to the subscribers, together with
interest, at bank rates for a deposit of the same term jointly and severally if the company cannot
be incorporated; and (iii) damages suffered by the company as a result of the default of the
promoters in the course of incorporation of the company.
Share Capital
The promoters of a company can make capital contributions in cash or in kind, which can
be valued in currency and transferable according to law such as intellectual property rights or
land use rights based on their appraised value.
If capital contribution is made other than in cash, valuation and verification of the
property contributed must be carried out and converted into shares.
A company may issue registered or bearer share. However, shares issued to promoter(s)
or legal person(s) shall be in the form of registered share and shall be registered under the
name(s) of such promoter(s) or legal person(s) and shall not be registered under a different
name or the name of a representative.
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Under the Overseas Listing Trial Measures, if a domestic enterprise issues shares
overseas, it may raise funds and dividend distributions in foreign currency or Renminbi.
To issue shares overseas, the domestic enterprise shall report the application documents
for issuance and listing to the CSRC for record-filing within three working days after
submission of the application documents for issuance and listing overseas.
The transfer of shares by shareholders should be conducted via the legally established
stock exchange or in accordance with other methods as stipulated by the State Council.
Allotment and Issue of Shares
All issue of shares of a joint stock limited company shall be based on the principles of
equality and fairness. The same class of shares must carry equal rights. Shares issued at the
same time and within the same class must be issued on the same conditions and at the same
price. It may issue shares at par value or at a premium, but it may not issue shares below the
par value.
To issue shares overseas, the domestic enterprise shall report the application documents
for issuance and listing to the CSRC for record-filing within three working days after
submission of the application documents for issuance and listing overseas.
Registered Shares
Under the Company Law, the shareholders may make capital contributions in cash, or
alternatively may make capital contributions with such valuated non-monetary property as
physical items, intellectual property rights, and land-use rights that may be valued in monetary
term and may be transferred in accordance with the law.
Under the Company Law, when the company issues shares in registered form, it shall
maintain a register of shareholders, stating the following matters:
 the name and domicile of each shareholder;
 the number of shares held by each shareholder;
 the serial numbers of shares held by each shareholder; and
 the date on which each shareholder acquired the shares.
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Increase of Share Capital
According to the Company Law, when the joint stock limited company issues new shares,
resolutions shall be passed by a shareholders’ general meeting, approving the class and number
of the new shares, the issue price of the new shares, the commencement and end of the new
share issuance and the class and amount of new shares to be issued to existing shareholders.
When the company launches a public issuance of new shares with the approval or filing of the
securities regulatory authorities of the State Council, it shall publish a document and financial
and accounting reports, and prepare the share subscription form. After the new share issuance
has been paid up, the change shall be registered with the company registration authorities and
an announcement shall be made.
Reduction of Share Capital
A company may reduce its registered capital in accordance with the following procedures
prescribed by the Company Law:
 it shall prepare a balance sheet and a property list;
 the reduction of registered capital shall be approved by a shareholders’ general
meeting;
 it shall inform its creditors of the reduction in capital within 10 days and publish an
announcement of the reduction in the newspaper within 30 days after the resolution
approving the reduction has been passed;
 creditors may within 30 days after receiving the notice, or within 45 days of the
public announcement if no notice has been received, require the company to pay its
debts or provide guarantees covering the debts;
 it shall apply to the relevant administration of registration for the registration of the
reduction in registered capital.
Repurchase of Shares
According to the Company Law, a joint stock limited company may not purchase its
shares other than for one of the following purposes: (i) to reduce its registered capital; (ii) to
merge with another company that holds its shares; (iii) to grant its shares for carrying out an
employee stock ownership plan or equity incentive plan; (iv) to purchase its shares from
shareholders who are against the resolution regarding the merger or division with other
companies at a shareholders’ general meeting; (v) use of shares for conversion of convertible
corporate bonds issued by a listed company; and (vi) the share buyback is necessary for a listed
company to maintain its company value and protect its shareholders’ equity.
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The purchase of shares on the grounds set out in (i) and (ii) above shall require approval
by way of a resolution passed by the shareholders’ general meeting. For a company’s share
buyback under any of the circumstances stipulated in (iii), (v) or (vi) above, a resolution of the
company’s board of directors shall be made by a two-third majority of directors attending the
meeting according to the provisions of the company’s articles of association or as authorized
by the shareholders’ meeting.
Following the purchase of shares in accordance with (i), such shares shall be canceled
within 10 days from the date of purchase. The shares shall be assigned or deregistered within
six months if the share buyback is made under the circumstances stipulated in either (ii) or (iv).
The shares held in total by a company after a share buyback under any of the circumstances
stipulated in (iii), (v) or (vi) shall not exceed 10% of the company’s total outstanding shares,
and shall be assigned or deregistered within three years.
Listed companies making a share buyback shall perform their obligation of information
disclosure according to the provisions of the Securities Law. If the share buyback is made
under any of the circumstances stipulated in (iii), (v) or (vi) hereof, centralized trading shall
be adopted publicly.
The company shall not accept the shares of the company as the subject matter of the
pledge.
Transfer of Shares
Shares held by shareholders may be transferred in accordance with the relevant laws and
regulations. Pursuant to the Company Law, transfer of shares by shareholders shall be carried
out at a legally established securities exchange or in other ways stipulated by the State Council.
Transfer of registered shares by a shareholder must be made by means of an endorsement or
by other means stipulated by laws or administrative regulations. Bearer shares are transferred
by delivery of the share certificates to the transferee.
No modifications of registration in the share register caused by transfer of registered
shares shall be carried out within 20 days prior to the convening of shareholder’s general
meeting or five days prior to the base date for determination of dividend distributions.
However, where there are separate provisions by law on alternation of registration in the share
register of listed companies, those provisions shall prevail.
Under the Company law, shares issued prior to the public issuance of shares shall not be
transferred within one year from the date of the joint stock limited company’s listing on a stock
exchange. Directors, supervisors and the senior management shall declare to the company their
shareholdings in the company and any changes of such shareholdings. They shall not transfer
more than 25% of all the shares they hold in the company annually during their tenure. They
shall not transfer the shares they hold within one year from the date on which the company’s
shares are listed and commenced trading on a stock exchange, nor within six months after their
resignation from their positions with the company.
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Shareholders
Under the Company Law and the PRC Guidelines on AoA, the rights of holders of
ordinary shares of a joint stock limited company include:
 to receive dividends and other distributions according to the number of shares held;
 to attend the general meeting in person or by proxy and exercise the right to vote on
the number of shares held;
 to supervise, forward suggestions on or question the Company’s operations;
 transfer, donate or pledge its shares in accordance with applicable laws and
regulations and the company’s Articles of Association;
 to inspect the company’s Articles of Association, register of shareholders,
counterfoil of creditor’s rights, minutes of shareholders’ meeting, resolutions of the
board of directors, resolutions of the supervisory board and financial and accounting
reports;
 to acquire the remaining assets of the company in proportion to its shareholding at
the time of termination or liquidation;
 any shareholder who has a different view on a resolution on the merger or division
of the Company made by a shareholders’ general meeting has the right to require the
Company to acquire its shares; and
 any other shareholder’s rights specified in the laws, regulations and company’s
Articles of Association.
The obligations of the shareholders include to abide by the Articles of Association of the
company, to pay the subscription amount for the subscribed shares, to bear the debts and
liabilities of the company to the extent of the subscription amount agreed by the shareholders
for the subscribed shares, not to abuse the rights of the shareholders to damage the interests of
the company or other shareholders of the company, and not to abuse the independent status and
limited liability of the company as a legal person to damage the interests of the creditors of the
company, and any other shareholder’s obligations under the company’s Articles of Association.
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Shareholders’ General Meetings
The shareholders’ general meeting is the organ of authority of the company, which
exercises its powers in accordance with the Company Law.
Under the Company Law, the shareholders’ general meeting exercises the following
principal powers:
 to decide on the company’s operational policies and investment plans;
 to elect or remove the directors and supervisors (other than the representative of the
employees of the company) and to decide on matters relating to the remuneration of
directors and supervisors;
 to examine and approve reports of the board of directors;
 to examine and approve reports of the board of supervisors;
 to examine and approve the company’s proposed annual financial budget and final
accounts;
 to examine and approve the company’s proposals for profit distribution plans and
loss recovery plans;
 to decide on any increase or reduction of the company’s registered capital;
 to decide on the issue of bonds by the company;
 to decide on issues such as merger, division, dissolution and liquidation of the
company and other matters;
 to amend the company’s articles of association; and
 other powers as provided for in the articles of association.
Shareholders’ annual general meetings are required to be held once every year. Under the
Company Law, an extraordinary shareholders’ general meeting is required to be held within
two months after the occurrence of any of the following:
 the number of directors is less than the number stipulated by the law or less than two
thirds of the number specified in the articles of association;
 the aggregate losses of the company which are not recovered reach one-third of the
company’s total paid-in share capital;
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 when shareholders alone or in aggregate holding 10% or more of the company’s
shares request the convening of an extraordinary general meeting;
 whenever the board of directors deems necessary;
 when the board of supervisors so requests; or
 other circumstances as provided for in the articles of associations.
Under the Company Law, shareholders’ general meetings shall be convened by the board
of directors, and presided over by the chairman of the board of directors. In the event that the
chairman is incapable of performing or does not perform his duties, the meeting shall be
presided over by the vice chairman. In the event that the vice chairman is incapable of
performing or not performing his duties, a director nominated by more than half of directors
shall preside over the meeting.
Where the board of directors is incapable of performing or not performing its duties of
convening the shareholders’ general meeting, the board of supervisors shall convene and
preside over such meeting in a timely manner. In case the board of supervisors fails to convene
and preside over such meeting, shareholders alone or in aggregate holding more than 10% of
the company’s shares for 90 days consecutively may unilaterally convene and preside over such
meeting.
Under the Company Law, notice of shareholders’ general meeting shall state the time and
venue of and matters to be considered at the meeting and shall be given to all shareholders 20
days before the meeting. Notice of extraordinary shareholder’s general meetings shall be given
to all shareholders 15 days prior to the meeting.
There is no specific provision in the Company Law regarding the number of shareholders
constituting a quorum in a shareholders’ meeting.
Under the Company Law, shareholders present at shareholders’ general meeting have one
vote for each share they hold, save that shares held by the company are not entitled to any
voting rights.
Pursuant to the provisions of the articles of association or a resolution of the
shareholders’ general meeting, the accumulative voting system may be adopted for the election
of directors and supervisors at the shareholders’ general meeting. Under the accumulative
voting system, each share shall be entitled to vote equivalent to the number of directors or
supervisors to be elected at the shareholders’ general meeting and shareholders may
consolidate their voting rights when casting a vote.
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Pursuant to the Company Law, resolutions of the shareholders’ general meeting shall be
adopted by more than half of the voting rights held by the shareholders present at the meeting.
However, resolutions of the shareholders’ general meeting regarding the following matters
shall be adopted by more than two-thirds of the voting rights held by the shareholders present
at the meeting: (i) amendments to the articles of association; (ii) the increase or decrease of
registered capital; (iii) the merger, division, dissolution, liquidation or change in the form of
the company; (iv) other matters considered by the shareholders’ general meeting, by way of an
ordinary resolution, to be of a nature which may have a material impact on the company and
should be adopted by a special resolution.
Under the Company Law, meeting minutes shall be prepared in respect of decisions on
matters discussed at the shareholders’ general meeting. The chairman of the meeting and
directors attending the meeting shall sign to endorse such minutes. The minutes shall be kept
together with the shareholders’ attendance register and the proxy forms.
Board
Under the Company Law, a joint stock limited company shall have a board of directors,
which shall consist of 5 to 19 members. Members of the board of directors may include
representatives of the employees of the company, who shall be democratically elected by the
company’s staff at the staff representative assembly, general staff meeting or otherwise. The
term of a director shall be stipulated in the articles of association, but no term of office shall
last for more than three years. Directors may serve consecutive terms if re-elected. A director
shall continue to perform his duties in accordance with the laws, administrative regulations and
articles of association until a duly re-elected director takes office, if re-election is not
conducted in a timely manner upon the expiry of his term of office, or if the resignation of
directors results in the number of directors being less than the quorum.
Under the Company Law, the board of directors mainly exercises the following powers:
 to convene the shareholders’ general meetings and report on its work to the
shareholders’ general meetings;
 to implement the resolutions passed in shareholders’ general meetings;
 to decide on the company’s business plans and investment proposals;
 to formulate the company’s proposed annual financial budget and final accounts;
 to formulate the company’s profit distribution proposals and loss recovery
proposals;
 to formulate proposals for the increase or reduction of the company’s registered
capital and the issuance of corporate bonds;
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 to prepare plans for the merger, division, dissolution and change in the form of the
company;
 to decide on the set-up of internal management organisation of the company;
 to decide on appointment or dismissal of company managers and their remuneration,
and decide on appointment or dismissal of deputy managers and finance controller
of the company based on the nomination by the managers;
 to formulate the company’s basic management system; and
 to exercise any other power under the articles of association.
Board Meetings
Under the Company Law, meetings of the board of directors of a joint stock limited
company shall be convened at least twice a year. Notice of meeting shall be given to all
directors and supervisors 10 days before the meeting. Interim board meetings may be proposed
to be convened by shareholders representing more than 10% of voting rights, more than
one-third of the directors or the board of supervisors. The chairman shall convene and preside
over such meeting within 10 days after receiving such proposal. Meetings of the board of
directors shall be held only if half or more of the directors are present. Resolutions of the board
of directors shall be passed by more than half of all directors. Each director shall have one vote
for resolutions to be approved by the board of directors. Directors shall attend board meetings
in person. If a director is unable to attend a board meeting, he may appoint another director by
a written power of attorney specifying the scope of the authorization to attend the meeting on
his behalf.
If a resolution of the board of directors violates the laws, administrative regulations or the
articles of association, and as a result of which the company sustains serious losses, the
directors participating in the resolution are liable to compensate the company. However, if it
can be proved that a director expressly objected to the resolution when the resolution was voted
on, and that such objection was recorded in the minutes of the meeting, such director may be
released from that liability.
Chairman of the Board
Under the Company Law, the board of directors shall appoint a chairman and may appoint
a vice chairman. The chairman and the vice chairman are elected with approval of more than
half of all the directors. The chairman shall convene and preside over board meetings and
examine the implementation of board resolutions. The vice chairman shall assist the work of
the chairman. In the event that the chairman is incapable of performing or not performing his
duties, the duties shall be performed by the vice chairman. In the event that the vice chairman
is incapable of performing or not performing his duties, a director nominated by more than half
of the directors shall perform his duties.
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Qualification of Directors
The Company Law provides that the following persons may not serve as a director:
 a person who is unable or has limited ability to undertake any civil liabilities;
 a person who has been convicted of an offense of bribery, corruption, embezzlement
or misappropriation of property, or the destruction of socialist market economy
order; or who has been deprived of his political rights due to his crimes, in each case
where less than five years have elapsed since the date of completion of the sentence;
 a person who has been a former director, factory manager or manager of a company
or an enterprise that has entered into insolvent liquidation and who was personally
liable for the insolvency of such company or enterprise, where less than three years
have elapsed since the date of the completion of the bankruptcy and liquidation of
the company or enterprise;
 a person who has been a legal representative of a company or an enterprise that has
had its business license revoked due to violations of the law and has been ordered
to close down by law and the person was personally responsible, where less than
three years have elapsed since the date of such revocation; or
 a person who is liable for a relatively large amount of debts that are overdue.
Board of Supervisors
A joint stock limited company shall have a board of supervisors composed of not less than
three members. The board of supervisors is made up of representatives of the shareholders and
an appropriate proportion of representatives of the employees of the company. The actual
proportion shall be stipulated in the articles of association, provided that the proportion of
representatives of the employees shall not be less than one third of the supervisors.
Representatives of the employees of the company in the board of supervisors shall be
democratically elected by the employees at the employees’ representative assembly,
employees’ general meeting or otherwise.
The directors and senior management may not act concurrently as supervisors.
The board of supervisors shall appoint a chairman and may appoint a vice chairman. The
chairman and the vice chairman of the board of supervisors are elected with approval of more
than half of all the supervisors. The chairman of the board of supervisors shall convene and
preside over the meetings of the board of supervisors. In the event that the chairman of the
board of supervisors is incapable of performing or not performing his duties, the vice chairman
of the board of supervisors shall convene and preside over the meetings of the board of
supervisors. In the event that the vice chairman of the board of supervisors is incapable of
performing or not performing his duties, a supervisor nominated by more than half of the
supervisors shall convene and preside over the meetings of the board of supervisors.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
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--- page 543 ---
Each term of office of a supervisor is three years and he or she may serve consecutive
terms if re-elected. A supervisor shall continue to perform his duties in accordance with the
laws, administrative regulations and articles of association until a duly re-elected supervisor
takes office, if re-election is not conducted in a timely manner upon the expiry of his term of
office, or if the resignation of supervisors results in the number of supervisors being less than
the quorum.
The board of supervisors of a company shall hold at least one meeting every six months.
According to the PRC Company Law, a resolution of the board of supervisors shall be passed
by more than half of all the supervisors.
The board of supervisors exercises the following powers:
 to review the company’s financial position;
 to supervise the directors and senior management in their performance of their
duties and to propose the removal of directors and senior management who have
violated laws, regulations, the articles of association or the resolutions of
shareholders’ meeting;
 when the acts of directors and senior management are harmful to the company’s
interests, to require correction of those acts;
 to propose the convening of extraordinary shareholders’ general meetings and to
convene and preside over shareholders’ general meetings when the board of
directors fails to perform the duty of convening and presiding over shareholders’
general meeting under this law;
 to initiate proposals for resolutions to shareholders’ general meeting;
 to initiate proceedings against directors and senior management;
 other powers specified in the articles of association; and
 Supervisors may attend board meetings and make enquiries or proposals in respect
of board resolutions. The board of supervisors may initiate investigations into any
irregularities identified in the operation of the company and, where necessary, may
engage an accounting firm to assist their work at the company’s expense.
According to the PRC Guidelines on AoA, the supervisors of the company shall comply
with laws, administrative regulations and the Articles of Association and bear the responsibility
of loyalty and diligence. They shall not take any bribe or other illegal gains by taking
advantage of their authority and shall not take illegal possession of the company property.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-15 –


--- page 544 ---
Manager and Senior Management
“Senior management” refers to the company’s manager, deputy manager, person-in-
charge of finance, secretary to the board of directors of the listed company and other personnel
specified in the Articles of Association.
The company shall have a manager who shall be appointed or removed by the board of
directors. The manager shall be responsible to the board of directors and exercise the following
functions and powers:
 to manage the production and operation and administration of the company and
arrange for the implementation of the resolutions of the board of directors;
 to arrange for the implementation of the company’s annual operation plans and
investment proposals;
 to formulate proposals for the establishment of the company’s internal management
organs;
 to formulate the fundamental management system of the company;
 to formulate the company’s specific rules and regulations;
 to recommend the appointment or dismissal of any deputy manager and any
financial officer of the company;
 to appoint or dismiss management personnel (other than those required to be
appointed or dismissed by the board of directors);
 to attend meetings of the board of directors as non-voting participants; and
 other powers granted by the board of directors or the company’s Articles of
Association.
According to the PRC Guidelines on AoA, other senior management personnel of the
company include the deputy managers, the Secretary of the board of directors, the person in
charge of finance, and other personnel specified in the Articles of Association of the company.
The disqualification of a director of a company shall also apply to the managers and officers
of the company. The company’s Articles of Association are binding on the company’s
shareholders, directors, supervisors, managers and other management personnel. Such persons
shall have the right to exercise their respective rights, apply for arbitration and conduct legal
proceedings in accordance with the Articles of Association of the company.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-16 –


--- page 545 ---
According to the PRC Guidelines on AoA, the senior management shall have
responsibility of loyalty and shall faithfully perform their respective duties and safeguard the
best interests of the company and all the shareholders. The senior management fails to perform
his/her duties faithfully or breaches his/her obligation of good faith and causes losses to the
company or public shareholders, the senior management shall be liable for compensation.
Duties of Directors, Supervisors and Senior Management
Directors, supervisors and senior management of the company are required under the
Company Law to comply with the relevant laws, regulations and the articles of association, and
have fiduciary and diligent duties to the company. Directors, supervisors and senior
management are prohibited from abusing their powers to accept bribes or other unlawful
income and from misappropriating of the company’s properties. Directors and senior
management are prohibited from:
 misappropriation of the company’s capital;
 depositing the company’s capital into accounts under his own name or the name of
other individuals;
 loaning company funds to others or providing guarantees in favor of others
supported by the company’s assets in violation of the articles of association or
without prior approval of the shareholders’ general meeting or board of directors;
 entering into contracts or deals with the company in violation of the articles of
association or without prior approval of the shareholders’ general meeting;
 using their position and powers to procure business opportunities for themselves or
others that should have otherwise been available to the company or operating for
their own benefits or managing on behalf of others businesses similar to that of the
company without prior approval of the shareholders’ general meeting;
 accepting and possessing commissions paid by a third party for transactions
conducted with the company;
 unauthorized divulgence of confidential business information of the company; or
 other acts in violation of their duty of loyalty to the company.
A director, supervisor or senior management who contravenes any law, regulation or the
company’s articles of association in the performance of his duties resulting in any loss to the
company shall be personally liable to the company.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-17 –


--- page 546 ---
Where the general meeting of shareholders requires directors, supervisors or other senior
management personnel to attend the meeting as non-voting delegates, the directors, supervisors
or other senior management personnel shall attend as non-voting delegates and accept the
shareholders’ questions. The directors and senior management personnel shall truthfully
provide the supervisory board with relevant information and materials, and shall not hinder the
supervisory board from exercising its functions and powers.
The company shall not directly or through its subsidiaries provide loans to any director,
supervisor or senior management personnel, and shall regularly disclose to the shareholders the
remuneration of the director, supervisor or senior management personnel from the company.
Finance and Accounting
Under the Company Law, a company shall establish financial and accounting systems
according to laws, administrative regulations and the regulations of the financial department of
the State Council and shall at the end of each financial year prepare a financial and accounting
report which shall be audited by an accounting firm as required by law. The company’s
financial and accounting report shall be prepared in accordance with provisions of the laws,
administrative regulations and the regulations of the financial department of the State Council.
Pursuant to the Company Law, the company shall deliver its financial and accounting
reports to all shareholders within the time limit stipulated in the articles of association and
make its financial and accounting reports available at the company for inspection by the
shareholders at least 20 days before the convening of an annual general meeting of
shareholders. It must also publish its financial and accounting reports.
When distributing each year’s after-tax profits, it shall set aside 10% of its after-tax
profits into a statutory common reserve fund (except where the fund has reached 50% of its
registered capital).
If its statutory common reserve fund is not sufficient to make up losses of the previous
year, profits of the current year shall be applied to make up losses before allocation is made
to the statutory common reserve fund pursuant to the above provisions.
After allocation of the statutory common reserve fund from after-tax profits, it may, upon
a resolution passed at the shareholders’ general meeting, allocate discretionary common
reserve fund from after-tax profits.
The remaining after-tax profits after making up losses and allocation of common reserve
fund shall be distributed in proportion to the number of shares held by the shareholders, unless
otherwise stipulated in the articles of association.
Shares held by the Company shall not be entitled to any distribution of profit.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-18 –


--- page 547 ---
The premium received through issuance of shares at prices above par value and other
incomes required by the financial department of the State Council to be allocated to the capital
reserve fund shall be allocated to the company’s capital reserve fund.
The Company’s reserve fund shall be applied to make up losses of the company, expand
its business operations or be converted to increase the registered capital of the company.
However, the capital reserve fund may not be applied to make up the company’s losses. Upon
the conversion of statutory common reserve fund into capital, the balance of the statutory
common reserve fund shall not be less than 25% of the registered capital of the company before
such conversion.
The Company shall have no other accounting books except the statutory accounting
books. Its assets shall not be deposited in any accounts opened in the name of any individual.
Appointment and Retirement of Accounting Firms
According to the PRC Guidelines on AoA, a company shall engage an accounting firm
which is qualified with The Securities Law to provide services including the audit of financial
statements, the verification of net assets and other relevant consultancy services. The term of
engagement is one year and may be extended.
Pursuant to the Company Law, the appointment or dismissal of accounting firms
responsible for the auditing of the company shall be determined by shareholders’ general
meeting or board of directors in accordance with provisions of articles of association. The
accounting firm should be allowed to make representations when the shareholders’ general
meeting or board of directors conducts a vote on the dismissal of the accounting firm. The
company should provide true and complete accounting evidences, books, financial and
accounting reports and other accounting data to the accounting firm it employs without any
refusal, withholding and misrepresentation.
If the company dismisses or does not continue to employ auditors, it shall notify the
auditors in advance in accordance with the PRC Guidelines on AoA, and the auditors have the
right to present their opinions to the general meeting of shareholders.
Distribution of Profits
According to the Company Law, a company shall not distribute profits before losses are
covered and the statutory common reserve is drawn.
Amendments to Articles of Association
Any amendments to the company’s articles of association must be made in accordance
with the procedures set out in the company’s articles of association. In relation to matters
involving the company’s registration, its registration with the authority must also be changed.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-19 –


--- page 548 ---
Dissolution and Liquidation
According to the Company Law, a company shall be dissolved by reason of the following:
(i) the term of its operations set down in the articles of association has expired or other events
of dissolution specified in the articles of association have occurred; (ii) the shareholders’
general meeting have resolved to dissolve the company; (iii) the company is dissolved by
reason of merger or division; (iv) the business license is revoked; the company is ordered to
close down or be dissolved; or (v) the company is dissolved by the people’s court in response
to the request of shareholders holding shares that represent more than 10% of the voting rights
of all its shareholders, on the grounds that the company suffers significant hardship in its
operation and management that cannot be resolved through other means, and the ongoing
existence of the company would bring significant losses for shareholders.
In the event of (i) above, it may carry on its existence by amending its articles of
association. The amendment of the articles of association in accordance with provisions set out
above shall require approval of more than two thirds of voting rights of shareholders attending
a shareholders’ general meeting.
Where the company is dissolved in the circumstances described in subparagraphs (i), (ii),
(iv), or (v) above, a liquidation group shall be established and the liquidation process shall
commence within 15 days after the occurrence of an event of dissolution.
The members of the company’s liquidation group shall be composed of its directors or the
personnel appointed by the shareholders’ general meeting. If a liquidation group is not
established within the stipulated period, creditors may apply to the people’s court and request
the court to appoint relevant personnel to form the liquidation group. The people’s court should
accept such application and form a liquidation group to conduct liquidation in a timely manner.
The liquidation group shall exercise the following powers during the liquidation period:
 to handle the company’s assets and to prepare a balance sheet and an inventory of
the assets;
 to notify creditors through notice or public announcement;
 to deal with the company’s outstanding businesses related to liquidation;
 to pay any tax overdue as well as tax amounts arising from the process of
liquidation;
 to claim credits and pay off debts;
 to handle the company’s remaining assets after its debts have been paid off; and
 to represent the company in civil lawsuits.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-20 –


--- page 549 ---
The liquidation group shall notify the company’s creditors within 10 days after its
establishment and issue public notices in newspapers within 60 days. A creditor shall lodge his
claim with the liquidation group within 30 days after receiving notification, or within 45 days
of the public notice if he did not receive any notification. A creditor shall state all matters
relevant to his creditor rights in making his claim and furnish evidence. The liquidation group
shall register such creditor rights. The liquidation group shall not make any debt settlement to
creditors during the period of claim.
Upon liquidation of properties and the preparation of the balance sheet and inventory of
assets, the liquidation group shall draw up a liquidation plan to be submitted to the
shareholders’ general meeting or people’s court for confirmation.
The company’s remaining assets after payment of liquidation expenses, wages, social
insurance expenses and statutory compensation, outstanding taxes and debts shall be
distributed to shareholders according to their shareholding proportion. It shall continue to exist
during the liquidation period, although it can only engage in any operating activities that are
related to the liquidation. The company’s properties shall not be distributed to the shareholders
before repayments are made in accordance to the foregoing provisions.
Upon liquidation of the company’s properties and the preparation of the balance sheet and
inventory of assets, if the liquidation group becomes aware that the company does not have
sufficient assets to meet its liabilities, it must apply to the people’s court for a declaration for
bankruptcy.
Following such declaration, the liquidation group shall hand over all matters relating to
the liquidation to the people’s court.
Upon completion of the liquidation, the liquidation group shall submit a liquidation report
to the shareholders’ general meeting or the people’s court for verification. Thereafter, the report
shall be submitted to the registration authority of the company in order to cancel the company’s
registration, and a public notice of its termination shall be issued. Members of the liquidation
group are required to discharge their duties honestly and in compliance with the relevant laws.
Members of the liquidation group shall be prohibited from abusing their powers to accept
bribes or other unlawful income and from misappropriating the company’s properties.
A member of the liquidation group is liable to indemnify the company and its creditors
in respect of any loss arising from his intentional or gross negligence.
Loss of Share Certificates
If a registered share certificate is lost, stolen or destroyed, the relevant shareholder may
apply, in accordance with the relevant provisions set out in the Civil Procedure Law, to a
people’s court to declare such certificate invalid. After the people’s court declares the
invalidity of such certificate, the shareholder may apply to the company for a replacement
share certificate.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-21 –


--- page 550 ---
Merger and Demerger
Companies may merge through merger by absorption or through the establishment of a
newly merged entity. If it merges by absorption, the company which is absorbed shall be
dissolved. If it merges by forming a new corporation, both companies will be dissolved.
A merger agreement shall be signed by merging companies respectively and prepare
balance sheets and inventory of property. The companies concerned shall within 10 days of the
date of passing the resolution approving the merger notify their creditors and publicly
announce the merger in newspapers within 30 days. A creditor may, within 30 days of receipt
of the notification, or within 45 days of the date of the announcement if he has not received
the notification, request the company to settle debts or provide relevant guarantees. When the
company merged, the credits and debts of the merging parties shall be assumed by the surviving
or the new company.
When the company divided, the company’s property shall be divided and a balance sheet
and an inventory of property shall be prepared. The company should notify its creditors within
10 days of the date of making such resolution and publicly announce the division in
newspapers within 30 days. The liabilities of the company which have accrued prior to the
division shall be jointly borne by the divided companies. However, unless otherwise agreement
in writing is reached with creditors before the company’s division in respect of the settlement
of debts.
SECURITIES LA W AND REGULATIONS
The PRC has promulgated a number of regulations that relate to the issue and trading of
shares and disclosure of information. In October 1992, the State Council established the
Securities Committee and the CSRC. The Securities Committee is responsible for coordinating
the drafting of securities regulations, formulating securities-related policies, planning the
development of securities markets, directing, coordinating and supervising all securities-
related institutions in the PRC and administering the CSRC. The CSRC is the regulatory arm
of the Securities Committee and is responsible for the drafting of regulatory provisions of
securities markets, supervising securities companies, regulating public offers of securities by
PRC companies in the PRC or overseas, regulating the trading of securities, compiling
securities related statistics and undertaking relevant research and analysis. In April 1998, the
State Council consolidated the two departments and reformed the CSRC.
The Interim Provisional Regulations on the Administration of Share Issuance and Trading
(၍ଣᅲБૢԷ) deals with the application and approval procedures for
public offerings of equity securities, trading in equity securities, the acquisition of listed
companies, deposit, clearing and transfer of listed equity securities, the disclosure of
information with respect to a listed company, investigation, penalties and dispute settlement.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-22 –


--- page 551 ---
On December 25, 1995, the State Council promulgated and implemented the Regulations
of the State Council Concerning Domestic Listed Foreign Shares of Joint Stock Limited
Companies (). These regulations deal
mainly with the issue, subscription, trading and declaration of dividends and other distributions
of domestic listed and foreign invested shares and disclosure of information of joint stock
limited companies having domestic listed and foreign invested shares.
The PRC Securities Law () took effect on July 1, 1999 and
was revised on August 28, 2004, October 27, 2005, June 29, 2013, August 31, 2014 and
December 28, 2019, respectively. This is the first national securities law in the PRC, which is
divided into 14 chapters and 226 articles regulating, among other things, the issue and trading
of securities, takeovers by listed companies, securities exchanges, securities companies and the
duties and responsibilities of the State Council’s securities regulatory authorities. The PRC
Securities Law comprehensively regulates activities in the PRC securities market. Article 224
of the PRC Securities Law provides that domestic enterprises shall comply with the relevant
provisions of the State Council to list its shares outside the PRC. Currently, the issue and
trading of foreign issued shares (including H shares) are mainly governed by the rules and
regulations promulgated by the State Council and the CSRC.
Overseas Listing
According to the Overseas Listing Trial Measures, the domestic enterprise shall report the
application documents for issuance and listing to the CSRC for record-filing within three
working days after submission of the application documents for issuance and listing overseas.
The remittance and cross-border flow of funds related to overseas issuance and listing of
domestic enterprises shall comply with national regulations on cross-border investment and
financing, foreign exchange management and crossborder RMB management.
Suspension and Termination of Listing
The Company Law has deleted provisions governing suspension and termination of
listing. The PRC Securities Law has also deleted provisions regarding suspension of listing.
The Securities Law removes the provisions regarding the suspension of listings while
stating the following provisions for the termination of listings:
 securities to be listed for trading shall be terminated from listing by the stock
exchange in accordance with the business rules where the circumstances leading to
the termination of listing as prescribed by such stock exchange occurs;
 where a termination of listing for securities is determined by the stock exchange, an
announcement shall be made in a timely manner and the record shall be filed with
the security’s regulatory authorities of the State Council; and
 in the event of objection to a decision of disapproval or termination of listing made
by the stock exchange, an application may be submitted to a review institution
established by the stock exchange for review.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-23 –


--- page 552 ---
ARBITRATION AND ENFORCEMENT OF ARBITRAL A W ARDS
The Arbitration Law of the PRC () (the “ Arbitration Law ”)
was passed by the Standing Committee of the NPC on August 31, 1994, became effective on
September 1, 1995 and was amended on August 27, 2009 and September 1, 2017. Under the
Arbitration Law, an arbitration committee may, before the promulgation by the PRC Arbitration
Association of arbitration regulations, formulate interim arbitration rules in accordance with
the Arbitration Law and the Civil Procedure Law. Where the parties have by agreement
provided arbitration as the method for dispute resolution, the people’s court will refuse to
handle the case except when the arbitration agreement is declared invalid.
Under the Arbitration Law and the Civil Procedure Law, an arbitral award is final and
binding on the parties. If a party fails to comply with an award, the other party to the award
may apply to the people’s court for enforcement. A people’s court may refuse to enforce an
arbitral award made by an arbitration commission if there is any irregularity on the procedures
or composition of arbitrators specified by law or the award exceeds the scope of the arbitration
agreement or is outside the jurisdiction of the arbitration commission.
A party seeking to enforce an arbitral award of PRC arbitration panel against a party who,
or whose property, is not within the PRC, may apply to a foreign court with jurisdiction over
the case for enforcement. Similarly, an arbitral award made by a foreign arbitration body may
be recognized and enforced by the PRC courts in accordance with the principles of reciprocity
or any international treaty concluded or acceded to by the PRC. The PRC acceded to the
Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “ New Y ork
Convention ”) adopted on June 10, 1958 pursuant to a resolution of the Standing Committee
of the NPC passed on December 2, 1986. The New Y ork Convention provides that all arbitral
awards made in a state which is a party to the New Y ork Convention shall be recognized and
enforced by all other parties to the New Y ork Convention, subject to their right to refuse
enforcement under certain circumstances, including where the enforcement of the arbitral
award is against the public policy of the state to which the application for enforcement is made.
It was declared by the Standing Committee of the NPC simultaneously with the accession of
the PRC that (i) the PRC will only recognize and enforce foreign arbitral awards on the
principle of reciprocity and (ii) the PRC will only apply the New Y ork Convention in disputes
considered under PRC laws to arise from contractual and non-contractual mercantile legal
relations.
An arrangement was reached between Hong Kong and the Supreme People’s Court for the
mutual enforcement of arbitral awards. On June 18, 1999, the Supreme People’s Court adopted
the Arrangement on Mutual Enforcement of Arbitral Awards between Mainland China and
Hong Kong (τર), which became
effective on February 1, 2000, and Supplementary Arrangements of Supreme People’s Court on
Reciprocal Enforcement of Arbitration Awards between the Mainland and the Hong Kong
Special Administrative Region (໾̂τ
ર), which promulgated on December 26, 2020. In accordance with these arrangements,
awards made by PRC arbitral authorities under the Arbitration Law can be enforced in Hong
Kong, and Hong Kong arbitration awards are also enforceable in the PRC.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-24 –


--- page 553 ---
Judicial judgment and its enforcement
According to the Arrangement on Mutual Recognition and Enforcement of Judgments in
Civil and Commercial Matters by the Courts of the Mainland China and of the Hong Kong
Special Administrative Region Pursuant to Agreed Jurisdiction by Parties Concerned ( ௰৷
΁кӔ
τર) promulgated by the Supreme People’s Court on July 3, 2008 and implemented on
August 1, 2008, in the case of final judgment, defined with payment amount and enforcement
power, made between the court of China and the court of the Hong Kong Special
Administrative Region in a civil and commercial case with written jurisdiction agreement, any
party concerned may apply to the People’s Court of China or the court of the Hong Kong
Special Administrative Region for recognition and enforcement based on this arrangement.
“Choice of court agreement in written” refers to a written agreement defining the exclusive
jurisdiction of either the People’s Court of China or the court of the Hong Kong Special
Administrative Region in order to resolve dispute with particular legal relation occurred or
likely to occur by the party concerned. Therefore, the party concerned may apply to the Court
of China or the court of the Hong Kong Special Administrative Region to recognize and
enforce the final judgment made in China or Hong Kong that meet certain conditions of the
aforementioned regulations.
APPENDIX IV SUMMARY OF PRINCIPAL LEGAL AND REGULATORY PROVISIONS
– IV-25 –


--- page 554 ---
17/F., 83 Wan Chai Road,
Wan Chai, Hong Kong,
T: (852) 2811 1876 F: (852) 3007 8501
W: www.raviagroup.com
E: general@raviagroup.com
June 20, 2024
The Board of Directors
Tianju Dihe (Suzhou) Technology Co., Ltd.
No. 9 Rongfu Street
Suzhou Industrial Park
Suzhou City, Jiangsu Province
The People’s Republic of China
Dear Sirs/Madams,
Re: Property Valuation of No. 9 Rongfu Street, Suzhou Industrial Park, Suzhou City,
Jiangsu Province, the People Republic of China (the “PRC”)
In accordance with the instructions of Tianju Dihe (Suzhou) Technology Co., Ltd. (the
“Company ”) to assess the market value of the captioned property located in the PRC held by
the Company, we confirm that we have carried out inspection, made relevant enquiries and
obtained such further information as we consider necessary for the purpose of providing you
with our opinion of the market value of the property as at 30 April 2024 (the “ Valuation Date ”)
for listing purpose.
1. BASIS OF V ALUATION
Our valuation of the property is our opinion of the market value which we would define
as intended to mean “the estimated amount for which an asset or liability should exchange on
the valuation date between a willing buyer and a willing seller in an arm’s-length transaction,
after proper marketing and where the parties had each acted knowledgeably, prudently and
without compulsion”.
Market value is understood as the value of an asset or liability estimated without regard
to costs of sale or purchase (or transaction) and without offset for any associated taxes or
potential taxes.
APPENDIX V PROPERTY V ALUATION
–V - 1–


--- page 555 ---
2. V ALUATION METHODOLOGY
We have valued the property by direct comparison approach assuming sale of the property
by making references to comparable sales transactions as available in the relevant market.
3. TITLE INVESTIGATION
We have been provided with copies of title documents and have been advised by the
Company that no further relevant documents have been produced. However, we have not
examined the original documents to verify ownership or to ascertain the existence of any
amendment documents, which may not appear on the copies handed to us. In the course of our
valuation, we have relied upon the advice given by the Company’s PRC legal advisors, King
& Wood Mallesons, regarding the title to the property located in the PRC.
4. V ALUATION ASSUMPTIONS
Our valuation has been made on the assumption that the property is sold in the market in
its existing state without the benefit of deferred terms contract, leaseback, joint venture,
management agreement or any other similar arrangement which might serve to affect the value
of the property.
In addition, no account has been taken of any option or right of pre-emption concerning
or effecting sale of the property and no forced sale situation in any manner is assumed in our
valuation.
In valuing the property, we have relied on the advice given by the Company and the
Company’s legal Advisors that the Company has valid and enforceable title to the property
which is freely transferable, and has free and uninterrupted rights to use the same, for the whole
of the unexpired term granted subject to the payment of annual government rent/land use fees
and all requisite land premium/purchase consideration payable have been fully settled.
5. SOURCE OF INFORMATION
In the course of our valuation, we have relied to a very considerable extent on the
information provided by the Company and have accepted advice given to us on such matters
as planning approvals or statutory notices, easements, tenure, identification of property,
particulars of occupation, site/floor areas, ages of buildings and all other relevant matters
which can affect the value of the property. All documents have been used for reference only.
We have no reason to doubt the truth and accuracy of the information provided to us. We
have also been advised that no material facts have been omitted from the information supplied.
We consider that we have been provided with sufficient information to reach an informed view,
and have no reason to suspect that any material information has been withheld.
APPENDIX V PROPERTY V ALUATION
–V - 2–


--- page 556 ---
6. V ALUATION CONSIDERATION
Our inspection was performed by Ms. Annie Li in June 2023. We have inspected the
exterior and, where possible, the interior of certain property. No structural survey has been
made in respect of the property. However, in the course of our inspection, we did not note any
serious defects. We are not, however, able to report that the property is free from rot,
infestation or any other structural defects. No tests were carried out on any of the building
services.
We have not carried out on-site measurement to verify the site/floor areas of the property
under consideration but we have assumed that the site/floor areas shown on the documents
handed to us are correct. Except as otherwise stated, all dimensions, measurements and areas
included in the valuation certificates are based on information contained in the documents
provided to us by the Company and are therefore approximations.
No allowance has been made in our valuation for any charges, mortgages or amounts
owing on the property nor for any expenses or taxation which may be incurred in effecting a
sale or purchase. Unless otherwise stated, it is assumed that the property is free from
encumbrances, restrictions and outgoings of an onerous nature which could affect its value.
In valuing the property, we have complied with the requirements set out in Chapter 5 and
Practice Note 12 to the Rules Governing the Listing of Securities issued by The Stock
Exchange of Hong Kong Limited and The HKIS V aluation Standards (2020 Edition) published
by The Hong Kong Institute of Surveyors.
7. REMARKS
Unless otherwise stated, the monetary amounts stated in our valuation is in Renminbi
(“RMB”).
Our valuation certificate is attached herewith.
Y ours faithfully,
For and on behalf of
RA VIA GLOBAL APPRAISAL ADVISORY LIMITED
Dr. Alan W K Lee
PhD(BA) MFin BCom (Property)
MHKIS RPS (GP) AAPI CPV CPV(Business)
Co-Founder and Director
Note: Dr. Alan W K Lee is a Registered Professional Surveyor (General Practice), a member of Hong Kong Institute
of Surveyors and an Associate of Australian Property Institute. He has over 18 years’ valuation experience
in Hong Kong, Macau, the PRC, the Asia Pacific Region, European countries and American countries.
APPENDIX V PROPERTY V ALUATION
–V - 3–


--- page 557 ---
Property held by the Company for owner-occupation in the PRC
V ALUATION CERTIFICATE
Property Description and Tenure
Particulars of
Occupancy
Market Value in
Existing State as at
30 April 2024
No. 9 Rongfu Street,
Suzhou Industrial Park,
Suzhou City,
Jiangsu Province,
the PRC
(ᘽψ̹
ᘽψʈุ෤ਜ
ፄబ൑9໮)
The property comprises of a
16-storey industrial building over a
storey of basement car port
containing 115 car parking spaces
and a mezzanine floor containing
parking spaces, together with a
3-storey podium with a site area of
approximately 10,301.06 sq.m..
As advised by the Company, The
building was completed in about
2022.
The property has a total gross
floor area (“GFA”) of
approximately 25,461.89 sq.m..
The property is a leasehold estate
and it has been granted for a term
expiring on 10 March 2066.
As advised by the
Company, (i) a
portion of the
property with a total
GFA of 15 sq.m. was
subject to a tenancy
in favour of one of its
subsidiaries, Zhonghui
Juhe, expiring on
27 June 2028 at an
annual rent of
RMB3,600 exclusive
of utility fee; and (ii)
a portion of the
property with a total
GFA of 60 sq.m. was
subject to a tenancy
in favour of one of its
subsidiaries, Tianju
Renhe, expiring on 4
July 2028 at an
annual rent of
RMB20,000 exclusive
of utility fee.
The remaining portion
of the property was
occupied by the
Company as at the
V aluation Date.
RMB165,000,000
Notes:
1. Pursuant to a Real Estate Right Certificate Su (2023) Su Zhou Gong Y e Y uan Qu Bu Dong Chan Quan
No. 0000157 ( ᘽ(2023) ᘽψʈุ෤ਜʔਗପᛆୋ0000157 ໮) dated 20 June 2023, the land use right of the
property with a site area of approximately 10,301.06 sq.m. and the building ownership right of the property
with a gross floor area of 25,461.89 sq.m. are held by Tianju Dihe (Suzhou) Technology Co., Ltd. for a term
expiring on 10 March 2066 for industrial (R&D) use.
2. The inspection was performed by Ms. Annie Li, who is a member of Hong Kong Institute of Surveyors in June
2023.
3. We have been provided with a legal opinion on the property prepared by the Company’s PRC legal Advisors,
King & Wood Mallesons, which contains, inter alia, the following information:
a. The land use right and building ownership right owned by the Company that have obtained the title
certificate are clearly defined; and
b. There are no restrictions on rights such as mortgages and freezes, and there are no property rights
disputes.
APPENDIX V PROPERTY V ALUATION
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This Appendix sets out summaries of the main clauses of our Articles of Association
adopted on August 4, 2023 and amended on January 9, 2024 which shall become effective as
at the date on which the H shares are listed on the Stock Exchange. As the main purpose of this
Appendix is to provide potential investors with an overview of the Articles of Association, it
may not necessarily contain all information that is important for prospective investors. As
discussed in the appendix headed “Appendix VIII – Documents Delivered to the Registrar of
Companies and Available on Display” to this document, the full document of the Articles of
Association in Chinese is available for examination.
DIRECTORS AND BOARD OF DIRECTORS
Power to allocate and issue Shares
Without violating laws and regulations as well as the statutory requirements of local laws
and regulations in the place of listing, the general meeting may authorise or appoint the Board
of Directors to act on its behalf, including but not limited to subject to applicable laws,
regulations and Listing Rules, upon approval by a special resolution at general meeting,
granting a general mandate for the Board of Directors to issue, allot and treat additional
overseas listed foreign shares, in the quantity not more than 20% (or even lower percentage
required by applicable laws, regulations or Listing Rules) of overseas listed foreign shares
issued as of the date of the general meeting.
Power to dispose of our Company’s or any of our subsidiaries’ assets
The Board of Directors shall determine the authority of significant matters, such as
external investment, acquisition and sale of assets, asset mortgage, external guarantee matters,
entrusted financial management, connected transactions, and establish strict review and
decision-making procedures; significant matters shall be strictly in accordance with the
relevant system to fulfill the decision-making procedures and reported to the General Meeting
for approval.
Compensation or payments for loss of office
Not applicable.
Loans to Directors
The Articles of Association do not contain any specific provision in respect of loaning to
Directors.
However, if the loans to Directors is a significant matter such as a connected transaction
under Article 120 of the Articles of Association, it shall be strictly in accordance with the
relevant system to fulfill the decision-making procedures to be reviewed by the Board of
Directors or be reported to the General Meeting for approval.
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Giving of financial assistance to purchase our Company or any of our subsidiaries’ Shares
The Company or its subsidiaries (including its subsidiaries) shall not provide any
financial assistance to those who purchase or intend to purchase Company’s Shares in the form
of gifts, advances, guarantees, compensations, or loans.
Disclosure of interests in contracts with our Company or any of our subsidiaries
Directors shall not conclude any contract or engage in any transaction with the Company
either in violation of the Articles of Association or without the approval of the General
Meeting.
Remuneration
The appointment and removal of the members of the Board of Directors, as well as their
remuneration and payment methods, shall be adopted by the General Meeting by ordinary
resolution.
Retirement, appointment, removal
The Company sets up the Board of Directors, composed of no less than five Directors.
There shall be no less than three independent non-executive directors and they shall constitute
no less than 1/3 of the Board of Directors.
The Board of Directors has one chairman. The chairman of the Board of Directors shall
be elected by more than half of all Directors. The Directors shall be elected or replaced by the
General Meeting, and may be removed by the General Meeting through an ordinary resolution
before the expiration of their term of office.
The chairman of the Board and other Directors serve three-year terms, and the Director
can be re-elected and reappointed at the end of the term. The term of office of a Director shall
be calculated from the date of appointment until the expiration of the term of office of the
current Board of Directors. If the term of office of a Director expires without timely
re-election, the original Director shall still perform the duties of a Director in accordance with
laws, administrative regulations, departmental rules, and the provisions of these Articles of
Association before the newly elected Director takes office.
The general manager or other senior managers may concurrently serve as Directors.
However, the total number of Directors holding senior management positions and Directors
held by employee representatives shall not exceed half of the total number of Directors of the
Company. None of the following persons shall serve as our Director, Supervisor or senior
management:
(I) having no or limited capacity for civil conduct;
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(II) having been sentenced to criminal punishment for corruption, bribery, encroachment
on property, misappropriation of property or sabotage of the order of the socialist
market economy, and less than five years have elapsed since the completion of the
sentence, or having been deprived of his/her political rights as a result of a criminal
conviction and five years have not elapsed since the date on which execution of the
sentence was completed;
(III) if a Director, factory Director, or general manager of a company or enterprise that
has gone bankrupt and is personally responsible for the bankruptcy of the company
or enterprise, less than three years have passed since the completion of the
bankruptcy liquidation of the company or enterprise;
(IV) serving as the legal representative of a company or enterprise whose business
license has been revoked or ordered to close due to illegal activities, and bearing
personal responsibility, where less than three years have passed since the date of
revocation of the company or enterprise’s business license;
(V) individuals who have a significant amount of debt due but unpaid;
(VI) those who have been banned from entering the securities market by the China
Securities Regulatory Commission and the deadline has not expired; or
(VII) other contents stipulated by laws, administrative regulations, departmental rules, or
the Listing Rules.
The election, appointment or employment of the Directors, Supervisors or other senior
management shall be invalid if such election, appointment or employment is against the
Articles of Association. If the Directors, Supervisors or senior management falls into the
situations provided in the above-mentioned situations during their term of office, they would
be dismissed by our Company.
Borrowing Powers
The Board of Directors shall be entitled to develop proposals for our Company to issue
bonds or other securities, and that such bond issues must be approved by the Shareholders by
a special resolution at the General Meeting.
ALTERNATIONS TO CONSTITUTIONAL DOCUMENTS
In any of the following circumstances, the Company shall amend its articles of
association:
(I) after amendments are made to the law, administrative regulations or regulations or
listing rules of the places where the shares of the Company are listed the Articles of
Association run counter to the said amendments;
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(II) the conditions of the Company have changed, and such change is not covered in the
Articles of Association;
(III) the shareholders’ general meeting has resolved to amend the Articles of Association
which has been approved by the special resolution.
If the amendment of the articles of association approved by the Shareholders’ Meeting
resolution requires approval by the competent authority, it must be submitted to the competent
authority for approval. If it involves Company registration matters, change registration shall be
handled in accordance with the law.
The Board of Directors shall modify the Company’s articles of association in accordance
with the resolution of the Shareholders’ Meeting to modify the articles of association and the
approval opinions of relevant competent authorities.
The amendment of the articles of association belongs to the information required to be
disclosed by laws and regulations and shall be announced in accordance with regulations.
V ARIATION OF RIGHTS OF EXISTING SHARES OR CLASSES OF SHARES
Not applicable.
SPECIAL RESOLUTIONS – MAJORED REQUIRED
The resolutions of the General Meeting are categorized as ordinary resolutions and
special resolutions. An ordinary resolution shall be adopted by over one-half of the voting
rights held by the Shareholders (including proxies) attending the General Meeting. A special
resolution shall be adopted by over two-thirds of the voting rights held by the Shareholders
(including proxies) attending the General Meeting.
VOTING RIGHTS (GENERALLY AND ON A POLL)
Shareholders (including proxy) shall exercise their voting rights according to the number
of voting Shares they represent, and each Share shall have one vote.
Any Shareholder who, in accordance with the laws, administrative regulations,
departmental regulations, the laws, regulations or listing rules of the places where the shares
of the Company are listed, regulations, is required to waive their voting rights or is limited to
only casting affirmative or negative votes on a certain matter shall waive their voting rights or
voting rights in accordance with the provisions; Any Shareholder vote or representative vote
that violates relevant regulations or restrictions will not be counted in the voting results.
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When the Shareholders’ Meeting considers major matters that affect the interests of small
and medium-sized investors, separate votes should be counted for the votes of small and
medium-sized investors. The results of individual vote counting should be promptly and
publicly disclosed.
The Shares held by the Company do not have voting rights, and these Shares are not
included in the total number of Shares with voting rights present at the Shareholders’ Meeting.
The Board of Directors, independent Directors, Shareholders who meet the relevant
prescribed conditions may publicly solicit Shareholder voting rights. The solicitation of
Shareholder voting rights shall fully disclose specific voting intentions and other information
to the solicited party. It is prohibited to solicit Shareholder voting rights in a paid or disguised
way. Except for statutory conditions, the Company shall not impose minimum Shareholding
ratio restrictions on soliciting voting rights.
When the Shareholders’ Meeting deliberates on related transactions, affiliated
Shareholders shall not participate in voting, and the number of voting Shares represented by
them shall not be included in the total number of valid votes in accordance with the laws,
regulations or listing rules of the places where the shares of the Company are listed. The
announcement of the resolution of the Shareholders’ Meeting should fully disclose the voting
status of non-related Shareholders.
The Shareholders’ Meeting adopts a registered voting method. The same voting right can
only choose one of on-site, online, or other voting methods. If duplicate voting occurs with the
same voting right, the first voting result shall prevail.
Shareholders attending the Shareholders’ Meeting shall express one of the following
opinions on the proposal submitted for voting: agree, oppose, or abstain. Securities registration
and settlement institutions, as nominal holders of interconnected mechanism stocks in the
mainland and Hong Kong stock markets, shall not declare according to the actual holder’s
intention.
V otes that are not filled in, mistakenly filled in, or illegible, as well as votes that have not
been cast, shall be deemed as a waiver of voting rights by the voter. The voting result of the
number of shares held by the voter shall be counted as “waiver”.
REQUIREMENTS FOR ANNUAL GENERAL MEETINGS
The General Meetings are divided into annual general meetings and extraordinary general
meetings. The annual general meeting shall be convened once a year and be held within six
months of the end of the previous fiscal year.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
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ACCOUNTING AND AUDITS
Financial and accounting policies
The Company formulates its financial and accounting system in accordance with the laws,
administrative regulations, departmental regulations, the laws, regulations or listing rules of
the places where the shares of the Company are listed.
The Company shall announce two financial reports each fiscal year, i.e. interim financial
report announced within 60 days after the end of the first six months of the fiscal year and the
annual financial report announced within 120 days after the end of the fiscal year.
If the securities regulatory authority of the location where the Company’s shares are listed
has other provisions, such provisions shall prevail.
The Company shall not establish separate accounting books except for statutory
accounting book. The assets of the Company shall not be stored in any individual’s account.
Appointment and Dismissal of Accountants
Our company employs accounting firms that comply with the provisions of the PRC
Securities Law and the Listing Rules to conduct accounting statement auditing, net asset
verification, and other related consulting services. The term of employment is one year and can
be renewed. The appointment of an accounting firm by the Company must be decided by a
majority of Shareholders at the Shareholders’ Meeting, and the Board of Directors shall not
appoint an accounting firm before the decision is made at the Shareholders’ Meeting. The
Company guarantees to provide the hired accounting firm with true and complete accounting
vouchers, accounting books, financial accounting reports, and other accounting materials, and
shall not refuse, conceal, or falsely report.
The remuneration of an accounting firm or the method of determining remuneration shall
be determined by the Shareholders’ Meeting. When the Company dismisses or no longer
renews the appointment of an accounting firm, the Shareholders’ Meeting shall make a decision
and notify the accounting firm 10 days in advance. When the Company’s Shareholders’
Meeting votes on the dismissal of an accounting firm, the accounting firm is allowed to state
its opinions. If the accounting firm resigns, it shall explain to the Shareholders’ Meeting
whether the Company has any improper circumstances.
NOTICE AND AGENDA OF GENERAL SHAREHOLDERS’ MEETINGS
The shareholders’ general meeting is the organ of authority of the Company, and shall
duly exercise following functions and powers:
(I) to determine the operating principles and investment plans of the Company;
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(II) to elect and replace any Director or Supervisor not being employee representative,
and to determine the remuneration of the relevant directors and supervisors;
(III) to review and approve the reports of the Board of Directors;
(IV) to review and approve the reports of the Board of Supervisors;
(V) to review and approve the Company’s annual financial budgets and final accounts;
(VI) to review and approve the Company’s profit distribution plans, profit distribution
policy adjustment plan and loss recovery plans;
(VII) to resolve on the Company’s increase/decrease of registered capital;
(VIII) to resolve on issuance of corporate bonds and other securities and listing;
(IX) to consider the Company’s purchase or sale of major assets investment or guarantees
within one year with the transaction amount exceeding 30% of the latest audited
total assets of the Company;
(X) to consider a notifiable transaction requiring the approval of the general meeting as
defined under the laws, regulations or listing rules of the places where the shares of
the Company are listed and the Articles of Association (including but not limited to
Chapter 14 of the Listing Rules);
(XI) to resolve on the Company’s merger, division, dissolution, liquidation or change of
its corporate form among other matters;
(XII) to modify the Articles of Association;
(XIII) to decide on the engagement, dismissal or discontinuation of the appointment of the
accounting firm and its remuneration;
(XIV) to review and approve the motions proposed by shareholder(s) individually or
jointly holding at least 3% voting shares of the Company;
(XV) to review and approve the equity incentive plans at corporate level;
(XVI) to consider and approve matters relating to the changes in the use of proceeds from
share offerings;
(XVII) to consider any connected transaction or continuing connected transaction requiring
the approval of the general meeting as defined under the laws, regulations or listing
rules of the places where the shares of the Company are listed and the Articles of
Association (including but not limited to Chapter 14 of the Listing Rules);
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
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(XVIII) other matters to be decided by general meeting under the laws, administrative
regulations, departmental regulations, the laws, regulations or listing rules of the
places where the shares of the Company are listed and the Articles of Association;
(XIX) other matters required by the regulations or listing rules of the places where the
shares of the Company are listed.
The following acts of external guarantee (including mortgage, pledge or guarantee) of the
Company shall be submitted to the general meeting for deliberation and approval after being
reviewed and approved by the Board of Directors:
(I) any single guarantee for an amount more than 10% of the Company’s net assets
audited in the latest period;
(II) any guarantee to be provided after the total amount of external guarantees provided
by the Company or the subsidiaries it controls has exceeded 50% of the Company’s
net assets as audited in the latest period;
(III) any guarantee to be provided for a party whose ratio of liabilities to assets exceeds
70%;
(IV) the amount guaranteed by the Company within one year exceeds 30% of its latest
audited total assets;
(V) any guarantee to be provided after the total amount of external guarantees provided
by the Company has exceeded 30% of the Company’s net assets as audited in the
latest period;
(VI) any guarantee to be provided to a shareholder, or to an ultimate controller or related
party thereof;
(VII) other external guarantees that meet the requirements of the listing rules of the places
where the shares of the Company are listed or the Articles of Association.
Under the precondition of not violating relevant laws, without prejudice to the interests
of the Company, the provisions of items (I) to (III) of the first paragraph of this Article can be
waived for the guarantees provided by the Company for its wholly-owned subsidiary or the
guarantees provided by the Company for its majority-owned subsidiary whose other
shareholders also providing equal proportions of guarantees according to their interests.
There are two types of general meetings: annual general meeting and extraordinary
general meeting. The annual general meeting shall be convened once a year, and be held within
6 months from the end of last accounting year.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
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The extraordinary general meeting shall be convened when necessary. The Board of
Directors shall hold extraordinary general meeting within 2 months from the date of occurrence
of any of the following events:
(I) the number of Directors is less than the quorum required by the Company Law, or
less than two-thirds of the quorum required by the Articles of Association;
(II) the outstanding losses of the Company accounts for one-third of the Company’s total
paid-in share capital;
(III) shareholder(s) individually or jointly holding at least 10% shares of the Company
send(s) a written request for meeting;
(IV) the Board of Directors deems necessary;
(V) the Board of Supervisors proposes to convene the meeting;
(VI) other circumstances under the laws, administrative regulations, departmental
regulations, regulations or listing rules of the places where the shares of the
Company are listed and the Articles of Association.
The number of shares held in item (III) above is calculated based on the number of shares
held at the close of trading on the day when the shareholder makes a written request or the
previous (1) trading day (if the day when the written request is made is a non-trading day).
Shareholders requesting the convening of an extraordinary general meeting shall proceed
in following procedures:
Shareholder(s) severally or jointly holding more than 10% shares of the Company shall
have the right to request the Board to hold an extraordinary general meeting, and shall put
forward such request to the Board in writing. The Board shall, pursuant to laws, administrative
regulations, departmental regulations, regulations or listing rules of the places where the shares
of the Company are listed and the Articles of Association, give a written reply on whether or
not it agrees to hold such an extraordinary general meeting within ten days after receipt of the
request. The number of shares held by such shareholders shall be calculated according to the
number of shares held at the close of the day when the shareholders make the written request,
and if the day when the written request is made is not a trading day, the number of shares shall
be calculated on the basis of the number of shares held at the close of the previous trading day.
Where the Board agrees to hold the extraordinary general meeting, it shall serve a notice
of such meeting within five days after the resolution is made by the Board. Any change to the
original request set forth in the notice shall be subject to approval by the relevant shareholders.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
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If the Board does not agree to hold the extraordinary general meeting or fails to give a
written reply within ten days after receipt of the request, shareholder(s) severally or jointly
holding more than 10% shares of the Company shall be entitled to propose to the Supervisory
Committee to hold an extraordinary general meeting, and shall put forward such request to the
Supervisory Committee in writing.
If the Supervisory Committee agrees to convene the extraordinary general meeting or
class meeting, it shall serve a notice of such meeting within five days after receipt of the said
request. In the event of any change to the original request set forth in the notice, the consent
of relevant shareholder(s) shall be obtained.
If the Supervisory Committee fails to serve the notice of general meeting or class meeting
within the prescribed period, it shall be deemed as failing to convene and preside over the
general meeting or class meeting. The shareholder(s) severally or jointly holding more than
10% shares of the Company for more than ninety consecutive days may convene and preside
over the meeting by themselves.
Prior to the disclosure of the resolution of the general meeting, the shareholding of
shareholders who convene the meeting shall not be less than 10% of the total share capital of
the Company.
If the Supervisory Committee or shareholders itself/themselves convene a general
meeting, the expenses necessary for the meeting shall be borne by the Company and set off
against sums owed by the Company to the defaulting directors.
To hold annual general meeting, the Company shall send a written notice 21 calendar days
before meeting. To hold extraordinary general meeting, the Company shall send a written
notice to all registered shareholders 14 calendar days before meeting. The aforesaid “21
calendar days” or “14 calendar days” period counted by the Company shall not include the day
on which the meeting is convened and the day on which the notice is issued.
No matters not stated in the notice shall be resolved at a general meeting.
The notice of general meeting shall:
(I) specify the time, date and venue of meeting;
(II) state the matters and proposals to be discussed at the meeting the notice of the
general meeting shareholders and the supplementary notice shall fully and
completely disclose all the specific contents of all proposals;
(III) provide information and explanations necessary for shareholders to make informed
decisions on the matters to be discussed; this means (including but not limited to),
providing the specific conditions and contract (if any) of contemplated transactions
and detailed explanations on the cause and outcome, when the Company proposes
merger, share repurchase, capital restructuring or other reorganisation;
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(IV) if any Director, Supervisor, Manager or other management officer has important
interest relation with a matter to be discussed, the nature and degree of the interest
relation shall be disclosed; if the impact of the matter to be discussed on the said
Director, Supervisor, Manager or other senior management officer as a shareholder
is different from the impact on other shareholders of a same class, their difference
shall be explained;
(V) contain the full text of any proposed special resolution to be voted on at the meeting;
(VI) contain a written state that clearly indicates that any shareholder who has the right
to attend and vote at the meeting is entitled to appoint one proxy or more to attend
and vote at the meeting on its behalf, and such proxy does not need to be a
shareholder of the Company;
(VII) state the time and address of delivery of the power of attorney for the voting proxy;
(VIII) the notice shall designate the equity registration date of shareholders entitled to
attend the general meeting;
(IX) the notice shall indicate name and telephone number of the permanent contact
person of the meeting;
(X) the voting time and voting procedure of other means.
The interval between the equity registration date and the meeting date shall comply with
the regulations of the relevant supervisory authority in the place where the Company’s
securities are listed. Once the equity registration date is confirmed, it cannot be changed.
TRANSFER OF SHARES
Unless otherwise required by laws, regulations, local securities regulatory authorities of
the place where the Company are listed, the fully paid shares of the Company may be
transferred freely, without any lien attached.
All the H-shares with paid-up share capital may be freely transferred in accordance with
the Articles of Association; but unless the following conditions are met, the Board may refuse
to admit any transfer document without stating any reason:
(I) any transfer document and other documents that are relevant with the ownership of
H-shares or will influence the ownership of H-shares must be registered. A fee for
the registration must be paid to the Company according to a charge standard
specified in Listing Rules. The fee shall not exceed the maximum fees set out in
Listing Rules;
(II) the instrument of transfer involves H-shares only;
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(III) the stamp duty payable by the laws of Hong Kong on the instrument of transfer has
been paid;
(IV) the relevant share certificates and evidence reasonably required by the Board
proving that the transferer has the right to transfer shares shall be provided;
(V) if the shares are to be transferred to joint shareholders, the number of jointly
registered shareholders shall not exceed four;
(VI) the Company does not have any lien over the shares.
If the Board refuses to register share transfer, the Company shall issue a notice of refusal
of share transfer to the transferer and transferees within two months from the official filing date
of transfer application.
Transfer documents and other documents relating to the ownership of shares shall be
registered with the share registration institutions entrusted by the Company.
The Company shall not accept the shares of the Company as the subject of a right of
pledge.
The shares of the Company held by a promoter shall not be transferred within 1 year from
the date of the establishment of the Company. The shares issued by the Company before public
offering shall not be transferred within 1 year from the date on which the Company’s shares
are listed on stock exchange. The Controlling shareholders should be subject to the restrictions
of the Listing Rules which restricts the disposal of Shares by Controlling shareholders
following a new listing.
The Directors, Supervisors and Senior Management of the Company shall report their
shareholding in the Company and changes thereof to the Company, and during their tenure, the
shares transferred each year shall not exceed 25% of the total Company shares held by them;
the Company shares held by them shall not be transferred within 1 year from the date when the
shares of the Company are listed and traded; within half a year from departure from the
Company, the aforesaid persons shall not transfer the Company shares held by them.
If the Directors, Supervisors, Senior Management of the Company and shareholders
holding more than 5% of the Company’s shares sell the shares of the Company or other
securities with an equity nature they held within six months after the purchase, or purchase
again within six months after sale, the proceeds thereon shall be owned by the Company and
the Board of the Company will recover the proceeds. However, if a securities company holds
more than 5% of the shares after purchasing the remaining shares upon underwriting and other
circumstances stipulated by the CSRC shall be excluded.
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The shares or other securities with an equity nature held by the Directors, Supervisors,
Senior Management and natural shareholders mentioned in the preceding paragraph include the
shares or other securities with an equity nature held by their spouses, parents and children and
held under accounts of other parties.
POWER OF OUR COMPANY TO PURCHASE OUR OWN SHARES
In any of the following circumstances, the Company may repurchase its issued shares
upon approval by relevant competent authorities, at the requirements of laws, administrative
regulations, departmental regulations, the laws, regulations or listing rules of the places where
the shares of the Company are listed, and the Articles of Association:
(I) cancelling its shares for the purpose of reducing the registered capital of the
Company;
(II) merging with another company holding shares of the Company;
(III) using shares for employees stock ownership plan or equity incentives;
(IV) acquiring the shares of shareholders who vote against any resolution adopted at the
shareholders’ general meeting on the merger or demerger of the Company and
request the Company to acquire their shares;
(V) using shares for converting corporate bonds issued by the Company;
(VI) as required for the Company to maintain corporate value and shareholders’ interests;
(VII) other circumstances approved by laws, administrative regulations the laws,
regulations or listing rules of the places where the shares of the Company are listed
and regulatory authorities.
A resolution of a shareholders’ general meeting is required for repurchasing shares under
circumstances (I) or (II) above. A resolution of a meeting of the board of directors with a
quorum of more than two-thirds of directors is required for repurchasing shares under
circumstances (III), (V) or (VI) above within the authority permitted under the Articles of
Association or the authority granted by the general meeting.
Regarding the shares not reversed into overseas listed shares, the shares acquired under
the above circumstance (I), shall be de-registered within 10 days from the date of repurchase;
the shares acquired under the above circumstances (II) or (IV), shall be transferred or
de-registered within 6 months; and the shares acquired under the above circumstances (III),
(IV) or (VI), shall be transferred or de-registered within 3 years, and the shares held in total
by the Company shall not exceed 10% of total shares issued by the Company.
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– VI-13 –


--- page 571 ---
A prior approval of a shareholders’ general meeting is required for repurchasing by
contract outside a stock exchange in accordance with the Articles of Association. With prior
approval by a general meeting in the same manner, the Company may rescind or alter contracts
entered into in the said manner or waive any rights under such contracts. The aforesaid
repurchase contracts include but not limited to the agreement for bearing the obligation to
repurchase shares and obtaining the right to repurchase shares.
The Company shall not transfer the repurchase contracts or any rights stated therein.
POWER OF ANY SUBSIDIARY OF THE ISSUER TO OWN SHARES IN ITS PARENT
Not applicable.
DIVIDENDS AND OTHER METHODS OF DISTRIBUTION
The profit distribution proposal of the Company for each year shall be reviewed and
approved at the general meeting. The Company shall distribute its after-tax profit for the
current year in the order of:
(I) recovering losses of the preceding year;
(II) withdrawing ten percent (10%) after-tax profit of the current year as a statutory
common reserve fund;
(III) withdrawing its profit as a risk reserve in accordance with relevant national
requirements;
(IV) withdrawing its profit as a discretionary common reserve fund according to
resolutions of the general meeting;
(V) distributing dividends to shareholders.
The Company may not withdraw its profit for the statutory common reserve fund if the
cumulative amount has reached fifty percent (50%) or more of the Company’s registered
capital. The general meeting shall determine whether or not allocate to the discretionary
reserve and the rate after allocating the statutory reserve and the risk reserve.
If the statutory reserve could not cover the losses of the preceding year, profit of the year
shall be used to cover the losses before withdrawing the statutory reserves. Where the general
meeting distributes profits to shareholders in violation of the foregoing provision, the
shareholders concerned shall refund to the Company the profits distributed in violation of the
foregoing provision.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-14 –


--- page 572 ---
After losses have been covered and the statutory reserve and risk reserve have been
allocated in accordance with these Articles of Association, any remaining after-tax profits shall
be distributed to the shareholders in proportion to their shareholdings, unless otherwise
stipulated in these Articles of Association.
The shares of the Company held by the Company shall not be subject to profit
distribution.
PROXIES
Any Shareholder who has the right to attend and vote at the Shareholders’ Meeting may
attend the meeting in person or entrust one or more (who may not be a shareholder) as their
proxy to attend and vote on their behalf.
The power of attorney issued by Shareholders authorizing others to attend the
Shareholders’ Meeting shall include the following contents:
(i) the name of the proxy and number of shares represented by the proxy;
(ii) whether it has voting rights;
(iii) instructions to vote for, against or abstention from voting on each item to be
discussed on the agenda of the Shareholders’ Meeting;
(iv) whether or not the attorney has the voting right for provisional motions on the
agenda of the general meeting, and if so, specific instructions on how to exercise
such voting right;
(v) date of issuance and validity period of the power of attorney;
(vi) signature (or seal) of the principal; If the principal is a corporate Shareholder, the
seal of the legal entity shall be affixed.
Any form issued to a shareholder by the directors for the appointment of a proxy to attend
and vote at meetings of the Company shall enable the shareholder to freely instruct the proxy
to vote in favor of or against the motions, such instructions being given in respect of each
individual matter to be voted on at the meeting. Such a form shall contain a statement that, in
the absence of specific instructions from the shareholder, the proxy may vote as he thinks fit.
CALLS ON SHARES AND FORFEITURE OF SHARES
Not applicable.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-15 –


--- page 573 ---
INSPECTION OF REGISTER OF MEMBERS
Our Company establishes a register of Shareholders based on the vouchers provided by
the securities registration and settlement institution, which is sufficient evidence to prove that
shareholders hold our Company’s Shares.
The Company may keep overseas the register of holders of overseas listed foreign shares
and entrust it to the care of an overseas agency in accordance with the understanding and
agreement reached between the securities regulatory authority under the State Council and the
overseas securities regulatory authority. The entrusted overseas agency shall always ensure that
the original and copies of the register of holders of overseas listed foreign shares are consistent.
Where the original and copies of the register of holders of overseas listed foreign shares are
inconsistent, the original shall prevail. The branch register of holders must be available for
inspection by shareholders.
Shareholders shall enjoy rights and assume obligations according to the types of Shares
they hold; Shareholders holding the same type of Shares shall have equal rights and assume the
same obligations.
When our Company convenes a Shareholders’ Meeting, distributes dividends, liquidates,
or engages in other activities that require confirmation of Shareholder identity, the Board of
Directors or the convener of the Shareholders’ Meeting shall determine the equity registration
date. After the equity registration date is closed, the registered Shareholders shall be the
Shareholders who enjoy the relevant rights and interests.
QUORUM FOR MEETINGS AND SEPARATE CLASS MEETINGS
Not applicable.
RIGHTS OF THE MINORITIES IN RELATION TO FRAUD OR OPPRESSION
THEREOF
If Directors, general managers, and other senior management personnel violate laws,
administrative regulations, or the provisions of these articles of association while performing
their duties, causing losses to our Company, Shareholders who individually or jointly hold
more than 1% of our Company’s Shares for more than 180 consecutive days have the right to
request in writing that the Supervisory Committee file a lawsuit with the people’s court; If the
Supervisory Committee violates laws, administrative regulations, or the provisions of these
articles of association while performing its duties, causing losses to our Company, the
aforementioned Shareholders may request in writing that the Board of Directors file a lawsuit
with the people’s court. If the Supervisory Committee or the Board of Directors refuses to file
a lawsuit after receiving a written request from the Shareholders as specified above, or fails to
file a lawsuit within 30 days from the date of receiving the request, or if the situation is urgent
and the failure to file a lawsuit immediately will cause irreparable damage to our Company’s
interests, the Shareholders as specified above have the right to directly file a lawsuit in their
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-16 –


--- page 574 ---
own name to the people’s court for the benefit of our Company. If another person infringes on
the legitimate rights and interests of our Company and causes losses to our Company,
Shareholders who individually or jointly hold more than 1% of our Company’s Shares for more
than 180 consecutive days may file a lawsuit with the people’s court in accordance with the
provisions as specified above.
If Directors, general managers, and other senior management personnel violate laws,
administrative regulations, or the provisions of these Articles of Association and harm the
interests of Shareholders, Shareholders may file a lawsuit with the people’s court.
If Shareholders of our Company abuse their Shareholder rights and cause losses to our
Company or other Shareholders, they shall bear compensation liability in accordance with the
law. If Shareholders of our Company abuse the independent status of the Company as a legal
person and the limited liability of Shareholders, evade debts, and seriously harm the interests
of our Company’s creditors, they shall bear joint and several liability for our Company’s debts.
The Controlling Shareholders and actual controllers of our Company shall not use their
affiliated relationships to harm the interests of our Company. Those who violate regulations
and cause losses to our Company shall be liable for compensation. The Controlling
Shareholders and actual controllers of our Company have a fiduciary obligation towards our
Company and all Shareholders of our Company. The Controlling Shareholder shall strictly
exercise its right as a capital contributor in accordance with the law. The Controlling
Shareholder, actual controller, and their affiliated parties shall not use profit distribution, asset
restructuring, external investment, fund occupation, loan guarantee, etc. to harm the legitimate
rights and interests of our Company and all Shareholders, and shall not use their controlling
position to harm the interests of our Company and all Shareholders.
PROCEDURES ON LIQUIDATION
The Company shall be dissolved and liquidated in accordance with the laws upon the
occurrence of any of the following events:
(I) the occurrence of other events of dissolution as stated in the Articles of Association;
(II) a resolution for dissolution is passed by a shareholders’ general meeting;
(III) dissolution is necessary due to a merger or division of the Company;
(IV) the Company is revoked of business license, ordered to close or canceled according
to law;
(V) the Company was declared bankrupt due to its inability to pay off its due debts;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-17 –


--- page 575 ---
(VI) serious difficulties arise in the operation and management of the Company and its
continued existence would cause material loss to the interests of the shareholders
and such difficulties cannot be resolved through other means, in which case
shareholders holding at least 10% of all shareholders’ voting rights may petition a
People’s Court to dissolve the Company.
In the case of item (I) above, the company can survive by amending the Articles of
Association, and the amendment of the Articles of Association must be approved by more than
two-thirds of the voting rights held by shareholders present at the general meeting of
shareholders.
Where the Company is dissolved in accordance with the provisions of items (I), (II), (IV)
and (VI) above, a liquidation committee shall be formed within 15 days after the occurrence
of the event of dissolution to deal with matters of the liquidation. The members of the
liquidation committee shall be Directors or other persons appointed by a shareholders’ general
meeting. If a liquidation committee is not established in time, the creditors may apply to the
People’s Court to establish a liquidation committee by their appointment to proceed with the
liquidation. Where the Company is dissolved in accordance with the provisions of item (IV)
above, the People’s Court shall, according to relevant legal provisions, organize the
shareholders, relevant departments, and professionals to form a liquidation committee to carry
out the liquidation. Where the Company is dissolved in accordance with the provisions of item
above, the competent authorities shall organize the shareholders, relevant departments, and
professionals to form a liquidation committee to carry out the liquidation.
The liquidation committee shall exercise the following functions and powers during the
period of liquidation:
(I) to dispose of the property of the Company, and to prepare a balance sheet and a list
of property items;
(II) to inform creditors by notice and public announcement;
(III) to dispose of unfinished business of the Company relating to the liquidation;
(IV) to pay up all outstanding taxes and tax arising during the liquidation process;
(V) to clear up claims and debts;
(VI) to dispose of the remaining property of the Company after the full settlement of
debts;
(VII) to represent the Company in civil litigations.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-18 –


--- page 576 ---
The liquidation committee shall notify the creditors within 10 days after its establishment,
and publish announcements in the newspaper(s) within 60 days. Creditors shall, within 30 days
from the date of receiving the notice; or for creditors who do not receive the notice, within 45
days from the date of the public announcement, declare their claims to the liquidation
committee.
The creditor shall provide a description and supporting evidence of the matters relating
to their claims. The liquidation committee shall register the creditors’ claims.
The liquidation committee shall not make any debt settlement during the period of
declaration of claims.
A liquidation plan shall be formulated by the liquidation committee after the stocktaking
of the Company’s assets has been carried out and the balance sheet and a detailed inventory of
assets have been formulated, and shall be submitted to the general meeting or the People’s
Court for confirmation.
The assets of the Company shall be applied for payment in the following order: payment
of liquidation expenses, staff wages, social insurance expenses and statutory compensation,
payment of outstanding taxes, and payment of the Company’s debts. The residual assets of the
Company after settlement of all liabilities in accordance with the provisions of the preceding
article shall be distributed to the shareholders of the Company according to the proportion of
their shareholdings.
During the liquidation period, the Company continues to exist but the Company shall not
commence any new business activities. Before the Company’s debts have been fully repaid in
accordance with the provisions of the preceding paragraph, no assets of the Company shall be
distributed to its shareholders.
Where the Company is liquidated due to its dissolution and the liquidation committee,
having examined the Company’s assets and having prepared a balance sheet and an inventory
of assets, discovers that the Company’s assets are insufficient to pay its debts in full, it shall
immediately apply to the People’s Court for a declaration of insolvency. Once the People’s
Court has declared the Company insolvent, the liquidation committee shall turn over any
matters regarding the liquidation to the People’s Court.
Following the completion of liquidation, the liquidation committee shall formulate a
report on liquidation, a statement of income and expenditure and financial accounts during the
period of liquidation, which shall be examined and verified by an accountant registered in
China and submitted to the shareholders’ general meeting or the People’s Court for
confirmation. The liquidation committee shall also within 30 days after such confirmation,
submit the aforesaid documents to the company registration authority and apply for
cancellation of registration of the Company, and publish an announcement relating to the
termination of the Company.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-19 –


--- page 577 ---
OTHER PROVISIONS MATERIAL TO THE ISSUER OR THE SHAREHOLDERS
THEREOF
General Provisions
Our Company is a permanently existing joint stock limited company.
All the assets of our Company are divided into Shares of equal value. The Shareholders
are responsible for our Company to the extent of their subscribed Shares, and our Company is
responsible for our Company’s debts with all its assets.
From the effective date, this Articles of Association shall become a legally binding
document regulating the organization and behavior of our Company, the rights and obligations
between our Company and its Shareholders, and between Shareholders, and shall have legal
binding force on our Company, Shareholders, Directors, supervisors, general manager, and
other senior management personnel. According to these articles of association, Shareholders
can sue Shareholders, Shareholders can sue Company Directors, supervisors, general
managers, and other senior management personnel, Shareholders can sue our Company, and our
Company can sue Shareholders, Directors, supervisors, general managers, and other senior
management personnel.
Increase/Decrease of Shares
Subject to the provisions of laws, regulations and the Articles of Association, upon special
resolution by a shareholders’ general meeting, the Company may increase its registered capital
on the basis of its business and development needs by any of the following means:
(I) public offering of new shares;
(II) non-public offering of new shares;
(III) allotting new shares to existing shareholders;
(IV) distributing new shares to existing shareholders;
(V) converting the reserved funds into share capital;
(VI) other means approved by laws, administrative regulations and the relevant
regulatory authorities.
Upon the approval in accordance with the provisions of the Articles of Association, the
increase of the Company’s capital by issuing new shares shall be proceeded in compliance with
relevant national laws and administrative regulations.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-20 –


--- page 578 ---
To reduce its registered capital, the Company shall prepare the balance sheet and the
inventory of properties. Within 10 days from the resolution of capital reduction, the Company
shall notify the creditors, and shall make a public announcement on newspapers within 30 days.
Creditors, within 30 days from receiving such notice, or within 45 days from the public
announcement if no notice has been received, may require the Company to repay up the debts
or provide corresponding guarantees for the debts.
Shareholders
Shareholders of the Company are persons who lawfully hold shares of the Company and
whose names are entered in the register of shareholders. Shareholders enjoy rights and assume
obligations in proportion to the class and numbers of shares they hold; shareholders who hold
the same class of shares shall enjoy equal rights and assume the same obligations.
The shareholders of ordinary shares shall be entitled to the following rights:
(I) receiving dividends and other form of interest distribution in proportion to its
shareholding;
(II) requiring, convening, chairing, attending by person or by proxy into a general
meeting pursuant to the laws, administrative regulations, departmental regulations,
the laws, regulations or listing rules of the places where the shares of the Company
are listed, regulations of regulatory authorities and the Articles of Association, and
exercising the voting right at the meeting in proportion to its shareholding;
(III) supervising and managing, presenting suggestions on or making inquiries about the
business operation of the Company;
(IV) transferring, donating or pledging the shares held by them, in accordance with the
laws, administrative regulations, departmental regulations, the laws, regulations or
listing rules of the places where the shares of the Company are listed, regulations of
regulatory authorities and the Articles of Association;
(V) obtaining relevant information according to the Articles of Association, in
accordance with the laws, administrative regulations, departmental regulations, the
laws, regulations or listing rules of the places where the shares of the Company are
listed, regulations of regulatory authorities and the Articles of Association,
including:
1. a copy of the Articles of Association upon payment of costs thereof;
2. the right to inspect and duplicate after paying a reasonable charge;
(1) the whole and all parts of the register of shareholders;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-21 –


--- page 579 ---
(2) personal information of Directors, Supervisors, General Manager and
other senior management members, including:
(a) present and former names and aliases;
(b) principal address (domicile);
(c) nationality;
(d) full-time and all other part-time occupations and positions;
(e) identification certificate document and its number;
(3) status of issued share capital of the Company;
(4) latest audited financial statements of the Company, and reports and
special resolutions of the Board, Auditors and the Supervisory
Committee;
(5) report on the par value and number of shares repurchased by the Company
since the last fiscal year, as well as the maximum and minimum prices
paid for the repurchased securities (with a breakdown between domestic
unlisted shares and overseas listed shares);
(6) photocopy of the latest annual renewal report filed with market regulation
authority or other competent authorities;
(7) minutes of general meetings (only for review by shareholders), and
resolutions of Board meetings and resolutions of Supervisory Committee
meetings;
(8) special resolutions of the Company; and
(9) bond stubs of the Company.
(VI) The Company shall prepare the above documents (1), (3), (4), (5), (6), (7), (8) & (9)
and other applicable documents at the Hong Kong address of the Company
according to the requirements of Listing Rules, for free reference of the public and
shareholders of overseas listed shares (except minutes of general meetings available
for shareholders only), and for photocopy at reasonable expense within 7 days. The
Company may refuse to provide any information for access or photocopy that
involves the trade secret or insider information of the Company;
(VII) participating in the distribution of residual assets of the Company in proportion to
its shareholdings, upon termination or liquidation of the Company;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-22 –


--- page 580 ---
(VIII) for shareholders who vote against any resolution adopted at the shareholders’
general meeting on the merger or demerger of the Company, requesting the
Company to acquire its shares;
(IX) for shareholder(s) who individually or jointly hold(s) 3% or above shares of the
Company, having the right to propose extraordinary resolutions and submit in
writing to the Board of Directors within 10 days before the convention of general
meeting;
(X) any other rights stipulated by laws, administrative regulations, departmental
regulations, the laws, regulations or listing rules of the places where the shares of
the Company are listed and the Articles of Association.
In event any resolution by general meetings or the Board meeting violates the laws or
administrative regulations, shareholders may request local People’s Court to invalidate such
resolution.
In event the convening or voting of general meetings or Board meeting violates the laws,
administrative regulations or the Articles of Association, or any resolution violates the Articles
of Association, shareholders may request local People’s Court to withdraw such resolution
within 60 days from the date of resolution.
If a Director or a member of Senior Management violates the provisions of laws,
administrative regulations or these Articles to the detriment of the interests of shareholders, the
shareholders can file a lawsuit in the People’s Court.
The shareholders of the Company’s ordinary shares shall undertake the following
obligations:
(I) abiding by laws, administrative regulations and the Articles of Association;
(II) making payment for shares subscribed according to the quantity of shares subscribed
for and the manners of subscription;
(III) assuming liability to the Company to the extent of its shareholding;
(IV) not withdrawing capital contribution, unless otherwise required by laws and
regulations;
(V) not abusing shareholder’s rights to harm the interests of the Company or other
shareholders; not abusing the independent legal person status of the Company and
the limited liability of shareholders to harm the interests of the Company’s creditors;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-23 –


--- page 581 ---
(VI) any other obligations stipulated by laws, administrative regulations and the Articles
of Association. Unless otherwise required, a shareholder shall not be obliged to
make additional contribution to share capital subsequently other than the conditions
agreed at the time of subscription.
Any shareholder who abuses shareholder’s rights causing loss to the Company or other
shareholders shall be liable for compensation pursuant to the laws. Any shareholder who
abuses the independent legal person status of the Company and the limited liability of
shareholders to evade debts and severely infringe upon the interests of the Company’s creditors
shall be held jointly and severally liable for the Company’s debts.
Any shareholder who holds 5% or more of the Company’s voting shares pledges his/her
shares. Such shareholder shall report to the Company in writing within the day when the fact
occurs. Any controlling shareholder of the Company pledges certain or all his/her shareholding
in the Company as security for the Company’s indebtedness, guarantees or other liabilities, the
Company should fulfil the disclosure obligations under the Listing Rules.
The controlling shareholder or actual controller of the Company shall not utilise its
associated-party relationship against the interests of the Company, or else, shall compensate
the Company for any loss incurred.
Unless otherwise obliged by the laws, regulations or the listing rules of local stock
exchange in the place where the Company shares are listed, the controlling shareholder in
exercising its power shall not make a decision against the interests of all or part of shareholders
by exercising its voting rights upon following issues:
(I) exempting the liability of Directors or Supervisors to act in good faith for the best
interests of the Company;
(II) approving Directors or Supervisors (for the benefit of themselves or others) to
deprive the Company’s property in any form, including but not limited to any chance
favorable to the Company;
(III) approving Directors or Supervisors (for the benefit of themselves or others) to
deprive other shareholders of their personal interests and benefits, including but not
limited to any rights to distribution or voting, excluding corporate restructuring
submitted to the shareholders’ general meeting for approval in accordance the
Articles of Association.
Board of Directors
The Board of Directors shall be responsible to the general meetings and exercise the
following functions and powers:
(I) convening the general meeting and reporting work to the general meeting;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-24 –


--- page 582 ---
(II) implementing resolutions of the general meetings;
(III) determining the operating plans and investment schemes of the Company;
(IV) formulating the annual budget plan and final accounts plan of the Company;
(V) formulating the profit distribution plan and loss makeup plan of the Company;
(VI) formulating the Company’s plans for the increase/decrease of the registered capital,
issuance of corporate bonds or other securities;
(VII) contemplating the plans for merger, division, dissolution or change of form of the
Company;
(VIII) contemplating the plans for purchase and disposal of material assets, share
repurchase of the Company;
(IX) appointing or dismissing the General Manager, Secretary; appointing or dismissing
the deputy General Manager, Chief Financial Officer (the “CFO”) or other Senior
Management of the Company as nominated and deciding on and decide on their
remunerations, rewards and punishments;
(X) deciding on the setup of internal management bodies of the Company;
(XI) determining the composition of special committees under the Board by the listing
rules of the places where the shares of the Company are listed;
(XII) formulating the fundamental management systems of the Company;
(XIII) formulating the modification plan of the Articles of Association;
(XIV) filing an application for bankruptcy on behalf of the Company;
(XV) considering and approving shareholders to list and trade the unlisted shares on an
overseas stock exchange;
(XVI) considering and approving the Company’s transaction (including but not limited to
the disclosable transaction and the connected transaction) that should be considered
and approved by the Board of Directors pursuant to the laws, administrative
regulations, departmental regulations, regulations or listing rules of the places where
the shares of the Company are listed and the Articles of Association;
(XVII) deciding on the Company’s external investments, acquisition and disposal of assets,
pledge of assets, external guarantees, trust management and other matters within the
scope of authorization by a general meeting;
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-25 –


--- page 583 ---
(XVIII) managing the disclosure of information by the Company;
(XIX) proposing to the general meeting with respect to the engagement or replacement of
the audit firm of the Company;
(XX) receiving the work report of the General Manager of the Company and examine such
work;
(XXI) establishing the Company’s purpose, values and strategy and ensuring that they are
aligned with the Company’s culture;
(XXII) developing and reviewing the policies and practices of the Company on corporate
governance and make recommendations to the Board of Directors;
(XXIII) reviewing and monitoring the training and continuous professional development of
Directors and Senior Management;
(XXIV) reviewing and monitoring the Company’s policies and practices on compliance with
legal and regulatory requirements;
(XXV) developing, reviewing and monitoring the code of conduct applicable to the
Directors and employees;
(XXVI) review the Company’s compliance with the code provisions set out in the CG Code
contained in Listing Rules and disclosures in the corporate governance report;
(XXVII) any other functions and powers granted by the laws, regulations, the laws,
regulations or listing rules of the places where the shares of the Company are listed,
the Articles of Association or the General Meeting.
Resolutions concerning any of the above matters (VI), (VII) or (XIII) may be passed by
the affirmative vote of more than two-thirds of Directors, while a resolution concerning any of
the remaining matters may be passed by the affirmative vote of a more than half of the
directors.
The Board of Directors shall explain to general meeting about the Auditor’s Report with
standard opinions issued by the accounting firm against the financial statements of the
Company.
The Board of Directors may hold two kinds of meetings, namely: regular meetings and
interim meetings. The Board shall hold at least 4 meetings per year, convened by the Chairman.
Entire Directors and Supervisors shall be notified in writing of a regular meeting at least 14
days before meeting.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-26 –


--- page 584 ---
In any of the following events, the Chairman shall convene an interim meeting within 10
days from the receipt of the proposal:
(I) when shareholders representing at least 1/10 voting rights propose;
(II) when the Chairman considers it necessary;
(III) when at least 1/3 Directors jointly propose;
(IV) when at least 1/2 independent non-executive Directors propose;
(V) when the Supervisory Committee proposes;
(VI) when the General Manager proposes;
(VII) other circumstances as stipulated in the laws, administrative regulations,
departmental rules, regulatory documents, regulations or listing rules of the places
where the shares of the Company are listed or the Articles of Association.
The notice of regular meeting or interim meeting shall be sent in writing to entire
Directors, Supervisors at least 14 days prior to the date of regular meetings, or 5 days prior to
the date of interim meetings.
A meeting of the Board of Directors may not be held without more than half of Directors
being present.
Every Director may cast one vote. A motion at the meeting of the Board of Directors may
be passed as resolution by a simple majority of entire directors unless otherwise required by
the laws, regulations and the Articles of Association, and any Director materially interested in
any relating contract, transaction or arrangement shall abstain from voting.
Directors shall attend Board meetings in person. A Director who is unable to attend a
meeting for any reason shall appoint another Director to attend a Board meeting on his/her
behalf in writing, provided that the power of attorney shall contain the scope of authorization.
The appointed Director shall exercise the rights as Director within the scope of authorization.
The failure of a Director to attend a Board meeting in person or by proxy shall be deemed as
forfeiting his/her voting rights at such meeting.
Independent Non-executive Director
The Company’s Board of Directors includes independent non-executive Directors. There
shall be no less than three independent non-executive Directors and they shall constitute no less
than 1/3 of the Board of Directors. At least one independent non-executive Directors shall
possess the appropriate professional qualifications or have appropriate accounting or related
financial management expertise and one independent non-executive Directors shall reside in
Hong Kong.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-27 –


--- page 585 ---
Secretary to the Board of Directors
The Company shall appoint the Secretary to the Board of Directors, who shall be a
member of Senior Management of the Company. The term of the Secretary to the Board of
Directors is 3 years, and may be reappointed for re-election.
The Secretary to the Board of Directors shall be a natural person with requisite
professional knowledge and experience and also comply with the listing rules of the places
where the shares of the Company are listed, and shall be appointed or dismissed by the Board
of Directors, with the duties to:
(I) ensure that the Company has complete constituent archives and records;
(II) ensure that the Company lawfully prepares and files the reports and documents
required by the competent authorities;
(III) ensure the proper establishment of share register, and ensure the persons entitled to
access relevant corporate records and files are able to acquire such records and
documents promptly;
(IV) provide service to ensure the Board procedures and all applicable laws, rules and
regulations are complied with;
(V) other duties required by the laws, administrative regulations, departmental rules,
regulatory documents, regulations or listing rules of the places where the shares of
the Company are listed or the Articles of Association.
A Director or other member of Senior Management may concurrently serve as Secretary
to the Board of Directors. A Supervisor, an accountant of the accounting firm and the law firm
engaged by the Company and a manager of the controlling shareholder shall not concurrently
serve as Secretary to the Board of Directors. Where the office of the Secretary to the Board of
Directors is concurrently held by a director of the Company, for an act which is required to be
made by a Director and the Secretary to the Board of Directors separately, then such person
shall not perform the act in dual capacity.
Supervisory Committee
The Supervisory Committee is composed of no less than 3 Supervisors, one of whom acts
as the Chairman. A Supervisor shall serve a term of three years and may seek reelection upon
the expiry of the said term. The appointment or dismissal of the Chairman is subject to the
approval by at least two-thirds (inclusive) of the members of the Supervisory Committee
through voting.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-28 –


--- page 586 ---
The Supervisory Committee reports to the General Meeting, and has the duties to:
(I) examine the financial reports, operational reports and profit distribution plan among
other financial information to be submitted from the Board of Directors to the
General Meeting and produce written opinions thereon;
(II) check the finance of the Company;
(III) supervise any act of Directors, General Manager, and other Senior Management in
breach of laws, administration regulations, and the Articles of Association during
performance of duties, and propose the dismissal of any Director or Senior
Management who contravene the law, administration regulations, the Articles of
Association, or the resolutions of General Meeting;
(IV) require a Director or Senior Management to correct its act that has damaged the
interests of the Company;
(V) propose an extraordinary general meeting, and when the Board of Directors fails to
perform its duties to convene or hold the general meeting as required by the
Company Law, convene or hold the general meeting;
(VI) submit proposals to the general meeting;
(VII) propose an interim Board meeting;
(VIII) attend meetings of the board of directors in a non-voting capacity and raise
questions and make suggestions in respect of matters that are the subject of
resolutions of the board of directors;
(IX) litigate against a Director or Senior Management in accordance with the Company
Law or the Articles of Association;
(X) to conduct an investigation and, if necessary, to engage professional organizations,
such as accounting firms and law firms, to assist it in its work in the event that it
discovers any irregularities in the Company’s operations. The reasonable expenses
incurred in respect of engaging a professional shall be borne by the Company;
(XI) other duties under the laws, administrative regulations, departmental rules,
regulatory documents, regulations or listing rules of the places where the shares of
the Company are listed or the Articles of Association.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-29 –


--- page 587 ---
General Manager and Other Senior Management
The Company shall have one General Manager and several Deputy General Managers
who shall be appointed or dismissed by the Board of Directors. General Manager, Deputy
General Manager, the CFO and Secretary are all the Company’s Senior Management.
The General Manager reports to the Board of Directors, and has the duties to:
(I) chair the production, operation and management of the Company, organize the
implementation of resolutions of the Board of Directors and report to the Board of
Directors;
(II) organise the implementation of resolutions made at Board meetings, the annual
operating plan, the investing plan, the annual budget plan and final accounts plan of
the Company;
(III) contemplate the fundamental management system and the internal management
setup plan of the Company;
(IV) formulate the specific rules and regulations of the Company;
(V) propose to the Board of Directors the appointment or dismissal of the Deputy
General Manager, the CFO, or the other Senior Management;
(VI) appoint or dismiss a manager other than those who should be appointed or dismissed
by the Board of Directors;
(VII) propose to hold interim meetings of the Board of Directors;
(VIII) other duties authorized by the General Manager’s Working Rules;
(IX) other duties authorized by the Articles of Association or the Board of Directors.
The General Manager shall preside at Board meetings, while he/she has no voting rights
at the Board meetings if he/she is not a director.
APPENDIX VI SUMMARY OF THE ARTICLES OF ASSOCIATION
– VI-30 –


--- page 588 ---
A. FURTHER INFORMATION ABOUT OUR GROUP
1. Establishment of our Company
Our predecessor company Thinkland Technology was established under the laws of the
PRC as a company with limited liability on February 25, 2010 with an initial registered capital
of RMB3.00 million. On September 20, 2017, our Company was converted to a joint stock
company with limited liability under the PRC Company Law. The registered address and
headquarter of our Company in the PRC is at 16/F, No. 9 Rongfu Street, Suzhou Industrial
Park, Suzhou, Jiangsu Province, PRC. A summary of our Articles is set out in “Appendix VI
– Summary of the Articles of Association”.
We have established a principal place of business in Hong Kong at 40/F, Dah Sing
Financial Centre, 248 Queen’s Road East, Wanchai, Hong Kong, and was registered with the
Companies Registry in Hong Kong as a non-Hong Kong company under Part 16 of the
Companies Ordinance on September 13, 2023. Ms. Y ang, being our executive Director, deputy
general manager, secretary to our Board and one of our joint company secretaries, and Ms.
Ching Shuk Wah Shirley, being our other joint company secretary, have been appointed as the
Authorized Representatives of our Company for the acceptance of service of process and notice
in Hong Kong. Our address for acceptance of service of process is 40/F, Dah Sing Financial
Centre, 248 Queen’s Road East, Wanchai, Hong Kong.
As our Company was established in the PRC, our operation are subject to the relevant
laws and regulations of the PRC. A summary of the relevant aspects of laws and regulations
of the PRC and our Articles of Association is set out in Appendix IV and VI, respectively.
2. Changes in Share Capital of our Company
As of the date of establishment of our predecessor company ThinkLand Technology on
February 25, 2010, our registered capital was RMB3.00 million, which was fully paid up by
Mr. Zuo, Mr. Wang Haojin and Mr. Qin Cheng. On September 20, 2017, our Company was
converted to a joint stock company with limited liability. As of the date of such conversion, our
total issued share capital was RMB45,000,000 divided into 45,000,000 Shares with a nominal
value of RMB1.00 each. On December 23, 2020, our total issued share capital was increased
from RMB45,000,000 to RMB45,300,000.
Upon completion of the Global Offering, our share capital will be increased to
RMB50,118,200, made up of 50,118,200 H Shares fully paid up or credited as fully paid up.
For more details, see “History, Development and Corporate Structure”.
Save as disclosed above, there has been no alteration in our total issued share capital
within the two years immediately preceding the date of publication of this prospectus.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-1 –


--- page 589 ---
3. Changes in the Share Capital of Our Subsidiaries
A summary of the corporate information and the particulars of our subsidiaries are set out
in Note 1 to the Accountants’ Report as set out in Appendix I to this prospectus.
There has been no alteration in the total issued share capital of our subsidiaries during the
two years immediately preceding the date of this prospectus. For details of our subsidiaries, see
“History, Development and Corporate Structure – Our Subsidiaries”.
4. Resolutions of our Shareholders in relation to the Global Offering
Pursuant to the resolutions passed at a duly convened general meeting of our Shareholders
on August 4, 2023, it was resolved, among others:
(a) the issue by our Company of H Shares of nominal value of RMB1.00 each up to
4,818,200 H Shares and such H Shares being listed on the Stock Exchange;
(b) subject to the completion of the Global Offering, the conditional adoption of the
Articles of Association, which shall become effective on Listing Date, and the Board
has been authorized to amend the Articles of Association in accordance with any
comments from the Stock Exchange and other relevant regulatory authorities; and
(c) authorization of the Board and its authorized persons to handle all matters relating
to, among other things, the Global Offering and the Listing.
5. Restrictions on Repurchase
See “Appendix IV – Summary of Principal and Regulatory Provisions” and “Appendix VI
– Summary of the Articles of Association” for details.
6. Corporate Reorganization
Our Company has not gone through any corporate reorganization. See “History,
Development and Corporate Structure” for further details of the history and development of our
Company.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-2 –


--- page 590 ---
B. FURTHER INFORMATION ABOUT OUR BUSINESS
1. Summary of Material Contracts
The following contracts (not being contracts entered into in the ordinary course of
business) have been entered into by us within the two years preceding the date of this document
and are or may be material:
(a) the equity transfer agreement dated July 22, 2023 entered into among our Company,
Zuo Lei ( ̸ᆾ), Suzhou Yiju Liuhe Investment Consulting Enterprise (Limited
Partnership) ( ᘽψɓၳʬΥҳ༟ፔ༔Άุ(Υྫ)) and China-Singapore Suzhou
Industrial Park V entures Co., Ltd. (ʮ̡)( “ China-
Singapore Ventures ”), pursuant to which Zuo Lei agreed to transfer 369,111
Shares, representing 0.8148% equity interest of our Company as of the date of the
agreement, to China-Singapore V entures for a consideration of RMB22.0 million;
(b) the cornerstone investment agreement dated June 17, 2024, entered into among our
Company, The Reynold Lemkins Group (Asia) Limited (“ Reynold Lemkins ”),
CITIC Securities (Hong Kong) Limited, CLSA Limited and Tiger Brokers (HK)
Global Limited, pursuant to which Reynold Lemkins agreed to subscribe for H
Shares at the Offer Price in the aggregate amount of the Hong Kong dollar
equivalent amount of US$15,000,000 (excluding brokerage and levies);
(c) the cornerstone investment agreement dated June 17, 2024, entered into among our
Company, Suzhou Industrial Park Industrial Investment Fund (Limited Partnership)
(ږ(Υྫ)) (“ SIP Industrial Investment Fund ”),
CITIC Securities (Hong Kong) Limited (ᗇՎ(ಥ)ʮ̡) and CLSA
Limited (ʮ̡), pursuant to which SIP Industrial Investment Fund
agreed to subscribe for H Shares at the Offer Price in the aggregate amount of the
Hong Kong dollar equivalent amount of US$12,200,000 (including brokerage and
levies);
(d) the cornerstone investment agreement dated June 17, 2024, entered into among our
Company, Xuzhou Economic and Technology Development Zone (HK) Investment
Co., Limited (ψ຾᏶Ҧஔක೯ਜ(ಥ)ʮ̡)( “ Xuzhou ETDZ (HK) ”),
CITIC Securities (Hong Kong) Limited (ᗇՎ(ಥ)ʮ̡), CLSA Limited
(ʮ̡) and CMB International Capital Limited (ვ਷ყፄ༟Ϟ
ʮ̡), pursuant to which Xuzhou ETDZ (HK) agreed to subscribe for H Shares at
the Offer Price in the aggregate amount of the Hong Kong dollar equivalent amount
of US$10,000,000 (excluding brokerage and levies);
(e) the cornerstone investment agreement dated June 17, 2024, entered into among our
Company, Gold Wings Holdings Limited (“ Gold Wings ”), CITIC Securities (Hong
Kong) Limited (ᗇՎ(ಥ)ʮ̡), and CLSA Limited (ࠢ
ʮ̡), pursuant to which Gold Wings agreed to subscribe for H Shares at the Offer
Price in the aggregate amount of HK$30,000,000 (excluding brokerage and levies);
(f) the Hong Kong Underwriting Agreement; and
(g) the price determination agreement dated June 19, 2024 entered into among our
Company and CLSA Limited, which determined the Offer Price per Offer Share.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-3 –


--- page 591 ---
2. Intellectual Property Rights of Our Group
(a) Patents
(i) Registered Patents
As of the Latest Practicable Date, we were the registered owner of and had the right
to use the following patents which we consider to be or may be material to our business:
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
1. Cloud Computing System for Data
Dispersed Storage ( ɓ၇ᅰኽʱ౳
ၑӻ୕)
Our Company PRC 2013104227185 2013/09/16 2033/09/15
2. Method, Equipment, and Mobile
Device for Mobile Device
Operation (˙
eༀໄձ୅ਗண௪)
Our Company PRC 201610867 1111 2016/09/29 2036/09/28
3. Method for Equipment Menus and
Terminal Device (ᐏ՟
ձ୞၌ண௪)
Our Company PRC 2016101136281 2016/02/29 2036/02/28
4. Time Display Method and Terminal
(ձ୞၌)
Our Company PRC 2016105944723 2016/07/26 2036/07/25
5. Method and System for Terminal-
based Big Data Processing (׵
ʿӻ୕)
Our Company PRC 2019103354922 2019/04/24 2039/04/23
6. Improved Deep Learning Intelligent
Response System Based on Cloud
Data (ၑዚථᅰ
ኪ୦౽ঐᏐഈӻ୕)
Our Company PRC 2016109109884 2016/10/20 2036/10/19
7. Data Filtering System Based on
Blockchain (ᅰ
ኽጜ፯ӻ୕)
Our Company PRC 2019102584005 2019/04/01 2039/03/31
8. Blockchain-based Big Data Security
Processing System ( ɓ၇ਜ෯ᗡɽ
ᅰኽτΌஈଣӻ୕)
Our Company PRC 2019106117670 2019/07/08 2039/07/07
9. Iterative Search Localization Method
Based on Communication
Operator Location V erification
Technology (༶ᐄਠ
З˙
ج)
Our Company PRC 2019109655266 2019/10/11 2039/10/10
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-4 –


--- page 592 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
10. Data Source Access Method,
Equipment, Storage Medium, and
Device (eༀໄe
πᎷʧሯʿண௪)
Our Company PRC 2021105752584 2021/05/26 2041/05/25
11. Identity V erification Method,
Equipment, Storage Medium, and
Device (eༀໄeπ
Ꮇʧሯʿண௪)
Our Company PRC 2021106455443 2021/06/10 2041/06/09
12. Instant Messaging Message Sending
Method, Equipment, Storage
Medium, and Device (ஷৃऊ
eༀໄeπᎷʧሯʿண
௪)
Our Company PRC 2021106460367 2021/06/10 2041/06/09
13. Deployment Method, Equipment,
Storage Medium, and Device for
Interface Services (௅
eༀໄeπᎷʧሯʿண௪)
Our Company PRC 2021107227887 2021/06/29 2041/06/28
14. Blockchain-Based Financial Product
Transfer Method and Related
Equipment (ଣৌପ
ᗫༀໄ)
Our Company PRC 2021107760566 2021/07/09 2041/07/08
15. Server Monitoring Method and
System (ʿӻ୕)
Our Company PRC 2021107923614 2021/07/14 2041/07/13
16. Service Request Forwarding Method
and System (ʿ
ӻ୕)
Our Company PRC 2021107646804 2021/07/07 2041/07/06
17. Execution Method, Equipment,
Storage Medium, and Device for
Scheduled Tasks (ੂБ
eༀໄeπᎷʧሯʿண௪)
Our Company PRC 202 1111473831 2021/09/29 2041/09/28
18. Interface Key Reset Method,
Equipment, Storage Medium, and
Server (eༀ
ਕኜ)
Our Company PRC 2021112011295 2021/10/15 2041/10/14
19. Object Access Method and Service
System (ਕӻ
୕)
Our Company PRC 2021112672743 2021/10/29 2041/10/28
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-5 –


--- page 593 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
20. Service Invocation Method,
Equipment, Storage Medium, and
Device for Legacy Systems ( ፲व
eༀໄeπᎷ
ʧሯʿண௪)
Our Company PRC 202111502261X 2021/12/10 2041/12/09
21. Shared File Configuration Method
and Equipment ( ɓ၇΍͜˖΁ৣໄ
ʿༀໄ)
Our Company PRC 2021108107524 2021/07/19 2041/07/18
22. Privacy Computing Method and
System Based on Distributed
Collaboration (ٙ
ʿӻ୕)
Our Company PRC 2022103219814 2022/03/30 2042/03/29
23. Sensitive Information
Desensitization and V erification
Method, System, and Electronic
Device (୭ઽ᜕ᗇ˙
eӻ୕ʿཥɿண௪)
Our Company PRC 2022103208538 2022/03/30 2042/03/29
24. Negotiation Method and System for
Cross-Domain AI Privacy
Computing Based on Blockchain
(༨ਹAIٙ
ʿӻ୕)
Our Company PRC 2022103292082 2022/03/31 2042/03/30
25. Account Login Method and System
Based on Blockchain (ਜ෯ᗡ
ʿӻ୕)
Our Company PRC 2022103143891 2022/03/29 2042/03/28
26. Cross-Domain Federated Learning
Method and System Based on
Trusted Execution Environment
(༨ਹᑌԞኪ
ʿӻ୕)
Our Company PRC 2022103543767 2022/04/06 2042/04/05
27. Sensitive Credential Management
Method and System Based on
Robotic Process Automation
(RPA) (׵RPAઽชኯኽ၍ଣ
ʿӻ୕)
Our Company PRC 2022103608583 2022/04/07 2042/04/06
28. Data Source Determination Method
and Equipment (˙
ձༀໄ)
Our Company PRC 2022103749806 2022/04/11 2042/04/10
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-6 –


--- page 594 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
29. Identity Authorization Method and
System Based on Blockchain ( ɓ
ձӻ
୕)
Our Company PRC 2022104553681 2022/04/28 2042/04/27
30. Generation Method and Generation
System for Blockchain
Applications (͛ϓ˙
ʿ͛ϓӻ୕)
Our Company PRC 2022106450088 2022/06/09 2042/06/08
31. Method, Equipment, Storage
Medium, and Gateway for
Abnormal Data Detection Based
on Blockchain (ମ੬
eༀໄeπᎷʧሯʿ
ၣᗫ)
Our Company PRC 202210670809X 2022/06/14 2042/06/13
32. Method and Equipment for
Determining Resource
Consumption (༟๕ऊঃ
ձༀໄ)
Our Company PRC 2022108003661 2022/07/08 2042/07/07
33. Privacy Data Management Method
and System Based on Serverless
Architecture (ݖ
ձӻ୕)
Our Company PRC 2022109015469 2022/07/28 2042/07/27
34. Data Collaboration Method,
Equipment, Storage Medium, and
Device Based on Privacy
Requirements (ᅰ
eༀໄeπᎷʧሯʿண
௪)
Our Company PRC 2022109277828 2022/08/03 2042/08/02
35. Interface-Based Privacy Computing
Method, System, Storage Medium,
and Device (ၑ
eӻ୕eπᎷʧሯʿண௪)
Our Company PRC 2022109783904 2022/08/16 2042/08/15
36. Data Element Privacy Computing
Method and System Based on
Blockchain and CDN (ਜ
෯ᗡձCDNၑ˙
ձӻ୕)
Our Company PRC 2022110429361 2022/08/29 2042/08/28
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-7 –


--- page 595 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
37. Method, Equipment, and System for
Data Element Rights Allocation
Based on Blockchain (ਜ෯ᗡ
eༀໄձ
ӻ୕)
Our Company PRC 2022110706063 2022/09/02 2042/09/01
38. Transaction Data V erification
Method and System Based on
Blockchain (ʹ
ձӻ୕)
Our Company PRC 2022 111109958 2022/09/13 2042/09/12
39. Data Transaction Method and
System Based on Blockchain ( ɓ
ձӻ
୕)
Our Company PRC 2022111295148 2022/09/16 2042/09/15
40. Privacy Computing Audit Method
and Device Based on Knowledge
Graph (ᒯӷ
ձༀໄ)
Our Company PRC 2022111584010 2022/09/22 2042/09/21
41. Data Query Method and Device ( ɓ
ձༀໄ)
Our Company PRC 2022112707484 2022/10/18 2042/10/17
42. Method and Device for Generation
of RPA Processes ( ɓ၇RPA೻
ձༀໄ)
Our Company PRC 2022112534023 2022/10/13 2042/10/12
43. Heat Dissipation Device for Internet
Big Data Servers ( ɓ၇ʝᑌၣɽᅰ
౳ᆠༀໄ)
Our Company PRC 2018222314298 2018/12/28 2028/12/27
44. Dustproof Device for Face
Recognition Device ( ɓ၇ɛᑕᗆй
ኜ͜ԣྡྷༀໄ)
Our Company PRC 2019204183419 2019/03/29 2029/03/28
45. Pulling and Cutting Device for
Floating-Type Data Recorder ( ɓ
Ұʲ
௲ༀໄ)
Our Company PRC 2018219240994 2018/11/21 2028/11/20
46. Separation Device for Floating-Type
Data Recorder (ɪओόᅰ
୭ᕎༀໄ)
Our Company PRC 2018219240636 2018/11/21 2028/11/20
47. Protective Device for CAD 3D
Model Displayers ( ɓ၇CADɧၪ
ᜑͪኜ͜ԣᚐༀໄ)
Our Company PRC 2019203960716 2019/03/27 2029/03/26
48. Fingerprint Acquisition Detection
Device (७મණᏨ಻ༀໄ)
Our Company PRC 2019204075537 2019/03/28 2029/03/27
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-8 –


--- page 596 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
49. Financial Intelligent Device with
Anti-Tampering Function ( ɓ၇Ո
ፄ౽ঐண௪)
Our Company PRC 2019202280289 2019/02/22 2029/02/21
50. Determination Method and System
Based on Blockchain Data
Provider (ᅰኽ
ձӻ୕)
Our Company PRC 2022116373088 2022/12/16 2042/12/15
51. Privacy Computing Method and
System for Attendance Data Based
on Blockchain (ٙ
ձӻ୕)
Our Company PRC 202211027903X 2022/08/25 2042/08/24
52. Power Trading Method and System,
Power Consumption Terminal and
Power Generation Terminal Based
on Privacy Computing (ᒯӷ
ձӻ୕e͜ཥ
၌ձ೯ཥ၌)
Our Company PRC 2023101053151 2023/02/13 2043/02/12
53 Power Trading Method, Equipment
and System Based on Blockchain
and Privacy Computing (׵
˙
eༀໄձӻ୕)
Our Company PRC 2023101215283 2023/02/16 2043/02/15
54 Assisting Pricing Method,
Equipment and System Based on
Data Element of Blockchain ( ɓ၇
ᄆ˙
eༀໄձӻ୕)
Our Company PRC 2023102105882 2023/03/07 2043/03/06
55 Method and Equipment for
Obtaining Off-chain Data Based
on Oracle Reputation V alue ( ɓ၇
ᗡ̮ᅰኽᐏ՟
ձༀໄ)
Our Company PRC 2023102105929 2023/03/07 2043/03/06
56 Identity Authentication Method,
Equipment and System Based on
Blockchain (Ԓ
eༀໄձӻ୕)
Our Company PRC 2023102128102 2023/03/08 2043/03/07
57 Assisting Transaction Method,
Equipment and System Based on
Data Element of Blockchain ( ɓ၇
˙
eༀໄձӻ୕)
Our Company PRC 2023102267340 2023/03/10 2043/03/09
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-9 –


--- page 597 ---
No. Patent Patentee
Place of
Registration Patent Number
Application Date
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
58 Data Circulation Method, Equipment
and System Based on Trusted
Execution Environment (׵
eༀ
ໄձӻ୕)
Our Company PRC 2023102408870 2023/03/14 2043/03/13
59 Control Methods, Equipment,
Storage Medium and Device for
Interface Services (છ
eༀໄeπᎷʧሯʿண௪)
Our Company PRC 2023102471145 2023/03/15 2043/03/14
60 Privacy Computing Method Based
on API, API Caller and API
Provider (׵APIၑ˙
eAPIሜ͜၌ձAPI౤Զ၌)
Our Company PRC 2023102673414 2023/03/20 2043/03/19
61 Digital Identity Authentication
Method and System Based on
Blockchain (ᅰοԒ
ʿӻ୕)
Our Company PRC 2023102838811 2023/03/22 2043/03/21
62 Transaction Method, System, Storage
Medium and Device Based on
Data Element of Blockchain (׵
eӻ
୕eπᎷʧሯʿண௪)
Our Company PRC 2023102810483 2023/03/22 2043/03/21
63 Loophole Detection Method,
Equipment, Storage Medium and
Device for Interface (ݸ
eༀໄeπᎷʧሯʿண
௪)
Our Company PRC 2023103021691 2023/03/27 2043/03/26
64 Model Training Method and System
Based on Blockchain (ਜ෯ᗡ
ʿӻ୕)
Our Company PRC 2023103354204 2023/03/31 2043/03/30
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-10 –


--- page 598 ---
(b) Trademarks
(i) Registered Trademarks
As of the Latest Practicable Date, we had registered the following trademarks which
we consider to be or may be material to our business:
No. Trademark Class
Place of
Registration
Registration
No.
Registered
Owner
Date of
application
(yyyy/mm/dd)
Expiry Date
(yyyy/mm/dd)
1.
38 PRC 27204943 Our Company 2017/10/31 2028/11/13
2.
 41 PRC 27195398 Our Company 2017/10/31 2028/11/27
3.
 9 PRC 27182827 Our Company 2017/10/31 2029/01/27
4.
 41 PRC 27190966 Our Company 2017/10/31 2029/01/27
5.
 9 PRC 27204882 Our Company 2017/10/31 2029/01/27
6.
 35 PRC 27198504 Our Company 2017/10/31 2029/02/13
7.
 9 PRC 27200355 Our Company 2017/10/31 2029/02/27
8.
 41 PRC 27187843 Our Company 2017/10/31 2029/03/20
9.
 16 PRC 27196979 Our Company 2017/10/31 2029/03/20
10.
 42 PRC 60873018 Our Company 2021/11/25 2032/05/13
11.
 42 PRC 56770984 Our Company 2021/06/08 2032/12/20
12.
 9, 42 Hong Kong 306231465 Our Company 2023/04/28 2033/04/27
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-11 –


--- page 599 ---
(c) Copyrights
(i) Registered Copyright
As of the Latest Practicable Date, we were the registered owner of and had the right
to use the following copyrights which we consider to be material to our business:
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
1. ThinkLand Technology Comic
Reading Mobile Software ( อ
ᚆᅃဘ೥ቡᛘ˓ዚழ΁)
V1.0 Our Company 2011SR096245 2011/05/01 2011/04/22 PRC
2. ThinkLand Technology Crazy
Sushi Shop Mobile Game
Software (ᚆᅃဵӮྪ̡
˓ዚ༷Ꮥழ΁)
V1.0 Our Company 2012SR002477 2010/11/20 2010/11/17 PRC
3. ThinkLand Technology
Convenient Ordering Tablet
Software (ઠᓃ᎛
ழ΁)
V1.0 Our Company 2012SR002780 2011/08/01 2011/04/22 PRC
4. ThinkLand Technology Juhe
Cloud Data Platform Software
(ᚆᅃၳΥථᅰኽ̨̻ழ
΁)
V1.0 Our Company 2012SR016501 2011/04/01 2011/03/12 PRC
5. ThinkLand Technology Credit
Card Discount Check Mobile
Software (̔͜Ꮄ
༔˓ዚழ΁)
V1.0 Our Company 2012SR016505 2010/12/01 2010/11/22 PRC
6. ThinkLand Technology Early
Childhood Education Mobile
Software (ᚆᅃ̼Յ઺ԃ
˓ዚழ΁)
V1.0 Our Company 2012SR016256 2012/01/04 2012/01/04 PRC
7. ThinkLand Technology
Teahouse Entertainment
Platform Software (ᚆᅃ
ᆀ̨̻ழ΁)
V1.0 Our Company 2012SR018788 2011/11/15 2011/08/22 PRC
8. ThinkLand Technology Super
Crazy Sushi Shop Mobile
Game Software (ᚆᅃ൴
˓ዚ༷Ꮥழ΁)
V1.0 Our Company 2012SR018804 2011/04/10 2011/03/05 PRC
9. ThinkLand Technology City
Defense Mobile Game
Software (ሊ
኷˓ዚ༷Ꮥழ΁)
V1.0 Our Company 2012SR018795 2011/06/20 2011/06/05 PRC
10. ThinkLand Technology Sports
Information Mobile Software
(˓ዚழ΁)
V1.0 Our Company 2012SR018793 2010/06/01 2010/05/22 PRC
11. ThinkLand Technology Our
UEFA Champions League
Sports Information Mobile
Software* (ᆄ
˓ዚழ΁)
V1.0 Our Company 2012SR070015 2012/05/18 2012/05/15 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-12 –


--- page 600 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
12. ThinkLand Technology
Android-based Smart Home
Platform Software (ᚆᅃ
׵Android̨̻
ழ΁)
V1.0 Our Company 2014SR113123 2014/02/22 2013/10/08 PRC
13. ThinkLand Technology
Merchant Seller Analysis
System Software (ᚆᅃᏍ
ӻ୕ழ΁)
V1.0 Our Company 2014SR166912 2013/11/05 2013/09/22 PRC
14. ThinkLand Technology Price
Comparison Mobile Software
(ᚆᅃˢᄆ୅ਗழ΁)
V1.0 Our Company 2014SR163248 2014/02/01 2013/11/02 PRC
15. ThinkLand Technology
e-Commerce Mobile Software
(ᚆᅃཥਠ୅ਗழ΁)
V1.0 Our Company 2014SR165255 2014/02/01 2013/11/01 PRC
16. ThinkLand Technology JD
Active Merchandise
Monitoring Software (ᚆ
္಻ழ΁)
V1.0 Our Company 2014SR164787 2014/08/20 2014/06/22 PRC
17. ThinkLand Technology Juhe
Data Platform Software (߅
ᚆᅃၳΥᅰኽ̨̻ழ΁)
V2.0 Our Company 2014SR166195 2013/11/09 2013/09/09 PRC
18. ThinkLand Technology
Developer Service Store
System Software (ᚆᅃක
ӻ୕ழ΁)
V1.0 Our Company 2014SR164196 2014/09/03 2014/08/02 PRC
19. ThinkLand Technology Free
SMS V erification Code
Software (ڦ
᜕ᗇᇁழ΁)
V1.0 Our Company 2014SR166919 2014/08/25 2014/07/02 PRC
20. ThinkLand Technology
Nichacha APP Software (߅
ݟݟAPPழ΁)
V1.0 Our Company 2014SR163214 2014/03/05 2014/03/02 PRC
21. ThinkLand Technology Barcode
Mobile Software (ᚆᅃૢ
ᇁ୅ਗழ΁)
V1.0 Our Company 2014SR164646 2014/02/01 2013/11/01 PRC
22. ThinkLand Technology Code
Sharing Platform Software
(ᚆᅃ˾ᇁʱԮ̨̻ழ΁)
V1.0 Our Company 2015SR211473 2015/07/05 2015/07/02 PRC
23. ThinkLand Technology Tool
99APP (IOS version)
Software (ᚆᅃʈՈ
99APP(IOSو)ழ΁)
V1.0 Our Company 2015SR211412 2015/08/05 2015/06/02 PRC
24. ThinkLand Technology Tools
Touchstone Website Software
(ͩၣ१ழ
΁)
V1.0 Our Company 2015SR214535 2015/09/01 2015/09/01 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-13 –


--- page 601 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
25. ThinkLand Technology Car
Violation Checking Software
(༔ழ
΁)
V1.0 Our Company 2015SR211701 2015/07/12 2015/07/10 PRC
26. ThinkLand Technology Data
Fox Enterprise Information
Inquiry Software (ᚆᅃᅰ
༔ழ΁)
V1.0 Our Company 2016SR001198 2015/10/01 2015/09/30 PRC
27. ThinkLand Technology Tool
99APP (Android version)
Software (ᚆᅃʈՈ
99APP(Androidو)ழ΁)
V1.0 Our Company 2015SR250250 2015/08/05 2015/06/02 PRC
28. ThinkLand Technology Juhe
Cloud Data Platform Software
(ᚆᅃၳΥථᅰኽ̨̻ழ
΁)
V2.0 Our Company 2015SR250245 2015/07/12 2015/07/10 PRC
29. ThinkLand Technology Juhe
Recharge System Software
(ӻ୕ழ΁)
V1.0 Our Company 2017SR004407 2016/10/01 2016/09/30 PRC
30. ThinkLand Technology AdEcho
Advertising and Marketing
Platform Software (ᚆᅃ
AdEcho ᄿѓᐄቖ̨̻ழ΁)
V1.0 Our Company 2017SR004099 2016/10/01 2016/09/30 PRC
31. Tianju Dihe Recharge System
Software (ӻ୕
ழ΁)
V2.0 Our Company 2018SR274177 2018/01/30 2018/01/26 PRC
32. Tianju Dihe Anti-fraud Security
Check System Software ( ˂ၳ
༔ӻ୕ழ
΁)
V1.0 Our Company 2018SR274240 2018/01/03 2017/12/28 PRC
33. Tianju Dihe Industry Big Data
Cloud Service Platform
Software ( ˂ၳήΥБุɽᅰ
ਕ̨̻ழ΁)
V1.0 Our Company 2018SR215817 2018/01/30 2018/01/26 PRC
34. Tianju Dihe Business Data
Inquiry Service Platform
Software ( ˂ၳήΥุਕᅰኽ
ਕ̨̻ழ΁)
V1.0 Our Company 2018SR216341 2018/01/03 2017/12/28 PRC
35. Tianju Dihe Gift Card
Marketing Management
Platform Software ( ˂ၳήΥ
̔મቖ၍ଣ̨̻ழ΁)
V1.0 Our Company 2019SR0012685 2018/10/25 2018/09/30 PRC
36. Tianju Dihe Financial Risk
Management System Software
(છӻ୕ழ΁)
V1.0 Our Company 2019SR0011640 2018/11/05 2018/11/02 PRC
37. Tianju Dihe Automobile
Violation Service Platform
System Software ( ˂ၳήΥӛ
ਕ̨̻ӻ୕ழ΁)
V1.0 Our Company 2019SR0383715 2018/12/30 2018/11/01 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-14 –


--- page 602 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
38. Tianju Dihe Agency System
Software ( ˂ၳήΥ˾ଣਠӻ
୕ழ΁)
V1.0 Our Company 2019SR0383726 2018/12/08 2018/12/02 PRC
39. Tianju Dihe Digital Geofence
Monitoring and Warning
Software ( ˂ၳήΥᅰοήଣ
ఖᙷ္಻ཫᙆழ΁)
V1.0 Our Company 2019SR0659886 2019/05/22 2019/05/22 PRC
40. Tianju Dihe Magic Mirror
Back-office Management
Software (̨
၍ଣழ΁)
V1.0 Our Company 2019SR1269362 2019/09/02 2019/08/30 PRC
41. Tianju Dihe Quick
Authentication Software ( ˂
ၳήΥઠ᜕ҞઠႩᗇழ΁)
V1.0.0 Our Company 2019SR1416354 2019/10/18 2019/10/14 PRC
42. Tianju Dihe Member Ranking
System Software ( ˂ၳήΥึ
ഃॴӻ୕ழ΁)
V1.0 Our Company 2019SR1447643 2019/07/12 2019/07/12 PRC
43. Tianju Dihe Hui Recharge
System Software ( ˂ၳήΥ౉
ӻ୕ழ΁)
V1.0 Our Company 2019SR1447635 2019/06/20 2019/06/20 PRC
44. Juhe Data Fuchehui Service
Platform Software ( ၳΥᅰኽ
ਕ̨̻ழ΁)
V1.0 Our Company 2019SR1447536 2019/07/22 2019/07/22 PRC
45. Juhe Data Enterprise
Information Monitoring and
Rating Platform System
Software (ࢹڦ
္છၾ൙ॴ̨̻ӻ୕ழ΁)
V1.0 Our Company 2020SR0316192 2019/02/26 2019/02/18 PRC
46. Juhe Data SMS Messaging
Network Relationship
Software (೯৔
ழ΁)
V1.0 Our Company 2020SR0316688 2019/04/01 2019/03/20 PRC
47. Tianju Dihe External Data
Management System Software
(˂ၳήΥ̮௅ᅰኽ၍ଣӻ୕
ழ΁)
V1.1 Our Company 2020SR0350935 2020/01/15 2020/01/15 PRC
48. Tianju Dihe Enterprise
Marketing System Software
(˂ၳήΥΆุᐄቖӻ୕ழ΁)
V6.0 Our Company 2020SR1511669 2019/06/21 2019/06/21 PRC
49. Tianju Dihe Database Intelligent
API Conversion Software
System (౽ঐ
APIᔷ౬ழ΁ӻ୕)
V1.0 Our Company 2020SR1819714 2020/02/08 2020/02/08 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-15 –


--- page 603 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
50. Fengniao Tripartite Data
Collection Management
Platform ( ໶௢ᅰණɧ˙ᅰኽ
၍ଣ̨̻)
V1.0 Our Company;
Hebei Xingfu
Xiaofei
Finance Co.,
Ltd. (ֱ
ٰ
ʮ̡)
2020SR1823842 2020/11/17 2020/11/16 PRC
51. Tianju Dihe Violation Payment
Service Software ( ˂ၳήΥ༼
ਕழ΁)
V1.0.0 Our Company 2021SR0332939 2020/09/08 2020/09/08 PRC
52. Tianju Dihe Mobile Point
Marketing Service Software
(ਕ
ழ΁)
V1.2 Our Company 2021SR0357091 2020/08/30 2020/08/30 PRC
53. Tianju Dihe API Open Platform
Software ( ˂ၳήΥAPI׳
̨̻ழ΁)
V1.0 Our Company 2021SR0357086 Unpublished 2020/12/16 PRC
54. Tianju Dihe Internet Defense
System Software ( ˂ၳήΥʝ
ᑌၣԣᇞፍᛓӻ୕ழ΁)
V1.0 Our Company 2021SR0393294 2020/11/16 2020/11/09 PRC
55. Tianju Dihe SaaS API
Management Platform
Software ( ˂ၳήΥSaaS API
၍ଣ̨̻ழ΁)
V1.0 Our Company 2021SR1181216 2021/05/10 2021/05/10 PRC
56. Tianju Dihe Cloud Data Service
Platform Software ( ˂ၳήΥ
ਕ̨̻ழ΁)
V8.5 Our Company 2021SR0571532 2020/10/30 2020/10/30 PRC
57. Data Lifecycle Agile
Governance Platform ( ᅰኽΌ
ଣ̨̻)
V1.0 Our Company 2022SR0036671 2021/11/01 2021/11/01 PRC
58. Tianju Dihe Process Automation
Software (೻Іਗ
ʷழ΁)
V1.0 Our Company 2022SR0191686 2021/11/01 2021/11/01 PRC
59. Tianju Dihe API Service
Governance Platform ( ˂ၳή
ΥAPIଣ̨̻)
V1.0 Our Company 2022SR0191687 2021/11/01 2021/11/01 PRC
60. Digital Police Support Platform
(ᅰο኷ᙆ˕౪̨̻)
V1.3 Our Company 2023SR0334554 2022/12/02 2022/11/30 PRC
61. SmartShield Privacy
Preservation Computing
Platform (SmartShieldࠇ
ၑ̨̻)
V1.0 Our Company 2023SR0184215 2022/07/24 2022/07/20 PRC
62. AnchorChain Blockchain
Browser Software
(AnchorChain ਜ෯ᗡᓭᚎኜழ
΁)
V1.0 Our Company 2023SR0088887 2022/07/02 2022/06/20 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-16 –


--- page 604 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
63. AnchorChain Blockchain
Network Management
Software (AnchorChain ਜ෯
ᗡၣഖ၍ଣழ΁)
V1.0 Our Company 2023SR0088729 2022/06/10 2022/06/08 PRC
64. AnchorDB Immutable Database
Software (AnchorDB ʔ̙ጛҷ
ழ΁)
V1.0 Our Company 2023SR0088732 2022/08/02 2022/07/22 PRC
65. AnchorDID Decentralized
Digital Identity Management
Software (AnchorDID ̘ʕː
ʷᅰοԒ΅၍ଣழ΁)
V1.0 Our Company 2023SR0563571 2023/02/12 2023/02/07 PRC
66. Automated stop-loss robot
software for fund warning ( ༟
ཫᙆІਗ˟ฦዚኜɛழ΁)
V1.0 Our Company 2023SR1483460 2023/06/23 2023/06/22 PRC
67. APIMaster-gateway Portal
System (APIMaster-gateway
ၣᗫӻ୕)
V1.0 Our Company 2023SR1318926 2023/07/09 2023/05/19 PRC
68. Daily Case Acceptance and
Abnormality Detection Alert
Robot Software (e
ཫᙆዚኜɛழ
΁)
V1.0 Our Company 2024SR0094787 2023/06/30 2023/06/30 PRC
69. Funds Monitoring and Control
Digital Warfare Robot
Software (છᅰο኷ᙆ
ዚኜɛழ΁)
V1.0 Our Company 2024SR0093440 2023/08/31 2023/08/30 PRC
70. Tianju Renhe United
Authentication Rights System
Software ( ˂ၳɛΥ୕ɓႩᗇ
ӻ୕ழ΁)
V1.0.0 Tianju Renhe 2022SR0223584 2021/10/01 2021/07/01 PRC
71. Tianju Renhe Platform
Monitoring Management
System Software ( ˂ၳɛΥ̻
္̨છ၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2022SR0223586 2021/05/01 2021/04/01 PRC
72. Tianju Renhe Data Download
Center System Software ( ˂
ၳɛΥᅰኽɨ༱ʕːӻ୕ழ
΁)
V1.0.0 Tianju Renhe 2022SR0224516 2021/10/01 2021/06/15 PRC
73. Zonghui Juhe Fixed Asset
Investment Management
System Software ( ଺ිၳΥո
༟ପҳ༟၍ଣӻ୕ழ΁)
V1.0 Zhonghui Juhe 2018SR275279 2018/03/01 2018/03/01 PRC
74. Tianju Renhe Gift Card
Management System Software
(̔၍ଣӻ୕ழ
΁)
V1.0.0 Tianju Renhe 2020SR1668156 Unpublished 2020/05/25 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-17 –


--- page 605 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
75. Tianju Renhe Business Statistics
Reporting System Software
(ӻ୕
ழ΁)
V1.0.0 Tianju Renhe 2020SR1668184 Unpublished 2020/05/25 PRC
76. Tianju Renhe Supplier
Management System Software
(˂ၳɛΥԶᏐਠ၍ଣӻ୕ழ
΁)
V1.0.0 Tianju Renhe 2020SR1668392 Unpublished 2020/05/25 PRC
77. Tianju Renhe User Point
Management System Software
(˂ၳɛΥጐʱ͜˒၍ଣӻ୕
ழ΁)
V1.0.0 Tianju Renhe 2020SR1668393 Unpublished 2020/06/15 PRC
78. Tianju Renhe Procurement
Management System Software
(˂ၳɛΥમᒅ၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1668858 Unpublished 2020/05/25 PRC
79. Tianju Renhe Customer
Management System Software
(˒၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1668859 Unpublished 2020/05/25 PRC
80. Tianju Renhe Gas Card Top-up
System Software ( ˂ၳɛΥ̋
ӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1669572 Unpublished 2020/02/25 PRC
81. Tianju Renhe Order
Management System Software
(ఊ၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1670002 Unpublished 2020/05/25 PRC
82. Tianju Renhe Main User Site
Fee Management System
Software ( ˂ၳɛΥ͜˒˴१
൬͜၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1674593 Unpublished 2020/05/25 PRC
83. Tianju Renhe Operation Control
Management System Software
(˂ၳɛΥ༶ᐄછՓ၍ଣӻ୕
ழ΁)
V1.0.0 Tianju Renhe 2020SR1674822 Unpublished 2020/05/25 PRC
84. Tianju Renhe Financial
Management System Software
(˂ၳɛΥৌਕ၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1674842 Unpublished 2020/05/25 PRC
85. Tianju Renhe Product Inventory
Point Management System
Software (ۜ
π၍ଣӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1674962 Unpublished 2020/06/15 PRC
86. Tianju Renhe Main User Site
Security Protection System
Software ( ˂ၳɛΥ͜˒˴१
ᚐӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1674979 Unpublished 2020/05/25 PRC
87. Tianju Renhe Main User Site
Business System Software ( ˂
ၳɛΥ͜˒˴१ุਕӻ୕ழ
΁)
V1.0.0 Tianju Renhe 2020SR1674980 Unpublished 2020/05/25 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-18 –


--- page 606 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
88. Tianju Renhe Main User Site
Customer Information System
Software ( ˂ၳɛΥ͜˒˴१
ӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1677050 Unpublished 2020/05/25 PRC
89. Tianju Renhe Message Robot
Management System Software
(ዚኜɛ၍ଣӻ
୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1677051 Unpublished 2020/05/25 PRC
90. Tianju Renhe Product Point
Management System Software
(၍ଣӻ୕
ழ΁)
V1.0.0 Tianju Renhe 2020SR1677054 Unpublished 2020/06/15 PRC
91. Tianju Renhe Main User Site
Bulk Recharge System
Software ( ˂ၳɛΥ͜˒˴१
ӻ୕ழ΁)
V1.0.0 Tianju Renhe 2020SR1677055 Unpublished 2020/05/25 PRC
92. Tianju Renhe Orders Point
Management System Software
(ఊ၍ଣӻ୕
ழ΁)
V1.0.0 Tianju Renhe 2020SR1696910 Unpublished 2020/06/15 PRC
93. Phone Bill Recharge Platform
System (̨̻ӻ୕)
V1.0.0 Tianju Renhe 2021SR0753910 Unpublished 2019/12/31 PRC
94. Tianju Renhe Inventory
Procurement System Software
(πમᒅӻ୕ழ΁)
V1.0.0 Tianju Renhe 2022SR0223585 Unpublished 2021/11/29 PRC
95. Tianju Renhe Gateway Routing
System Software ( ˂ၳɛΥၣ
ᗫ༩͟ӻ୕ழ΁)
V1.0.0 Tianju Renhe 2022SR0224517 Unpublished 2021/09/01 PRC
96. Recharge Order System ( ˂ၳɛ
ఊӻ୕)
V1.0.0 Tianju Renhe 2023SR0379344 Unpublished 2021/07/01 PRC
97. Message Publishing
Management System ( ˂ၳɛ
೯б၍ଣӻ୕)
V1.0.0 Tianju Renhe 2023SR0167024 Unpublished 2022/09/30 PRC
98. Recharge Product Management
System (၍
ଣӻ୕)
V1.0.0 Tianju Renhe 2023SR0167022 Unpublished 2022/06/30 PRC
99. After-sales Management System
(၍ଣӻ୕)
V2.0.0 Tianju Renhe 2023SR0167023 Unpublished 2022/11/11 PRC
100. Operation Control Management
System ( ˂ၳɛΥ༶ᐄછՓ၍
ଣӻ୕)
V2.0.0 Tianju Renhe 2023SR0167025 Unpublished 2022/11/11 PRC
101. Tianju Renhe Points Mall
System (ӻ
୕)
V1.0 Tianju Renhe 2024SR0227837 Unpublished 2023/09/30 PRC
102. Tianju Renhe Points Product
Management System ( ˂ၳɛ
၍ଣӻ୕)
V2.0 Tianju Renhe 2024SR0227850 Unpublished 2023/09/30 PRC
103. Tianju Renhe Points Order
Management System ( ˂ၳɛ
ఊ၍ଣӻ୕)
V2.0 Tianju Renhe 2024SR0227842 Unpublished 2023/09/30 PRC
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-19 –


--- page 607 ---
No. Copyright Name Version Owner
Copyright
Number
First
Publication
Date
(yyyy/mm/dd)
Development
Completion
Date
(yyyy/mm/dd)
Place of
Registration
104. Capital Warning Automatic
Stop-Loss Robot Software
V1.0 (ཫᙆІਗ˟ฦዚኜ
ɛழ΁V1.0)
V1.0 Our Company 2024SR0632645 2023/6/23 2023/6/22 PRC
105. Data Product Co-Creation
Platform V1.0 (΍௴
̨̻V1.0)
V1.0 Our Company 2024SR0462397 2023/11/6 2023/11/6 PRC
106. Juvenile Cross-Regional Crime
Warning Robot Software V1.0
(͊ϓϋɛ༨ਜਹ͕ໆཫᙆዚ
ኜɛழ΁V1.0)
V1.0 Our Company 2024SR0411542 2023/6/30 2023/6/30 PRC
107. Tianju Renhe Number
Management System ( ˂ၳɛ
Υ໮ᇁ၍ଣӻ୕)
V1.0 Tianju Renhe 2024SR0378395 Unpublished 2023/10/30 PRC
(d) Domain Names
As of the Latest Practicable Date, we had registered and maintained ownership to the
following domain names in China which we consider to be or may be material to our business:
No. Domain Owner
Expiry Date
(yyyy/mm/dd)
1. juhe.cn Our Company 2025/04/04
2. juheapi.com Our Company 2024/11/05
3. tianjurenhe.com Tianju Renhe 2027/03/27
4. sdk.cn Beijing Sidike 2024/09/09
Save as disclosed above, as of the Latest Practicable Date, there were no other patents,
trade or service marks, intellectual or industrial property rights which are or may be material
in relation to our business.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-20 –


--- page 608 ---
C. FURTHER INFORMATION ABOUT OUR DIRECTORS, SUPERVISORS AND
SUBSTANTIAL SHAREHOLDERS
1. Particulars of Directors’ and Supervisors’ service contracts and appointment letters
Each of our executive Directors and non-executive Directors has entered into a service
contract with our Company for an initial term of three years, and we signed letters of
appointment with each of our independent non-executive Directors. The service contracts and
the letters of appointment are subject to termination in accordance with their respective terms.
The service contracts may be renewed in accordance with our Articles of Association and the
applicable Listing Rules.
Save as disclosed above, none of our Directors has entered, or has proposed to enter, a
service contract with any member of the Group (other than contracts expiring or determinable
by the employer within one year without the payment of compensation (other than statutory
compensation)).
2. Remuneration of Directors and Supervisors
The aggregate remuneration (including fees, salaries, allowance and other benefits,
discretionary bonus, retirement scheme contribution and equity-settled share-based payments
as the case may be) paid to our Directors and Supervisors for the three years ended December
31, 2021, 2022 and 2023 was approximately RMB2,306,000, RMB2,472,000 and
RMB2,529,000, respectively.
It is estimated that, under the arrangements currently in force, the aggregate amount of
remuneration payable to our Directors and Supervisors for the year ending December 31, 2024
will be approximately RMB2.7 million (excluding any discretionary bonus but including
historical share-based payment expenses).
The number of our Company’s five highest paid individuals for the three years ended
December 31, 2021, 2022 and 2023 included four, three, four and five employees who were not
our Directors and Supervisors, respectively. The aggregate remuneration (including salaries,
allowance and other benefits, discretionary bonus, contribution to retirement scheme and
equity-settled share-based payments) payable to such individuals (excluding any of our
Directors and Supervisors) for the three years ended December 31, 2021, 2022 and 2023 was
approximately RMB2,143,000, RMB3,138,000 and RMB3,735,000, respectively.
During the Track Record Period, no fees were paid by our Group to any of our Directors,
Supervisors or the five highest paid individuals as an inducement to join us or as compensation
for loss of office, and there has been no arrangement under which a Director or Supervisor has
waived or agreed to waive any emoluments.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-21 –


--- page 609 ---
3. Disclosure of interests
(a) Disclosure of interests of Directors, Supervisors and chief executive of our Company
Immediately following the completion of the Global Offering, the interest and/or short
position (as applicable) of our Directors, Supervisors and chief executives of our Company in
the shares, underlying shares and debentures of our Company or its associated corporations
(within the meaning of Part XV of the SFO) which will be required to be notified to our
Company and the Stock Exchange pursuant to Divisions 7 and 8 of Part XV of the SFO
(including interest or short positions which they were taken or deemed to have under such
provisions of the SFO) or which will be required, pursuant to section 352 of the SFO, to be
entered in the register referred to therein, or which will be required, pursuant to the Model
Code for Securities Transactions by Directors of Listed Issuers as set out in Appendix C3 to
the Listing Rules, to be notified to our Company and the Stock Exchange, once the H Shares
are listed, will be as follows:
(i) Interests in our Company
Name of
Shareholder Nature of interest
Shares held as of the Latest Practicable Date
Shares held immediately following the
completion of the Global Offering
Type of Shares
Number of
Shares (1)
Approximate
percentage of
shareholding
in the total
issued share
capital of our
Company
Type of
Shares
Number of
Shares (1)
Approximate
percentage of
shareholding
in the total
issued share
capital of our
Company
Mr. Zuo Beneficial interest Unlisted Shares 19,744,192 43.59% H Shares 19,744,192 39.40%
Interest of spouse (2) Unlisted Shares 69,042 0.15% H Shares 69,042 0.14%
Interest in
controlled
corporation
(3)
Unlisted Shares 4,345,711 9.59% H Shares 4,345,711 8.67%
Mr. Qiu
Jianqiang
Beneficial interest Unlisted Shares 4,037,978 8.91% H Shares 4,037,978 8.06%
Ms. Ren Y uan Beneficial interest Unlisted Shares 628,838 1.39% H Shares 628,838 1.25%
Mr. Y u Gang Interest in
controlled
corporation
(4)
Unlisted Shares 1,298,926 2.87% H Shares 1,298,926 2.59%
Notes:
(1) All interests stated are long positions.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-22 –


--- page 610 ---
(2) As of the Latest Practicable Date, Ms. Hua was interested in 69,042 Shares. Mr. Zuo and Ms. Hua are
spouses. Accordingly, they are deemed to be interested in the same number of Shares that the other
person is interested in for the purpose of the SFO.
(3) These Shares are held by Yiju Liuhe and Liuju Liuhe. As of the Latest Practicable Date, Yiju Liuhe was
interested in 3,512,401 Shares where Liuju Liuhe was interested in 833,310 Shares. As Yiju Liuhe was
owned as to 99.00% by Mr. Zuo as its sole general partner and Liuju Liuhe was owned as to 69.75%
by Mr. Zuo as its sole general partner, Mr. Zuo is deemed to be interested in the Shares held by Yiju
Liuhe and Liuju Liuhe.
(4) As of the Latest Practicable Date, Tahoe Growth, Tahoe Lande and Tahoe Growth II were interested in
569,780, 520,819 and 208,327 Shares, respectively where Tahoe V enture Capital is the general partner
of Tahoe Growth, Tahoe Lande and Tahoe Growth II. As Mr. Y u Gang was interested in 58.00%
partnership interest in Tahoe V enture Capital, he is deemed to be interested in the Shares held by Tahoe
Growth, Tahoe Lande and Tahoe Growth II.
(ii) Interests in associated corporations of our Company
Name of Supervisor
Name of
associated
corporation Nature of interest
Percentage of
shareholding
Mr. Y u Gang Beijing Sidike Interest in controlled
corporation
(1)
10%
Note:
(1) As of the Latest Practicable Date, Tahoe V enture Capital is the general partner of Tahoe Growth,
which owns 10% of the equity interest in Beijing Sidike. Mr. Y u Gang was interested in 58.00%
partnership interest in Tahoe V enture Capital. Accordingly, he is deemed to be interested in the
shares held by Tahoe Growth.
(b) Disclosure of interests of substantial shareholders
Save as disclosed in “Substantial Shareholders” in this prospectus, immediately following
the completion of the Global Offering, our Directors are not aware of any person (not being a
Director or chief executive of our Company) who will have interests or short positions in our
H Shares or underlying Shares which would be required to be disclosed to us and the Stock
Exchange under the provisions of Divisions 2 and 3 of Part XV of the SFO, or, directly or
indirectly, be interested in 10% or more of the nominal value of any class of share capital
carrying the rights to vote in all circumstances at general meetings of our Company or any
other members of our Group.
4. Agency Fees or Commissions Received
Save as disclosed in the section headed “Underwriting”, no commissions, discounts,
brokerages or other special terms were granted within the two years preceding the date of this
prospectus in connection with the issue or sale of any capital or security of any member of our
Group.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-23 –


--- page 611 ---
5. Disclaimers
Save as disclosed in this prospectus:
(a) none of our Directors, Supervisors or the chief executive of our Company has any
interest or short position in the Shares, underlying shares or debentures of our
Company or any of its associated corporation (within the meaning of the SFO)
which will have to be notified to our Company and the Stock Exchange pursuant to
Divisions 7 and 8 of Part XV of the SFO or which will be required, pursuant to
section 352 of the SFO, to be entered in the register referred to therein, or which will
be required to be notified to our Company and the Stock Exchange pursuant to the
Model Code for Securities Transactions by Directors of Listed Issuers once the H
Shares are listed;
(b) save as disclosed in this prospectus, none of our Directors, Supervisors or any of the
experts referred to under paragraph headed “E. Other Information – 12.
Qualification of Experts” in this appendix is:
(i) interested in our promotion, or in any assets which have been, within two years
immediately preceding the date of this prospectus, acquired or disposed of by
or leased to us, or are proposed to be acquired or disposed of by or leased to
any member of our Group; or
(ii) materially interested in any contract or arrangement subsisting at the date of
this prospectus which is significant in relation to our business;
(c) so far as is known to our Directors, Supervisors or the chief executive of our
Company, no person (not being a Director, Supervisors or chief executive of our
Company) will, immediately following the completion of the Global Offering, have
an interest or short position in the Shares or underlying shares of our Company
which would fall to be disclosed to our Company under the provisions of Divisions
2 and 3 of Part XV of SFO or be interested, directly or indirectly, in 10% or more
of the nominal value of any class of share capital carrying rights to vote in all
circumstances at general meetings of any member of our Group; and
(d) none of our Directors, Supervisors or their respective close associates (as defined
under the Listing Rules) or our Shareholders who are interested in more than 5% of
the issued share capital of our Company has any interest in the five largest customers
or the five largest suppliers of our Group.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-24 –


--- page 612 ---
D. EMPLOYEE INCENTIVE SCHEME
The following is a summary of the principal terms of the employee incentive scheme in
relation to Liuju Liuhe (the “ Employee Incentive Scheme ”) approved and adopted by our
Company in August 2020 for the purpose of attracting and retaining talents for our Group.
Under the Employee Incentive Scheme, eligible participants are entitled to equity interest in
Liuju Liuhe (the “ Incentive Shares ”). As of the Latest Practicable Date, all of the Incentive
Shares under the Employee Incentive Scheme have been granted to the eligible participants. In
addition, our Company intends to expand the scope of the Employee Incentive Scheme to
include Yiju Liuhe (our another employee shareholding platform) in the future. As of the Latest
Practicable Date, Yiju Liuhe and Liuju Liuhe held approximately 7.75% and 1.84% of our total
issued Shares, respectively. The Employee Incentive Scheme is not subject to the provisions of
Chapter 17 of the Listing Rules as the Employee Incentive Scheme does not involve the grant
of options by our Company to subscribe for new Shares or award of Shares upon Listing.
(a) Purpose
The purpose of the Employee Incentive Scheme is to attract and retain talents for our
Group. The Employee Incentive Scheme foster shared interests between our Shareholders and
our management team, thereby furthering our Company’s focus on long-term development.
(b) Eligible participants
Persons eligible to participate in the Employee Incentive Scheme are the senior
management and employees who hold important roles in our Group, and any other person
whom the chairman of our Board considers appropriate.
(c) Voting right
Pursuant to the partnership agreement of Liuju Liuhe, the eligible participants who are
granted equity interest in Liuju Liuhe became limited partners of Liuju Liuhe and they shall
abstain from the management of Liuju Liuhe. All management powers reside with the sole
general partner Mr. Zuo.
(d) Scheme administration
Pursuant to the partnership agreement of Liuju Liuhe, Mr. Zuo has been authorized to act
as the scheme administrator, and has the authority to, among others, determine the eligible
participants of the Employee Incentive Scheme, the number of Incentive Shares to be granted
and the grant price after considering the position, work performance and contribution of the
eligible participants to the Group.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-25 –


--- page 613 ---
(e) Vesting of Incentive Shares
The Incentive Shares granted will vest in five years from the date of grant subject to the
applicable PRC laws and regulations. In the event that the corresponding employment contract
or consultancy agreement of the grantee is terminated prior to the vesting of the Incentive
Shares and the Incentive Shares are automatically terminated, such Incentive Shares shall be
repurchased by the general partner of Liuju Liuhe at the original grant price.
(f) Disposal of the Incentive Shares
Upon the vesting of the Incentive Shares, the grantees may dispose the Incentive Shares
at a price which is within the range of consideration agreed by the general partner of Liuju
Liuhe to the entities designated or approved by the general partner of Liuju Liuhe.
E. OTHER INFORMATION
1. Estate Duty
We have been advised that no material liability for estate duty under PRC law is likely
to fall upon the Group.
2. Litigation
Except as disclosed in this prospectus, as of the Latest Practicable Date, we were not
engaged in any litigation, arbitration or claim of material importance and no litigation,
arbitration or claim of material importance is known to our Directors to be pending or
threatened by or against any member of our Group, that would have a material adverse effect
on our Group’s results of operations or financial condition, taken as a whole.
3. Application for Listing
The Sole Sponsor has made an application on behalf of our Company to the Stock
Exchange for the listing of, and permission to deal in, (i) the Unlisted Shares to be converted
into H Shares; and (ii) the H Shares to be issued as mentioned in this prospectus. All necessary
arrangements have been made to enable the securities to be admitted into CCASS.
4. Sole Sponsor’s Independence and Fees
The Sole Sponsor satisfies the independence criteria applicable to sponsors as set out in
Rule 3A.07 of the Listing Rules. The sponsor fee payable to the Sole Sponsor in connection
with the Listing is US$600,000, of which US$510,000 had been paid and US$90,000 remains
payable as of the Latest Practicable Date.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-26 –


--- page 614 ---
5. Compliance Advisor
Our Company has appointed Rainbow Capital (HK) Limited as our compliance advisor in
compliance with Rule 3A.19 of the Listing Rules.
6. Preliminary Expenses
As of the Latest Practicable Date, our Company had not incurred material preliminary
expenses.
7. Promoter
Mr. Zuo, Mr. Wang Haojin and Mr. Qin Cheng are the promoters of our Company. Within
the two years immediately preceding the date of this prospectus, no cash, securities or other
benefit have been paid, allotted or given or have been proposed to be paid, allotted or given
to the above promoters in connection with the Global Offering or related transactions herein.
8. Consents of Experts and Interests of Experts in Our Company
Each of the experts as referred to in “E. Other Information – 12. Qualification of Experts”
in this appendix has given and has not withdrawn its consent to the issuance of this prospectus
with the inclusion of its view, report and/or letter and/or legal opinion (as the case may be) and
references to its name included herein in the form and context in which it respectively appears.
None of the experts named above has any shareholding interest in our Company or any
of our subsidiaries or the right (whether legally enforceable or not) to subscribe for or to
nominate persons to subscribe for securities in our Company or any of our subsidiaries.
9. Binding Effect
This document shall have the effect, if an application is made in pursuance hereof, of
rendering all persons concerned bound by all of the provisions (other than the penal provisions)
of sections 44A and 44B of the Companies (Winding Up and Miscellaneous Provisions)
Ordinance so far as applicable.
10. Bilingual document
The English language and Chinese language versions of this document are being
published separately in reliance on the exemption provided in section 4 of the Companies
Ordinance (Exemption of Companies and prospectus from Compliance with Provisions) Notice
(Chapter 32L of the Laws of Hong Kong).
This prospectus is written in the English language and contains a Chinese translation for
information purposes only. Should there be any discrepancy between the English language of
this prospectus and the Chinese translation, the English language version of this prospectus
shall prevail.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-27 –


--- page 615 ---
11. Taxation of Holders of H Shares
(a) Hong Kong
The sale, purchase and transfer of H Shares are subject to Hong Kong stamp duty if such
sale, purchase and transfer are effected on the H Share register of members of our Company,
including in circumstances where such transactions are effected on the Stock Exchange. The
current rate of Hong Kong stamp duty for such sale, purchase and transfer is 0.1% of the
consideration or, if higher, the fair value of the H Shares being sold or transferred.
(b) Consultation with Professional Advisors
Intending holders of the H Shares are recommended to consult their professional advisors
if they are in any doubt as to the taxation implications of subscribing for, purchasing, holding
or disposing of or dealing in the H Shares. It is emphasized that none of our Company, our
Directors, Supervisors or the other parties involved in the Global Offering will accept
responsibility for any tax effect on, or liabilities of, holders of H Shares resulting from their
subscription for, purchase, holding or disposal of or dealing in the H Shares or exercise of any
rights attaching to them.
12. Qualification of Experts
The following are the qualifications of the experts who have given opinion or advice
which are contained herein:
Name Qualifications
CITIC Securities (Hong Kong)
Limited
Licensed corporation to conduct Type 4 (advising
on securities) and Type 6 (advising on corporate
finance) of the regulated activities under the SFO
King & Wood Mallesons Legal advisor to our Company as to PRC laws
Frost & Sullivan (Beijing) Inc.,
Shanghai Branch Co.
Independent industry consultant
BDO Limited Certified Public Accountants under Professional
Accountant Ordinance (Chapter 50 of the Laws of
Hong Kong) and Registered Public Interest Entity
Auditor under Accounting and Financial Reporting
Council Ordinance (Chapter 588 of the Laws of
Hong Kong)
Ravia Global Appraisal
Advisory Limited
Independent property valuer
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-28 –


--- page 616 ---
13. No Material Adverse Change
Our Directors believe that there has been no material adverse change in the financial or
trading position since December 31, 2023 (being the date to which the latest audited
consolidated financial statements of the Group were prepared).
14. Miscellaneous
Save as disclosed in this prospectus:
(a) within the two years immediately preceding the date of this prospectus, our
Company has not issued nor agreed to issue any share or loan capital fully or partly
paid either for cash or for a consideration other than cash;
(b) no share or loan capital of our Company is under option or is agreed conditionally
or unconditionally to be put under option;
(c) our Company has not issued nor agreed to issue founder, management or deferred
shares or any deferred debentures;
(d) our Company has no outstanding convertible debt securities or debentures;
(e) within the two years immediately preceding the date of this prospectus, no
commission, discount, brokerage or other special term has been granted or agreed to
be granted in connection with the issue or sale of any share of our Company or any
of our subsidiaries;
(f) within the two years immediately preceding the date of this prospectus, no
commission has been paid or is payable for subscription, agreeing to subscribe,
procuring subscription or agreeing to procure subscription for any share in or
debentures of our Company;
(g) there is no arrangement under which future dividends are waived or agreed to be
waived;
(h) there has been no interruption in our business which may have or have had a
significant effect on the financial position in the last 12 months; and
(i) our Company is not presently listed on any stock exchange or traded on any trading
system.
APPENDIX VII STATUTORY AND GENERAL INFORMATION
– VII-29 –


--- page 617 ---
1. DOCUMENTS DELIVERED TO THE REGISTRAR OF COMPANIES IN HONG
KONG
The documents attached to the copy of this prospectus delivered to the Registrar of
Companies in Hong Kong for registration were:
(a) copies of material contracts referred to in “Appendix VII – Statutory and General
Information – B. Further Information About Our Business – 1. Summary of Material
Contracts”; and
(b) the written consents referred to “Appendix VII – Statutory and General Information
– E. Other Information – 8. Consents of Experts and Interests of Experts of Our
Company.”
2. DOCUMENTS ON DISPLAY
The following documents will be available on display on the websites of the Stock
Exchange ( www.hkexnews.hk ) and our Company ( https://www.juhe.cn/ ) up to and including
the date which is 14 days from the date of this prospectus:
(a) the Articles of Association;
(b) the Accountants’ Report from BDO Limited, the text of which is set out in Appendix
I;
(c) the report from BDO Limited relating to the unaudited pro forma financial
information, the text of which is set out in Appendix II;
(d) the valuation report from Ravia Global Appraisal Advisory Limited, the text of
which is set out in Appendix V;
(e) the audited consolidated financial statements of our Group for the years ended
December 31, 2021, 2022 and 2023;
(f) the material contracts referred to in “Appendix VII – Statutory and General
Information – B. Further Information About Our Business – 1. Summary of Material
Contracts”;
(g) the written consents referred to in “Appendix VII – Statutory and General
Information – E. Other Information – 8. Consents of Experts and Interests of Experts
of Our Company”;
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-1 –


--- page 618 ---
(h) the contracts referred to in “Appendix VII – Statutory and General Information – C.
Further Information About Our Directors and Supervisors and Substantial
Shareholders – 1. Particulars of Directors’ and Supervisors’ service contracts and
appointment letters”;
(i) the legal opinions issued by King & Wood Mallesons, our legal advisor as to PRC
law, in respect of our general matters and property interests of the Group;
(j) the PRC Company Law and the PRC Securities Law, together with their unofficial
English translations; and
(k) the Frost & Sullivan Report.
APPENDIX VIII DOCUMENTS DELIVERED TO THE REGISTRAR OF
COMPANIES AND A V AILABLE ON DISPLAY
– VIII-2 –


--- page 619 ---
天聚地合 ( 蘇州 ) 科技股份有限公司
Tianju Dihe (Suzhou) Technology Co., Ltd.
